By John McCallum
Managing Editor 

EWU faces grim financial future

EWU budget shortfall hits all departments and services

 

Last updated 6/4/2020 at 10:21am



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 trustees the university will be looking at revenue reductions in a number of areas, partly due to impacts from the coronavirus pandemic. The first reduction stems from declining enrollment — with operating revenue loss 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 includes no international students attending the university. Voves said that overall number is a midpoint between 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 revenue shortfall due to the pandemic’s economic shutdown, Voves said the university is expecting a 15 percent reduction in state revenues, resulting in another loss of $9.904 million. State officials also said the $2.5 million awarded Eastern under House Bill 2158 Workforce Education will most likely disappear.

“We were 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 hoping for appropriations of over $100 million to renovate and upgrade the 1960s-era Science Building.

Additionally, Voves said 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.

Other parts of the university will not be spared — including athletics. Eagle sports programs are 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 game-day associated money. Additionally, a $2 million 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.

In remarks prior to Voves’ presentation, university President Dr. Mary Cullinan said the current crisis surrounding COVID-19 is not the sole cause of the budget issues. Changes have been coming to higher education the past several years, including reduction in state financial support and decreasing high school class sizes — factors that led the Board of Trustees to set new guiding principals about 10 years ago to help steer the university’s direction.

“We can’t be all things to all people and interests,” Cullinan said. “We need to place university priorities over unit priorities. We need to take action, (asking) is what we’re doing now more important than what we should be doing?”

Cullinan outlined the university’s vision in what is called “Eagle Flight Path.” The plan specifies EWU won’t be a completely online university, nor will it be a community college or a research university.

“We will remain a regional public university focused on what our region needs and what our students are looking for,” Cullinan said.

In a June 1 news release, the university announced that Cullinan had notified the United Faculty of Eastern that a serve financial crisis exists, beginning a process to “allow more flexibility in making critical budget decisions” in the immediate future.

The board will meet in June to hear final budget numbers and options before making a decision.

John McCallum can be reached at jmac@cheneyfreepress.com.

Author Bio

John McCallum, Retired editor

John McCallum is an award-winning journalist who retired from Cheney Free Press after more than 20 years. He received 10 Washington Newspaper Publisher Association awards for journalism and photography, including first place awards for Best Investigative, Best News and back-to-back awards in Best Breaking News categories.

 

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