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Business Officer Magazine

Grit and Soul

Institutions caught in Hurricane Katrina’s path are rebuilding with resolve.

By Karla Hignite

The Best Laid Plans

In a word, “heartbreaking” is what came to mind for Ronnie Smith one week after Katrina’s landfall when he set eyes on the downtown campus of the Louisiana State University Health Sciences Center. The center is a complex of six medical and health care training schools and two patient care clinics. Smith, vice chancellor of administration and finance for the medical schools, caught a helicopter ride into New Orleans with state emergency officials. The officials were eager to access the main power plant situated at the corner of LSU’s campus and within reach of the elevated walkways connecting many of its buildings. Subsequent escorts by state police and members from the Oklahoma National Guard allowed for retrieval of an eclectic mix of remnants, including student financial aid checks and servers with patient-related data.

This isn’t what Smith had envisioned for the start of the fall semester. Having hired a new associate vice chancellor for facilities in early August, Smith planned to concentrate on bringing his newest staff member up to speed. “When I think of how tough this has been for me, I can only imagine what it’s been like for him, not knowing our structures or staff and still in the process of relocating,” says Smith. He calls it a shared spirit of exhaustion and a firm resolve to maintain critical health care services in New Orleans that have kept LSU’s faculty and staff working tirelessly around the clock all these months. But to say that Smith and his staff were unprepared for Katrina would be untrue.

On Friday, August 26—three days before Katrina hit—LSU carried out its disaster recovery plan to send a remote operations team offsite to the system’s Shreveport campus. That team included Smith’s assistant vice chancellor for IT along with networking, e-mail, Web applications, and payroll staff. “In anticipation of the storm we expedited running payrolls that normally would have run on Monday—the day the storm was scheduled to hit land,” says Smith. Staff also stayed late Thursday night before the storm to print checks for those without direct deposit. “This was a particularly big deal because we run payroll not only for New Orleans employees but for the entire network of state public medical employees—about 20,000 people.”  

Another group from LSU stayed in New Orleans to oversee campus closure and evacuation. By Monday afternoon, leaders believed the institution had survived the storm largely unscathed, with only about a foot of water in the streets and with emergency power still running. Then Smith got a call at 2:30 a.m. on Tuesday with reports of the worst-case scenario: water to the tops of street signs and entering buildings. Loss of generators soon followed.

Smith and his staff spent that first week post-Katrina coordinating the rescue of 180 stranded employees and students, setting up an emergency command post at system headquarters in Baton Rouge, and establishing toll-free numbers and emergency e-mail and directories through Web sites to capture the whereabouts of students, faculty, and staff. At the same time, deans of the various schools modified class schedules and lined up temporary housing and classroom and lab facilities, mostly in Baton Rouge. All classes started within a month in every imaginable available space, including a vet clinic and a vacant movie theater. Smith notes that this massive medical school migration took place with only a 7 percent loss of enrollment and no loss of accreditation.

Wake-up Realities

At Tulane University, classes weren’t scheduled to start until September 1, but students were already filtering into the city, says Yvette Jones, chief operating officer and senior vice president for external affairs. On Saturday morning, August 27, as Tulane freshmen checked in for orientation, storm tracking made it clear that Katrina was shifting toward New Orleans. The president’s 3 p.m. convocation was moved up two hours to welcome students and then tell them they must leave. University leaders activated Tulane’s evacuation plan, which it had practiced one year prior under the threat of Hurricane Ivan. Through an arrangement with Jackson State University, 650 students with nowhere to go boarded buses bound for Jackson State’s gymnasium where they waited out the storm. By Tuesday, when news reports and television footage made it clear that normal operations would not resume for the foreseeable future, Tulane’s incoming freshmen were bussed to Atlanta and Dallas to fly home.

Initially about a dozen Tulane administrators convened in Houston, which nearly 4,000 alumni call home and where Tulane operates an MBA program. During those first days and weeks students scrambled to register for classes at colleges and universities across the country—595 institutions, according to final tabulations—and leaders waited for the opportunity to assess damages to real estate. Even before Tulane’s leaders could get into the city, Jones notes, the university hired Belfor Recovery Services to commence mold remediation and reconstruction at the earliest moment possible.

