Spring semester at the University of Virginia ended not with a bang but the virus.
The pomp of Final Exercises went virtual. Walking the Lawn will be an altogether different circumstance. It’s postponed until fall, or maybe next spring. Too soon to know. So it was that those graduating in 2020 made history by becoming a makeup class: The University will make it up to you; meantime, look for your diploma in the mail.
The unfinished business of it all, the lack of closure to the academic year, is palpable, from abandoned laundry lying on dorm-room floors to outdated leaflets flapping on Lawn room doors. They are archeological artifacts of the University’s March 11 directive to students not to return from spring break as the SARS-CoV-2 pandemic approached.
It was a semester like no other, marked by a series of escalating exigencies and a cascade of executive orders to meet them. It ushered in an era of decisiveness and agility to an institution and an industry historically known for neither.
And it has introduced a time of prolonged suspense. What happens come fall semester is just coming into view. Under the best scenario—an on-time start to the academic year—normal returns some time hence, if ever. As we await a semester that may not properly begin, we consider the one that did not properly end.
Rising to the Contagion
The University began tracking COVID-19 and its implications before the U.S. confirmed its first known death. It captivated K. Craig Kent’s radar two weeks after his arrival as UVA’s executive vice president for health affairs. “By mid-February it was clear that, to any health system leader in the country, we needed to start thinking about it and preparing for it,” he says. “When it really exploded was somewhere between the first and second week of March.”
That’s when UVA issued its keep-away order to students during spring break—the week between Virginia’s first confirmed case of the respiratory disease and its first known death. UVA shut down Grounds the same day the World Health Organization declared the novel coronavirus a pandemic. The following day, March 12, Virginia Gov. Ralph S. Northam declared a state health emergency; the Atlantic Coast Conference halted the men’s basketball tournament, already two days underway in Greensboro, North Carolina; and the NCAA canceled all its spring championships.
Telling students to stay home was the easy part. More difficult was UVA’s declaration in the same memo that all classes would move online—and that such a massive, untested, technology-dependent undertaking would go live in eight days. And then it did, to the tune of 4,273 classes and 61,000 Zoom videoconference accounts, according to UVA Provost M. Elizabeth Magill (Law ’95).
In a video interview with Virginia Magazine, she and President James E. Ryan (Law ’92) both marveled at how the organization conquered the challenge. Said Ryan, “If you can take over 4,000 classes and put them online in eight days, it should give you a lot of confidence that you can be innovative and be nimble.”
The New Nimble
Nimbleness has become a recurring theme across Grounds throughout the crisis. Amid frustrations over the country’s delayed rollout of large-scale coronavirus testing, UVA Health developed its own test in mid-March, sharing it with other providers for use throughout a multistate region.
Several parts of the University stepped up when Kent’s team sought to make more COVID-19 beds ready in case of a surge in patients. In early March, the new health chief asked the departments involved whether an under-construction hospital tower could open a specially configured coronavirus unit ahead of the building’s scheduled debut.
“This is one of my first levels of amazement at UVA. I’ve been at a lot of different places,” says Kent, who has held medical positions at five universities. He figured if he pushed, he might be able to gain several days on the building’s July 1 start date. Instead, he says, “They came back to me about a week later and said, ‘We think we can open it April 3.’”
They were off by a day. The first beds became available April 2.
UVA Executive Vice President and Chief Operating Officer Jennifer “J.J.” Wagner Davis offers a similar example. In early April, after food services contractor Aramark Corp. laid off UVA dining services workers, the University committed $2 million to help them and others. The initiative, keyed to Ryan’s pre-pandemic pledge to make the University a model employer and neighbor, instantly drew good reviews.
The trick was figuring out how to distribute payment to someone else’s employees, especially when the shutdown meant they had no place to pick up a check. Electronic payment seemed the logical means, but with UVA’s being a major public institution subject to complex accounting standards, there didn’t seem to be an easy solution.
The finance team got the challenge on a Friday afternoon. The group’s reaction: “Hey, give us the weekend,” Davis says. “It was Zoom calls all weekend long with like 12 people from every facet of the organization.” By Monday they had designed an electronic payment system to get special funds to crisis-affected workers.
The University’s wealth manager tested its nimbleness months before this crisis. The University of Virginia Investment Management Company, the separate entity that oversees $9 billion in endowments and other assets for the University and affiliated organizations, including the Alumni Association, conducted a war game the previous May. It simulated something akin to spring’s wild market drops. CEO and Chief Investment Officer Robert Durden says the exercise gave UVIMCO the opportunity to update its playbook and reaffirm with its board its long-term investing strategy.
