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COVID-19 Updates: IRS Guidance on Sick Leave, Operations Survey, Institutional Finances, Privacy Concerns

By Net Assets posted 03-25-2020 09:49 AM


(from EdWeek) As of Tuesday, March 24, 124,000 U.S. public and private schools have been closed, affecting at least 55 million students. Maine, Iowa and Nebraska are the only states in which some schools remain open. 

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The IRS has released guidance for small and midsize businesses on implementing coronavirus-related paid leave for workers as well as tax credits to recover the costs.

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Krista Webb, director of finance and operations at Christian Academy of Knoxville, put together an informal survey regarding school operations in the wake of school closures. Thus far, about 150 independent schools have responded to questions on length of school closure, who works on campus/remotely, non-exempt employees and payroll, tuition refunds, and more. 

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Current scenarios suggest that the economic impact of the COVID-19 crisis could mirror the Great Depression, when the real gross domestic product sank more than 30% and unemployment rose to up to 25%. Among the most important ways macroeconomic trends will affect resources for education are decreases in philanthropy and endowment returns. School leaders should start developing models and anticipate what levels of revenue drops may occur on their campus, as substantial variances are likely based upon the type of institution and historical financial models, said Paul N. Friga of the University of North Carolina. He believes tuition increases, which were used widely during the 2008 recession, will not be a viable option this time around. Schools should consider cutting costs in administrative and academic areas instead. 

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Decision making at educational institutions has taken whole new forms during the COVID-19 crisis. Distinguishing between "urgent" and "important" decisions can help processes run efficiently. Ted Mitchell, president of the American Council on Education, broke down leadership’s priorities into three groups: student and personnel safety, systems resilience, and continuing the work of the college. As campus operations slow or close, some colleges are reassigning employees, such as librarians or admissions professionals, to areas with greater need at the college. And it's likely more and more colleges will implement hiring freezes in the coming weeks.

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As schools have pivoted to online learning, some privacy experts worry about unintended consequences. Ensuring educational software doesn't violate the Family Educational Rights and Privacy Act (FERPA) is one key issue, and the potential for increased surveillance of students is another. FERPA, for example, allows schools to use contractors and consultants for services -- including for online instruction -- but the contracts need to include stipulations to protect student privacy under the law. Most importantly, if the vendor collects any data on its users, the school has to be the owner of that information. This means that the data can only be used or redisclosed at the school's direction.

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