AU {by the numbers}
American University Annual Report 2006–2007
4400 Massachusetts Avenue, NW
Washington, DC 20016
Table of Contents
From the Chairman of the Board of Trustees
2
From the President
3
Introduction
5
The Quest Is Knowledge: Academic Achievement at AU
7
The Dream Is Green: Sustainability and Environmental Activism at AU
15
The Spirit Is Service: Community Involvement at AU
23
From the Vice President of Finance and Treasurer
28
Financial Statements
29
University Administration
42
Board of Trustees
42
From the
From the
Chairman of the Board of Trustees
President
American University is distinctive in higher education because of traits that convey the essence of
the university and its academic excellence, national and international profile, community service, and
social consciousness. When combined on a campus where the “dream is green,” these traits help
set AU apart.
The proof is in the numbers—that American University is an active campus growing stronger each
year. In addition to the financial strength of a $400 million budget and an endowment to match, AU’s
student quality, academic achievements, faculty prominence, and commitment to social values is
impressive by any count.
Our diverse student body includes students from every state and more than 145 nations, bringing
intellectual ideas from all corners of the world. They are taught by faculty who are researchers,
musicians, writers, and artists and whose scholarly or creative contributions garner professional
acclaim and national attention.
In the past year alone, AU gained acclaim for its student achievements—as a Truman Foundation
Honor Institution for its success in placing students in public service careers; as number three in the
nation for producing Presidential Management Fellows for the federal service; for its four students
who earned Fulbright grants to study abroad, four who won Killam fellowships to study in Canada,
and nine who won David L. Boren scholarships to augment their international education. And these
are just a few.
An essential part of the AU experience spans beyond the books and takes students into the world
of hands-on service in settings where people need help—in Washington, the nation, and abroad.
Yet, while learning of life beyond the campus borders, the campus itself is a place where every day
students apply lessons of sustainability, social awareness, and living on one planet.
A college experience helps shape the way that students will think and act for the rest of their lives.
We are proud to play a part in that important life task, as illustrated in the pages of this report.
Closer to home, more than 1,500 AU students, faculty, and staff logged more than 64,000 hours of
community service by volunteering to assist those in need in the Washington, D.C., area; we hosted
Saturday workshops at the Katzen Arts Center to teach local kids about the arts and assisted the
D.C. schools in both the classroom and administrative areas. On campus, AU’s teaching about
environmental awareness and sustainability is achieving tangible results as reflected in AU’s signing
of the Talloires Declaration this past spring and committing itself to its 10-point action plan.
AU is a dynamic place instilling education on a daily basis as a lifelong pursuit—as revealed by
the numbers.
Gary M. Abramson
Cornelius M. Kerwin
2 AU by the Numbers
American University 3
AU by the Numbers
On any given day, American University’s community of more than
12,700 students, faculty, and staff reads 200,000 e-mails, drinks
13 gallons of fair trade coffee, checks out 634 library books, and
volunteers 175 hours throughout metropolitan Washington, D.C.
But behind every number is a story—AU’s story.
Home to nearly 11,000 students, AU is the school of choice for many
who want to better their communities, the environment, and themselves.
Behind every hour volunteered at a local park or elementary school
is a passion for service. Behind every study abroad trip and academic
accolade is an unbridled thirst for knowledge. And behind every
tree planted and scrap of paper recycled is an obligation to leave this
university, this city, this planet a better place.
Some things, such as library books and test tubes, can be quantified,
while others, such as activism and intellectual curiosity, defy such
categorization. Taken together, however, they tell the story of a vibrant
community of learning and service, where students, faculty, and staff
alike strive to leave their mark.
Join us as we explore three areas—scholarship, sustainability, and
service—in which members of the AU community are making a
difference, both in Washington and around the world. From faculty
research that’s shaping history and influencing public policy to
service projects that take students from a local homeless shelter to
an indigenous community in the Amazon River basin, American
Eagles are leaving their mark.
Join us as we share the stories behind the numbers, stories of
passion, achievement, curiosity, and service. Join us as we share
the story of AU.
4 AU by the Numbers
American University 5
The Quest Is Knowledge
96 {full-time faculty}
5
14:1 {student-faculty ratio}
Academic Achievement at AU
Though AU’s students come to Washington with different interests and
79 {faculty members wrote books,
monographs, and government reports}
a sound academic foundation, upon which they will continue to build,
2,000 {people use AU’s wireless network each day}
441 {WCL podcasts, which have
been downloaded 201,500 times}
American’s 112 undergraduate and graduate programs, many of them
nationally ranked and internationally renowned, provide students with
1,343 {foreign students,
representing 145 countries}
87 {class and seminar rooms}
690 {computers in campus labs}
aspirations, they all share one thing in common: a thirst for knowledge.
long after graduation.
