During the challenge of the COVID-19 pandemic, our financial operation was served well by a number of factors—deep scientific and public health expertise, data-driven decision-making, and clear institutional focus on teaching, research, and the well-being of our students, faculty, and staff. But perhaps none was as important as the dedication and shared sacrifice of our community members.
When we were forced to depopulate campus in March of 2020, we knew we would be facing significant budget uncertainties in the approaching fiscal year. Through the spring, the University modeled rapidly changing enrollment and operating scenarios resulting in the need to solve a $243 million total revenue shortfall.
By early summer, we introduced expense mitigation measures—including freezing hiring and pay increases, cutting senior leadership salaries, slowing capital expenditures, reducing discretionary spending, and suspending University contributions to employee retirement accounts for one year. These significant measures allowed us to offset the majority of the projected FY2021 revenue shortfall.
As a result of better-than-expected enrollment, federal pandemic relief funding, and the hard work of faculty and staff to reduce expenses, the University realized an operating surplus of $143 million for FY2021, and saw our endowment grow to $3.4 billion, up $956 million (39 percent) over FY2020. Our AA-/Aa3 credit ratings held steady, too.
Despite the extraordinarily trying circumstances, our institutional character, the resiliency of our community, and our commitment to providing a residential teaching and research experience allowed us to control our destiny, financially and otherwise.