UW System Wants To Borrow for Pandemic Costs
President Ray Cross asks legislature to convene a special session.
As campuses moved to online education in the spring semester, schools were hit with added financial burdens. Now System leaders are working to figure out how to hold in-person classes in the fall.
To address these issues, Cross asked Gov. Tony Evers, Senate Majority Leader Scott Fitzgerald and Assembly Speaker Robin Vos to allow the System to borrow money as a way to deal with added costs, allow classes to start before Sept. 1 and lift some regulatory requirements.
“As we plan for fall semester, our universities are determined to find creative solutions to safely deliver quality education to students on-campus and through alternative delivery models,” Cross wrote. “However, we face significant financial and operational challenges that are made much worse by the ever-changing nature of the pandemic. As seen throughout higher education, our costs are increasing, and revenues are decreasing dramatically.”
Under state law, schools are unable to start classes before September — with the exception of medical schools and some veterinary school classes. If that requirement is lifted for the 2020-21 school year, Cross said schools could complete the fall semester by Thanksgiving in an attempt to avoid an anticipated fall spike in COVID-19 infections.
To justify his request for a line of credit to assist with cash flow, Cross pointed to another Big Ten institution, Indiana University, which recently opened a $1 billion line of credit to help with lost revenue.
“The UW System is requesting the ability to responsibly access credit markets to open a line of credit should there be any further fiscal challenges created due to COVID-19,” Cross wrote. “This will allow our institutions to use a tool, available to the private sector and other public and private institutions of higher education, to assist with our cash flow.”
He also said any debt would be held by the System, meaning the state isn’t liable.
Finally, Cross asked the state leaders to ease some reporting requirements to open up staff time and resources to focus on getting safely through the semester.
“The UW System is one of the most regulated higher education systems in the country, and these reporting requirements are more burdensome during these difficult times,” he wrote. “We are devoting as many of our resources as possible to helping get students and institutions ready for fall semester. Reducing the number of required reports will provide cost savings and free up staff resources at a time when our campuses need them the most.”
He said the System was asking for relief measures included in 2019 SB 486. The bill, which never advanced, and therefore died with the end of session in March, would have exempted the UW System from filing a number of reports required by state agencies and changed some reporting guidelines around campus sexual assault.
Spokespeople for Vos, Fitzgerald and Evers did not immediately respond to requests for comment, but Vos spokeswoman Kit Beyer told the Wisconsin State Journal that the speaker plans to discuss the request with the Assembly Republican Caucus.
The University of Wisconsin System Board of Regents is scheduled to meet Thursday.
Reprinted with permission of Wisconsin Examiner.