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Cutler Hall on Ohio University's campus in Athens, Ohio. (FILE)

Nellis shares OU’s financial position amid COVID-19 pandemic

Ohio University President Duane Nellis informed faculty members Tuesday about the university’s financial situation, including that he will take a 15% pay cut during the upcoming fiscal year.

Nellis said in an email to faculty members he expects the impact on OU revenues to “grow significantly” in the coming weeks and months.

Nellis and interim Provost Elizabeth Sayrs have both agreed to take a pay cut of 15% to their base salaries. They will both also not take any performance bonus during the next fiscal year.

Nellis normally makes $489,357, but with a 15% cut, he will make around $415,953.

“This global crisis will force permanent changes in communities worldwide, including here at Ohio University,” Nellis said in the email.

Just from refunding housing, dining and parking fees, OU has lost over $18 million in revenue this year.

All in-progress capital projects will be reviewed, and all new capital projects have been suspended. OU will also reduce its space in a way that protects OU’s student experience.

Nellis said OU will reduce management positions where possible as well as streamline administrative positions to reduce costs that don’t directly impact students and instruction.

OU announced March 25 that budget reductions would be paused during the pandemic.

In a message Feb. 28, Nellis said the scope of reductions is significant, and there would be about $26 million in reductions on the college level over the next three years while at least $8 million would be cut in administration, according to a previous Post report.

The Board of Trustees has also approved OU to use $65 million from its reserves through the 2024 fiscal year.

There will also be a hiring freeze where only critical positions will be hired. Those positions will be determined by a hiring review committee. 

On top of that, employee recognition awards will be suspended. Those awards are given to employees for their productivity, attendance and employee morale.

Officials from the OU chapter of the American Association of University Professors did not immediately respond for comment.

University leaders have been asked to reduce their operational spending to essential purchases.

OU also lost revenue from study abroad trips being canceled as well as summer camps and athletics.

There has also been a reduction in the NCAA’s revenue distribution since the winter and spring championships were canceled.

The NCAA announced March 26 it is only going to pay Division I schools $225 million instead of $600 million. About $50 million is coming from the NCAA’s reserves, according to an NCAA news release.

Most of the NCAA’s revenue comes from March Madness, which was canceled due to the COVID-19 pandemic.

Ohio Gov. Mike DeWine has instructed universities to prepare for budget cuts of up to 20% for the remainder of the 2020 fiscal year and the 2021 fiscal year. 

That would be over $8 million lost for OU for the rest of the 2020 fiscal year, which ends on June 30. OU would lose about $35 million in funding from the state for the 2021 fiscal year.

OU does not know exactly how much money will be lost from lower student enrollments. Nellis said data shows some students will be forced to change or delay their college plans for economic reasons.

Federal funding to OU from the CARES Act will provide OU about $9.7 million as well as another $9.7 million for emergency grants that will be directly distributed to students in need.

The funds will help offset losses, but it falls short of a growing gap, Nellis said.


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