Steps to address financial crisis, reopen in the fall
Dear Furman Community,
I hope you and your loved ones are safe and well. As we all know from our shared experience, the COVID-19 pandemic has thrust us into a global crisis we could not have imagined six months ago. While the heroes working on the front lines in medicine, public health, and biomedical science struggle with the overwhelming task of defeating this virus, others are struggling with its many effects, which permeate every aspect of our lives.
Today, I’m writing to share an update on Furman University’s fiscal health and the steps we’re taking to ensure that our university can continue to carry out our academic mission at the highest level of quality and engagement.
Since we first communicated with you about this crisis in January, the university’s senior leadership and emergency management teams, together with a task force of trustees, have been meeting regularly to address both urgent and long-term issues related to the pandemic. We are now focused on returning in the fall for in-person instruction and are working on a detailed plan to reopen the campus safely, which we will share in the next few weeks.
First, we must address our financial situation. Like all universities across the country, Furman has experienced extreme revenue shortfalls from multiple sources. When we shifted to remote instruction in March, we refunded nearly $4 million in room and board and other fees while at the same time incurring new costs related to the pandemic, such as increased technology support. The cancellation of camps and conferences, performances, and other events through the summer resulted in significant additional losses. At the same time, the value of our endowment dropped by more than $100 million as the global economy and markets experienced significant downturns.
We anticipate continued financial stress on the university. Most universities are expecting a decrease in enrollment, which could be 15% or higher, as many students are postponing college or enrolling at schools that are closer to their homes. We also expect our incoming first-year class to be significantly smaller than usual. Like most liberal arts and sciences universities, tuition is the primary source of Furman’s revenue. This drop in revenue and the additional costs of the pandemic will result in an anticipated deficit of tens of millions in the coming fiscal year, the effects of which will be felt for several years.
Even with these financial constraints, we are continuing to meet the urgent needs of our students. Over the past few months, the university has distributed nearly $100,000 from Furman funds, on top of regular financial aid, to help students facing emergencies resulting from COVID-19.
Since the beginning of the crisis, we have been focused on prioritizing the health and safety of the Furman community while working to ensure that our students are able to make progress in their academic programs. With these priorities in mind, we have already taken several steps to reduce current and anticipated financial strain. As a reminder, those actions included:
These quick actions helped us balance this fiscal year’s budget, ending June 30, 2020. However, the financial challenges that the global pandemic has created require us to move quickly to implement additional cost-saving measures to ensure the university’s financial viability. We do not make these decisions lightly. In all of our planning, we are driven and guided by our core academic mission and values.
With a unanimous vote of endorsement of the Furman Board of Trustees, we are implementing the following additional measures:
Furloughed employees will retain their health benefits for the duration of their furloughs. Human Resources will assist all employees interested in applying for unemployment and related COVID-19 relief funds. Please see these FAQs for more information.
In addition, the vice presidents will continue to identify ways to manage operating costs at the divisional level to ensure that resources are focused on the essentials of our academic mission and supporting students.
When Jason Donnelly arrived as our Director of Athletics in August 2019, the university was already in the process of developing a comprehensive long-term strategy that would align our athletics programs with our core academic mission via The Furman Advantage. The financial impact of the COVID-19 pandemic has accelerated the urgency for implementing this strategy.
Following a comprehensive department-wide analysis conducted by national consultants, guided by Jason’s strong leadership, and with the support of the administration and the unanimous endorsement of the Board of Trustees, we have decided on a new model for sustainable success for Furman Athletics that includes these changes:
These changes, together with an increased emphasis on revenue generation and philanthropic support, will create a sustainable 18-sport athletics program that advances academic and athletic excellence, financial stability and gender equity. We sincerely appreciate all of the donors who have supported and continue to support the university’s athletics programs. We will need your support more than ever to ensure the future viability and success of the athletics program.
We share the disappointment that many in our community will feel regarding these difficult decisions. We have reached out to the affected student-athletes and coaches, as well as many of the alumni and fans who are passionate about these programs. For more information, please see these FAQs.
Every option for mitigating our critical financial situation has an impact on our campus community. None of these decisions was easy or made lightly, but I can say with great sincerity that each was carefully considered and adopted in the interest of advancing the university and fulfilling our academic mission.
Furman’s greatest qualities are our community’s commitment to serving and nurturing our students and one another, our ability to adapt and meet challenges head on, and our grace and kindness through it all. Working together, we will get through this crisis and emerge a stronger university.
I know this because I’ve seen first-hand every day since this pandemic started the many ways that you have risen to this challenge. Our community’s response to this crisis has been nothing short of extraordinary. Our faculty and staff transitioned classes and student support to remote delivery in just two weeks and have continued every day since then to engage our students in creative and innovative ways.
You supported and cared for each other, triumphed over unbelievable challenges, and remained resilient through it all. You helped us bolster our university and our students’ experience, and I could not be prouder or more grateful. Better days are ahead.