Maryland’s public universities have been forced to adapt to one sudden change by shifting their learning online, but they face another looming challenge from the COVID-19 pandemic as the state expects to enact significant budget deficits.
Over the past decade, Maryland public universities have enjoyed some of the highest levels of state funding in the country. But with state revenues projected to decline by as much as $2.8 billion during the year’s final quarter, those universities will have to come up with ways to make up for expected funding cuts.
The 2021 fiscal year budget directs about $7.2 billion toward higher education.
Already, most institutions in the University System of Maryland, which includes all but two of the state’s public 4-year schools, have instituted a hiring freeze or are carefully considering their new hires. The uncertainty meant that USM Chancellor Jay A. Perman could not give system staff definite answers about the future, he told the Board of Regents last week.
“I was frank in my assessment that the University System won’t be immune to cost-cutting, and that we should anticipate, at the state level, tougher measures to come,” he said. “During the recession a dozen years ago, the state eliminated vacant positions and mandated expense reductions. They implemented hiring freezes, salary freezes, and furloughs.”
Perman has been updating the board weekly on the system’s response to the pandemic, which is wide ranging and includes instituting distance learning, positioning health profession students to participate in the state’s medical response, helping to expand the state’s testing capacity, providing protective equipment for hospitals and researching cures and therapies.
The budget challenge is also coming, though how much the system and its institutions will be expected to cut is uncertain, Perman told the regents last week.
“We expect that the Department of Budget and Management will give us direction in terms of a budget reduction target that we’ll need to hit, and we’ll work with the universities to implement cuts that will get us to that number,” he said. “As in the past, that process will involve some very hard decisions.”
The system’s institutions have already seen some fiscal effects from the pandemic. Because the system moved learning online, its universities have refunded some fees for students, including room and board and parking.
There is also uncertainty about what future semesters look like. Universities have prepared to continue online learning through the summer, though a final decision has not been made.
More significantly, most are also preparing for a variety of approaches for the fall semester, including online learning, traditional in-person learning or a combination of both. That could mean fewer students paying those room and board and parking fees.
Universities across the country are also worried about their fundraising, according to a survey of more than 400 university fundraisers by education consulting firm Washburn & McGoldrick.
Just 22% of those surveyed said they would be able to achieve their fundraising goals for this year. Forty-three percent said they were not confident their schools would reach their fundraising goals this year. And 35% said they were somewhat confident that they would be able to achieve their goals.
Maryland universities did receive some money from the federal government as part of the CARES Act, the $2.2 trillion stimulus bill passed earlier this month. Maryland institutions expect to receive $183.3 million from that package.
The money each school is set to receive ranges from a little over $1 million for some of the state’s small private liberal arts colleges to $21.4 million for the University of Maryland, College Park.
But, at least half of the money must be spent on financial aid grants to students to cover cost-of-attendance expenses like food, housing and course materials. The remainder is earmarked for lost revenue and technology costs associated with the transition to distance learning.