Update on our Financial Response to Federal Actions

Dear Georgetown University Faculty and Staff:

In earlier messages this semester (January 28, February 24, March 25), I have reviewed various federal government actions affecting the Georgetown community. I asked you to reflect on the enduring values expressed in the University’s mission statement – what it is we are called to do, why we have committed to this way of proceeding, and how we go about this work.

Our Current Context

Since the 1940s, Georgetown’s ability to pursue its fundamental mission has relied on a partnership with the federal government to fund and support education and research to advance the common good of our society. The federal government is reevaluating this long-standing practice, scaling back research and education funding, and signaling a heightened level of scrutiny of higher education.

Federal actions that have harmed our operations so far include reductions in research funding and the elimination of graduate fellowship programs. Other potential actions could affect student loans and increase the taxes on university endowments. As the federal actions taken to date are impacting the national and global economy, we are also monitoring potential indirect effects – including the possibility of declining enrollment of international students and losses of philanthropic support. Any or all of these factors could threaten our mission through significant financial losses.

In fiscal year 2024, we had an operating budget of $1.8 billion and annual federal support for research at Georgetown was about $195 million (most of which came from National Institutes of Health and the Centers for Disease Control). Annual federal financial aid support in fiscal year 2024 was about $267 million, which included direct lending, Pell grants, work-study, and supplemental educational opportunity grants. While there remains great uncertainty for the year ahead, it is clear that we are facing unusual headwinds that we must prepare for. 

Our guiding principle is to be able to continue our mission-critical work – education, research, and service to the common good. We want to be proactive now to avoid a series of reactive budget adjustments month after month, which would be even more disruptive of the work we do together. We also want to avoid large-scale layoffs and furloughs as a way of coping with external financial threats.

Our Next Steps Through the First Half of Fiscal Year 2026

We have completed extensive financial analyses of possible losses. To help protect our mission, and in consultation with the Board of Directors, we will take several steps to ensure that we have the strongest possible financial framework during this period of uncertainty.

On the revenue side, we plan to:

• Increase graduate and certificate enrollments in existing programs and accelerate new graduate programs.
• Increase revenues from auxiliary services.
• Use more temporarily restricted gift funds to support priority activities.
• Implement strategies to increase philanthropic support.

This moment also calls for us to intentionally limit our expenses. Most of these mitigation actions will be focused on the first half of the upcoming fiscal year (July 1 – December 31, 2025), including:

• Pausing the payment of annual merit increases that would have gone into effect on July 1 for faculty and staff with a full-time equivalent salary of $50,000 or greater. This pause will last for the duration of the first half of the fiscal year, and we will reassess by December 2025.
• For senior level executives (SLE) and administrative staff who earn $200,000 or more annually, this pause on annual merit increases will last for the duration of the full fiscal year.
• Freezing off-cycle administrative staff compensation increases and position reclassifications, unless the adjustment is deemed critical by campus senior leadership (i.e., the Executive Vice Presidents or the Senior Vice President/Chief Operating Officer).
• Freezing new hiring of faculty and administrative staff, unless a position is supported by external fundraising or identified as a critical hire by campus senior leadership (i.e., the Executive Vice Presidents or the Senior Vice President/Chief Operating Officer). 
• Directing that University Services (including the Office of the President, Athletics, the Office of the COO, and other units) and senior academic leaders work to identify additional budget savings.

Throughout this period we will continuously monitor the external environment to determine whether more budget actions are required for financial stability or if we are able to relax some of the spending constraints. More information and answers to frequently asked questions are available online.

I am grateful to the many colleagues who have been working to respond in real-time to immediate cuts, such as research grant stop-work orders, in addition to our colleagues who continue to closely track new developments. I also look forward to continuing to meet with faculty and staff leaders and community members throughout the fall semester. 

Thank you all for your continued efforts in support of our university. These shared sacrifices are necessary to protect and preserve Georgetown’s mission of education, research, and service.

We will weather this challenging period by recommitting to our mission and helping one another share the burdens of this moment.

Sincerely,

Robert M. Groves
Interim President