Ohio State takes action to respond to COVID-19 budget challenges
Fiscal stewardship secures university mission
As The Ohio State University continues to develop and implement a return to campus, university leaders are managing a budget severely impacted by the COVID-19 pandemic. The overriding goal: prudent fiscal stewardship to protect the core academic mission.
As part of the university response to the pandemic’s impact on operations, officials implemented several steps to manage an estimated $100 million in revenue losses during FY20. Among the first steps included instituting a hiring pause on April 1, a move that will save the university an estimated $4 to $6 million through June 30.
The university also temporarily paused the annual merit compensation process for Ohio State faculty and staff and instituted pauses in off-cycle salary increases, saving an estimated $5 to $10 million through June 30. The university also remains committed to implementing a $15 an hour minimum wage in the new fiscal year.
All capital projects have been assessed to determine how existing projects can defer hundreds of millions of dollars in spending to ensure adequate financial flexibility until the total impact of the pandemic on revenue sources becomes clear.
Restrictions on university travel this spring resulted in saving approximately $9 million. The university also reviewed all non-essential commitments such as office supplies, dining hall purchases, conferences and membership expenses for additional savings.
The above mentioned steps along with the use of limited strategic cash reserves allowed the University to navigate FY20 without significant financial impacts on faculty, staff and students.
Planning for multiple contingencies continues. All colleges and units are preparing multiple budget scenario projections of 5%, 10% and 20% reductions in spending for FY21 with a focus on maintaining core academic objectives.
“We continue to focus on the university’s core academic mission to keep Ohio State in the best possible position for a future in which the virus is contained,” Senior Vice President for Business and Finance Michael Papadakis said in a statement. “At the same time, our preparation for FY21 is based on the possibility of ongoing disruptions.”
To help address student financial challenges caused by the pandemic, the university proactively provided grants of up to $1,000 to undergraduate students from lower-income families. No applications were needed for these new grants; Ohio State alerted qualifying students directly. The grants were provided through the Together As Buckeyes emergency grants program.
Sly Worthy, a rising senior majoring in social work and African-American and African studies, said the grant he received helped him get through a very challenging time as the pandemic shuttered businesses across the state.
“I was definitely able to pay my rent, and my utilities, and I was able to get some food for myself. I’m taking summer classes and I’m starting my thesis this summer for my senior project. So I was able to get a printer, too,” Worthy said. “Those things helped me out a lot and alleviated a lot of that pressure off me.”
Resource stewardship is one of the pillars of the university’s strategic plan, and Ohio State has achieved over $200 million in administrative efficiencies, over $450 million in strategic procurement savings and over $1 billion in new resource generation over the last 5 years.
Ohio State has committed $200 million in additional need-based aid to students and families since 2015, far exceeding its stated goal of reaching $100 million by 2020. The additional aid has benefited more than 40,000 Buckeyes and their families.