Continuing Impact of Declining Enrollment on PNW’s Budget
To: Faculty and Staff
From: Thomas L. Keon, Chancellor
RE: Continuing impact of declining enrollment on PNW’s budget
I want to thank everyone for working so diligently right now to serve our students and community under the current circumstances. Assuming governmental authorities permit doing so, Purdue University Northwest intends to offer classes on campus this fall, while remaining conscientious about whatever rules and practices are necessary to protect the health and safety of students, faculty, staff and the community. We are making contingency plans in case the COVID-19 situation makes it necessary to conduct any part of the fall semester online.
We continue to respond strategically to the changing landscape in higher education and in our greater communities in order to sustain the quality education our students expect and deserve. To that end, we are taking some immediate actions and are also planning for next year to ensure our fiscal stability.
FY 21 Budget Impact on Faculty, Staff and Students
First, Purdue Northwest, pre-Covid-19, was anticipating a drop in our Fall 2020 student enrollment based upon the predictions made by the Office of Institutional Research. The general fund budget projected shortfall for fiscal year 2021 is $2.8 million.
We are addressing this shortfall and each division, as we have done in the past, is making adjustments to their recurring budget proportional to their reliance on the general fund, as outlined in the following table. Measures include reduction of supplies and equipment (S&E), elimination of vacant positions, and reduction in force of current positions.
| Divisional Unit | Recurring Allocation* | Percent of Funding Base | Reduction |
|---|---|---|---|
| Chancellor | $3,214,300 | 3% | ($96,411) |
| Institutional Advancement | $3,221,619 | 3% | ($96,631) |
| Enrollment Management and Student Affairs | $9,484,622 | 9% | ($284,486) |
| Finance and Administration | $17,732,278 | 17% | ($531,871) |
| Information Services | $8,599,341 | 8% | ($257,933) |
| Academic Affairs | $57,385,094 | 56% | ($1,405,199) |
| Intercollegiate Athletics | $3,088,419 | 3% | ($92,636) |
| Total General Fund Base | $102,725,673 | 100.00% | ($2,765,167) |
The steps outlined above demonstrate our continued focus to make adjustments that are fiscally responsible in response to continued enrollment and financial challenges. These adjustments are pre-emptive and will reduce recurring budgets effective for FY21. Any reductions in force will become effective on or before July 1, 2020.
Impact of COVID-19 pandemic
In addition, the COVID-19 pandemic has had a tremendous impact on our daily lives and we anticipate that it will certainly affect the ability of our students to join us for the first time or to return to Purdue Northwest this fall. Thus, we must take further steps to prepare for a possible significant financial loss in our operating budgets.
Based upon this uncertainty, we are planning for additional budget adjustments in scenarios that range from $10 million to $16 million. The final decisions on our FY21 fiscal plan will be made after final enrollment figures are known in early September.
Deans, directors, department chairs and unit leaders are proactively assessing the needs of all areas of the university and determining adjustments that could fit those needs. In anticipation of further budget declines in FY21, we are exploring many options including reductions in supplies and expenses (S&E) and travel expenditures, as well as temporary faculty and staff furloughs and salary reductions.
Clinical Faculty, with the exception of those in the College of Nursing, will soon be given notice of contract suspension, following the one year notice Purdue policy, and Continuing Lecturers may be given notice in the fall depending upon enrollments. It is our commitment to continue to work to find measures that could materially change the circumstances that necessitated these notices.
At PNW, we are all in this together as we Power Onward in order to provide our students with a quality educational experience and to serve Northwest Indiana. The Senior Leadership Team and I are confident that PNW will emerge from these unusual circumstances stronger and better positioned to lead Northwest Indiana.
Thomas L. Keon
Chancellor, Purdue University Northwest