Inside the next two months, independent school Heads will provide school families with concrete plans and, perhaps, revised tuition details for the 2020 - 2021 school year. Some will convey the devastating news of closure. They will also inform employees of actual or potential reductions in force, revised assignments, community health precautions, new "game-on" standards for remote instruction and the summer professional learning plan for being game-ready. They will have arrived at the crossroads of the school as a community and the school as a business.
It's a familiar intersection for Heads who conduct onsite pressers there several times a year in the Annual Fund appeal, the Annual Report, the letter accompanying re-enrollment contracts, employment agreements for faculty and staff. The typical rhetoric goes something like this: "Behind that tasteful sound barrier lies the carefully engineered thoroughfare on which the school's revenues and expenses travel in complete harmony. Here are three or four key spotlights and how each enhances the mission of the school." This year, however, the school's business affairs will be on full display and all anticipate the vista to be less Autobahn, more Mad Max.
Although some of the new rules of the road are outside any school's control, many of them are, especially if school leaders are taking the time to imagine the secondary and tertiary consequences of financial adjustments in context of the early predictions that the pandemic will have a three to four year economic impact. Here are a few inherent dangers to anticipate and combat.
Financial Aid
Wheeling and dealing: Entertaining negotiation in financial aid discussions is unethical, potentially illegal, and erosive of school culture. You'll lose more families in the long run on principle than you'll gain from being unprincipled in the moment.
Asset-rich, cash-poor: If your school decides to provide single year support to families who have lost income but have considerable assets that they can't leverage, be clear that those families need to plan appropriately for 2021 - 2022. This dilemma was a hallmark of financial aid discussions in 2009, especially with families who owned commercial property.
Graduating class bubbles: Unbalanced distribution of financial aid across grade levels complicates financial planning and, if your school is like most and experiences greater attrition among families receiving support, increases the likelihood of churn.
Next year: One lesson from 2008 - 9 that could play out in this crisis is the fact that financial aid apps went up even more in year two. If this crisis has a three or four year tail, it will be important that schools plan beyond the coming school year.
Elementary Attrition
Child care: Parents of elementary age kids need you to have the kids covered, ideally 5 days a week, 8 hours or more per day. Schools should be creative in thinking how they might safely meet this need, especially if kids are coming in staggered groups, and even if campus is closed.
Brutal fact: For most elementary age kids and particularly with the youngest, remote learning is the palest shadow of the rich social, emotional and academic learning that happens in a high quality elementary classroom. This fact should be the threshold by which Heads measure any potential move from in person to remote learning. It should also be at the center of any discussion of discounting tuition.
Your Market
False security: If your competitors are fumbling this moment, don't make that the sole reason you choose not to provide families with some financial relief for your diminished program. A full school with many resentful families is not a win. . . . and there's a chance that your competitors will get better.
Division in the ranks: This is already playing out in some independent school markets. A peer school in your area makes a first move--a partial tuition credit for next year, 25% tuition reduction for any remote learning portion of year, enrollment incentives--and you must respond to your constituents who wonder what your move will be. This will happen. Prepare your talking points.
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