Updated: Dec. 14, 2020 at 5:39 p.m.
Based on current data about the COVID-19 vaccine, University President Thomas LeBlanc says a full return to campus next fall seems “unlikely.”
LeBlanc said at the Faculty Senate’s final meeting of the semester Friday that some faculty, staff and students may not have access to the vaccine by next fall, but officials will likely be able to “do more than we’re doing now” on campus. He also confirmed at the meeting that expected layoffs resulting from the pandemic for the fiscal year, which have saved the University $32 million, have concluded.
“Obviously we will have our eyes on a fall reopening if it’s possible, and we’ll be watching the data very carefully on the distribution of the vaccines and using that to ultimately guide our decision on how we reopen in the fall,” LeBlanc said.
Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, said the United States could see the “overwhelming majority” of the population vaccinated by the end of the second quarter of 2021. But he said masks and social distancing measures will still be needed throughout 2021 because the vaccine is not 100 percent effective.
LeBlanc said officials saw an increase in requested COVID-19 tests and a “modest” increase in positive cases among the on-campus cohort after Thanksgiving break, which he said is likely tied to an increase in travel around the holiday.
“It looks like there’s a slight uptick in our positivity rate, but we have to remember that off-campus students self-select to get tested, and therefore they are kind of a unique population in that regard, a bit of a biased sample,” he said.
Provost Brian Blake said at the meeting that officials have finalized certain GW Law courses and courses at the Arlington campus to be held in a hybrid format during the spring semester.
Senators also provided a report on GW’s finances for fiscal year 2020 and discussed budget scenarios for the upcoming fiscal year.
Joe Cordes, a faculty senator and a professor of economics, said administrators implemented two phases of budget mitigation in FY20 to deal with the pandemic’s financial impact on the University. He said the first phase included 339 layoffs; the elimination of about 150 vacant positions that officials had initially budgeted for, which saved about $47 million; a temporary merit pay freeze, which saved about $15 million; and expense reductions like cutbacks in travel, which saved about $38 million.
He said phase two included the temporary suspension of retirement contributions in August, which saved about $27 million, and expense reductions at the school and unit levels, which saved about $21 million. Cordes said the phase also included using $20 million in “unrestricted assets” that the Board of Trustees made available, but he added that he is not sure if the money came from the endowment, which officials had previously vowed not to tap into in response to the pandemic’s financial impacts.
Cordes said officials indicated to him at the time he created his presentation for the report that restoring part of GW’s suspension to retirement contributions is a priority in the next fiscal year.
“I’m told that this is highly likely, but it needs to be run by the Board, so that’s where we are right now,” Cordes said.
He said GW has opportunities going into the next fiscal year to generate more revenue through potential increases in enrollment, which would provide more tuition revenue, and an increase in the University’s housing capacity after Thurston Hall renovations are completed. But he said those goals could also be challenged by national trends indicating a decrease in undergraduate enrollment.
Cordes outlined three scenarios for fiscal year 2021 – a pessimistic scenario in which the University remains fully online, a “moderately optimistic” scenario in which students return to campus and enrollment projections for FY21 remain the same and an optimistic scenario in which enrollment is higher than projected for FY21 and students return to campus.
He said GW’s endowment performance should be improving because 25 percent of it was previously invested in private equity, but that amount has decreased to 8 percent. Investment experts have criticized private equity investments for being risky despite their potential for high returns.
“We can hopefully look to improve endowment performance,” Cordes said. “We’re starting the 200th year campaign, which hopefully will bring in some additional resources.”
Cordes also said the A1 credit rating that GW received from Moody’s Investors Service in October was better than some of GW’s peer schools like the University of Miami and D.C.-area schools like American and Georgetown universities. He said A1 is a “pretty good” rating and is the third-highest rating that GW could have received, with AA being the best possible rating.
“The main thing to look at here is kind of how they’ve characterized us,” Cordes said. “The way I would put it is that our financial situation is very sound, very solid.”
He added that Chief Financial Officer Mark Diaz said Standard and Poor’s, a New York City-based rating agency, will release its own evaluation of GW’s credit soon, which he expects to be similar to that of Moody’s.
Susan Kulp, a faculty senator and professor of accountancy, said FY20 was the first full year of the Medical Faculty Associates’ consolidation with GW, and a “big part” of the University’s losses comes from the MFA.
Officials announced in December 2018 that they would restructure the relationship between GW and the MFA to increase the University’s decision-making power and provide increased responsibility over the MFA’s annual budget and CEO.
She said the University faced a $61 million loss this year, with $43 million coming from the MFA. Kulp said the University faced a loss of only $14 million during fiscal year 2019 since the MFA consolidation occurred after the the year began, demonstrating that the MFA provided a “significant impact” on the University’s finances this fiscal year.
Cordes, the faculty senator, said the losses due to the MFA consolidation are likely a result of the COVID-19 pandemic since doctors could not provide certain basic services or elective procedures for some time.
“The hope is that the new arrangement is going to lead to, I would say, better cost and management control, and that should improve matters,” he said.
Kulp said officials also changed GW’s auditor from PricewaterhouseCoopers to Grant Thornton this fiscal year, which she said is “unusual,” but the new auditor has provided better service to GW for a lower cost.
“All accounts are that the new auditor is fabulous and responsive, and this was a GW-initiated process,” Kulp said.
Arthur Wilson, the chair of the Faculty Senate executive committee, said executive committee members are working to develop a survey of LeBlanc’s leadership and communication abilities after faculty voted to conduct a review of LeBlanc at last month’s Faculty Assembly meeting.
Wilson said officials will release the survey “on or about” Tuesday, and it will be open for faculty to fill out for one month. He said officials will make the findings of the survey available “sometime in February.”
Senators also unanimously voted to approve the nomination of Tarek El-Ghazawi, a professor of engineering and applied sciences, to the senate’s research committee.