COVID-19 Crisis Is Forcing UWM To Make Its Largest Single-Year Budget Cut

Jul 29, 2020

A cloud of financial trouble is hanging over the University of Wisconsin-Milwaukee as it plans for its first full semester in the throes of the COVID-19 pandemic.

On Wednesday, UWM administrators outlined the financial situation for faculty and staff in an online town hall. They also talked about safety precautions for the upcoming school year, which starts Sept. 2.

>>UWM Releases Fall Plans: Face Masks Required, Large Classes Online

“In total we’re anticipating that the impact of COVID-19 on our overall [Fiscal Year 2021] budget would be a net deficit of somewhere between $25 and $54 million,” said Vice Chancellor of Finance Robin Van Harpen.

Prior to COVID-19, UWM was dealing with nine years of declining enrollment and eight years of frozen in-state tuition revenue. Now, the financial losses are accelerating. School administrators are predicting a decline in enrollment between 5% and 10% this year, and dorms will be only about 60% full.

Then there are state budget cuts. UWM is expecting a 7.5% reduction in state support this fiscal year as part of Gov. Tony Evers’ plan to trim $250 million from state agencies because of the economic downturn caused by COVID-19.

On top of the cuts, UWM has new expenses related to reopening campus. Van Harpen said the university needs to take immediate steps to balance its budget.

"This is the worst, biggest crisis we have ever gone through at UWM." - Johannes Britz

“We need to reduce our expenses further this fiscal year by $25 million below what we had already been planning pre-COVID,” Van Harpen said. "That’s a really big number. The biggest we’ve ever had to deal with for a single year in our history.”

It’s an about 3.5% cut to UWM’s total operating budget. UWM has already implemented furloughs and frozen pay raises and travel. But that won’t be enough to save $25 million. Van Harpen said each division of the university will need to find more cost savings, and that could include layoffs. More information about possible layoffs will come out in the next couple of months, a spokesman said.

“This is the worst, biggest crisis we have ever gone through at UWM,” said Provost Johannes Britz.

Britz said in the future, UWM will have to restructure or downsize programs to save money.

“I don’t foresee that we will continue with 13 colleges with 13 deans,” Britz said. “We will have a different future. But we can shape it if we strategically engage in planning post-pandemic."

UWM has planned for restructuring – a report recommends consolidating UWM’s 13 colleges into as few as six and “streamlining” degree programs. Those recommendations may need to happen sooner than expected because of the financial impact of the pandemic.

In the short term, UWM is trying to figure out how to reopen its campus in the safest way possible this fall. About 65% of classes will be entirely online, partly because of classroom space constraints. Usually, about 20% of courses are online-only.

“Social distancing changed the campus completely,” said College of Letters and Sciences Dean Scott Gronert. “We lost 75% of our classroom space. We couldn’t have classes with more than 50 individuals. That led to a recommendation of a mostly online fall semester. It also led to a recommendation of shortening courses by 15 minutes across the board. That’s to create time for safe ingress, egress from the classrooms and more time for cleaning between classes.”

Even though UWM and other Wisconsin colleges are striving to resume some in-person classes this semester, the state’s COVID-19 situation is anything but contained. In other states, some universities have reversed plans for in-person learning because coronavirus case numbers are going up.

UWM leaders say they are still working out what metrics would push them to revert to an online-only semester.

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