The COVID-19 pandemic has already cost Cornell hundreds of millions of dollars, and the University is preparing for the possibility that months of uncertainty will extend through the summer and into the fall semester.
President Martha E. Pollack detailed the grim impact of the coronavirus on University finances in an email on Wednesday, and described four new committees tasked with helping Cornell “determine the best path forward.”
As unpredictability looms over the fall 2020 semester and Cornell considers its options for reactivating its campuses, Pollack wrote that an update on plans for the fall semester isn’t expected until June, when the committees have completed their work.
University expects hundreds of millions in losses
The president wrote that financial modeling shows an estimated loss for the Ithaca and Cornell Tech campuses of between $160 million and $210 million by the end of the next fiscal year, “with a potential longer-term impact of approximately $40 million per year for at least two more years.”
The bulk of the anticipated $160 million or more in losses — $145 million — is expected to go toward students’ increased need for financial aid.
“As is true across higher education in any downturn, the economic impact of the coronavirus will reach us from both sides, with the demand for financial aid and student assistance rising just as available sources of support fall,” Pollack wrote.
The grim numbers take into account the $18 million in prorated rebates for students who were living in University housing and were on meal plans. But the projections assume that Cornell will go back to relative normalcy in the fall — something that is far from certain.
“If that is not possible, we are looking at hundreds of millions in additional impact,” Pollack wrote.
Because of a decline in clinical revenue stemming from the suspension of most services not related to COVID-19 treatment, Weill Cornell Medicine in New York City has already seen a loss of close to $200 million, Pollack said in Wednesday’s email.
Hiring freeze, other measures won’t be enough; furloughs and layoffs likely
While Cornell took measures on March 30 to mitigate the economic impact of the crisis in the short term, Pollack wrote that “additional, difficult steps … will almost certainly include painful steps such as furloughs or layoffs, but we are considering programs to protect the salary and benefits of our staff for as long as possible.”
Pollack added that University officials will communicate more details on Cornell’s financial situation later this week.
President implements four planning committees
Looking ahead to the fall semester — as students wonder whether they’ll be able to return to Ithaca in August — Pollack said the logistics of “reactivating” campus will be even more complicated than those that were required when deactivating last month.
Underlying the many questions that Cornell officials will confront before campuses reopen “is the reality that any emergence from complete shutdown carries risk,” Pollack wrote. “Until there is an effective treatment or a vaccine for COVID-19, every decision we make regarding in-person campus activity will require us to accept and tolerate some degree of that risk.”
Pollack’s email described four committees tasked with developing recommendations “for reactivating the university and for saving resources.”
The four committees include a Committee on Teaching Reactivation Options, chaired by Provost Michael Kotlikoff, that will “identify various options for reactivating our campuses for in-person teaching.” The committee will consider multiple reactivation scenarios, according to Pollack’s email, which include bringing back all students in late August, reopening campuses gradually over a period of weeks and “having only a subset of students return.”
The other three bodies are a Committee on Preparation for Online Teaching in the event that coursework has to continue virtually; a Committee on Research and Operations Reactivation; and an Administrative Functional Review Initiative, the latter of which will plan scenarios for five, 10 and 20 percent budget reductions.
Pollack said a decision on plans for the fall semester isn’t expected until the committees have all completed their work. The reactivation options committee will complete its work by May 15, and the others will present recommendations between June 15 and June 30.
“We recognize that there is great interest in knowing Cornell’s plans for the fall semester,” Pollack wrote. “While we are committed to making a decision as early as possible, we are also committed to making that decision in a principled way, taking into account both the guidance of public health officials and a careful analysis of our own situation. We therefore don’t anticipate an announcement before the committees complete their work.”
Summer programs moved online or canceled
All Cornell summer courses and programs will move online or be canceled, Pollack’s email said. Previously, the University had called off activities during the first half of the summer.
“As we work to find the best and safest path to an active fall semester, it is clear that there is no feasible path to in-person instructional activities this summer,” Pollack wrote.