The university’s 596 full-time faculty members—themselves an
accomplished group of researchers, poets, musicians, and writers—
fuel students’ intellectual curiosity, encouraging them to explore,
create, read, question, and grow. And if ever students need a little
guidance or advice along the way, professors’ doors are always open.
5,866 {undergraduate students}
3,263 {graduate students}
1,688 {law students}
6 AU by the Numbers
56 {bachelor’s programs}
48 {master’s programs}
8 {doctoral programs}
From the library to the law school to the 87 classrooms in between,
AU truly is a laboratory for learning.
American University 7
AU Named Truman
Foundation Honor Institution
Beneath pristine skies on a perfect October day in
the garden of AU’s president’s house, Fred Slabach,
executive secretary of the Harry S. Truman Scholarship
Foundation, formally designated AU as a Truman
Foundation Honor Institution.
Two Students Named
Scholarship Winners Tackle
AU Third in Nation
Four Named
Truman Scholars
Issues around the World
for PMF Finalists
Killam Fellows
This past year AU students Anna Carpenter
(below, left) and JoAnna Smith (below, right)
were awarded the prestigious Harry S. Truman
Foundation Scholarship.
In 2007 four AU students earned Fulbright grants
and nine won NSEP David L. Boren scholarships.
As impressive as the achievements that earned those
prestigious awards are the studies those students plan
to do with the funding they provide.
AU is among the top schools for Presidential
Management Fellows (PMF). The university
ranked third in the nation with 37 graduate and
law students selected for the federal government’s
prestigious two-year program, which puts fellows
on the fast track to high-level management positions.
The Killam Fellowships Program, which provides
a unique opportunity for formal student exchange
between Canada and the United States, has awarded
four AU students fellowships to study in Canadian
universities during the 2007–2008 academic year.
Carpenter, now a senior in the College of Arts and
Sciences and the School of International Service,
recently studied abroad in Kenya, where she created
an advocacy campaign to raise awareness about the
sexual exploitation of female domestic laborers.
Smith, a senior in the School of Public Affairs,
serves as a student wellness advocate for the Naked
Truth and as an assault victim advocate for women.
According to Paula Warrick, director of merit
awards at the Career Center, the scholarship will
provide Carpenter and Smith “with a layer of
mentoring that they wouldn’t otherwise receive.”
Next summer, the students will intern with a nonprofit or federal government agency and meet with
distinguished public servants—including Supreme
Court justices.
“I believe the respective missions of American
University and the Truman Foundation are the same,”
Slabach said. “They further President Truman’s vision
that ‘free and inquiring minds with unlimited access
to the sources of knowledge can be the architects of
a peaceful and prosperous world.’”
School of International Service (SIS) professor
Akbar Ahmed won a $100,000 Purpose Prize
with Judea Pearl, the father of slain journalist
Daniel Pearl, last fall. The award, created by
Civic Ventures, a think tank supporting social
innovation, recognized Ahmed’s and Pearl’s
ongoing Muslim-Jewish interfaith dialogues.
Since 2003, their program, Daniel Pearl Dialogue
for Muslim-Jewish Understanding Featuring
Akbar Ahmed and Judea Pearl, has brought their
candid conversations on faith, culture, violence,
and tolerance to 12 cities in the United States,
Canada, and England. Both Jewish and Muslim
leaders have praised the program for helping
bring together Pakistani and Israeli dignitaries.
For Boren recipient Katherine Suplick, a teacher’s
vivid description of the Tiananmen Square massacre
will culminate in a trip to China to probe human
rights issues. Mi’cael Bogar will use her Fulbright to
research conflict resolution strategies in the Republic
of Georgia. Courtney Radsch will travel to Lebanon
and use her Boren fellowship to explore the impact
of satellite news on politics in the Arab world. The
ten other award winners will use their funding to
take on issues ranging from sex-trafficking in Thailand
to oil-sharing in Iraq.
SIS led the way with 20 finalists. SIS’s strong
showing exemplifies its dedication to public service,
according to Dean Louis Goodman.
“It’s indicative of our students’ commitment to
international public service and indicative of the
school’s continuing support of the ideas on which
it was founded 50 years ago,” he said.
The PMF program was created in 1977 to attract top
students from various disciplines to federal service.
The Killam winners are Curtis Harris, who is now
studying at the University of Ottawa; Maureen Reed,
who is attending Dalhousie University; Alison Shott,
who is studying at Acadia University; and Katie Young,
who is attending McMaster University.
“I’d say that the best way to learn about the United
States is to go to a country that does not seem quite
as different as Uganda might be but in fact is quite
distinct,” said Robert Pastor, director of AU’s Center
for North American Studies, which was instrumental
in having AU named as a Killam fellowships site.
