Catholic colleges, universities face pandemic's financial punch

WASHINGTON -- The coronavirus pandemic that has impacted the health and economy of the nation particularly dealt a blow to Catholic higher education, from the large universities with hefty endowments to smaller liberal arts schools.

Two articles posted online May 13 in The Washington Post illustrate the scope of the financial situation for two very different Catholic universities located just five miles away from each other.

One focused on Georgetown University's budget cuts as it faced a $50 million shortfall while another article examined the impact of federal aid, and lack of it, for students without legal documentation, affecting Trinity Washington University, a women's university which serves predominantly African American and Latina students.

At Trinity, DACA students make up 10% of the enrollment. These students are part of the Deferred Action for Childhood Arrivals, a program that allows qualified adults who arrived in the U.S. as children without legal documentation to attend college without the threat of deportation.

Through the federal Coronavirus Aid, Relief and Economic Security, or CARES Act, college students were eligible for student aid, which Patricia McGuire, president of Trinity Washington University, said she immediately applied for only to later find out the requirements for it had changed to exclude students without legal documentation.

"I have never been in a situation where you get the money and you're still getting the rules after the fact," McGuire told the Post.

She also said the current time is "precarious" for the university, which is not wealthy. "Our endowment is $16 million. That's the sob story, but we're going to make it. I'm committed to making sure that the people here don't suffer because of the pandemic," she said.

Conversely, the newspaper's story about Georgetown University, a school with a significantly larger endowment, revealed how no schools are immune from the financial impact of the pandemic's shutdown.

A May 12 letter to members of the Georgetown community from the university's president, John DeGioia, said the school's unbudgeted spending at the beginning of the pandemic's shutdown along with loss of revenue in the summer has brought the university to an operating loss of $50 million as it looks to the fall semester.

DeGioia, like other university leaders, responded to this financial crunch by saying the school would significantly reduce new capital expenditures. It also was withholding salary increases, putting a hold on hiring and suspending contributions to employees' retirement plans for the coming fiscal year.
More than 50 members of the school's administration also took voluntary salary reductions for the coming fiscal year.

These cuts along with a nine-week voluntary temporary furlough program for all eligible employees, while still receiving health care benefits, and a voluntary temporary salary reduction program for eligible employees were other measures to make up for some of the schools' financial losses, he said.

To date, one Catholic college has closed, due in part to the financial impact of the coronavirus: Holy Family College in Manitowoc, Wisconsin, sponsored by the Franciscan Sisters of Christian Charity. The school, founded in 1935, announced May 4 it was closing at the end of August.

In a May 7 letter to the school community, Franciscan Sister Natalie Binversie, the school's community director, said the decision to close the college was a difficult one to make but that the "COVID-19 ramifications sealed the concerns about the colleges long-term future" since it was already coping with increased costs, changing student demographics and fundraising challenges.

Notre Dame de Namur University in California announced this spring that the school, with about 1,500 students, would not enroll new undergraduate students for this summer or fall and will likely only remain in operation through the spring 2021 semester.

The school, in the San Francisco Bay Area and founded by the Sisters of Notre Dame de Namur in 1868, said on its website that it intends to "stay open at least long enough to serve our students who are close to graduating. We hope to find a way to remain open in the future, but we cannot make that guarantee."

The economic costs of closing campuses for two months and in some cases refunding students' tuition and room and board costs was a huge financial hit for many colleges.

Joseph Nyre, president of Seton Hall University, which is operated by the Archdiocese of Newark, New Jersey, outlined some of these costs in an April 27 letter to the school community.

He said the school is "understandably facing lost revenue and additional costs this academic year" from pro-rated refunds to students for room, board and parking and school-funded grants to cover amounts not refunded or credited for students' study abroad. It also lost funds from not offering summer sessions and from the canceled NCAA basketball tournament, which provides funds for NCAA member schools for their athletic departments.

The university took steps to address the impact of these unplanned costs and losses with a university-wide hiring freeze, the suspension of major planned capital projects, a review of all contracts with outside vendors and an assessment of the school's pay and benefits for employees.

The school announced that like other colleges and universities, it had to furlough some of its employees, while keeping their health insurance coverage, for those whose work could not continue remotely or was not needed at the time.

While colleges are trimming budgets wherever they can, they also are trying to make sure their students get financial relief in this crisis and working to reopen in the fall as a way to keep the revenue stream flowing.

But they also are reaching out to students in no-cost ways as well.

At Albertus Magnus College in New Haven, Connecticut, founded by the Dominican Sisters of St. Mary of the Springs, students who were sent home during the pandemic this spring each received a phone call from a faculty member or someone from the staff or even the school's president, Marc Camille.

Callers let the students know they were missed and asked how they are doing and how the college could be of assistance.

Camille, who addressed the school community in a video message May 15, as he did each week of the campus shutdown, thanked students and faculty for their resilience and perseverance and noted that it has been a "challenging but fulfilling year."

He also said he looked forward to seeing returning students in the fall while "details about the parameters" involved in resuming school again continued to be worked out.