UD leaders have recently formed committees to tackle spending and revenue challenges on the horizon and met last Friday with faculty and staff to communicate those challenges.
Already, the university said, it has “tightened up” on discretionary expenses like travel and entertainment.
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“The organization responded very well,” UD said in written responses to recent questions from the Dayton Daily News. “But now we need to think bigger and broader about structural changes.”
UD has pulled back its typical pace of spending growth by $10 million, Horner said.
“We reduced the (pace of budgetary) increase by $10 million,” he said. “So by no means can you call it a ‘budget cut,’ because our expenses still increased year over year.”
UD wants to preserve those savings and find an additional $15 million to $20 million in savings this coming fiscal year, which begins July 1, Horner added.
UD is not in crisis, he said. It enjoys record enrollment, having welcomed more than 2,000 first-year students this past August, with total enrollment at 11,474 students and undergraduate enrollment at 8,046, according to figures the university offered Friday.
“But we are now at a point where we are having to make some decisions that help us to continue to sustain what we want to do,” Horner said. “And we’re doing it from a position of strength — we’re doing it now where we are still having operating margins and preserving those operating margins.”
“We’re not losing sleep (over the challenges) but we are highly focused on ensuring that we stay where we want to,” he added.
“The overall quality and wealth of UD never been higher,” UD said in its statement to the Dayton Daily News. “Our enrollment and our endowment are at record highs and, unlike many schools, we have been running a positive operating margin for many years.”
In January, UD President Eric Spina announced he was creating a committee and four working groups to craft recommendations on how to cut total expenses and grow revenue.
“Our strategy moving forward cannot be about doing more with less or the same with less,” Spina said last month. “Rather, it should be about sharpening our priorities and focus, which could include doing less in some instances or becoming smaller in some areas.”
And while UD says it is enjoying record enrollment, “net revenue from tuition” is an issue being watched.
More students are graduating in four years, the university said. That means revenue UD previously received from fifth- and sixth-year students has declined. And international enrollment is down, as it is for other U.S. colleges and universities.
From an academic and student-debt perspective, an accelerating graduation rate is a good thing, Horner said. But less revenue from students in later years of enrollment has to be faced.
“There is a revenue impact we to have absorb,” Horner said.
He maintained that UD’s balance sheet is “about as strong as it has ever been,” with endowment at “all-time level” and some debt being recently retired.
“We’re talking about expense reductions,” Horner said. “But what we’re trying to do is ensure we have resources to continue to invest.”
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