With the impacts of COVID-19 wreaking havoc on nearly every facet of the American economy, Cornell — which last year reported an operating deficit of $104 million — has not proved immune to the virus’ financial effects.
On Monday, a letter posted to University’s COVID-19 website announced a slew of cost-cutting measures intended to ensure “that Cornell has the funds necessary to continue to be a world-class university.”
The letter — signed by Provost Michael Kotlikoff and Executive Vice President and Chief Financial Officer Joanne DeStefano — calls for a wide range of significant changes curtailing hiring, salaries, travel, summer programs, discretionary spending and capital projects. The new policies will be implemented immediately.
Cornell will freeze employees’ upcoming salaries for the fiscal year beginning July 1, after which the University “will be unable to” give raises based on bonuses, promotions, acting rates, changes to time status or additional pays.” The policy excludes already collectively-bargained wage hikes or raises tied to faculty promotions.
The belt-tightening extends to University administration, with the president, provost, vice presidents, deans, vice provosts and other members of Cornell’s leadership having agreed to “voluntarily assumed salary reductions” for the next six months. The exact amount of the reductions have not been made public.
According to the letter, “every dollar of these recaptured funds will be used to help meet the financial aid needs of our undergraduate, graduate or professional students.”
For the time being, Cornell will also indefinitely freeze hiring for staff and temporary workers. However, the University is creating a process for exceptions, and new hires in academic departments “will be carefully reviewed by deans.”
Reflecting the pandemic’s worsening severity, University functions continue to be pushed back, with all summer programs starting before July 12 to be either canceled or moved online. This includes classes and conferences before this point, while ones that begin after July 12 will be reevaluated at a later date.
Discretionary spending on things like meals, events and outside consultants will also be canceled immediately, much like University-related travel. While such expenses can be incurred on an ad hoc basis, they must now first be approved by administration.
Cornell also announced that it will cancel any new capital projects and will reevaluate those that are currently ongoing.
“We fully appreciate that these steps are significant,” the letter read. “But until we can better understand the full impact of COVID-19 on the economy, financial markets and the university, these steps are essential to our being able to sustain our commitment to our employees and our students.”
The full letter can be viewed here.