Of Tulane’s four campuses, its main campus was two-thirds under water and its medical campus was completely flooded. In total, 85 of Tulane’s 125 buildings required gutting of ground floors and basements from sustained water damage. “We started rebuilding early and recovered quickly, which had many thinking we had little damage,” says Jones. While proportionately Tulane’s financial losses did not scale with the severe blow dealt to some of the city’s other institutions—including Dillard University and Southern University at New Orleans (SUNO)—Tulane still took a knockout punch that stole intellectual capital and material assets. The university suffered an estimated $150 million in physical damages and another $150 million to $200 million in lost fine arts, collections, and research, including data and material from a major 40-year heart study, says Jones.

By the end of 2005, nearly 200 of Tulane’s senior leaders had gathered in Houston to plan the institution’s reopening in the spring. “By October 1 we announced we would open January 17. And we did,” Jones says. But in addition to rerecruiting students, university leaders knew they would have to convince faculty and staff to return. Housing was in universal shortfall, as were operating elementary and secondary schools. With most of the public school system shut down for the year, Tulane reinstated a charter school initiative it had explored prior to the storm. “We put up half the money—about $1.5 million—to make this happen in exchange for a certain allotment of spots for the children of our faculty and staff,” says Jones. As for housing stock, Tulane bought an available apartment building to serve as graduate and married student housing and brought in a cruise ship as backup to temporary units for faculty and students.

Location, Location, Location

According to Roger Knight, dean of business services for Mississippi’s Pearl River Community College, “There’s not much more than imagination left in Hancock County.” The town of Waveland—home to Hancock Center, a PRCC satellite campus—shared the fate of many Mississippi coastal communities pummeled by Katrina’s storm surge: It washed away. Among PRCC’s losses were $300,000 of contents—everything contained within the 7,500 square feet of leased space in the former Wal-Mart where 168 students were enrolled in general academic courses. The center had opened in fall 2004 after the county approached PRCC about starting a campus. “We were looking ahead to additional full-time faculty and a permanent facility but were still several years from that,” says Knight. 

All three of PRCC’s campuses were in the path of Katrina and show the difference that a few miles inland can make. The Hattiesburg campus, about 50 miles north of the coast, sustained minimal wind damage, requiring mostly debris cleanup. Poplarville is situated between Waveland and Hattiesburg and was not so lucky. Winds were still clocking 120 miles per hour when they hit the main campus, where 2,800 of the college’s 4,300 students were enrolled. Extensive roof damage led to wide-scale water damage and compromised the structural integrity of several buildings, including the campus coliseum and Moody Hall—the oldest classroom facility among the state’s 15 community and junior colleges. The college’s vehicle maintenance shop was destroyed. Estimated total losses of $50 million include $7 million in roof damage and at least $1 million in inventory, says Knight.

When classes recommenced at PRCC’s Poplarville campus on September 12, close to 1,000 students—more than one third—did not show up. Many of those did return during the fall semester, taking advantage of PRCC’s mini-term allowing students to pick up part-time where they left off. For the spring semester, enrollment at the main campus was down about 300 students. In Waveland, portable facilities now stand on the Wal-Mart parking lot, where 90 students have resumed their coursework.

Negotiating New Turf

Almost half of Dillard University’s 2,200 students returned when the university resumed classes in New Orleans this spring. But not to Dillard’s campus, which suffered heavy damage at the hands of Katrina, getting hit by water, wind, and fire, says Michael Todd, interim vice president for business and finance. Conversations with the Hilton New Orleans Riverside Hotel yielded an opportunity for Dillard to occupy about one third of the guest rooms and several ballrooms for classes. This spring the normal routine for students has included courses at the hotel Mondays through Thursdays. On Fridays, students engage in labs and art classes on the campuses of Xavier and Tulane universities, where Dillard students also have access to library and recreation services. Dillard purchased five shuttle buses and hired drivers to transport students to and from those campuses.

