Adding Up the Damage

To make the case for U.S. aid, higher ed groups tally cost of colleges' Katrina cleanup: over $2 billion.
November 14, 2005

It's perhaps a sign of our times, and not necessarily a heartening one, that when catastrophes like the recent hurricanes in the Gulf Coast occur, affected individuals and groups often end up standing in line to show just how seriously and significantly they've been affected. That's especially true when, as is almost always the case, the parties turn to the federal government for help.

Higher education usually loses these kinds of competitions (as colleges, with increasing frequency, seem to be lagging in the eyes of foundation officials and donors to charity), as elementary and secondary schools, groups that help the aged or infirm, sometimes have easier or more poignant stories to tell. (It's also the case that government money occasionally flows not to those with more perceived need but to those with friends in high places.)

In the wake of Hurricane Katrina and Rita, as the federal government has poured billions of dollars into efforts to clean up and rebuild affected areas in Louisiana, Mississippi and Alabama, little of the money has flowed to colleges, to the dismay of higher education lobbyists and leaders (the government has waived several financial aid rules that help affected colleges and students). As federal officials formulate plans for a third "emergency supplemental" appropriations bill, several higher education associations have sought to make the case for the needs of area colleges and universities.

To bolster their argument, they have put together the most comprehensive estimate yet of the costs of damage to and potential losses suffered by 27 institutions in the three states. 

The numbers in the estimate, which those who crafted it say are conservative, are eye-popping: $1.2 billion in estimated physical damage to the campuses. Potential losses of $230 million in tuition that the institutions have refunded to students who left or that they expect to lose because of diminished enrollments now or, in the case of the dozen that remain closed, when they reopen. And hundreds of millions more in salaries and benefits paid to faculty and staff members who are not working, along with some other miscellaneous costs. 

All told, says Cynthia J. Littlefield, director of federal relations for the Association of Jesuit Colleges and Universities, who spearheaded the effort to collect the damage information, colleges in the area have between $2 billion and $2.4 billion in “disaster losses,” and the institutions are asking Congress for more than $3 billion, with the hoped-for additional funds going for grants to encourage faculty and staff members and students to return to the closed campuses when they reopen. 

“Members [of Congress] have seen a gazillion requests from individual institutions and entities about what is needed,” Littlefield says. “We thought it was important to do, as best we could, an approach that showed the devastation and damage for higher ed in the region. We think that's resonating in that it's making it easier for these people to understand.”

The United Negro College Fund, which represents several historically black colleges that were among the colleges most significantly damaged by Hurricane Katrina, led the way in crafting the legislation seeking disaster funds. Among the other groups involved both in collecting the information on colleges’ damages and in lobbying for the funds are the American Association of Community Colleges, the American Council on Education and the National Association of Independent Colleges and Universities. (Independent requests for federal funds have reportedly come from a group of Gulf Coast colleges led by Tulane University and from the Louisana Board of Regents). 

The damage figures provided by the colleges, which those who put it together said represent the institutions’ “best good faith estimates,” vary greatly. 

In Louisiana, Southern University’s New Orleans campus and Dillard University reported the most physical damage, estimating their (pre-insurance) costs at $350 million and $282 million, respectively. Delgado Community College, Tulane University and the University of New Orleans, all of which remain closed, also reported physical damage over $100 million (see table below), while Loyola University of New Orleans and Our Lady of the Holy Cross College reported physical damages of $4 million and $2.7 million, respectively.

In Mississippi, Pearl River Community College reported by far the most physical damage, at $50 million, followed by Mississippi Gulf Coast Community College ($15 million) and William Carey College ($12.8 million).

The $230 million in lost tuition revenue (see figures below), Littlefield said, include tuition dollars for which students and their families have sought refunds or that institutions estimate having already lost or expect to lose because of current students who have decided not to re-enroll.
Although most colleges that took in Katrina-accepted students agreed not to charge them a second time for tuition they’d already paid to their original institutions, many parents are still requesting refunds from the original institutions, college officials say. Tulane reported its lost tuition at $60 million, the University of New Orleans reported $50 million in such losses, and Loyola University $34 million.

The faculty and staff figures in the table represent the colleges’ estimates of what they are paying in salaries and benefits to employees for the entire year, even while most of them are not able to work. 

If the institutions reopen in January, as most of them say they are planning to do, all that money won’t be actually “lost,” because the employees will be earning the funds for the late winter and spring months. But in every case, the colleges will have spent millions of dollars – and in some cases tens of millions -- to continue to pay employees who could not work.

Littlefield said that the $2 billion to $2.5 billion in estimated losses probably represent “the tip of the iceberg” for Gulf Coast colleges, because of what the figures do not include: lost research grants (Tulane estimates nearly $200 million in such losses), money institutions spent to send students elsewhere before the hurricane, faculty relocation costs, and even such things as mental health care for those employees and students who suffered emotional damage from losing their homes and having their lives turned upside down. 

But getting at least some funds from the government to help rebuild physically and to encourage staff members and students to return is absolutely crucial, she and others say, if colleges in the Gulf Coast are to make a meaningful recovery. But they acknowledge that the current climate – in which lawmakers are trying balance the budget at the same time the White House and Congressional leaders are seeking to give tens of billions in tax breaks – don’t bode well for those in the Gulf Coast seeking relief.

“If this were any time, the government would be pouring money into the region and these communities could be restored,” Littlefield said. But because we are in the middle of this debate, these communities are suffering. It’s a tragedy upon a tragedy.”
Estimated Losses of Gulf Coast Colleges and Universities

Institution Physical Damages Lost Tuition Revenue Faculty and Staff Costs (annual)
Delgado CC $132,116,576 $14,125,000 --
Dillard U. 282,000,000 25,900,000 $26,000,000
Louisiana State U. Health Sciences Center -- -- 348,000,000
Louisiana Tech College 18,188,750 2,800,000 --
Loyola U. New Orleans 4,000,000 33,997,000 64,992,000
Nunez CC 32,934,347 2,200,000 --
Our Lady of the Holy Cross College 2,750,000 -- 6,000,000
Southern University 350,000,000 9,000,000 19,700,000
SOWELA Tech CC 20,000,000 -- --
Tulane U. 125,000,000 60,000,000 304,750,236
U. of New Orleans 103,620,000 50,000,000 75,600,000
Xavier University 30,000,000 25,000,000 36,000,000
Alcorn State U. 3,000,000 -- -
Copiah-Lincoln CC 100,000 3,780 --
East Central CC 665,000 2,100 --
East Mississippi CC 74,800 10,000 --
Hinds CC 300,000 5,000 --
Jackson State U. 1,200,000 3,700,000 1,200,000
Jones CC 2,000,000 206,400 --
Meridian CC 232,775 -- --
Mississipipi Delta CC 20,020 -- --
Mississippi Gulf Coast CC 15,000,000 4,000,000 --
Pearl River CC 50,000,000 300,000 --
Southwest CC 108,500 40,000 --
Tougaloo College 2,000,000 -- --
William Carey College 12,800,000 -- 10,954,485
Alabama   -- --
Spring Hill College 1,000,000 -- --
Total $1,189,110,768   $231,289,280 $893,196,721

Sources: Colleges and higher education associations; Association of Jesuit Colleges and Universities


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