COVID-19 University Update — 4/27/2020

NJIT Community Members,

The COVID-19 global pandemic has resulted, to date, in the loss of almost 55,000 lives throughout the United States and more than 207,000 deaths around the world. Regrettably, those numbers continue to grow each day and will do so for the foreseeable future. The loss of life caused by this virus has been heart-wrenchingly tragic, and, most sadly, several members of our university community have lost family members or loved ones.

We must not lose sight of that, yet we also must work to address the other forms of loss we are experiencing at this time. Millions of people all around us have lost jobs and financial security; countless businesses have been shuttered, in some cases permanently; and states and municipalities have been brought to their fiscal knees, which could jeopardize the support available to those most in need.

Higher education has not been immune to the impacts of COVID-19 and, in many ways, has been acutely affected. Colleges and universities throughout much of the nation were forced to move instruction online for the remainder of the spring semester as well as the upcoming summer session. NJIT has adapted quickly, and I commend our faculty and students for rapidly adjusting as we moved 100% of our spring courses to remote/on-line learning using more than 27,000 WebEx sessions and approximately 3,000 recordings. The move to remote instruction brought unanticipated costs for all institutions as well as a need for many to reimburse students for such services as housing and dining, which could not be provided in the current context. Public colleges and universities have experienced massive funding reductions late in this fiscal year, when little could be done to adjust budgets or enhance revenues. In addition, promising lines of research have been stunted, and students have been denied athletic seasons, academic competitions, as well as the in-person celebration of milestones such as commencement.

These losses pale in comparison to the loss of life wrought by this virus, but they are massive and cannot be ignored. So, I write today to share with you some details regarding how NJIT has been affected thus far and how we are planning for the future.

From a fiscal standpoint, we are fortunate that NJIT was in a strong position prior to the onset of COVID-19. In fact, Fiscal Year 2020 (which ends on June 30, 2020) was set to be a banner year for our university. NJIT’s enrollments were healthy and increasing, and applications for admission were at record levels. The university’s endowment was growing, and we had been successful in attracting robust funding through grants, gifts, and appropriations from both public and private sources in support of exciting initiatives. Nevertheless, the fiscal impact of COVID-19 has been monumental and has forced our leadership team to take significant steps to assure a balanced budget at the close of FY 20.

From March through June of 2020, COVID-19 will create a financial shortfall of more than $16 million for NJIT. That total is comprised of the following: a nearly $6 million reduction in state appropriations; more than $5.3 million credited or refunded to students for housing, dining, and parking fees; approximately $3 million in investment income and cost recovery losses; roughly $1 million in receivable payment defaults; and hundreds of thousands of dollars in event and program revenue losses as well as unanticipated business continuity costs.

NJIT’s senior leadership team has scoured budgets for savings. In two separate rounds of cost reductions, we have identified almost $10.5 million that has been moved to reserves. This has not been easy and will result in the deferral of many important projects and expenditures, but it has been absolutely necessary to close the budget gap. We also have restricted hiring to only the most essential vacant positions. In addition to the savings we identified, NJIT will receive $4.055 million from the third phase of the federal CARES Act. A like amount of funding will be made available to our students through the university for their expenses resulting from COVID-19. We also have identified numerous costs that NJIT has incurred due to this pandemic, which may be partially reimbursable through the Federal Emergency Management Agency (FEMA). These efforts, combined with a final round of budget reductions, will enable NJIT to close FY 20 with a balanced budget.

Despite successfully addressing the FY 20 budget gap, we face many uncertainties for FY 21 (July 1 - June 30, 2021) and must plan based upon some grim assumptions. At present, enrollment for summer session is ahead of last year’s pace and projections for the incoming freshman class and transfer cohort remain ahead of expectations, but we likely will realize significant declines in the number of international graduate students enrolled next year. This will affect our masters and doctoral degree programs most heavily. We also cannot be certain how severely external funding received by NJIT (state appropriations, private gifts, grants, corporate contracts, event and program revenues, etc.) will be diminished. Furthermore, the uncertainties surrounding COVID-19’s impact are numerous and must be considered. We need to prepare for the possibility that some form of social distancing as well as testing and personal protective equipment (PPE) may demand new investments and could limit or eliminate various sources of revenue. We also must recognize the likelihood that many of our students’ families will face financial hardships that threaten their enrollment status and academic progress. Along those lines, I note that our university fundraising efforts now are focused on this area of need and that 100% of NJIT’s senior leadership team members (president, vice presidents, and chief administrative officers) have made personal contributions to the Highlander Student Emergency Fund. Since April, we have raised a total of more than $62,000 for that fund.

As we prepare for FY 21, NJIT will need to explore a broad range of cost containment strategies and revenue enhancement efforts. Details of those will be shared as they evolve and our university’s financial picture becomes more clear in the coming weeks and months. We also are transitioning our COVID-19 Task Force and advisory group to a Recovery Steering Committee that is actively planning for future university operations. 

As part of that effort, NJIT’s senior leadership team members have begun the process of developing operational and continuity plans for the fall semester that align with the three phases outlined in the federal government’s “Guidelines for Opening Up America Again.” Our planning for return to in-person or hybrid operations will be consistent with state and federal guidelines and will be shaped by two key priorities: the health and safety of NJIT community members and the delivery of a high-quality academic experience. Therefore, we have begun to anticipate a broad range of possible scenarios and to make preparations that will enable NJIT to be nimble in achieving its mission during this uncertain time. We also are assessing what we have learned from our initial response to COVID-19 and will seek to apply the lessons we have learned in ways that make us a better university in the future.

I cannot thank the members of the NJIT community enough for all your efforts as we work together to meet the challenges of this moment. NJIT was on a rapid ascent prior to the arrival of COVID-19, and we undoubtedly will resume that trajectory once this tragedy abates. I have confidence that will be the case, because I know the people of NJIT. Our students, faculty, staff, trustees, and alumni are problem solvers who possess great talent and fierce determination. They give me reason for optimism and hope.

I also know I speak for the NJIT community in adding that we will be forever grateful for the tireless and self-sacrificing efforts of first-responders and health-care professionals in battling this pandemic.

I wish you all well and, again, thank you for your strong support of NJIT.

Sincerely,

NJIT President Joel S. Bloom