This document, issued by the Council on Governmental Relations in July 2020, provides an overview of the funding sources available to research universities in the context of the profound challenges posed by the COVID-19 pandemic and the associated economic downturn. It highlights that institutions across all types—public and private, with or without medical schools—are facing a deep financial crisis, driven by diminished revenues from traditional streams such as state appropriations, tuition, clinical revenue, and auxiliary enterprises. Universities have been compelled to implement stringent cost-cutting measures, including hiring and salary freezes, layoffs, and operational ramp-downs, while simultaneously incurring unexpected expenses related to ensuring safe operations and shifting to remote modalities.
The document categorizes university funding into unrestricted and restricted sources and systematically assesses each one’s current status. Most major funding sources—state appropriations, tuition and fees, endowment income, gifts, clinical revenue, and auxiliary enterprises—are classified as at-risk due to reduced revenues, enrollment uncertainties, market volatility, and the broader economic climate. While federal grants and contracts have been somewhat stabilized through short-term regulatory flexibilities, other grants, reimbursements, and discretionary reserves remain strained, and emergency federal and state relief offers only partial mitigation and is limited in scope. In conclusion, the report underscores the existential threat facing research universities, the pressing need for transparent financial management, and the likely continuation of financial uncertainties into the foreseeable future, necessitating careful allocation of resources and ongoing adaptations to institutional policies and practices.