Award-Winning Student Focuses on China
Stacy Aldinger has worked with the children of migrant workers in Beijing, elementary school children in southeast Washington, D.C., and women in the developing world. Along the way she earned not only a grade point
average of 4.0 and a degree in international relations but an impressive list of awards and scholarships.
The National Merit Scholar from Hawaii made her mark quickly when she led nearly 20 AU students in a weekly
project aimed at the welfare of third graders at Stanton Elementary School.
Then came a chance to study in China on an NSEP David L. Boren scholarship, where she took a job teaching
English to the children of migrant workers in Beijing.
Aldinger was tapped for another honor in 2006 when she became the university’s fourth student in six years
to win the congressionally funded Truman scholarship, which will enable her to pursue graduate training in
international relations. She was also the recipient of a 2007–2008 Fulbright scholarship to study public health
and gender norms in China. The SIS graduate capped off her undergraduate career as the winner of the 2007
President’s Award, AU’s highest award for a graduating senior.
7 {NSEP David L. Boren graduate fellows}
4 {Fulbright grant recipients}
2 {NSEP David L. Boren undergraduate scholars}
4 {Killam fellows}
8 AU by the Numbers
Interfaith Dialogues
“Initially, it was just two people talking, but now
it is much more than that,” Ahmed said of the
program, which he plans to expand with the prize
money. “People respond to it in a very personal
way. They can see that there’s no agenda there.
They see that it’s spontaneous and therefore
honest. . . . It gives people hope.”
Founded in 1977, the Truman Foundation recognizes
college juniors who are committed to careers in
public service. Winners are awarded $30,000 toward
graduate school, and they take part in leadership
training and fellowship opportunities.
“Because of the competitive nature of the scholarship, it is unusual for a single university to produce
a large number of scholars,” Slabach said. “Four
of the last six years, the Truman Foundation has
selected American University students as scholars.
That’s a tribute to the many faculty and staff involved
in American University’s process.”
Ahmed Shares Purpose Prize for
2 {Truman scholars}
37 {Presidential Management Fellows}
American University 9
Radin Challenges Performance
Movement in Government
In a critique of Challenging the Performance Movement,
the latest book by Beryl Radin, the reviewer muses that
Radin must read Government Accountability Office reports
“for pleasure.” Radin, a professor in the Department of
Public Administration and Policy, considers it high praise,
as it brings a dose of humor to a very contentious subject.
“Some people are very critical of my approach, while
others are glad that someone’s finally articulating their
concerns,” she said.
While the performance movement is generally well intentioned, Radin said it fails to recognize the diversity among
programs and people, instead advocating a “one-sizefits-all” ideology. She’s also critical of the movement’s
focus on efficiency and the bottom line, above all else.
Radin, who takes aim at the No Child Left Behind Act, is
critical of both Republicans and Democrats. “Their efforts
have been very technocratic. They don’t accept the fact
that we live in a complicated world, and that ours is a very
fragmented government,” she said.
Tobias Reveals Best Places
Law Professor Examines
Breitman Probes Unearthed Documents
to Work in Government
Prosecutorial Power
Detailing Anne Frank’s Failed Escape
The Nuclear Regulatory Commission and the
Federal Mediation and Conciliation Service are
the best places to work in the federal government,
according to an annual survey of more than
221,000 workers. The survey was conducted by
Robert Tobias, director of AU’s Institute for the
Study of Public Policy Implementation, and the
Partnership for Public Service.
Angela Davis describes the work she undertook for
a dozen years in the Washington Public Defender’s
Service as “the most important I’ve ever done.”
Last spring, AU history professor Richard Breitman helped shed new light on Anne Frank’s failed struggle to escape Nazi
Germany. Recently discovered letters from Frank’s father, he said during a press conference, show that U.S. national
security fears helped doom the iconic family detailed in The Diary of Anne Frank.
“It was a life-changing experience for me,” the
Washington College of Law professor said. “These
were people whom all of society had turned their
back on. I loved freeing people from the system,
loved it when my clients were found not guilty,
loved being able to keep them out of the awful
prison system.”
“There was a general belief that even if they left . . . people might still be loyal to [the Nazis] or they might be coerced by
threats against their relatives who were still there,” said Breitman about America’s decision to deny them visas despite the
attempts of several well-connected friends. “So the notion that Jews were victims got twisted with the notion that they
might be collaborators as well.”
The results of the 2007 survey—which ranks more
than 280 federal agencies and subcomponents in
such categories as leadership, teamwork, pay and
benefits, and work-life balance—were announced
in April.
“We are pleased to offer this benchmark that will
provide agencies the information they need to
attract the best and brightest career seekers in the
public service,” said Tobias.
