Wednesday, April 15, 2020

UA Braces for Impending Financial Impact of COVID-19

Posted By on Wed, Apr 15, 2020 at 12:01 PM

Courtesy Creative Commons

Facing large projected losses in revenue due to COVID-19, the University of Arizona is taking steps to trim their budget.

The university—one of Arizona's largest employers—has put a pause on hiring new employees and has halted all job changes for current employees, such as transfers between departments, promotions and compensation increases.

"Over the next 15 months we anticipate a significant loss of revenue and expect to see increased expenses related to the effects of COVID-19," UA President Dr. Robert Robbins and other leaders said in an email to faculty and staff. "This is going to have profound impacts on how we successfully achieve our mission."

While the university is ramping up efforts to create thousands of COVID-19 testing kits, they are also expecting a drop in tuition revenue. If community spread of the virus is still significant in the beginning of the fall semester, international and out-of-state students likely will not return to campus.

In a conference call last Wednesday, Robbins told Tucson Weekly that 40 percent of the university's students are from outside Arizona, and about 15 percent are international students. He said they’re currently modeling what that hit in revenue could look like, but they are expecting "significant shortfalls."

UA leaders are urging faculty and staff to share their insights with the new Financial Sustainability Emergency Response Taskforce, which was created to determine the financial impact coming up and make recommendations for immediate and future cost-saving measures.

These changes are categorized into six areas where future changes could be made: Capital Projects, Debt & Investments; Intercollegiate Athletics; New Opportunities; Operational Efficiencies; Strategic Plan Investments; Students and Workforce.

New information from university leaders is expected in the coming weeks.

"The bottom line is that we need to bolster our traditional sources of revenue, identify new ones and reduce expenses across all our mission areas, while maintaining or growing the quality of our academic programs and our research endeavors," said Lisa Rulney Senior Vice President and Chief Financial Officer, Business Affairs. "The future of the university and the state of Arizona is at stake."

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