The new spring semester setup—a win for both Dillard and the Hilton—didn’t transpire without negotiating the fine print to safeguard students and control institution costs. Among Dillard’s requirements: eliminate pay-per-view channels, get rid of room refrigerators (an insurance liability), require students to use prepaid phone cards for all long-distance calls, and waive the hotel’s normal $10-per-day Internet charge. Dillard also negotiated a cafeteria-style meal plan with the hotel, says Todd.

At least one of Dillard’s four dorms will be ready for occupancy this September as well as several apartment complexes on and off campus. Despite some damage incurred, renovations made to Williams Hall in 2000 kept destruction to a minimum. The other three dorms, which are historic 1930s-era structures, pose a dilemma. “Prior to the storm, we were looking to renovate them. Now we may need to tear them down,” says Todd. Another structure presenting a quandary is Dillard’s student union. The ground floor previously housed the student cafeteria, student support services, the campus police department, a post office, a food court, the bookstore, and the office for campus life. This structure—parts of it up to two feet below sea level—sustained some of the worst damage on campus. While the student cafeteria will be moved one level up, the institution must still determine where to relocate these other services and how, or whether, it can reconfigure the first floor into usable space.

Spring Cleaning

At LSU, renovation has entailed sealing off the first levels of each building, which will require major redesign work, to concentrate on occupying upper floors. The institution achieved its January 17 target to open its first research building, albeit under less-than-ideal circumstances, Smith noted. “Faculty and students returned to no heat, no flushing bathrooms above the fourth floor, no running water, and no medical gasses or vacuum.”

Those conditions have been resolved one at a time in fairly rapid succession, well documented in the extensive building-by-building progress updates Smith began posting to the institution’s Web site following Katrina. The posts detail everything from electrical and fire alarm systems upgrades to mold spore removal to elevator repair. The latter poses a significant expense. “In all buildings we have as many as 70 elevators—all of them dead,” says Smith. Most are repairable, but on average that still comes to $70,000 to $90,000 each to fix and wet-proof. Repairs to the eight older, larger elevators at LSU’s dental school campus may cost closer to $200,000 each.

Continuity In Chaos

Louisiana State University’s Baton Rouge campus became Hurricane Katrina headquarters for the system’s affected institutions and for federal and state emergency response teams. LSU’s IT staff quickly set up makeshift offices, established phone and network connections, and expanded wireless access.

William Silvia, Jr., executive vice president for the LSU system, describes those earliest days as tense—and inspiring. “Many who relocated to Baton Rouge had lost everything. But here they were, unselfishly trying to salvage institution assets under very stressful conditions.” Silvia is convinced that one of the best things the system office did was immediately hire an IBM disaster recovery team. “A single contract can set in motion a broad team of experts who know what to do and how to work with FEMA, where one misstep can cost millions of dollars,” he says.

One common frustration that quickly surfaced was a widespread inability to communicate, both verbally and electronically, says Silvia, who notes that ham radio proved among the most reliable forms of communication in the early stages of the crisis. Silvia believes a more sophisticated and secure means of communication technology must be explored. “This is a national priority that deserves our nation’s investment.”

Katrina has likewise provided plenty of fodder in terms of how institutions can improve business continuity amid chaos. Barbara Johnson, a consultant to NACUBO, spent four months with staff contacting institutions on behalf of, a joint initiative of NACUBO and the American Council on Education that aids campus disaster recovery by connecting affected institutions, students, faculty, and staff with institutions that are able to help. Johnson’s conversations with campus leaders yielded valuable insights about deficiencies with pre-Katrina continuity plans. Among her findings: The basics of securing data and records and establishing processes that allow continuation of payroll are too often overlooked. Every institution should also have designated alternate locations for key leaders to gather immediately following a crisis, a people locator system, and multiple ways to get out important information, says Johnson.

