Kansas State University is estimated to lose $35 million in revenue by July 31, caused by its move to remote instruction and limited operations attributed to the COVID-19 pandemic.
K-State President Richard Myers on Wednesday outlined a fiscal plan for the university moving forward that includes a hiring freeze, salary cuts for top administrators and athletics staff and an implementation of targeted emergency furloughs for areas where a lack of funding exists to continue operations. Myers wrote in a letter to staff and students that uncertainty in state funding as a result of lost tax revenues, near certain enrollment declines and continued losses are threatening the university’s financial viability.
“We are now at the point we need to make excruciating financial and budget choices,” Myers wrote. “We will talk about numbers, but these aren’t numbers really, they impact people.”
Among the measures that are being taken to save money ahead of the 2021 fiscal year budget:
- An instituted university-wide hiring freeze and process for supporting mission critical positions, estimated at producing $2 million in savings over the next year.
- Student worker appointments will end May 16, with the exception of those required for mission critical work.
- Restricted travel and professional development budgets, with an estimated savings of $800,000.
- Used utility savings to generate cash balances for this year and reduce utility costs to the colleges and revenue centers by $2 million.
- Voluntary 10 percent pay reductions across the board for the President, Provost, cabinet members and senior administrators, to save $800,000.
- Salary reductions for athletics staff and 42 coaches including football coach Chris Klieman and men’s basketball coach Bruce Weber, designed to save $1.5 million over the next year. Planned departmental budget cuts will save approximately $2 million in operating costs.
“These steps will not keep us financially solvent, there are other levers that must be pulled,” Myers said.
Additionally, Myers says the university is asking Human Capital Services to provide updated information about how emergency furloughs will function in conjunction with state and federal aid for employees. The university is also phasing out the use of administrative leave for employees unable to work due to limited operations by May 30 and have asked deans and vice presidents to develop plans on how to move forward with employees.
Myers says since the pandemic began in mid-March the university refunded over $8 million to students from Housing and Dining and lowered tuition funding within the new budget model for Fiscal Year 2021. It assumes worst-case scenarios going well into the next academic year.
K-State is receiving some federal financial relief, in the sum of $12.7 million from the CARES Act passed by Congress and signed by President Donald Trump in late March. To date, the university has not received those funds. By law half of those funds must go to support student assistance, with the other half designated for other COVID-19 expenses.
Myers ended his letter asking the public to have courage and hope as they move into the future.
“I am very confident K-State will emerge from this situation as a stronger institution serving its many constituents,” he said.