Weekly Briefing: Signs of a financial death spiral.

It’s not just small, tuition-reliant colleges in trouble. [Weekly Briefing] Are you working remotely? Here’s how to maintain your premium site-license access to The Chronicle. If you’re used to having access to The Chronicle when you’re on campus, you can keep that access when you’re at home. Read this “[Site License FAQ]( to see how. It’s easy to do and gives you access wherever you are. --------------------------------------------------------------- These are the signs of a financial death spiral. [Image] iStock By Fernanda Zamudio-Suaréz Many people think they know the telltale signs of an institution about to go belly up. The stereotype goes like this: The college is small, underendowed, in a rural area, and leans on tuition and international students. These days, as college leaders and board members examine their empty campuses accumulating expenses, and make complex decisions about the fall semester, it’s not just the small, tuition-dependent colleges that run the risk of closure. ADVERTISEMENT [advertisement]( That’s why our Scott Carlson, who has spent years covering college finances, and James F. Galbally Jr., a financial adviser to colleges and a former finance officer, teamed up to write about the additional warning signs that show a college is in trouble. Here are three: - Your institution has never assessed the cost of its operation. Believe it or not, at many colleges, the costs of programs and departments and the return on investments in those programs is unknown. Some colleges, particularly smaller institutions, have never had the time or resources to conduct a thorough analysis. In a high-stakes moment, like a pandemic, this knowledge is essential. Knowing operational costs allows colleges to cut programs based on the reality of demand and revenue, not a perception. - Your institution relies on third-party contracts. Many colleges have long-term contracts that provide for services beyond academic programming. These contracts, often called public-private partnerships, or P3s, have private companies operate services like maintenance, housing, food, or energy. In many of these contracts, the private company is guaranteed a base payment over a decade or more, based on the projected use of the service. That means that a college can be contractually bound to make up the difference when fewer students enroll. - Your college is considering liquidating parts of its endowment. This is a desperate move, and requires board approval. But it can bring more problems. The institution needs to identify what parts of its endowment are restricted and unrestricted. The restricted funds legally can pay for only specific activities on campus. Ultimately, the liquidation puts the college at an increased risk because the now-smaller endowment loses money in the dismal stock market, producing a smaller return. Colleges have to make up for that loss somehow. [Read the rest of the warning signs here.]( Best of the rest. [Image] Photo Illustration by Ron Coddington Here are a few Chronicle stories about some universal struggles in how higher ed deals with the coronavirus. - [Why Is Zoom So Exhausting?]( - [A Side Effect of the Covid-19 Pandemic? Reading Got a Lot Harder]( - [The Quandary: How Available Should Faculty Members Be to Students Online?]( - [How to Salvage a Disastrous Day in Your Covid-19 House Arrest]( Lagniappe. [Image] PictureWendy via Creative Commons - ✏️ Learn. We’ve entered the stage of the quarantine where we want to duck out of Zoom calls with friends early. Your neighbor’s morning run — and slamming door — keeps waking you up. And you can’t ask your pals, “What’s new?” because nothing is new. [Here are the answers]( to lockdown etiquette questions. - 📚 Read. I love jigsaw puzzles, but this essay, “[I Wouldn’t Do a Puzzle If It Were the Last Activity On Earth]( is too hilarious not to share. - 🎧 Listen. If you’re into short, captivating stories about the fall of well-known rulers, listen to the podcast [Noble Blood](. Most episodes are around 30 minutes, a nice soundtrack for your afternoon walk. - 📺 Watch. [This clip]( sews together outtakes from black-and-white movies, back when, “Nuts!” was a more common expression of frustration. I’ll be back next weekend. In the meantime, try to take a break from Zoom, and maybe call your friends and family. You know, the old-fashioned way. Cheers, Fernanda Subscribe Today Our mission, at a time of crisis and uncertainty, is to make sure you have the information you need to respond effectively, and make the best decisions for your institution and your students. Please consider subscribing today to sustain our continuing coverage. [Subscribe Today]( This Week's Top Reads Faculty [Why Is Zoom So Exhausting?]( During our seclusion due to the coronavirus, videoconferencing seems like the closest thing to holding a meeting or teaching a class face to face. Maybe that’s part of the problem. ADVERTISEMENT [advertisement]( Advice [How to Salvage a Disastrous Day in Your Covid-19 House Arrest]( Here are three ways to get yourself unstuck on those particularly bad pandemic days. Advice [The Quandary: How Available Should Faculty Members Be to Students Online?]( Plus: Tips for virtual programming to boost student engagement. Get guidance on common concerns in our Q&A series. Paid for and Created by Indiana University [Sparking hope for a 'hopeless' disease]( Home to one of the most comprehensive Alzheimer’s research programs in the nation, Indiana University’s School of Medicine seeks to advance Alzheimer’s research on all ends of the spectrum: prevention, cure and maintenance. Faculty [A Side Effect of the Covid-19 Pandemic? Reading Got a Lot Harder]( That’s made professors more empathetic to what their students are going through. Paid for and Created by Huron [Working Together for Student Success]( Connecting students with valuable resources, faculty members are collaborating with career services to guide students as they explore potential career opportunities, aligned toward a common goal of helping students find meaningful first jobs after graduation. Latest Jobs Visit [ChronicleVitae.com]( to view the latest jobs in higher education. --------------------------------------------------------------- [Sign up]( for other newsletters, [stop receiving]( this email, or [view]( our privacy policy. © 2020 [The Chronicle of Higher Education]( 1255 23rd Street, N.W. Washington, D.C. 20037 [The Chronicle of Higher Education](