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BOSTON – Warning that the pandemic continues to create financial uncertainty, UMass President Marty Meehan told a Board of Trustees committee today that it will be critical for the university to remain disciplined in its financial management to ensure the university remains financially sound and positioned to drive the Massachusetts economic recovery.

“Just as we have employed a science-and fact-driven approach to keeping our students and staff safe during this public health crisis, we have based our budgetary decisions on what we know to be rather than what we hope to be,” Meehan said. “We are dealing with a public health crisis and a huge financial challenge. The stakes are very high.”

President Meehan’s comments to the Committee on Administration and Finance prefaced Senior Vice President for Administration and Finance and University Treasurer Lisa Calise’s latest update on the budget for the current fiscal year. Treasurer Calise reported that since the last update in September the five-campus university has adjusted its projections to include:

• $76 million more in state funding due to level funding of the base appropriation.
• $21 million more in tuition and fees due to better than expected enrollment.  
• $80 million less in housing and dining revenue due to fewer than projected students returning to campus.
• $19 million in new expenses due to added COVID-19 safety-related initiatives.

The latest budget adjustments leave the university with a projected $335 million budget shortfall requiring a comprehensive set of expense reductions. The shortfall is caused primarily by the loss of housing and dining revenue (now projected to be $235 million for the year) resulting from fewer students living on campus as they engaged in remote learning. Decisions regarding the number of students allowed to return to campus were informed by safety concerns of faculty and staff unions as well as officials from surrounding communities.

With a slight budget deficit of 0.3 percent, campuses in Amherst, Boston, Dartmouth and Lowell are continuing to implement solutions that would have them finish this fiscal year in balance. The university is currently projecting a positive operating margin of 0.4 percent when one factors in the UMass Medical School’s projected operating results.

“The process, which is ongoing because the facts on the ground continue to change, has been professional, rational, and fact-driven,” said Committee Chairman Stephen Karam. “Every effort is being made to reduce costs in ways that protect the core mission of the university, which is student success.”

Recognizing the economic hardships that students and families across the Commonwealth are facing, the Board of Trustees at President Meehan’s recommendation, froze tuition rates for in-state undergraduate and graduate students this year, forgoing a planned 2.5 percent increase that would have generated nearly $15 million.

UMass officials have advocated tirelessly for public and private support for the university and will continue that effort, Meehan said.

“The Chancellors and I have worked together in advocating for state support, and I want to publicly express my appreciation to Governor Baker, Senate President Spilka and House Speaker DeLeo, Secretaries Heffernan and Peyser, and Ways and Means Committee Chairs Rodrigues and Michlewitz for supporting UMass throughout this unprecedented budget process,” he said. “The Commonwealth is sending a clear message that a strong UMass is critical to the futures of our 70,000-plus students and the Commonwealth’s post-pandemic economic recovery.”

President Meehan said he continues to advocate for more federal funding for UMass and for public higher education by staying in “regular contact with our congressional delegation and with congressional leadership” and making the case through his work as member of the board of the Association of Public and Land-grant Universities.

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