The University has spent $21,800,000 on refunds of room and board and parking charges, as well as student wages, E-Gap Funds for travel and a line of credit for Brown Physicians, Inc., in the wake of the COVID-19 pandemic and students’ evacuation from campus.
Total possible financial losses suffered by the University because of the pandemic will most likely reach up to $50-60 million, Provost Richard Locke P’18 said at a Tuesday faculty meeting. President Christina Paxson P'19 discussed these losses and the "tough" financial decisions the University would have to make in a community-wide email sent Monday, The Herald previously reported. Losses will be exacerbated in the coming months because of revenue lost from summer programs, international enrollment, endowment performance, research and indirect costs, philanthropy and financial aid.
Locke told faculty that the University has “real levers available” to deal with these financial losses. Hiring freezes, a salary freeze for all employees and salary reductions for senior leadership were enacted in an effort to reduce expenditures. In addition, the University will develop a liquidity model to enhance cash flow and will explore possible new revenue streams. These efforts will be reviewed by the COVID-19 Finance Committee, a subcommittee of the Corporation, the University’s highest governing body.
“We have been working hard to make sure that the financial foundations of this University are stronger and that we have the cash we need to get through these challenges,” Locke said.
Locke said that these predictions are based on the assumption that students will return to dorms in the fall, and that the financial situation could be “tougher” if that is not the case come next semester.
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