Update on Finances and Planning
“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair…” A Tale of Two Cities
Dear DU Community Members,
Charles Dickens could have easily written these words today. It is the worst of times as loved ones have perished due to the ghastly COVID-19 virus. It is the best of times to see our community rally, step up and demonstrate such courage, resilience and determination. I am profoundly grateful to you, our faculty, staff and students, for the many ways you are navigating working from home, adjusting to new ways of teaching and learning and taking care of yourselves and your loved ones. Your commitment to the public good, and the ways you’ve pivoted and handled the crisis, is inspirational. Thank you.
Throughout the crisis, I have promised to be as proactive and transparent as possible about the University’s financial outlook. In my campus message on March 23, I vowed that all our decisions would be based on a set of guiding principles that are consistent with our community’s values, including to:
- Protect the health and safety of our community members;
- Deliver the world-class education our students expect and for which our faculty is renowned;
- Promote equity and our commitment to the public good;
- Guide the University for long-term sustainability while advancing the University as promised in DU IMPACT 2025 and our Strategic Imperatives; and
- Support the livelihood of our faculty and staff.
With these principles as guides, we will not only survive but thrive—together. I am confident that DU will prevail and flourish—as we have so many other times throughout our history—despite the substantial impact of the COVID-19 pandemic.
In this letter, I want to provide updates on five important topics: the state of fiscal year 2020, summer 2020, fall 2020, a preview of the work that needs to be done for fiscal year 2021, and the formation of six important University task forces and a Student Advisory Board that will help us shape the immediate and longer-term future for DU.
Importantly, we are still considering our options for Commencement 2020. We are waiting to have the best possible information known to us about health and safety factors and government orders before making this decision. I know how important this decision is to our undergraduate and graduate students who have completed their degree requirements and deserve a celebration, and to DU parents, families and friends. I promise you we will have an update on this no later than May 15.
Fiscal Year 2020
By anticipating the financial pressure that lies ahead, and by acting swiftly and strategically, we have every indication that we will close out fiscal year 2020 healthy despite the disruptions. Our spring quarter enrollments have held steady and are consistent with previous years while our summer enrollments are stronger than in past years.
Although we experienced over $21 million in lost revenue and unanticipated additional expenses, we have recovered considerable savings from the hiring freeze, the freeze on non-essential expenses and the hold on non-essential capital projects. Though our projected losses still exceed the recovered savings, we have been able to manage the gap by using reserves that we keep on hand for emergent situations. I also have deep gratitude for our administrative and unit leaders who have managed their budgets wisely, and to the faculty who have ensured that our students remained engaged in their online work; all this effort has helped the university navigate these financially challenging times.
As a result, as we shared on Monday, we are able to largely continue April’s pay practices through May and June. This is a tremendous relief to us all, as so many other universities already are announcing furloughs and salary reductions.
Between now and June 30, we will continue to closely monitor enrollments for summer and fall. We are optimistic that summer will be, as always, a creative and enriching time for our students and faculty. Summer registrations are slightly up for undergraduate credit hours, and up for graduate credit hours. Because summer session is typically offered about 70 percent online for undergraduates and 55 percent for graduate courses, we are less vulnerable in summer to impacts of the coronavirus. We are announcing today that while most of our summer courses will be online as originally planned, we will be offering a very limited number of small, highly experiential courses in a face-to-face format. More information regarding these face-to-face courses will be shared in the coming weeks.
This brings me to our deepest and most profound desire: that we are able to reactivate our campus and welcome our community back for a joyful and productive fall session. We are already hearing from upper-class students who are eager to sign leases and continue accruing credits toward their majors and minors. The Dimond Family Residential Village, due to open in the fall, is yearning for signs of life and our Class of 2024 is eager to join us on our beautiful campus.
With this in mind, we plan to reopen with face-to-face classes when we begin our fall quarter in mid-September, even if it must be modified in some way. The same will hold true for our Sturm College of Law, which reopens its fall term a few weeks earlier. Our plans, of course, are dependent upon guidance from federal, state and local government and public health officials. We will also be mindful of those faculty and students who are immunocompromised or have other health issues that would prevent them from fully participating in face-to-face classes by the fall.
There are many details that must be worked out and as you will read later, we will have these plans outlined by May 27. Should any modifications be necessary to this decision about face-to-face delivery of fall classes, those changes will be communicated no later than July 15.
Budget Planning for Fiscal 2021
As we restart the budget process for FY21, we are keenly aware that the financial landscape will be volatile for quite some time. Despite the fact that we have accepted a very strong class and are offering a robust online experience now, we have to face certain realities. The longer the virus persists, the larger the enrollment decline will likely be across higher education, especially among international students. We have every reason to be hopeful though, thanks to our able team in the Office of Admission and Financial Aid. Deposits are still on pace with other years at this time, and the Class of 2024 is academically strong and diverse.
Affordability, we know, will be an even bigger consideration than usual, given these extraordinary circumstances and the uncertainty of when society and the economy will return to normal. We anticipate providing financial aid to a higher percentage of our classes and are preparing for that eventuality.
We are fortunate to have considerable strengths that will help us weather these times. We offer a distinctive combination of disciplines, programs and professional schools. Our trajectory of research and creative works is dedicated to the public good. And our vision and timing for the Denver Advantage building openings was fortuitous.
Even so, the formation of the FY21 budget must be fluid and guided by thorough planning that involves the analysis of a number of scenarios we might face next year. This necessitates intensive planning in the coming months.
