Budget and enrollment update08/26/2016
Interim President Matthew J. Wilson
The start of a new academic year is a time of energy and excitement as students return to campus and faculty and administrators renew their commitment to educational excellence and preparing students for a successful pursuit of their life goals. I invite and encourage you to personally engage with as many of our students as possible. Providing a special and individualized experience for our students will bring many benefits to our institution and our students.
The beginning of the new semester also is an appropriate time to update you on how we are addressing the challenges we face.
Enrollment is certainly one of our biggest issues this coming year. While official enrollment numbers won’t be known until mid-September, we continue to anticipate an eight or nine percent overall decline, due both to the size of last year’s larger graduating classes and the impact of the discord during the past year.
As you know, we are mobilizing the whole University community to address this challenge and to improve enrollment results for the fall 2017 semester. I am grateful to the faculty, staff, alumni and members of the greater Akron community who already have demonstrated their willingness to help. We also are adding much-needed resources to the Admissions team. Their devoted efforts last year, under extremely difficult circumstances, prevented our current challenge from being much larger. With more resources they will be able to have even more frequent personal interaction with students, parents, counselors and principals at high schools throughout our region, helping them learn about the great opportunities at UA. Personally, I will join in these efforts by visiting high schools, meeting with students, engaging with parents, and participating in other outreach activities.
The fiscal year 2017 budget (July 1, 2016 – June 30, 2017) approved by the Board of Trustees took into account the projected decline in enrollment. Among other actions, the Board authorized the use of $18 million of university reserves to stabilize our current budget in an effort to best serve our students and avoid personnel reductions.
Unfortunately, the enrollment decline we have experienced for several years will continue to impact us in the years ahead. With that in mind, and thanks to the generosity of an anonymous donor, the accounting firm of Ernst & Young has been engaged – at no cost to UA – to work with the Administration, the University Council Budget and Finance Committee and other groups across campus to conduct an independent assessment of our financial situation and help the entire campus community develop a common understanding of the impact it has on our budget. Ernst & Young is expected to complete its report before the end of the semester.
In the meantime, we must effectively manage our financial resources to avoid even greater challenges. To that end:
- We have asked all college and administrative leadership to be conservative with expenditures.
- We will roll out a new externally funded scholarship initiative next week, centered around the objective of making a difference and moving forward now (please stay tuned for details).
- We will make full-year general fund operating budgets for colleges and VP units available (this procedure should be completed by the end of next week). As you will recall, originally, just the first quarter funds had been made available for spending.
- The general fund designated fee accounts (e.g. course fees, library fees, etc.) have been populated assuming a 10% enrollment decline. Consistent with past practice, the spring allocation will occur in February 2017 and will be aligned with actual collections.
- We will limit hiring throughout the University to the most critical positions as determined by a case-by-case review of open positions and hiring needs.
- Pending the results of the Ernst & Young review, compensation for non-bargaining unit employees will be maintained at current levels. A final decision on compensation for those employees will be made later this year.
The challenges we face are real and the sacrifices required to overcome them are difficult. However, we are working hard to provide our students with the best experience possible while maintaining our current talent and infrastructure. At the same time, I am encouraged by the fact that faculty, staff, alumni and local community and business leaders have indicated an eagerness to help. The tiger team and general University community have developed action items and suggestions will be explored and implemented to the extent possible. The details about the tiger team recommendations will be provided very soon. As I have said before, I believe in the greatness of this institution and I have faith that our efforts will be successful.
Thank you for your support and for your dedication to The University of Akron.
Matthew J. Wilson