The University of Kansas was among several public universities whose financial outlook for the coming year was downgraded by an S&P Global Ratings report, which was updated on April 29.
The University went from being ranked “stable” to “negative.” It joins Emporia State University and Kansas State University, who also had their outlook downgraded by S&P as a result of the economic impact of the new coronavirus.
The negative outlook for the University means there is at least a one-in-three chance operations and economic conditions will be worsened, according to the report. If classes do not resume in the fall, the University may lose revenue from housing, dining, parking and other fees.
“We expect to see stressed operating budgets, the scope of which will ultimately be determined by the magnitude of lost revenues, the duration of the pandemic, fall 2020 mode of instruction, and ultimate enrollment figures,” according to the report.
The report predicted an even bigger financial pressure if travel restrictions are not lifted, resulting in a drop in international student enrollment. International students make up approximately 7.8% of students at the University, according to the department of Analytics and Institutional Research.
Academic institutions across the U.S. are grappling with the financial toll that spurred from the new coronavirus. Financial impacts for public universities were expected to be largely affected if states cut funding for higher education.
“While public colleges and universities have benefited from annual increases in state operating appropriations for several years now, funding for higher education still remains below pre-recession levels in certain states, and some schools are still coping with the lingering effects of funding cuts on their finances,” the report said.
The University is working to mitigate the financial effects for its students. On April 28, student senators met to revise the coming year’s student fees. Chancellor Douglas Girod requested the fee remain flat to lessen financial pressures on students.
Student senators held an emergency fee review meeting Tuesday to decrease the student fee package to $491.95.
KU spokesperson Erinn Barcomb-Peterson said there are a number of unknowns preventing the University from knowing the full financial implications of the coronavirus.
"Although the full picture of the financial implications continues to reveal itself, the university has been estimating that initial losses undoubtedly will be in the tens of millions of dollars," Barcomb-Peterson said in an email to the Kansan.
Moody’s Investor Service reported in early April higher education as a whole would see financial pressure as student enrollments are projected to decline.