CHENEY – Eastern Washington University’s Board of Trustees got a glimpse into the financial future of the institution at its May 29 meeting — and it’s not exactly very bright.
Vice President for Business and Finance Mary Voves told the trustees via a virtual meeting that the university will be looking at revenue reductions in a number of areas, mostly because of impacts from the coronavirus pandemic. The first comes from declining enrollment – with operating fee revenue from this source estimated at $12 million.
The university is budgeting for a fiscal year 2021 headcount of 8,600 students, a 14 percent decline that factors in no international students attending the university. Voves said that overall number is in the range of 8,514 on the low end and 8,989 at the upper — a number they hope might be reached.
“Hope is not a strategy, so we need to budget at a reasonable range,” she added.
With the state anticipating a $7 billion shortfall in revenue due to the economic shutdown to combat the pandemic, Voves said the university is advised to expect a 15 percent reduction in state revenues as well, resulting in another loss of $9.904 million. Additionally, state officials have indicated that the $2.5 million awarded Eastern under House Bill 2158 Workforce education will “most likely be pulled back.”
“We we’re already looking at $12 million for next year in revenue reductions and at least $10 million – $12 million in state reductions,” Voves said. “We’ve also been advised that as we go forward and plan for the next biennial budget, which is this summer, we’ve been advised by OFM (Office of Financial Management) that we should expect significant budget impacts.”
Voves said the possibility exists for impacts to the state capital projects budget. EWU is wrapping up construction of its $63 million Interdisciplinary Science Center, and is hoping for appropriations of over $100 million to renovate and upgrade the Science Building next door.
Additionally, Voves said that self-support accounts will continue to experience revenue reductions. Cancellation of summer activities will mean about $1 million in lost revenue while Housing and Dining services are looking at an estimated $12 million shortfall.
While academics and student support services will experience large impacts, other parts of the university will not be spared – including athletics. Eagle sports programs will be looking at a 23 percent reduction in monies from the state — $1,634,775 – along with a 22 percent drop — $475,000 – in student service and activity fee funding.
Voves said there will likely be impacts to the $6.825 million the department sees in revenue from athletic contests and other external funding streams as measures to slow the spread of COVID-19 could lead to changes in attendance and other game-day associated money. Additionally, a $2 million financial subsidy to the department approved by the board in 2018 is no longer feasible, with the department planning to make reductions in its budget accordingly.
“We can no longer support athletics with additional revenue when we are in a revenue decline and we can’t pull funds from other parts of the university to sustain athletics,” Voves said.
Voves outlined a number of measures the university could and is taking to meet the new financial challenges, including hiring freezes, staff reductions across all departments, travel restrictions and deferral of maintenance and small projects. Also included are reorganization measures.
Voves’ presentation was a first reading of the new supplemental budget proposal. The board will meet in June to hear final numbers and options before making a decision.
John McCallum can be reached at jmac@cheneyfreepress.com.
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