While some business continuity plans account for intermittent interruption and loss of power, many don’t factor in long-term loss of infrastructure and habitat—a sobering lesson delivered by Katrina with the hundreds of thousands who became homeless overnight. “It’s essential that every institution have a plan that addresses the full range of interruption scenarios—no matter an institution’s location—and that allows for continued operation of key activities, whether struck by a short-term interruption or a wide-scale catastrophe,” she says. Look for a summary of Johnson’s findings and proposed elements for a business continuity plan in the upcoming July issue of Business Officer.

One by one as LSU’s buildings have come back online, faculty, researchers, and students have returned. By fall 2006, Smith expects all operations to return to New Orleans excluding the school of dentistry, which will remain in Baton Rouge through spring 2007. The dental school campus was hardest hit: The buildings, in which all the main switchgear was located in the basements, sat in six feet of water for two weeks, says Smith.

For Knight, the biggest difficulty has been getting the college’s insurance company to respond. As of early spring, the college had received only a $3 million advance to fix its roofs. Meanwhile, PRCC has used $480,000 of its own resources to renovate one of the dorms to give displaced students a place to call home. Pre-Katrina, the Poplarville campus housed 650 students. “Even then, there was a waiting list,” says Knight. “Now students are gladly doubling up.”

Currently the college is constructing two new dorms that will bring capacity to 873 beds by fall 2006. The new dorms were already under way before the storm, financed by bond issues earlier in 2005. Fortunately, only the foundations had been laid, says Knight. Once the college receives settlement, it will move on to the coliseum. “You don’t realize how much you use a facility and in how many ways until you lose it,” he says. In the case of the Poplarville coliseum, use included community functions and high school graduations.

Other construction not on the books but on the drawing board may complement PRCC’s recovery effort. Prior to the storm, there was talk of a new performing arts center built with private and state funds that would include a new auditorium and classroom space. That likely won’t happen this year but would help offset the loss of Moody Hall.

Fueled by Potential

When Tulane reopened this spring, an amazing 85 percent of its 13,000 students returned, including 92 percent of full-time undergraduates. Still, Jones isn’t counting any proverbial chickens. She is convinced that retention remains an issue. Although applications are way up, even commitments that come in early May won’t be proof, says Jones. Those intervening summer months and the reality of a new hurricane season pose a barrier. “None of us will rest easy until students arrive next fall,” she says.

In the meantime, university leaders are optimistic about Tulane’s future. “We spent time during the fall not only assessing where to make short-term budget cuts but also rethinking institutional mission and reaffirming what is critically important for Tulane, and that is a high-quality undergraduate experience.” The university is now in the process of reconfiguring and streamlining some of its graduate programs and undergoing vigorous academic planning for undergraduate programs.

“There is something about living through crisis that makes you more willing to take risks,” Jones reflects. “We committed to a lot without knowing how we were going to do it, but we decided upfront that we would never consider not opening in the spring.” Of course, institutional leaders have taken some measured risks. With only about one quarter of the New Orleans population having returned as of the new year, Tulane plans to rebuild its medical practice slowly. This spring the institution reopened an emergency room and staffed for 60 beds. Until this July, Tulane’s medical school and residency program will remain in Houston at Baylor College of Medicine.

As LSU’s medical schools head back to New Orleans, the institution is looking to expand its relationship with the private sector. LSU’s two primary teaching hospitals in New Orleans—Charity Hospital and University Hospital—were both flooded and contaminated by mold, limiting the institution’s ability to train future doctors, nurses, and other health professionals.

Rescaled realities exist for individuals as well as for institutions. Amid personal tragedy, the needs of students have changed, says Knight. In the midst of its own new financial burden, PRCC instituted a policy allowing students enrolled for the fall semester to write a letter explaining their situation, since some had lost their homes. The college used the letters to document its decision to write off outstanding account balances for students in dire straights. That gave students a clean slate if they wanted to come back during the fall mini-term or in the spring. The debt forgiveness totaled $500,000 in tuition, plus another $40,000 to replace student texts free of charge.

