Emerson anticipates $30 million in pandemic-related losses over the 2021 fiscal year—an outcome college officials consider a “best case scenario” after initially projecting up to $100 million in losses.
More significant losses were avoided through “conscious” efforts to increase enrollment for next year, Vice President for Administration and Finance Paul Dworkis said in a November faculty and staff forum. More than 89 percent of the college’s annual revenue comes from tuition.
Approximately 98 percent of undergraduate students enrolled in either hybrid or online courses during the fall semester—all of whom paid Emerson’s full tuition price of $25,120 each semester.
The college reported a surplus for the 2020 fiscal year, which Dworkis said allowed the college to adequately fund and prepare for the fall semester reopening. Emerson has spent more than $5 million on COVID-19 tests to date, and “millions more” to implement “de-densification” and sanitary measures throughout the Boston campus, like plexiglass dividers and increased classroom cleaning, Dworkis said.
Despite the increased enrollment, the college failed to meet its goal for “residency level” and was also unable to re-open its Kasteel Well and Los Angeles campuses, which Dworkis said negatively impacted the college’s financial position.
Dworkis struck a cautiously optimistic tone as he warned that the $30 million in losses is subject to change if enrollment or residency levels were to dip below college projections in the spring. Still, administrators told The Beacon in October that enrollment is expected to tick up.
Ahead of the semester, college officials temporarily limited administrators’ salaries, staff members’ annual 3.9 percent salary increase and retirement fund contribution matching. Union members, who fought for two years to earn the yearly bump, agreed to temporarily suspend the increases to help mitigate potential severe pandemic related losses. Staff members told The Beacon earlier this month they hoped the college’s relatively stable financial state would mean their benefits would return.
Dworkis said the college does not plan to reinstate any of the suspended benefits at the time being.
“As disappointing as that may be, we are simply far too early in the year, and months away from seeing how the spring semester will turn out, for that to be considered,” he said in the forum. “The same is true for retirement plan contributions. There is simply no guarantee I can offer that we can commence those this year, even at reduced levels. If there is any chance to do that—if the spring goes exceedingly well, if revenue exceeds our projections, if we save more on expenses to offset any losses—we will certainly give every consideration to doing so.”
Emerson mandated weekly testing for all students enrolled in in-person courses in the fall—a requirement that will be increased to every four days during the spring semester. The Broad Institute, which provides and processes the college’s COVID-19 tests, charges colleges $25 for a single test. Next semester, faculty and staff will be required to take regular tests, too, shifting away from the opt-in program officials chose this fall that allowed employees to choose whether or not they would be tested weekly.
Since the college lowered its annual tuition increase from four to two percent in June, Dworkis said he expects revenue from tuition to decrease in the future. This year’s modest increase cost the college $3 million in revenue.
“We will need to be realistic in what our expectations for future tuition increases may be, given that the economic effects of COVID are still being experienced,” Dworkis said.