Friday, April 3, 2020

How Much Cash Do You Have?

D3Playbook
APRIL 3, 2020 | written by STEVE ULRICH
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1. How Much Cash Do You Have?


by Dan Bauman, Chronicle of Higher Education
"Worst-case scenario, $2.8 million.

That’s about how large an operating loss Trinity University in Texas is contemplating at the end of this fiscal year as a result of the coronavirus pandemic.

Six months ago, no one could have forecast the extraordinary financial stress academe would be under at this moment — with housing refunds to deliver, a recession likely to be underway, and the frightful prospect that students may not be able to return to campus in the fall.

But, for the moment, Trinity may be better positioned than many institutions in the short term to weather the outbreak’s fallout. In a letter to bondholders this month, the university disclosed that its “rainy day” funds — accounts holding unrestricted, readily available cash and other liquid assets — contain approximately $26 million.

It’s that kind of liquidity that private universities and colleges across the country will need to continue operations, as the nation struggles to get the virus under control."

>> Situational Awareness: "Summer is coming. Institutions traditionally rely on revenue from events like camps, conferences, and community programs to support some level of operations in the summer months. But this year, officials need to assume those revenue streams will evaporate."

>> Number Crunching: "The Chronicle combed through publicly available documents from the two ratings agencies to survey how expendable resources might fare against standard operating expenses over a prolonged period of time."
  • “Monthly Days Cash on Hand" reflects the estimate by Moody’s of the number of days it believes an institution will be able to cover cash operating expenses from monthly liquidity.
Birmingham-Southern - 13
Marymount - 157
Hanover - 164
Clarkson - 171
Middlebury - 177
Case Western Reserve - 186
Webster - 280
Kalamazoo - 446
Gettysburg - 463
Skidmore - 613
  • Standard & Poor’s uses a different metric — an expendable-resources-to-operations ratio — to determine if an institution is carrying sufficient and flexible resources. The ratio reflects retained wealth available to cover operating expenses. Generally, a ratio of 0.4 represents approximately 140 days, or one semester of operating expenses.
NYU - 0.263
Wilkes - 0.300
Gallaudet - 0.341
Sarah Lawrence - 0.357
Stevens - 0.518
Moravian - 0.543
McDaniel - 0.620
Case Western - 0.856
Allegheny - 1.138
Middlebury - 2.003
Grinnell - 10.817

>> The Key Stat: March has seen at least four private, nonprofit institutions draw upon or seek the availability of lines of credit. On March 10, Alvernia University established a $15-million line of credit. And on March 23 the investment bank JPMorgan Chase provided Ursinus College with a $5-million line of credit.

>> What They're Saying: "Relying on credit is appealing, especially — though not exclusively — in a time of crisis. “I’d much rather borrow against a line of credit at zero interest rate than take money out of the endowment,” said Kent John Chabotar, president emeritus of Guilford College and an expert on college finances.

>> Go Deeper

2.  Amherst Asks for Help

by Madeline St. Amour, InsideHigherEd.com

"Amherst College in Massachusetts is asking for help raising funds to cover the switch to remote learning.

In a letter to the college community, Andrew J. Nussbaum, chair of the college's trustees, asked for help covering the costs, which may exceed $10 million, according to MassLive Media.

“Financially, the College remains secure, though we will experience substantial increased costs to honor the commitments we have made. We estimate that the overall financial impact to the College of the move to remote learning may exceed the $10 million raised by the Amherst Fund last year,” Nussbaum wrote. “As you’d expect, the College’s endowment valuation has already declined, and may decline further, due to the economic environment.”



3.  #WatchD3
 

20206

Now, more than ever, America is turning to streaming video for quality content to get it through this time of crisis.

And, as Division III members, we should do our part to ensure that the ole' U-S-A gets to watch quality content.

So here are our featured games of the weekend.

Friday: 2016 Men's Lacrosse Final (Salisbury vs. Tufts)
Saturday: 2018 Women's Lacrosse Final (Gettysburg vs. Middlebury)
Sunday: 2017 Softball Title Game (Virginia Wesleyan vs. St. John Fisher)

D3Playbook encourages you to unlock the vault on your outstanding #WatchD3 games, just like @LETUAthletics@GoUBears@MITAthletics and @EphSports to name a few.

>> Be Smart: Now more than ever, DIII needs to show what quality athletics is all about.


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4. Dealing With a Pandemic

5.  Comings and Goings



6.  1 Beer Thing



Time to go to "Beer School." Today's lesson - style—the breathtakingly diverse family of beers from across the world, and their variations, which often blur the lines of what a given beer “should” be.

Because of this blurring, you could hardly fault a casual drinker for not being able to tell the difference between a kettle sour and an ale traditionally soured in a barrel, or for not having any earthly clue what even defines an IPA anymore.

>> Read on for the answers to everything you wanted to know about common craft beer styles.

>> A clear response to the wine drinking article earlier this week. Have a great weekend.

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