Housing and Dining faces financial toll after offering a ‘compassionate’ approach with student contract cancellations
University of Iowa Housing and Dining shared an annual report at the state Board of Regents meeting on Wednesday. Less students lived in the residence halls at the UI and the housing and dining system reported millions of dollars in losses.
The Old Capitol building is seen from the T. Anne Cleary on Feb. 10, 2021.
February 24, 2021
Occupancy at Iowa’s public universities’ residence housing significantly dropped in fiscal 2021 because of the pandemic, causing millions of dollars in financial losses, but university leaders expect numbers to rebound next fall.
The COVID-19 pandemic had a large impact on the state Board of Regents-governed institutions’ residence systems, causing 80 percent fewer residents since July 1, 2020, according to the Residence System Governance report.
The University of Iowa residence system followed trends similar to the two other regents-governed intuitions, Iowa State University and the University of Northern Iowa.
Contract revenues, canceled conferences and camps, retail sales, and catering revenues had a negative financial impact on all regents’ universities, the report stated.
Von Stange, assistant vice president for student life and senior director of UI Housing and Dining, told the regents on Wednesday that holding UI students to their housing and dining contracts during the academic year at the beginning of the pandemic would have been a better decision for business. The UI lost an estimated $15.85 million from giving student refunds for housing contracts and meal plans after universities sent students home and transitioned classes online in March last year.
But, Stange said, the pandemic requires a more compassionate approach.
“Everyone has been impacted by the pandemic,” Stange said during the meeting. “Parents may have lost jobs, savings from college may have had to be used for other purposes. Housing and Dining will suffer financially, but we’ll be okay.”
Like the UI, Iowa State University and the University of Northern Iowa also canceled student residence hall and dining contracts and made refunds last spring because of COVID-19, Associate Vice President Campus Life at ISU Pete Englin said.
ISU closed residence halls in March 2020 and refunded students, costing $14.5 million.
“The state and regional travel restrictions kept changing and it just wasn’t fair to require students to come back [to campus],” Englin said
For the second year in a row, UNI will not increase room and board rates for fiscal 2022 to stay competitive with the market.
“While that is not likely a long-term strategy, we’ve reflected carefully on this position,” Senior Vice President for Finance and Operation at UNI Michael Hager said at the regents meeting. “We have worked hard to avoid any layoffs of merit and P & S staff this year in order to help the local and state economy.”
In March, the Office of Postsecondary Education was awarded $14 billion from the Higher Education Emergency Relief Fund (HEERF) to nationally aid universities with financial losses.
The COVID-19 pandemic resulted in a decrease of student residence housing occupancy compared to previous years at the UI, the report stated.
Fall 2021 admissions to date indicate a positive rise of first-time students at the UI for residence housing, the report said.
“Our plan for next year is dependent on our first year class size. We expect the first year class to be larger than fall of 2020, but less than 2019 because of pandemic levels,” Stange said.
As previously reported by The Daily Iowan, UI students were refunded their housing and meal plans after the UI transitioned to virtual instruction in the fall.
“To help reduce operating costs, UH&D required temporary furloughs of up to 200 hours for members of the dining merit staff,” the report said.
The regents and the UI reported financial losses from the residence systems in several areas.
- An estimated $15.85 million lost to student refunds in housing and meal plans for the spring semester.
- An estimated $1.5 million of lost income because of the cancellation of summer camps and conferences hosted in residence halls in the spring semester.
- An estimated $3.67 million of semester revenue loss because of 702 UI student housing and dining contract cancellations for the fall semester.
- An additional estimated $3 million loss of revenue after students with canceled housing and dining contracts did not return in spring 2021. This financial loss was also made up by temporary furloughs of 40 to 80 hours for professional & scientific and merit staff not furloughed in the summer.
UI Housing and Dining received federal funds to “offset a portion of the revenue decline,” the report said.
This fiscal year, the UI’s residence and dining hall system is expected to be under budget because of staff reduction, rescheduling retail and catering operations, decrease of food costs, and decreases in utility and other operating expenses, the report said.
A few more than 700 UI students were released from their housing and dining contracts during the fall semester.
The report said that only 120 of those students with canceled contracts returned to UI residence housing for the current semester.
Stange said this year has been difficult for UI Housing and Dining. Projects to improve the residence hall system and dining operations will be postponed for years in the future, he said.
“Once COVID-19 has passed, it will take some time to fully recover and replenish the system reserves to allow for the appropriate level of capital project funding,” Stange said.