It Takes an Institution

Raising a city from physical devastation and its inhabitants from emotional despair can’t happen overnight or in one year. Most institution leaders agree it will take at least three years to resume normal business operations, and many believe that is optimistic. But then some aren’t seeking a return to normalcy. A catastrophe of this magnitude forces individuals and institutions alike to undergo serious soul searching. For the city of New Orleans in particular, who and how many come back will itself reshape that community in indelible ways.

“Post-storm population realities are pushing institutions to reflect on size and mission,” says William Silvia, Jr., executive vice president of the Louisiana State University System, based in Baton Rouge. Despite post-Katrina ambiguity, Silvia believes higher education will lead the way in responding to the new needs of an urban environment forever altered by this storm. In one example, the LSU system is negotiating significant changes to its agriculture center that may close severely damaged experimental stations to develop urban extension outreach programs to help communities rebuild. One thing is clear, says Silvia: “In striving to make decisions that contribute to their own recovery, institutions will fill a vital long-term role for the communities they serve through the training opportunities and programs they provide.”

Nowhere is that more true than at SUNO. Southern University at New Orleans is located in one of the lowest parts of the city. Immediately following the storm, SUNO administrators sought refuge and office space at SU’s Baton Rouge campus where they concentrated on one thing: returning to New Orleans. “It wasn’t a question of whether, but where,” says Gloria Matthews, vice chancellor for administration and finance. All 11 administrative and academic buildings on SUNO’s 22-acre campus flooded. Plans previously discussed to build dormitories on an undeveloped 38-acre property about a mile away are now on hold, even though student housing is among the institution’s—and the city’s—greatest needs.

While Matthews hopes to reallocate funding or secure a third-party financing arrangement to move dorm construction forward, SUNO’s north campus is not sitting idle. The Federal Emergency Management Agency contracted with the U.S. Army Corp of Engineers and the Shaw Group, Inc., to place 45 modular units on this undeveloped site in February to serve as temporary classrooms until SUNO’s main campus can be rebuilt. When SUNO first resumed operations in New Orleans in January, it held classes at a charter middle school. Nearly 400 SUNO faculty, staff, and students have taken up temporary residence at a Marriott hotel while awaiting FEMA trailers.

An open-admission institution, SUNO served 3,600 students prior to the storm, many of them low-income inner-city residents. At an average age of 25, most students were part of the city’s working economy, says Matthews. They had families and typically attended evening programs. “That segment of the population is now largely missing. With whole neighborhoods destroyed and lack of other affordable housing and with very limited access to schools for their children, many were forced to leave,” she says. Still, more than 2,000 students enrolled for the spring semester—a figure that exceeded the institution’s anticipated 50 percent return. SUNO leaders are now hoping to register 3,000 this fall.

One outcome of Katrina was a review by the system of the programs offered at the New Orleans campus. The system identified 20 programs to cut based on low numbers of graduates. “In reality we had to make the argument to our board of regents for why it was important that we even remain open,” Matthews explains. Cutting programs became a compromise. “We still have the same purpose: to educate students.” Only now, SUNO is further committed to community-centered education. Key programs that remain are early childhood education, elementary education, criminal justice, social welfare, and social work—all areas of need for a city on the mend, she says.

This same program review has inspired SUNO leadership to take stock of additional training needs, proposing that the institution serve as a small business incubator and develop degree programs in business entrepreneurship, human development and family services, public administration, and health information management. “As the makeup of a city and the availability of its services change, an institution has to respond differently within its community,” says Matthews. “We plan to stay in New Orleans and to keep serving students and providing for the needs of our city.”

No Place Like Home

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Dillard is likewise standing its ground. While the university’s faculty and students haven’t yet returned permanently to campus soil, Dillard’s seniors will carry on the institution’s traditional cap and gown promenade this June underneath the university’s Avenue of the Oaks—no longer as stately but certainly as symbolic. June also marks when Dillard’s arrangement with the Hilton Riverside ends. It’s time for the hotel to turn over its beds to tourists. And time for Dillard to get home.

KARLA HIGNITE, principal of KH Communication, Tacoma, Washington, is senior editor of Business Officer.