It was during this time that Davis became disturbed
by prosecutorial power run amok. As her intellectual
curiosity began pulling her from the courtroom
toward the classroom, she began delving deeper into
the subject. It became the backbone of her research
when she entered the academy, and it is the focus
of her new book, Arbitrary Justice: The Power of the
American Prosecutor.
In the book, Davis maintains that prosecutors in
many instances are more powerful than the judges
before whom they argue.
“What judges do, they do in open court,” she
said. “But with prosecutors, the most important
decisions that they make are made behind closed
doors. Those decisions are the charging and plea
bargaining decisions. They answer to no one for
those decisions. We need to all care very much
about how our criminal justice system works.”
After discovering the letters a year and a half ago, the YIVO Institute for Jewish Research asked Breitman and New York
University professor David Engel to help make sense of them. While Engel focused on hurdles the Frank family faced
within Europe, Breitman, who has written extensively on American refugee policy during WWII, focused on America.
Of the experience, Breitman said, “I came away from reading through the whole set of documents, and I said, [if things
had gone a little differently] Anne Frank could today be a 77-year-old writer living in Boston.”
Much Ado about Shakespeare
The bard was everywhere in D.C. during the six-month Shakespeare in Washington festival: the Kennedy
Center, the Washington Ballet, the Smithsonian. And, of course, AU. Playwright and director Caleen Sinnette
Jennings’s Elsewhere in Elsinore—which explores the world of the women in Hamlet—was one of four
performances staged as part of the Shakespeare at AU series.
“In Hamlet, you see a community of men—the dead king, his advisor, Hamlet, Horatio, even the grave
diggers. I wanted to create a community of women,” said Jennings, who as a young actress visited the
actual setting of Hamlet’s castle near Elsinore, Denmark, and concluded that “certainly, men did not
run this castle alone.”
The play, which premiered in March at AU with an all-female cast, examines class and what it means to
have power in a male-dominated context.
“It [gets] the audience thinking about the last time they were in a theatre and 16 women were on stage,”
said Jennings. “That really doesn’t happen.”
221,000 {workers surveyed for professor’s study of federal agencies}
48 {faculty members created poems, stories, or plays;
produced films; or were featured performers or artists}
10 AU by the Numbers
Shakespeare is nothing new to Jennings, a professor in the College of Arts and Sciences. Her play, Playing
Juliet/Casting Othello, was produced at Washington’s Folger Shakespeare Library in 1998 and was a
nominee for the Charles MacArthur Award that year. Jennings, whose work Inns and Outs was nominated
for a MacArthur Award for Outstanding New Play, is also a faculty member at the Folger’s Summer Teaching
Shakespeare Institute.
American University 11
Historian Kraut’s New Book
2,487 {daily library patrons}
Expores Jewish Hospitals
Career Award Honors
Aufderheide’s Impact
54,399{reference questions}
231,665 {books checked out}
on Documentary Film
Stack Tries to Shift
Death Penalty Debate
In his new book, Dead Wrong: Violence, Vengeance,
and the Victims of Capital Punishment, public
communication professor Richard Stack isn’t
just trying to change minds on the death penalty
debate—he’s trying to change the question.
1,058,221 {volumes}
1,128,248 {microforms}
32,691 {electronic journals}
47 {print newspaper subscriptions}
“The traditional debate has been over whether
capital punishment is a deterrent to crime, but
that’s not really a viable question. . . . The new
question, the question I want to ask, is ‘Can we
trust our government to make such an irreversible,
life-and-death decision, when the government
screws up so much?’”
To answer that question with a resounding “no,”
Stack presents case studies illustrating how innocent people were nearly executed due to mistaken
eyewitness testimony, racism, and incompetent
legal counsel. “There are a lot of reasons to be
opposed to the death penalty,” he said. “But there’s
one that unites the political left and the political
right, and that’s the innocence issue. . . . No one
wants to see an innocent person executed.”
School of Communication professor Patricia
Aufderheide’s documentary film scholarship
earned her one of the International Documentary
Association’s (IDA) top career achievement
awards. But it has earned scores of documentary
filmmakers much more.
“Pat has effected real change for documentarians,”
said entertainment lawyer Michael Donaldson,
who presented Aufderheide with the IDA’s 2006
Preservation and Scholarship Award. “I was talking
to an Oscar-winning filmmaker [who] said to me,
‘It’s like a huge weight lifted off my shoulders. I
never thought I’d get to finish this film, and now
I can.’ He was talking about Pat’s work.”
