Omar Abdul-Rahim / Sun File Photo

Cornell keeps spending down even while managing new COVID costs.

February 25, 2021

Cornell Staves Off Major Financial Losses, Despite $20 Million COVID Bill

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When Cornell announced the details of its re-opening strategy last summer, it garnered headlines for being among the nation’s most comprehensive — hundreds of hotel-provided quarantine rooms, at least twice-a-week surveillance testing and an aggressive contact tracing strategy. 

Five months and over half a million swabs later, those costs have added up. According to a University spokesperson, Cornell estimates that the price tag of its COVID-19 mitigation measures will likely amount to $20 million for the entire academic year, a sum that includes “facilities remediation, teaching technology, monitoring, testing, and sampling.” 

While Cornell has not disclosed breakdowns of how much the various mitigation measures cost, the experience of other colleges suggest that the University’s access to medical facilities — which can process samples in-house — may be saving it a pretty penny. 

For instance, North Carolina State University, an even larger institution, must pay between $88 and $115 per coronavirus test, Inside Higher Ed reported in October. By contrast, if Cornell had paid the lower end of that range, it would have already racked up $58 million in expenses, likely preventing it from testing all students regularly.    

Even so, the surge of COVID-19 expenses comes at what has been a relatively precarious financial time for the University, much like others around the country. Owing to an upshot in projected financial aid expenditures — Cornell promised last spring it would meet all students’ demonstrated need, despite swelling unemployment and falling family incomes — and declining revenues, the University was forced to implement a series of cost-cutting measures. 

In July, the University announced that Cornell’s Ithaca and Tech campuses could collectively lose up to $210 million during the 2021 fiscal year, which spans from July to June. To close the deficit, the University decided to, among other plans, cut salaries and retirement benefits for some faculty, institute a hiring freeze and halt new discretionary spending.   

However, the belt-tightening has appeared to pay off in recent months.   

In November, President Martha Pollack announced that the University had successfully reached a balanced budget, allowing it to end the temporary reductions to Cornell faculty salaries and retirement benefits far ahead of schedule in January. A November budget projection presented to the Faculty Senate also indicated that some of the bleakest financial projections failed to materialize, with actual financial aid costs coming in at $70 million less than initially anticipated. 

Prof. Ronald Ehrenberg, industrial and labor relations, praised the University’s actions as “amazing.”  

“The administration is not standing still, the changes that they have been forced to make continually during this process have been amazing,” Ehrenberg said. “They never dreamed they would be, for example, testing students twice a week. But, it turns out they had to do that.”

“When you are managing and trying to lead a place like Cornell, it’s never easy,” he continued.