University Planning Framework for 2020–2021
Looking ahead, it is imperative that we apply our best thinking and engage the tremendous expertise of our board members, senior leadership, faculty, staff and students to analyze our situation, collect data and make the best recommendations possible. Toward that end, I am announcing a network of five university-wide task forces, each with a separate charge. A sixth group, a University Planning Steering Committee will coordinate and communicate about the work of the other five.
The task forces are:
I. Scenario and Financial Solutions Task Force (SFSTF)—This joint task force between the DU Board of Trustees and university personnel is charged with scenario planning regarding the impact the crisis will have on fiscal year 2021 and beyond. The SFSTF will consider and research a range of scenarios that may occur starting with the 2020 fall term. These scenarios will be characterized by a range of reductions in enrollments, revenue and in the endowment. The SFSTF will then analyze financial data against these scenarios and recommend solutions. SFSTF will be co-chaired by Denise O’Leary, chair of DU’s Board of Trustees, and Leslie Brunelli, senior vice chancellor for financial affairs and treasurer. This group will have 18 members including nine trustees and nine members of the faculty, staff, and administration. The SFSTF will provide updates throughout the summer and will continue its work at least into the fall term.
Because this task force consists of trustees and university personnel, it is important to keep in mind the fiduciary and strategic responsibilities of the Board of Trustees and the operational and administrative roles of university personnel.
A subcommittee of this group comprised of university personnel will also develop a rubric to assess programs or units outside the division of academic affairs based on their impact and productivity. The subcommittee will collect data on each program or unit and ultimately make recommendations to the full SFSTF regarding the prioritization of these non-academic programs or units.
II. Fall Logistics Task Force—This short-term task force will rapidly assess current information within the higher education landscape and make recommendations for how the fall term should be managed including the possibility of either a fully face-to-face return this fall, or a mixture of face-to-face and online classes. It will also make recommendations related to start dates; physical-distancing guidelines in academic, administrative and residential spaces; creating a safe and vibrant orientation program; reviewing whether any athletic competitions could take place with or without spectators; developing an extended shuttle service and studying the implications of the cancellation of fall study abroad. Corinne Lengsfeld, interim provost and executive vice chancellor will chair this group, which will be comprised of faculty, staff and administration. This task force has one of the most ambitious timelines and will complete its work by May 27.
III. Digital and Online Strategy Task Force—With the well-executed pivot to online teaching and learning, the University is poised to look at its digital and online strategy with new confidence and experience. This task force will look at best practices in use by DU faculty, as well as student sentiment regarding the spring quarter online experience. It will investigate ways to improve and enhance DU’s offerings. The chair of this task force will be David Thomas, executive director, online programming, and the task force will be comprised of faculty, staff and administrators. Its work is also projected to be completed by May 27.
IV. Academic Program/Unit Assessment Task Force—This task force will utilize institutional data sets to investigate academic program/unit strength and viability. (An academic program/unit is defined to be any program or unit within the division of academic affairs.) This group will seek to identify strong programs that might be leveraged to strengthen other areas of the university as well as weak programs in need of interventions, support or discontinuance. The task force will take on the hard work now to be prepared for the worst-case scenarios in an unforeseeable future. Corinne Lengsfeld will chair this task force that will include faculty, staff, and administrators. This group will complete its work and recommendations by August 15.
V. Opportunity and Strategy Task Force—This task force is charged with investigating how the University advances in a time of crisis and how it might leverage opportunities in order to become stronger still. In essence, this task force looks at the strategic directions the University should take. In addition, this group will also consider external and alumni relationships as well as advancement/philanthropy. Possible considerations include (but are not limited to) property acquisition, mergers and acquisitions of other universities and/or businesses, aspects of DU IMPACT 2025, the five Strategic Imperatives and the pilot four-dimensional student experience. I will lead this task force of faculty, staff and administrative members, and we will complete our work by August 1.
VI. University Planning Steering Committee—This committee will oversee the other five task forces, ensure cross-communication between them, develop communications to the campus and with the Board of Trustees and assign resources to the task forces. I will chair this committee, which will be comprised of members of leadership from Faculty Senate, Staff Advisory Council, deans, vice chancellors and at least one trustee.
Each task force will aim for central and unit-level representation, including faculty, staff and administrators. I will be working closely with the leadership of the Faculty Senate and with the Staff Advisory Council as we consider nominations. Diversity, including diversity of thought, will be a guide for selection. Members will be selected for their unique expertise or positions, and for their commitment to creative thinking, data-driven decision-making and the university overall. Our offices of General Counsel, Human Resources and Inclusive Community and Information Technology will provide on-call support for issues and questions that the task forces identify.
Although students do not sit on these largely administrative task forces, their experiences, perspective and suggestions for these groups are vital to DU’s successful planning. Working closely with Undergraduate Student Government and Graduate Student Government, I will be convening a special Student Advisory Board that will be in active conversation with all five of the task forces, including joining some of the planning meetings.
Students, faculty and staff may submit nominations to any of the five task forces, as well as the Student Advisory Board. Nominations will be open until noon on Monday, May 4.
The task forces will be formally charged in early May and start meeting as soon as possible. Work will continue through the summer. Intermittent reports will be shared with the University Planning Steering Committee. Except where noted, final reports will be publicly available on or before August 15.
This global pandemic has tried and tested us in ways never imagined. Some have lost loved ones, others are risking their lives caring for the sick and dying and many have experienced great financial losses. Through these tragic circumstances, we also are seeing the very best in human nature: courage, grit, kindness and compassion. I am inspired every day, and I know that so many others are as well. I cannot wait to see everyone back on campus again. We will work harder than ever to ensure that when we do return, we can do so safely and with great enthusiasm to teach, learn and live together once again.