University Towns Face Economic Crisis and COVID-19 Head On

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On Monday, July 20, the National League of Cities University Communities Council, along with the International City/County Management Association and the International Town & Gown Association, hosted a virtual briefing with city leaders from college towns across the nation to share their community’s challenges and concerns brought on by COVID-19. Cities, towns and boroughs are home to over 4,000 colleges and universities in America. These communities are facing widespread economic and social challenges during these uncertain times, all while trying to prepare for a safe reopening.

Local leaders have been forced to act quickly and adapt to the unstable economy, while planning long-term policies that will determine our nation’s recovery. It remains clearer than ever that local and state governments need direct funding to aid their communities and residents.

Here are a few highlights from the briefing, University and College Towns Facing Economic Crisis During COVID-19.

College Towns Are on the Frontlines of the Response and the Future

City leaders across the nation have taken the necessary steps to alleviate one of the worst economic crises in history and are ready to bring their experiences to the table to facilitate an economic recovery. Not only are these beloved university and college towns facing major budget challenges due to the loss of revenue from college students not returning, but these communities are on the frontlines of our nation’s health, safety and economic response to the global pandemic. University communities are responsible for the safety of the student-residents who will lead the next generation of American businesses and prosperity.

“Ames, home to Iowa State University, now faces budget challenges because many of the 30,773 students, who comprise roughly half of the community’s 67,000 residents, left town in March.” – Gloria Betcher, Councilmember, Ames, Iowa and Chair of the National League of Cities’ University Communities Council


“Loss of population means loss of revenue. Residents are struggling to pay water bills but we still need to maintain the system. The retail sector was a large part built around catering to a student population. Truly, we don’t know what the fall will look like” – Steve Patterson, Mayor, Athens, Ohio and Vice-Chair of the NLC University Communities Council


“We must combat this [crisis] by looking at its long-term problems, not just getting over the hump.” – Ronald L. Filippelli, Mayor, State College, Pennsylvania


“It is important to be responsible and cut budgets to make sure essential services continue. Our most pronounced loss was in hotel/motel occupancy tax. We should expect similar losses in coming months and the rest of the year.” – Hank Guess, Mayor, Hickory, North Carolina

Federal Support to Towns Helps Those Who Need It Most

While some of the college and university communities represented at the briefing may be eligible to receive CARES Act funding, the funds are limited in their eligibility and are held back by several state restrictions. Previously allocated funding will not be sufficient for local needs.

“In Missouri, cities are understaffed and may not have programs to directly help residents.” – Greg McDanel, City Manager, Maryville, Missouri


“Counties are required to share 25% from CRF funds with local governments, so there is about $1.5 million to distribute among 8 municipalities. We are seeking targeting funding to help with lost revenue.” – Mayor Guess

Census Undercount Puts Cities, Towns, and Villages at Extended Risk

The decennial census impacts federal funding to cities, towns and villages for the next decade. College towns are at particular risk of an undercount, as college students have shifted their location before filling out the 2020 census during this unprecedented pandemic. An undercount could cost college towns millions in critical federal funding.

“Ames spends over $400,000 to obtain an accurate census count. This year, the student census tracts lag behind the rest of the community, showing under 50% of residents are reporting.” – Councilmember Betcher


“Flexibility is important with not only federal funding but also the way students can be enumerated for the census.” – Mayor Patterson 

Working Toward a Safe Reopening for University Towns

University and college students are essential to cities just as much as cities are essential to the nation. To prepare for their return, local leaders have found their own innovative and effective solutions:

“Universities are partnering with city and healthcare providers to get students invested in the larger community, with the goal of keeping students on campus and safe.” – Councilmember Betcher


“Positive relationships with the university can enforce joint decisions, such as wearing face masks.” – City Manager McDanel


“Strong ties with the university will ensure there is continuity. The main concern is the older community in Athens. We must make sure they are safe when the population increases in the Fall.” – Mayor Patterson


“Students will likely arrive – but fewer students will be on campus and classes may be partially online. The critical time will be in the spring and next year. “ – Mayor Filippelli

To begin to recover in places like university and college townsthe Senate is expected to bring forward a COVID-19 response package this week. We must stand together to ensure that our cities, towns, and villages receive direct and flexible federal funding to combat the coronavirus pandemic and the economic challenges that have followed it. We cannot safely reopen and rebuild our economy without supporting our cities, especially those housing and relying upon our university and college students.

To watch a recording of the briefing, click here. For more resources, visit the Cities Are Essential campaign website.

About the Authors:

Jenny Ha is a Frank Karel Fellow in the Digital Engagement, Marketing & Communications department at the National League of Cities.

Brittney Kohler is the legislative director for transportation and infrastructure at the National League of Cities.