Many documentaries that critique the media
would be impossible to produce without one of
two things—a multimillion-dollar budget or the
Documentary Filmmakers’ Statement of Best Practices
in Fair Use. Aufderheide worked with Washington
College of Law professor Peter Jaszi in 2005 to
craft the document, which helps filmmakers defend
their fair use of copyrighted material without
having to pay exorbitant clearance fees.
Just two years later, the work has become invaluable
to filmmakers. And more than any award, that’s
what matters to Aufderheide.
Although his latest book chronicles the history of a famed Newark, New Jersey, hospital, Alan Kraut says there’s
much more to the story than “bricks and mortar.”
Covenant of Care: Newark Beth Israel and the Jewish Hospital in America “is about an institution created by
flesh and blood people for flesh and blood people,” said Kraut, a professor of history in the College of Arts and
Sciences, who penned the book with his wife.
“You can’t write a history of a hospital without writing a history of the community and the people,” he continued.
“This turned into a really nice, juicy story.”
The book uses “the Beth”—which opened its doors in 1902 as a 21-bed facility and grew to become a pioneering
medical institution—as a lens through which to examine urban health care and the rise of Jewish hospitals in
the early twentieth century.
“There’s much to be gleaned from their successes,” Kraut said of the staff, which included Dr. Victor Parsonnet,
who helped perfect the cardiac pacemaker in the 1960s. “They did their jobs well.”
Peach Examines Complex Roots of Trafficking
When it comes to the ideological debate over sex work, Lucinda Peach is one feminist who sits squarely
in the middle.
“Prostitution shouldn’t be an occupation that women do out of necessity, as there’s something wrong
with a society where women must do that work just to survive,” said Peach, a professor of philosophy
and religion in the College of Arts and Sciences.
“However, it’s unrealistic to think that the sex industry is ever going to go away completely,” she continued.
“If governments aren’t open to decriminalizing or legalizing sex work, the only solution is to create more
jobs and economic opportunities for women.”
Peach’s recent scholarship focuses on the U.S. government’s war on human trafficking and prostitution,
and the role of faith-based organizations in “rescuing” sex workers and placing them in “rehabilitation
homes,” which they aren’t free to leave.
“If the government is really going to get serious about reducing trafficking and improving the status of
women, it needs to look more carefully at the root causes,” which include economic necessity and a lack
of legal protection, Peach said.
12 AU by the Numbers
American University 13
2,166,767 {kilowatts
of wind power}
The Dream Is Green
Sustainability and Environmental
Activism at AU
For members of the AU community, sustainability is more than a buzz
35 {bird species}
word: it’s a way of life. Students aren’t just exploring environmental
30 {green buildings}
issues in the classroom, they’re getting their hands dirty, working on
sustainability initiatives on campus, throughout the D.C. community,
and in all corners of the globe. Faculty and staff, too, have rolled up
their sleeves, planting more than 100 trees during the university’s 14th
2,000+ {trees}
annual Campus Beautification Day festivities in April, and helping to
700+{people participated in campus beautification}
recycle more than 816 tons of material each year.
10 {biodiesel buses}
From the locally grown produce in the student dining hall to the
100 {electric vehicles}
1,386,841 {AU shuttle rides}
171 {people used Metro benefits}
30 environmentally friendly buildings dotting the lush campus, the
dream is green at AU. And with every cup of fair trade coffee consumed,
800 {bags of produce
purchased through
community-supported
agriculture program}
and every kilowatt of wind power purchased, that dream is becoming
a reality.
35,000+ {flowering bulbs}
300+ {different plant and flower species}
800 {cubic yards of landscape waste
sent to a local composting facility}
14 AU by the Numbers
American University 15
Campus Sustainability Week
National Wildlife Federation Honors
AU for Student Activism
Highlights Environmentalism
on Wind Power
Interns Work for Environment
from Congo to Appalachia
Twenty-eight students earned credit for internships
that related to the environment this year, working
with organizations that focused on areas from
Appalachia to the Congo.
University Signs
Sustainability Pledge
AU committed itself to a 10-point action plan for
practicing and promoting sustainability when theninterim president Neil Kerwin signed the Talloires
Declaration this past spring. Drafted in Talloires,
France, in 1990, the declaration serves as a public
pledge for colleges and universities to practice
environmentally sound policies, create a culture
of sustainability, and increase environmental literacy.
“The Talloires Declaration is an exciting example of
our commitment to environmental sustainability,”
said Kerwin. Signing the pledge, he noted, builds on
an environmentally sound reputation that includes
AU’s commitment to recycling and plans for a
“green” design for the new School of International
Service building.
Since the signing, the university has switched its
shuttle fleet to biodiesel vehicles and planted a green
roof on the Media Production Center, boosting insulation and cutting rain water runoff by 80 percent.
