UM System budget scenarios include plan for escalated COVID-19 pandemic

COLUMBIA, Mo. (KMIZ)

The University of Missouri Board of Curators is planning for multiple financial scenarios related to the COVID-19 pandemic, including a worst-case $500 million budget hole if the outbreak worsens.

You can watch a portion of the meeting in the player below

The curators met Tuesday afternoon, with a financial update from UM System Chief Financial Officer Ryan Rapp on the agenda. The system is planning for three scenarios for how the pandemic plays out by the 2020-2021 school year:

• Virus contained: All in-person classes for the next school year. Some revenue will still likely decrease because of what the system terms "lower consumption" and lower attendance at sports games.
• Regional resurgence: One of the semesters undergoes serious disruptions as the virus pops back up in Missouri. State support would likely take a hit.
• Pandemic escalation: The COVID-19 outbreak continues throughout the school year and classes are all online for both semesters. The budget would take a big hit, with the state likely making extensive cuts to higher education funds.

All three scenarios include expectations for a drop in revenue, with a $60 million anticipated decrease for the UM System in even the best-case scenario. The "regional resurgence/virus recurrence" estimates show a $250 million decrease and the "pandemic escalation" scenario anticipates a $500 million drop.

"I think our best case scenario is probably the most unlikely of the three that we went through today," Rapp said in the meeting. He said he believes the second scenario is the most likely.

The governor withheld $37 million in funds from the UM System during the current fiscal year, which ends June 30. The Columbia campus absorbed $17 million of that cut. MU and MU Health Care has already laid off at least 78 people, furloughed nearly 900, given nearly 1,000 employees pay cuts and not renewed 33 faculty contracts.

According to the university, those measures resulted in at least $8.11 million in savings.

Find more information on the budgetary actions at MU and MU Health Care here

Budgets for fiscal 2021 (including approximately 12.5 percent across-the-board cuts) are due to the UM System president and UM Finance Office. The Board of Curators will discuss the plans at Tuesday's presentation.

"These plans will be presented for approval at the June meeting," Rapp said. "We remain committed to ensuring the mission of the University is sustained, understanding that many of the decisions we make are not about what we should do, but at this period of time what we can afford."

Additionally, the UM System is moving to a quarterly budgeting process. According to the board's financial status update, this is to account for the rapid changes and uncertainties of the COVID-19 pandemic and how it will affect the system.

The UM System is also creating a working team to handle the budget cuts. They hope to have members of the team finalized by the end of the week.

At the meeting, the Board of Curators also discussed plans to return next fall. Though they are planning on in-person classes, each course is required to prepare an online version that is of high quality.

A task force is looking into COVID-19 testing for students. They will consider what the appropriate level of testing for students is as they return and throughout the fall to address a possible resurgence of cases.

The cost of each individual test is $50 to $75. System President Mun Choi said they are looking for state and federal funds to help cover the cost, but they could not rule out the possibility of including the cost in student fees.