Our financial results from the past year (ending June 30) will be finalized as usual during the upcoming external audit. All indications are that we met financial goals despite the significant shortfall in revenue from the School of Graduate & Continuing Studies and the lack of progress with student retention. Strong undergraduate enrollment, conservative budgeting, budget holdbacks and cuts, and careful contingency planning were positive factors. It is important to note that the budgets for 2011-2012 and 2012-13 include significant investments in net additional faculty positions and overall employee compensation.
As always, the coming year’s budget is built on strong undergraduate new student recruitment, slight improvement in retention, and a modest increase in tuition and fees. As of July 1, new student recruitment is ahead of goal, but retention is running well behind goal, with an unexpected decline in returning upperclassmen. As a result, budget holdbacks and reductions are still in place for 2012-2013, both to offset the reduced enrollment assumptions and to support previously approved budget priorities.
Two topics deserve special mention:
For over a decade, the budget has depended on considerable net revenue growth annually from adult education programs. Indeed, until recently what we now know as the School of Graduate and Continuing Studies has been key to our financial strength and our capacity to make a range of academic and other investments. As mentioned earlier, wide ranging changes are needed and needed rapidly if Alvernia is again to achieve highly favorable results. Good initial steps have been made. New leadership, new programs and new markets, expanded use of online instruction, accelerated degree formats, expanded marketing, and improved enrollment management are all needed—as well as the support of faculty and staff across campus.
Several years ago the Board approved a Compensation Philosophy with a commitment to be competitive with the external market as established by our peer group, while affirming the collegial values appropriate for a Franciscan institution. Formal studies of faculty (2010) and staff (2011) salaries and benefits (2011) were conducted by Mosteller Associates. Employee benefits were evaluated as “highly competitive” overall; recent efforts have even managed to sustain current health care coverage without increased costs. With the support of the Board of Trustees, I am pleased to announce that, as of July 1, we have fully implemented all recommended salary adjustments, totaling $450,000 in additional salaries. The Trustees and I are especially pleased that this significant investment has been made during a period of economic turmoil, when many organizations have retrenched.