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Illinois universities losing millions as students stay home

UIC expects to lose $15 million with the number of students living on campus slashed in half, while Loyola expects a $50 million hit.

The University of Illinois at Chicago could lose $15 million revenues this fall with fewer students living on campus.
Pat Nabong/Sun-Times

Illinois colleges and universities are facing multimillion-dollar deficits as they prepare to reopen this fall while the coronavirus pandemic continues to take a huge toll.

A significant hit is coming from the dwindling number of students living on campus — a number that has been slashed in half at some schools and eliminated completely at others. Another hit is coming from the huge expenses of making dorms and classrooms safe for those who do come to campus.

Meanwhile, students are demanding discounts in tuition and fees — which would create more problems for schools’ bottom lines.

Nationwide, only 9.3% of students plan to live on campus this fall, according to a July survey by Real Estate Witch.

At the University of Illinois at Chicago, about 3,400 students lived on campus in fall 2019. This fall, that number will be slashed in half, to about 1,700 students. As a result, the university is losing about $15 million in room and board fees, said university spokeswoman Sherri McGinnis Gonzalez.

The U. of I.’s Champaign-Urbana campus estimated costs to respond to the pandemic had led to $70 million in financial losses in April. Though numbers aren’t finalized, the university expects about 2,500 fewer students to live on campus this fall, down from 8,800 last year. With average room and board fees at more than $12,000 for the year, that could signal a loss of tens of millions of dollars if the pandemic’s impact continues through the end of the school year.

Meanwhile, the Real Estate Witch survey found that 88% of the 1,000 students surveyed believe online classes should be cheaper. But of the 100 colleges surveyed — including DePaul University, the University of Illinois at Urbana-Champaign and the University of Chicago — less than 3% plan to reduce tuition this fall.

Nearly 4,000 students at Loyola University have signed a petition that fall tuition should be reduced. Northwestern University went as far as requiring students sign an agreement acknowledging tuition won’t be discounted for online classes.

“It’s all about value,” said Tony Minestra, president-elect of the Illinois Association of College Admission Counseling. “Is distanced learning in pajamas worth $65,000? For some families, it is, and for others, there are really hard questions to ask.”

Dean Darhussein a undergraduate majoring in physics at the University of Illinois at Urbana-Champaign stands in front of his Tinley Park home, Wednesday, Aug. 12, 2020. Darhussein like many college students will be staying home and taking classes online amid the coronavirus pandemic. | Tyler LaRiviere/Sun-Times
Dean Darhussein, an undergraduate majoring in physics at the University of Illinois at Urbana-Champaign, while stay home in Tinley Park for online classes this fall.
Tyler LaRiviere/Sun-Times

Dean Darhussein, a rising junior at University of Illinois at Urbana-Champaign, found himself asking those questions when he weighed whether to return to campus this fall.

Darhussein, 20, considered deferring classes for a year or enrolling in community college to save money since his classes will be online. But he decided to stay at the university to maintain the scholarships he’s receiving but will save room and board costs by completing fall semester from home in Tinley Park.

“I felt like I was going to be stuck in a tiny dorm room for four months,” said Darhussein, who's studying physics. “I know myself, and mentally, I’d go a little insane. ... If I’m going to do it online, I’d rather do it at home.”

With students seeing less value in online classes, combined with financial pressures like parents losing jobs, colleges will likely see declines in enrollment, said Francesca Ortegren, a data scientist at Clever Real Estate, the sister company of Real Estate Witch.

Loyola is anticipating at least 200 fewer freshmen enrolled this fall, officials said late last month. The university also announced last week that all dorms will be closed for the fall.

The school in July projected at least a $50 million decline in revenue, due in large part to declines in freshman enrolling or living on campus, as well as its suspension of the student activity fee. That estimate was released before the university announced dorms will remain closed this fall — housing and meal plans usually make up $65 million of the school’s revenue.

University spokeswoman Anna Shymanski Zach said it’s “too early” to quantify the total financial impact of not having students living in dorms.

For schools, dealing with the fallout won’t be easy, said Minestra, who is also a college counselor at DePaul College Prep, a private high school. Budgets are often set a year — or multiple years — in advance, he said.

“It’s a tough conversation,” Minestra said. “Do you lean into your human resources, your professors, to fight through this storm, or do you repurpose what education looks like on your campus?”

While prominent, selective private schools typically have healthy endowments and can better “weather the storm” financially, smaller schools or state institutions depending heavily on tuition will need “totally different” revenue streams this fall, he said.

“It’s not as simple as simply prorating or cutting the cost [of tuition] because there are still bills to be paid,” Minestra said. “There are some costs schools simply can’t untangle themselves from. They’ve got to run the campus, got to pay professors.”