Jacqueline Marks worked for Oceana, a marine
conservation organization that lobbies to ban bottom
trawling. Holly Mergler worked for Innovative
Resources Management, a small nonprofit that works
on sustainable development in the developing
world, particularly on water issues in the Congo
basin area. Rory McIlmoil worked in North Carolina
for Appalachian Voices, which campaigns to stop
such coal mining practices as mountaintop removal.
“I found out about Appalachian Voices while I was
conducting my initial research on mountaintop
removal (MTR),” McIlmoil said, “and when an
internship position opened up, I jumped at the
opportunity. By then I had learned enough about
MTR to help fight against it in any way possible.”
When students dressed as a smokestack and a
wind turbine battled on the quad, they weren’t
looking for an award. They were trying to get out
the vote for a student referendum to make AU
a greener campus by purchasing at least half its
energy from wind or other renewable sources
by 2012.
It passed by a landslide. Now the National
Wildlife Federation has honored AU for the
innovative project with its “especially ambitious
conservation goals.” While the referendum is
nonbinding, students worked closely with
administrators to craft achievable goals, and
AU is working to sharply increase its use of
wind power.
Students turned out in historic numbers for the
referendum, which recommended allocating
funds from the regular tuition increase or
raising student fees if necessary to meet the goal.
“That’s a strong message,” said student activist
Claire Roby ’09, “not only on electricity, but also
on sustainability in general.”
China Holds Key to
World’s Environmental Future
Judith Shapiro was one of the first Americans to live in China after the United States
normalized relations with the country in the 1970s. Now the booming nation of a
billion is poised to overtake the United States in carbon emissions.
“There is a broad recognition that as China goes, so goes the planet,” said Shapiro,
who is now director of the Global Environmental Politics program at the School of
International Service and has been studying the role of China in the changing
global environment.
While China has “some of the best environmental laws in the world,” enforcement
remains a challenge. An even deeper challenge, according to Shapiro, is that China
is inclined to focus on winning international respect through runaway economic
growth, while there is an increasing emphasis on public display of wealth.
AU created the university’s first Campus Sustainability Week by tacking on a few extra
days to National Campus Sustainability Day last fall. Amid the week of environmental
awareness events, several student groups launched a pilot recycling program aimed at
boosting recycling at AU and beyond. “We’re trying to create a culture of recycling so
that people can take this with them through their lives,” said Class of 2009 president
Andrew Gardner.
Other sustainability events included a solar panel demonstration and a transportation fair
offering staff and faculty commuting options that could save money and cut pollution.
According to staffer Riley Neugebauer, turning Sustainability Day into a week was an
easy decision. “Higher education is a place where people turn to look for answers to the
world’s problems,” she said. “And this is one of the huge issues of our time.”
“We can all do what we can, buying Priuses and screwing in funny light bulbs,”
she said. “But at some point we have to engage with China on the environment.”
Biologist Studies Effect of Global Warming on Coral Reefs
For Sam Keehn, who worked with a company
building factory-made housing that is energy
efficient and uses green materials, the chance to
do an environmental internship made him feel
“interconnected” because of the connection between
his education, internship, and work. He said his
education has enabled him to see that “while no
easy answers exist, there are potentials for real and
meaningful solutions.”
Kiho Kim has a laboratory at AU, where he teaches marine biology, but his real laboratory is the
ocean. He has snipped coral and planted it on planks in neat rows to observe how the passage
of water, with its microscopic cargo of food, affects its growth. He has plucked coral to ferret out
the secrets of its internal chemistry. But as the oceans warm, how will coral weather the change?
“The oceans are probably much more important than we ever gave them credit for,” said Kim,
whose achievements as a scientist recently won him a three-year term on the Ocean Studies
Board of the National Academies.
“Coral reefs are important for a number of reasons, but mostly because, biologically, they provide
food for many coastal communities,” he said. But the coral ecosystem faces an uncertain
future in a warming world. “When water temperature warms for longer times,” he said, “coral
begins to starve.”
Courtesy of Claire Roby
Photo by David M. Baker
300+ {universities have signed the Talloires Declaration}
3 {Zipcars are located on campus}
43 {percent of AU trash is recycled}
7,000 {plants on Media Production Center roof }
16 AU by the Numbers
28 {students completed internships related to the environment}
American University 17
Beautification Day Goes Greener with
Focus on Sustainability
14,000 {energy efficient light
bulbs purchased}
22 {students participated
in alternative break trips
related to sustainability and
environmental issues}
2,000 {gallons of used vegetable
oil converted into fuel by
Montgomery County farmer}
Wapner Teaches
Environmental Principles
on Campus
Paul Wapner teaches environmental politics at the
School of International Service (SIS). It’s a topic that
generally reaches beyond the classroom—but in one
course, the topic was the classroom itself.