The experience came in handy when UVIMCO held a virtual board meeting March 12, with the participants seeming to maintain their cool as the Dow Jones Industrial Average took its deepest dive since 1987. “The message that we all … came out of that meeting with was kind of a ‘Walk, don’t run’ approach,” Durden says. “You do what you can. Like, you double down your efforts. You risk-manage. You overcommunicate. But also you walk. You don’t run, because you have to be humble in what you do and don’t know.”
Sometimes the true test of the ability to innovate is having the discipline not to.
The governor’s shelter-in-place order came a few weeks after UVA went into quarantine. Those tandem actions succeeded in slowing the spread of the coronavirus in Virginia during the spring. But as the curve of new infections flattened, UVA’s financials cratered.
The microeconomics of shutting down on-Grounds operations and the macroeconomics of the global slowdown put potential stresses on each of the academic division’s revenue streams: tuition; research grants; endowment returns; state funding; fundraising; and auxiliary enterprises like housing, dining and big-time sports.
On the expense side, the infrastructure and licensing costs of supporting online instruction actually increased teaching expense rather than mitigating it, both Ryan and Davis have said. So UVA is holding onto spring tuition, but it did return about $12 million in room and board payments, according to Davis.
Those refunds contribute to the $50 million to $100 million financial hit Davis projected the academic division will suffer for March through July. To offset it, the University on April 14 announced a series of austerity measures. They include freezes on hiring, salaries and unbegun capital projects, as well as a call for managers to cut nonessential spending previously budgeted for fiscal year 2021. In imposing the restrictions, Ryan reaffirmed a commitment to avoid furloughs and layoffs as long as possible, at least for the academic division.
For UVA Health, the other half of UVA’s business operations, the economic impact has been several times worse. The health system in mid-March began postponing elective surgeries and suspending outpatient visits to its doctors’ offices and clinics. By month’s end, the governor mandated such measures as part of his shelter-in-place order.
Health EVP Kent estimated in April that hospital usage had dropped to 50 to 55 percent of capacity, surgeries had declined by 70 percent and clinic traffic had slowed by 90 percent. Together, they contributed to operating losses averaging close to $3 million per day. So, two weeks after the academic division’s austerity news, Kent announced a UVA Health regimen, including physician pay cuts, furloughs and reduced hours for certain staff and an array of expense reductions.
Northam allowed nonemergency procedures to resume in May. Kent says UVA representatives had been talking with state officials about restoring some level of non-COVID services. Just because nonurgent procedures technically qualify as elective doesn’t make them less vital, he says. He cites prostate surgery. The cancer grows slowly, but a candidate for surgery will need it before it’s too late. Similarly, says Kent, “A person that needs a knee replacement, that’s in a wheelchair, would like to actually walk around again.”
Masks as Prologue
So would a University community confined in a lockdown. The pressing question for the administration is whether UVA can reopen on schedule for the next academic year. A significant delay further challenges the financials on both sides of the house, academic and health, and portends more drastic cost-cutting.
When it comes to modeling the coronavirus, however, no one can yet discern an all-clear. “It’s going to require us to make decisions before we have perfect information,” Ryan said at the Alumni Association Board of Managers meeting in April. “My guess is that a decision will have to be made sometime in June. But that’s the very first question we’re trying to figure out: What’s the last date by which we can make a decision?”
He’s looking to his provost for that answer and others. Ryan has put Magill in charge of a committee to recommend when and how UVA might reopen for fall—and when it has to make that call. Says COO Davis, a member of the task force, “It’s like a huge, multidimensional jigsaw puzzle, and then the key variable is the virus.”
No matter the timing, the start to the school year will likely come with public health conditions. It could mean students and faculty must wear face masks in the classroom. The University may need to find creative ways to mitigate the density of students’ living together in dorms. The leadership team is assiduously running through an array of scenarios and remedies. “The harder question is to think about how plausible is it for those distancing measures to work on a college campus, and how much does that interfere with or disrupt the academic enterprise,” Ryan told the alumni board, “and that’s really what we’re trying to get our hands around.”
As those deliberations continued during what remained of spring semester 2020, the grounds seemed not the Grounds. Every so often you could see a University bus without passengers run the one route that survived the pandemic. The ghost ship plied its way from Barracks Road Shopping Center, past the law school, onward to the farthest reaches beyond Scott Stadium, and then back again.
Eerily, you could find parking on Central Grounds. It was the smallest of consolations for that occasional fourth-year who made her way to the Lawn, put on cap and gown, and centered herself in front of the Rotunda. Then a friend made her a picture of what might have been.
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