Egan: Local colleges facing significant financial strain if second stimulus doesn’t arrive

BROWN UNIVERSITY is one of several colleges in Rhode Island that has seen declined enrollments from year to year. / COURTESY BROWN UNIVERSITY
BROWN UNIVERSITY is one of several colleges in Rhode Island that has seen declined enrollments year over year as the COVID-19 pandemic drags on. / COURTESY BROWN UNIVERSITY

PROVIDENCE – Daniel P. Egan, president of the Association of Independent Colleges and Universities of Rhode Island, sees resiliency in students returning to local campuses and lauds colleges that have taken many steps to adhere to new safety regulations in order for campuses to reopen for in-person learning.

The reality, though, is local colleges, including the eight independent institutions represented by AICU Rhode Island – Bryant University, Brown University, Providence College, Salve Regina University, Johnson & Wales University, New England Institute of Technology, Rhode Island School of Design and Roger Williams University – are facing declining enrollments and significant red ink on the books thanks to the pandemic.

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If federal assistance does not come soon, Egan fears that colleges will have to make further changes to compensate for the lost revenue.

In interviews this week with Providence Business News, Egan estimated local colleges in the Ocean State will lose at least $200 million this year, an approximate 10% hit on the college’s collective operating budgets. Egan’s estimates apply to the eight independent schools that are part of the AICU Rhode Island and not the three state colleges – University of Rhode Island, Rhode Island College and Community College of Rhode Island. However, Rhode Island’s state schools have had to make changes, including laying off employees, due to budget shortfalls.

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Back in April, Rhode Island-based colleges received $61.8 million from the federal Coronavirus, Aid, Relief and Economic Security Act to help the institutions fill any financial gaps that were caused by the COVID-19 pandemic. Half of those funds were required to be directed to students for emergency financial aid, which left the 11 Ocean State-based colleges a combined $30.9 million to help with operational costs.

Those funds, Egan said, were just a “drop in the bucket” in terms of addressing colleges’ lost revenue. Egan previously told PBN that colleges were set to lose between $75 million and $100 million just on reimbursing room-and-board fees to students after campuses were closed in April for the rest of the spring semester.

Tack on about $50 million in COVID-19-related testing and reopening costs with minimal reimbursement from the state, plus enrollment decreases across most colleges, and that financial hole gets bigger, Egan said.

“We’ve been hit harder than the state’s budget has been hit as a sector,” Egan said. “And it’s all been directed to COVID expenses – testing, reopening, repopulation expenses, social distancing and lost revenue.”

Declining enrollments

Several colleges in Rhode Island have seen year-to-year enrollment declines.

RISD saw an 11.6% decline year to year in total enrollment, from 2,501 total students in 2019 to 2,227 this year.

RIC’s year-to-year enrollment declined 6.3% from 7,531 total students last fall to 7,072. The Providence-based college initially predicted a 12.9% drop for this coming fall, however, RIC’s enrollment over the last five years has dropped by 16.3%.

CCRI’s fall 2020 enrollment is at 13,684 students this semester. While it is 7.4% off from what the college’s enrollment was a year ago, it is a better outcome than the 20%-to-30% drop it initially projected this spring and summer, CCRI spokesperson Amy Kempe said Wednesday, much ado to CCRI gaining students through its “Last Call for Fall” initiative it put forth.

Brown, which is using a three-semester model this year to de-densify its campus by having its first-year students matriculate on Jan. 20, 2021, has 9,745 total students between undergraduates, graduates and medical students. That will represent a 5.8% decrease from last year when Brown had 10,333 total students.

Preliminary figures show RWU’s enrollment of 4,315 will have declined by 4.7% this fall compared to last fall. RWU Senior Research Analyst Megan Lynch said the current enrollment numbers are as of Oct. 1 and the university will conduct a second student count later in the semester to account for new course structures that began after Oct. 1.

Bryant’s enrollment dropped by 3% year-to-year to 3,674 total students this fall. The Smithfield-based university had 3,784 total students a year ago.

PC’s enrollment, at 4,822 total students this fall, dropped slightly year to year by 1.7%. Salve’s total headcount remained the same year to year at 2,771 students, but it saw a 0.8% decrease in undergraduate students attending and an 18.4% drop in first-year students attending the Newport-based university year to year.

A couple of Bristol County, Mass.-based schools are also seeing enrollment decreases on the horizon. The University of Massachusetts Dartmouth’s preliminary total enrollment for the 2020 fall is 7,869 students, which is a 3.6% drop from last fall. Easton-based Stonehill College saw a 1.4% drop in enrollment year to year from 2,542 students down to 2,506.

URI is an exception where it has seen a 1% increase in enrollment from 17,629 total students enrolled for the 2019 fall to 17,671 total students this fall.

In a statement Wednesday, URI Provost Donald DeHayes attributed the enrollment increase to a “record-breaking number” of applications for admission and a “very strong pool” of transfer students. URI also held more than 110 online webinars and chats back in April, DeHayes said, as well as did other texting campaigns and other virtual events to attract enrollment, DeHayes said.

Significant layoffs looming?

Despite the increased costs and decreased enrollment, Egan said colleges in Rhode Island, particularly the eight private institutions, have done what they can to maintain staffing levels at each institution.

But such efforts can only go so far, he said. If colleges do not receive either state or federal financial support on COVID-19-related expenses the institutions have incurred, Egan said colleges will have to make some difficult decisions after Thanksgiving regarding employees.

So far, most schools haven’t received that financial support from the state. According to the state’s COVID-19 Payee Transparency Portal, out of the $1.25 billion in federal stimulus money Rhode Island received in April and the $299.6 million the state issued out through Sept. 30 to various organizations to help with COVID-19 expenses, just $367,537 in total has been issued to five colleges – URI, CCRI, JWU, Brown and RISD.

URI received $170,230, the most of that pool, which includes $47,827 for testing. However, URI, so far, is the only college to receive funding help for testing, according to the portal.

“The schools have been at the forefront of testing. Nearly one out of two tests since Labor Day have been performed and paid for by institutions, and the state has not provided any funding for that testing,” Egan said, noting he’s “continuously” been reaching out to state officials for assistance for the sector.

When it all adds up, Egan’s view on how hard colleges could be hit in terms of employment is grim. His conservative estimate is that the workforce within local colleges could be cut by between 20% and 25% if Congress cannot agree to a second stimulus package soon.

Financial losses already prompted two of Rhode Island’s three state colleges to eliminate personnel. CCRI, due to the less-than-expected enrollment and losing out on approximately $4 million in tuition revenue as a result, had to lay off 45 full-time employees and those take effect Friday. Last month, CCRI laid off 122 part-timers from the college.

RIC, facing a $10.4 million deficit for the 2021 fiscal year, announced last month that it planned to lay off 35 full-time employees, a move that RIC President Frank D. Sanchez called as being a “last resort” as other measures of trying to close the budget cap brought on by the pandemic had failed.

“That’s why we need the [second] stimulus to avoid [layoffs],” Egan said. “We worked really hard as a sector to maintain those staffing levels. But without support from the state on COVID expenses, these eight [private] institutions are going to face hard decisions before the holidays regarding staffing levels. When you look at us as the second-largest employment sector outside of government, behind only health care, we’re on the precipice of some dramatic changes if we don’t see any support.”

James Bessette is the PBN special projects editor, and also covers the nonprofit and education sectors. You may reach him at Bessette@PBN.com. You may also follow him on Twitter at @James_Bessette.

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