The class revolved around the new SIS building,
which will break ground this fall and be a model of
“green” design. Students studied the concepts the
architects will use in the building and then made their
own recommendations on aspects from solar energy
to sustainable materials to fund raising.
4,760 {gallons of fair
trade coffee served}
20 {percent of produce
used by Bon Appetit food
service is purchased from
local farms}
750 {recycling bins on campus}
816 {tons of materials recycled}
18 AU by the Numbers
56 {courses focused on
environmental topics}
Like the architects, the students were committed to
wedding idealism and pragmatism. For instance, the
notion of an edible garden on the roof to provide
food for area residents was initially appealing. But,
Wapner said, “we did some calculations about how
much soil would be needed, and how symbolic it
would be versus how functional, and we decided
it was not a good use of our funds.” Instead, the
students argued that the university could have more
impact by taking a stand on energy use and “going
after the carbon question.”
There was more to AU’s 14th annual Campus
Beautification Day than mulch and moonflowers.
Faculty, staff, and students turned out for the April
event, which focused on AU’s new green initiatives.
“After all, sustainability goes hand in hand with
beautification,” said Mark Feist, assistant director
of facilities management.
In addition to bedding plants and picking up litter,
participants enjoyed a “clean car show” on the quad
featuring hybrid and solar cars. AU’s eco-friendly
fleet was also on display. People learned more
about AU’s ongoing sustainability initiatives,
including an energy efficient irrigation system and
compost made from organic waste.
“We need the support of the AU community
behind us,” said Feist of the event. “We want
everyone on campus to feel like they’re a part of
the sustainability effort.”
AU Students Recognized for
Commitment to the Environment
Environmental change takes more than just words;
it takes hard work.
Three AU students who understand that principle
were rewarded for pursuing careers related to
the environment when they were named Morris
K. Udall Undergraduate Scholarship winners. The
Morris K. Udall Foundation awards 80 scholarships
nationwide each year to sophomores or juniors
who have demonstrated commitment to careers
related to the environment.
The Udall scholarship winners were Erin O’Sullivan,
a communication, law, economics, and government
major; Claire Roby, an environmental studies
major; and Casey Roe, an environmental studies
and political science major.
“It shows that we are certainly attracting students
who are committed to the environmental fields and
who want to pursue careers in the environmental
policy area,” said Joan Echols, program associate
at the Office of Merit Awards. “We have a very
active Eco-Sense Club where the students have
an opportunity to demonstrate leadership in the
environmental area.”
American University 19
Durant Studies Military’s
Struggle to Go Green
In recent years world events have made clear
the significant impact made by the U.S. military
around the globe. But just what environmental
footprint it leaves in the places it operates has
flown under the radar.
School of Public Affairs professor Robert Durant,
whose primary areas of interest are environmental
and natural resource management, policy implementation, and public management issues, has
explored this question in his book, The Greening
of the U.S. Military: Environmental Policy, National
Security, and Organizational Change. The study
traces the struggle to raise environmental
consciousness and responsibility within the U.S.
military since the Cold War’s end.
One Staff Member
RFK Jr. Brings
Working for the Planet
Environmental Message to Campus
One Saturday last spring, a dozen AU students
stood in a Washington, D.C., kitchen, shaking
mason jars of vegetable oil and trying to turn it into
fuel. They’d come on their own time to spend the
day learning to run cars on the kind of biofuel that
AU’s sustainability coordinator, Lindsay Madeira,
SIS ’06, knew how to make from used cooking oil.
Standing before a large crowd in Bender Arena, Robert F. Kennedy Jr. spoke passionately about the cause
he’s dedicated much of his life to: the environment. During his speech his voice shifted from angry to
defiant to upbeat as he discussed the political, social, economic, and spiritual ramifications of protecting
the environment for future generations.
AU doesn’t just talk about sustainability. For two
years, AU has had a full-time position dedicated to
environmental initiatives. When student groups have
wanted to work with the administration on practical
measures for a greener campus, they’ve been guided
and mentored by the sustainability coordinator.
Faculty and administrators, too, have been able to
work more effectively on green initiatives with the
help of a knowledgeable resource person.
At AU, going green isn’t just a passion. It’s a fulltime job.
Agriculture Program Brings
Organic Produce to Campus
From potatoes to tomatoes, 40 members of the AU
community are eating up West Virginia farmer Allan
Balliett’s organic, biodynamic crops as part of the
community-supported agriculture (CSA) program.
Each week’s delivery yields its own unique harvest—
from pumpkins and pac choi to strawberries and
summer squash—with shareholders sampling more
than 150 varieties of produce. Those unfamiliar with
such offerings as muskmelon and rhubarb receive
recipes and storage tips.
