Financial Impact of COVID-19

Wed, 27 May 2020 18:08:42 -0400
covid19

The economic effects of the COVID-19 pandemic are among the many challenges facing higher education. We are fortunate to be working closely with our colleagues at the University System of Maryland (USM) and across the system campuses to manage these challenges. In a statement released today, Chancellor Jay Perman notes, “The University System of Maryland is among virtually every organization, public and private, undertaking difficult decisions in the face of this financial crisis.”

The Chancellor’s message describes both the lost revenues and increased costs that will affect the finances of all USM campuses, including state and federal funding reductions, and continued uncertainty about enrollment, philanthropic support, and investment income. At the same time, large investments are necessary to protect the health and well-being of our campus community, including testing and monitoring, personal protective equipment, and increased sanitation services. While the full financial picture will not be known for some time, the Chancellor states that significant budget reductions will be necessary for all campuses.

As we respond to these financial challenges, UMBC remains committed to our guiding principles: supporting the people who make up our campus community and protecting the quality of our academic program. Because of sound fiscal discipline in recent years, we have some ability within our own budget to address the financial pressures we are experiencing. In addition, we are working with USM leaders to use a variety of tools, such as suspending annual fund balance goals, to help address shortfalls. We are also converting the hiring pause, in effect since March 29, into a hiring freeze.

We are modeling a number of budget scenarios that take into account uncertainty regarding state appropriations reductions, enrollment, the nature of our fall semester, and more. As we determine the extent of required budget reductions across all sources of funding, we will continue to consult with shared governance leaders, and will keep the campus informed. We know that the Chancellor’s language about personnel actions may raise questions and concerns for people about their own personal situation. As we shared earlier, we are committed to doing all we can to support people. We will provide additional information as soon as possible.

We are in unprecedented times and face challenges on many fronts, and yet we are heartened by the commitment of our faculty, staff, and students as you continue to teach and learn, discover and create, and connect with each other and the world. You inspire us. Thank you for all that you do for UMBC and for Maryland.

President Freeman Hrabowski and Provost Philip Rous