Page 37 - 2019-20 CAFR

Rogue Community College

Fiscal Year Ended June 30, 2020

of our budget planning cycle, the College did not incorporate potential impacts of the crisis due to the
extreme uncertainty COVID-19 introduced into the economy.

The speed of policy changes affecting our federal, state, and local economies continues to impact our ability

to accurately forecast. Prior to COVID-19, most government policies attempted to encourage economic

growth and preserve employment. These policy changes took months, even years, to be adopted, enabling

accurate incorporation of the changes into forecasts. During the pandemic, policies are focused on saving

lives and take only days to adopt. This constant flurry of change is impossible to accurately incorporate into

a forecast.

In addition to the constant start and stop of local economies, the stimulus packages are impacting our ability

to create accurate forecasts. The unprecedented amount of federal aid from the Coronavirus Aid, Relief, and
Economic Security (CARES) Act passed on March 27, 2020 potentially slowed the economic pain of the

recession. Oregon is benefiting from the taxes assessed on the enhanced unemployment insurance as well as

tax collections associated with federal aid for businesses. As the pandemic continues from season to season,
without additional federal aid, the impact of additional lockdowns is unknown.

Oregon is also dealing with the aftermath of wildfires, drought, protests and clashes of violence throughout

the State. With so much turmoil in Oregon fewer households and investments may be attracted to the state

moving forward. To the extent quality of life has been reduced, or if Oregon is perceived as a riskier or costlier
place to live and do business, overall growth will be slower.
Traditionally Oregon’s recessions are more severe than those experienced at the national level. However,

Oregon’s employment, unemployment, and personal income are currently changing at a nearly identical rate

as those experienced at the national level. This may change moving forward as the underlying shock works

its way through the economy, and migration slows due to fewer job opportunities.

Regionally, Southern Oregon suffered significant damage when wildfires destroyed whole communities.
Although devastating, the impacts of natural disasters are usually temporary in nature with the affected

region made economically whole within a year. However, a key question is to what extent the lost

communities will be fully rebuilt. There is a chance some of the damage will be permanent in that not all the

homes will be rebuilt, not all the local businesses will reopen, and the like. Access to capital is key, in terms

of financial assistance, disaster relief, a well-functioning insurance market, legal and regulatory forbearance,
and so forth.
In response to
the COVID-19 pandemic the State of Oregon suspended in-person instructional activities at
institutions of
higher education starting in March 2020. In just over two weeks, the College converted to

an essentially all-online college, with instructors and staff working remotely. Most of the costs associated

with this transition will be covered by the CARES: Higher Education Emergency Relief Fund, Institutional

Portion of $1.26 million. While most of our additional costs are covered, the decline in enrollment is

weakening our financial security, as tuition and fees represent 1/3 of our overall revenue.

Due to the College offering only an on-line educational model, Spring term tuition and fees for credit

programs declined approximately 10%. In addition, the College canceled all in-person community
education, truck driver training, and driver’s training courses for spring term. Tuition and fee revenue for
credit programs for summer and fall terms experienced a sharp decrease of 25%. The 25% decline in credit
tuition and fees is expected to continue the remainder of the academic year, reducing overall tuition and

fee revenue for credit programs by $3.2 million. In addition, all in-person community education, truck

driver training, and driver’s training courses for spring term 2021 will remain canceled.
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