According to an email statement from UA President Robert Robbins, the university expects to lose at least $250 million from the COVID-19 pandemic.
The Arizona Republic reported that refunds issued for housing, meals and parking constitute a large portion of these costs. Meanwhile, the reduction of on-campus activities — including ticketed events, recreational opportunities and bookstore transactions — also contribute to the expenses.
As a result of these financial repercussions, Robbins proposed a graduated pay scale to the Arizona Board of Regents (ABOR) that includes faculty and staff. This program could generate approximately $93 million in savings, he added, or roughly 37% of the university’s projected shortfalls.
Based on this plan, salaried employees who make up to $150,000 annually will take graduated furloughs over time, specifically according to their pay levels. These furloughs will range between 13 and 39 days, and they will progress through fiscal years 2020 and 2021.
Additionally, any staff members who earn over $150,000 annually are slated for straight salary reductions. According to Robbins’s email, employees in the range of $150,001 to $199,999 are scheduled for cutbacks of 17%. For anyone else who makes $200,000 or more, UA proposed 20% reductions — or at least $40,000 yearly.
“We will all share in this as a team and we all will sacrifice as a team, but in a manner that respects your work, your contributions and your compensation and benefits, to the highest extent possible,” Robbins stated.
This system will allow employees to continue receiving their benefits, Robbins explained, and the university asks anyone involved to stay patient as the situation develops. Furloughs and pay reductions are scheduled from May 11, 2020 through June 30, 2021.
The university also implemented other measures to combat the estimated $250 million in costs. Firstly, UA’s email stated that approved building projects were halted to save approximately $7 million. President Robbins and senior vice presidents also accepted immediate pay cuts for themselves, although the exact savings were not detailed. Finally, UA initiated a hiring pause, delayed merit increases and suspended strategic plan funding to conserve another $48 million.
UA sophomore Zack Hansen said he appreciates the university’s honesty during this challenging situation, particularly with sharing financial details and procedures.
“What really clicks with me about this plan is its timeliness, transparency and compassion,” Hansen said. “Robbins’ sizable team of professors, administrators, representatives and financial sustainability experts is quelling my fears and reassuring me that the university is working tirelessly to figure this out.”
More specifically, Hansen explained that the university’s ongoing communication with students, faculty and staff demonstrates strong guidance.
“It just draws a really clear example of leadership during these times, because everybody has to deal with these decisions, but it really matters how you deal with them,” Hansen said.
Despite UA’s proposed furloughs and pay reduction program, The Arizona Republic reported that NAU and ASU have not announced similar changes, nor have they submitted any plans to ABOR.
However, in an email to the university community, President Rita Cheng said NAU forecasts between $30 and $100 million in costs. In order to review this financial information, consider operations and communicate with officials, Cheng explained that a 2020 COVID-19 Recovery Workgroup was assembled.
“This purposeful planning is not new for NAU, but certainly takes a heightened level of importance at this time when there are still so many unknowns in terms of future enrollment levels, mode of instructional delivery, and the status of future campus events,” the email stated.
Another section of Cheng’s announcement focused on current and future coursework, including NAU’s use of various educational formats. In fall 2020, the delivery of classes could depend on appropriate instructions from the state and federal government.
“Our intention and plans are focused on resuming normal operations in the fall, including offering full services at our mountain campus and in-person delivery of classes,” Cheng stated. “We will also continue to plan and be prepared for a variety of alternate education delivery scenarios following the health and safety guidelines of the CDC and direction from our state government.”
NAU began its final week of online instruction on Monday, shortly before reading week and testing to conclude this semester. Summer break officially starts May 8.