Mia Agostinelli, Fordham College at Lincoln Center (FCLC) ’23, applied to another university for the fall semester, despite loving her freshman year at Fordham.
Agostinelli has discussed the possibility of transferring if the university continues operating at the same cost remotely. With more students grappling with the decision to return to campus, a projected decrease in enrollment will in turn hurt Fordham’s overall revenue.
“If we are online still, it will be really critical to see how much the university will modify its costs,” she said. “I’m sure that’s going to be a major factor in students’ decision to stay at Fordham or transfer to another university.”
The net tuition received by the university — which makes up 79.3% of the budget — is heavily impacted by the number of students enrolled and can fluctuate as a result of it. A downturn in student enrollment means a downturn in total tuition collected and less funding for the school overall.
According to The New York Times, “Administrators anticipate that students grappling with the financial and psychological impacts of the virus could choose to stay closer to home, go to less expensive schools, take a year off or not go to college at all. A higher education trade group has predicted a 15 percent drop in enrollment nationwide.”
Steve Raymar, associate professor and area chair in the Gabelli School of Business, said that there are concerns regarding graduate students. “With the graduate business program, there’s logical fears of lower enrollment because of international students having difficulty getting to the United States. That, more or less, affects the whole school-wide budget.”
In the dire time of the novel coronavirus, the financial situation for students, staff and the university is anything but ideal.
In an official statement, University President Rev. Joseph M. McShane, S.J., wrote, “the University has had to introduce significant cost-saving measures to cover increased operating and technology costs … as well as to offset the issuance of pro-rated refunds to students for room and board and certain fees, and to make up for the lost revenue associated with the cancellation of various conferences, events, and camps that were scheduled to take place on campus this spring and summer.”
The Fordham University budget is balanced for each fiscal year (FY), which begins on July 1 and ends on June 30 of the following year. Each year, Martha Hirst, senior vice president and chief financial officer and treasurer of Fordham University, hosts a budget forum where she gives an updated presentation on the projected budget for the next FY.
At the last budget forum on Friday, Nov. 8, 2019, when asked why students should care about the budget, Hirst responded, “All these revenues and expenses are worthy of student attention because this all makes the place grow and makes it what it is. It’s reasonable for you to pay attention to tuition and fees, and auxiliary enterprises, room and board because they absolutely directly affect students.”
With that being said, Fordham’s main sources of funding are in three categories: tuition and fees, auxiliary revenue, and other revenue. Auxiliary revenue is broken down into Fordham press, food services, and room and board. Other revenue includes, but is not limited to, grants, private gifts and investment income, according to Hirst’s presentation in November 2017.
Fordham uses that revenue to fund its expenses. The biggest monetary provider for the university is net tuition — forecasted to be $482.3 million for FY ’19 in May 2019.
Students who choose to live on campus also contribute to the university’s auxiliary revenue through room and board fees. In 2020, auxiliary revenue was proposed to account for 13.6% of the university’s budget, at a total of $88.3 million. Due to students moving out early and receiving partial refunds, the university took a significant hit to its auxiliary revenue.
The university budget tries to prepare for unplanned or unanticipated costs in their contingency section. For FY ’18, $800,000 was set aside for contingency.
Fordham also said they hoped to increase the money they have on-hand. In the November 2017 budget presentation, Hirst said $0 to $5 million dollars on-hand had, “little cushion for unplanned costs,” and anything more than $6 million and above reserved would be ideal.
In the May 2019 budget forum, Fordham proposed a $3.5 million on-hand result for FY ’20. This on-hand money could go directly toward unanticipated costs.
In another revenue stream, Fordham began FY ’18 with $65.1 million in stock market investments (defined as publicly traded securities on their tax returns). They ended the year with $210.2 million. While this growth is commendable, the future of the investments is uncertain after stocks plummeted and the Dow suffered its third-worst day ever.
Private gifts, grants and contracts also play a significant role in the budget. According to data compiled by the Office of the Treasurer and the Office of Institutional Research, the recession of 2008 — while difficult on stock markets — resulted in a higher level of donations for Fordham. In 2009, Fordham received $46 million of its budget from this revenue stream. In 2011, it hit a peak of $79.1 million — a number that has not been matched in the years since and follows a trend found at a number of universities across the country.
The effect on the budget will appear in different ways across the university. Jason Morris, chair of the department of natural sciences, explained that his department is “very dependent on Fordham’s budget for salaries of faculty, administrators, TAs (teaching assistants), and tutors, and for supplies and equipment for our teaching labs and research programs.”
Student leaders have also felt the effects of Fordham budgeting uncertainty. United Student Government (USG) Treasurer Joseph Moyer, FCLC ’22, chairs the Student Activities Budget Committee (SABC) as part of his position’s duties.
He explained that the prorated refunds residential students received included the student activities fee, which is the basis for SABC’s budget. Because they will not have any funds roll over from the spring semester, Moyer said that in the fall, “We know that we’re going to have less money than other years.”
“USG relies completely on the budget as we get all of our funding from SABC … so in terms of events, right now we just focus heavily on prioritizing. Just because we have less of a roll over this year doesn’t mean we won’t be able to fund things next semester,” Moyer explained.
SABC member Zuzanna Smurzynska, FCLC ’22, is treasurer of the Campus Activities Board (CAB). Smurzynska explained that CAB, along with other clubs who are now hosting virtual events, is actually saving money at the moment.
Smurzynska said, “For example our virtual bingo definitely cost us a lot less than our usual bingo because we didn’t have to get any food or any decorations or anything like that.”
When considering potential funding cuts that may lie ahead, Smurzynska said, “I would like to see them continuing to make sure that it is evenly spread out so all clubs are able to put on their events. I’m hoping that it stays that way in the fall.”
Rev. Vincent DeCola, S.J., GSB assistant dean, expressed his optimism for the future of Fordham. “While there will be many challenges, Fordham is positioned very well to come through this and, in due course, to pick up on what has been a very notable upward trajectory for 20 years or more.”
A new budgetary plan was approved on April 23 by the Board of Trustees and is set to be released sometime this week. With the outbreak of the coronavirus, a proprietary budget that was finalized has to be reevaluated in order to ensure the university can survive this difficult time.
Andrew Beecher contributed additional reporting to this story.