While the coronavirus pandemic is expected to cost the University of North Carolina System at least $220 million in lost revenue this semester, universities also spent millions more to get their campuses ready for students on Aug. 10.
But just days later, UNC Chapel Hill and N.C. State sent many students home and reverted to remote instruction for all undergraduates after clusters of COVID-19 cases appeared in dorms, fraternity houses and among athletes.
UNC had spent at least $712,000 on precautions intended to make it safe for students, faculty and staff to return to campus for a mix of in-person and remote instruction. University spokeswoman Leslie Minton said in an email to The News & Observer that the money went to:
—Making public health signage across the campus and around the town of Chapel Hill
—Installing plastic shields across campus.
—Hiring extra janitorial and housekeeping services.
—Renting and setting up temporary tents and outdoor furniture for open-air study space.
—Moving and storing classroom furniture to provide social distancing space.
—Hiring temporary staff to help students during the first week of classes.
—Acquiring masks and other PPE.
Minton said UNC is still tallying the costs of responding to the pandemic.
The universities and the UNC System will seek reimbursement for COVID-19 related expenses from state and federal governments.
N.C. State University has spent $1.977 million since July 1 preparing to bring back students, faculty and staff, said Charlie Maimone, vice chancellor for finance and administration, in a phone interview Friday with the N&O.
The decision to resume in-person instruction “was driven by two motivations,” Maimone said. “Number one, we want to keep everyone safe. And two, we really do value in so many ways the in-person experience that students have. Getting our students back is obviously key to us.”
Maimone said determining whether it was financially worth trying to return to in-person instruction is complicated.
Systemwide, students were told before classes started that tuition and fees would not be reduced or refunded if their university went online. If students are asked to leave campus housing, those payments will be refunded.
But every operation within each university has fixed costs, Maimone said, which are incurred whether the system is operating at full or reduced capacity. Bringing just a few people back to campus, he said, does not cover the cost of operating housing, dining, transportation, parking and other services.
“We need students, we need faculty, we need staff on campus to fulfill those services,” he said. “That’s the only way that they can fulfill their revenue.”
‘POSITIVE TRENDS’ DIDN’T LAST
Campuses spent millions on illness-prevention efforts after Dr. Bill Roper, who was serving as interim UNC System president, announced in late April that the schools would reopen for fall. Roper said when he announced the decision that “Recent data in North Carolina are showing positive trends that suggest our collective efforts to minimize the spread of COVID-19 are paying off.”
Roper said at the time that the move in March to online-only instruction had been necessary — but that digital learning is not a long-term substitute for being on campus with access to libraries, labs, classrooms and medical and agricultural facilities.
Campuses were given some latitude in making decisions about how to best reopen, including staggered or shortened calendars and reduced density in classrooms and dorms.
“Above all,” Roper wrote in April, “our steps forward will be contingent on what we discover through ongoing monitoring of infection rates and North Carolina’s testing and treatment capacity. We will continue to follow the advice of the nation’s infectious disease experts and our own experts at UNC Health.”
On July 27, a week before students were to begin moving in at UNC and two weeks before the start of classes, the state Department of Health and Human Resources reported 1,625 new cases of virus. The record high of 2,481 new cases had been reported on July 18.
Gov. Roy Cooper extended Phase 2 of the state’s reopening plan on Aug. 5 through at least Sept. 11, saying the four major metrics the state uses to analyze the virus’ spread had stabilized. But they were still too high.
Roper left the interim president position on July 31 as he had planned. Peter Hans, the new system president, took over Aug. 1.
The UNC Board of Governors did not vote on the decision to reopen the universities but members were involved in discussions about the plans, board members have said.
CAMPUS REPORTS PREDICT LOSSES
In July, Board Chairman Randy Ramsey asked university budget experts to determine what the financial costs would be to the UNC System under various reopening scenarios that presumed decreases in enrollment.
The report, delivered later that month, included information provided by each campus on revenue that would be lost under each of seven scenarios. Those scenarios ranged from making no changes and seeing no drop in enrollment, to going fully online with increasing drops in enrollment up to 50%.
University officials were asked what adjustments they would have to make to continue operating under increasingly dire enrollment scenarios.
According to reports reviewed by The News & Observer, some school officials said that a 50% reduction in enrollment would be catastrophic, requiring such deep cuts to faculty, staff, courses, research and facilities that the schools’ missions would be severely compromised.
The report from UNC Asheville said administrators there believed that a 50% drop in enrollment was extremely unlikely, and that if it did occur, “We would use our remaining cash reserves, suspend at least 75% of our administrative and academic operations for as short a duration as possible, and make a passionate plea to all federal, state, and community entities for financial support if we had to weather this unlikely storm.
“This scenario may essentially be a liquidation event for many, if not most, of the universities in the UNC System,” the UNCA report said.
Some school officials said in letters that accompanied their reports from mid-July, a month or so before most were set to begin classes, that they had not seen significant drops in enrollment and did not expect to.
But none of the scenarios in the report precisely depicts where the UNC System finds itself now.
SCENARIOS EXAMINED ONLINE VS. IN-PERSON CLASSES
With UNC and NCSU transitioning to online-only instruction for undergrads, the system appears to be taking revenue losses more than those listed in “Scenario B,” where the universities would be practicing social-distancing only, but less than those listed in “Scenario C,” where the whole system is online only.
The systemwide loss of revenue under Scenario B is more than $220 million. It comes from losses in athletics, dining, sales and services, and patient services.
Under Scenario C, which assumes a 2% drop in enrollment that currently appears unlikely to materialize, the system would lose up to $607.5 million, including drops in tuition and fee payments, financial aid, housing, parking, research and grants, and athletics. If all UNC schools were to go online without a drop in enrollment, the system would lose some of those revenues but not all.
UNC officials won’t have final numbers on fall enrollment until after the last “drop” date for each university.
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