(The Center Square) – The latest financial snapshot at the University of Wisconsin’s flagship campus is not good.
UW-Madison Chancellor Rebecca Blank on Monday sent a letter to 21,000 university employees explaining what the coronavirus, and the economic slowdown that followed, has done to the school.
“Overall, we estimate that we will have approximately $320 million in combined lower revenue and increased costs between March of 2020 and the end of the current fiscal year, which ends on June 30, 2021,” Blank wrote. “Some of this shortfall has already been offset by the reductions we’ve implemented. The remaining gap is still very large, however, larger than any that we’ve faced in any past year.”
UW-Madison lost nearly $100 million last spring. That’s a combination of costs to move classes online, and the costs associated with sending students home in March.
Since then, Blank said the losses have not stopped.
“Our tuition receipts are down by roughly $24 million and our research enterprise is on track to receive $28 million less than anticipated,” Blank stated. “UW-Madison will also incur costs of approximately $50 million between last fiscal year and the current fiscal year, a combination of giving dollars back to the state due to the Governor’s order to state agencies and covering unfunded pay plan costs,” Blank added. “In addition, the units [of the university] that fund themselves with revenues they generate have experienced particularly acute revenue reductions. For instance, in Athletics, we haven’t been able to hold most sporting events or sell tickets. Conference Services can’t host guests or operate conferences. The Wisconsin Union has been affected by a limited Terrace summer season. In total, auxiliaries are facing a shortfall of roughly $150 million.”
Then there is the state budget. Wisconsin lawmakers expect a $2 billion shortfall in the next state budget which begins in July of next year.
Blank used the harsh fiscal picture to set-up another round of furloughs.
“We will implement another six months of these furloughs, beginning on Jan. 1 and continuing through June 30, 2021,” Blank wrote university employees. “We have delayed the start date on this next round of furloughs to allow employees time to plan.”
While most every UW-Madison worker will see a furlough, not all of them will lose pay. Blank reminded university employees that a 2% wage increase will take effect for the school’s lowest paid employees. Blank also said the university is moving toward a $15 minimum wage.
“I recognize that this is difficult news, but until we can resume normal operations, we will need to deal with the consequences of this pandemic on our organization,” Blank said.
By Benjamin Yount | The Center Square
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Reposted with permission