“Participating in the program made me feel like we
were choosing to help our community, and it inspired
us to cook and eat better at home,” said AU staffer
Sara Goode.
Courtesy of David Culver
Culver Pursues Conservation in Caves
When biology professor David Culver first saw the tiny animals that dominate his research, his reaction
was rather unscientific. A 19-year-old college freshman at the time, he looked at his first springtail—a
translucent, insect-like, cave-dwelling creature with no eyes—and thought, “Wow, this is neat!”
Since then, he has explored more than 500 caves in search of 40 different species of springtails. Along
with holding Culver’s interest for more than four decades, these strange creatures also hold one of the
keys to conservation in the region. By mapping various species of springtails in local caves, Culver arms
organizations like the U.S. Fish and Wildlife Service with the information they need to protect threatened
habitats.
“One of the questions [for conservationists] is, ‘If you’re going to buy land or get a conservation easement, where should you do it?’” said Culver. “You don’t want to just take the first property that comes
up for sale. . . . This gives you the numbers to establish some priorities.”
40 {members of the AU community participated in the communitysupported agriculture program
150+ {varieties of local organic produce sampled}
20 AU by the Numbers
Kennedy, president of the environmental group Waterkeeper Alliance and vice chairman of Riverkeeper,
whose mission is to protect the environmental integrity of the Hudson River, came to campus for the
university’s first-ever weeklong environmental summit. The event was cosponsored by the student-run
Kennedy Political Union.
For $485, “shareholders” receive 20 weeks of farmfresh fruits, vegetables, and herbs. “Virtually everything we deliver to AU will have been harvested that
very morning,” said Balliett.
The task, Durant said, was a daunting one, given
the military’s history on the environment.
“During the Cold War they didn’t keep thorough
records; they didn’t know a lot about what had
been dumped and where it was dumped,” he
said. “They operated in what I call ‘a cocoon of
sovereignty, secrecy, and sinecure.’”
“I don’t want my kids to grow up where there are no fishermen on the Hudson, where there are no family
farmers, where we’ve lost track of the seasons and the tides that connect us to the 10,000 generations that
came before there were laptops,” he said. “If we don’t return to our children something that is roughly
the equivalent of what we inherited, they’ll have the right to ask us some very difficult questions. When
we diminish nature, we diminish ourselves.”
500 {caves explored by AU biologist}
13,600 {minutes of classroom instruction on environmental issues}
American University 21
312 {students involved in service-learning courses}
The Spirit Is Service
Community Involvement at AU
64,200 {hours volunteered}
196 {D.C. Reads tutors}
Students are introduced to AU’s spirit of service before they even step
foot in the classroom. Now in its 17th year, the Freshman Service
Experience brings together more than 500 first-year students every
August to volunteer at dozens of sites throughout the D.C. area,
preparing meals, rebuilding homes, and working with children and
1,565 {students, faculty, and staff
volunteered in the local community}
38 {percent of freshmen participated in the
Freshman Service Experience}
12 {alternative break trips}
150 {students participated in alternative break trips}
seniors. It’s an opportunity for students to get to know the city that
will be their home for the next four years and to develop a deeper
understanding of that community’s needs.
At AU, there’s more to the educational experience than tests and texts.
Volunteer opportunities are learning opportunities, and students, faculty,
and staff—who logged more than 64,000 community service hours
last year—never pass up the chance to do either.
97,923 {dollars in the Eagle Endowment for
public and community service projects}
22 AU by the Numbers
American University 23
Student Breaks about
AU Student Wins
D.C. Service Award
Grad Students Host
Workshop for Teens
Interested in Peace
Professor Helps Mentor
New Principals
As a leadership coach with New Leaders for
New Schools, a national nonprofit that helps
train educators committed to transforming urban
schools, Cathy Crocker wears many hats.
Charged with helping guide and shape the next
generation of D.C. Public School principals,
Crocker, a professor in the School of Education,
Teaching and Health, is a confidante and a cheerleader, a sounding board and a mentor, a voice
of reason and a trusted advisor.
“The premise is simple,” said Crocker of New
Leaders. “To improve schools, you need to
improve leaders.”
The three-year program kicks off with a summer
workshop, where participants work with experts
to improve their educational and leadership skills.
Participants then spend a year in residence in
an urban public school, after which they get
a principalship. New Leaders then provides two
years of coaching and mentoring from teachers
like Crocker, who worked with eight D.C. principals
last year.
Although they started out in the morning as strangers,
by noon, the group of 40 local high school students
who gathered at AU in February for a peacemaking
workshop were giggling and conversing like old friends.
According to Rebecca Davis, one of the six School
of International Service (SIS) graduate students
behind the daylong event, the teens were bound by
their common interest in peacemaking and conflict
resolution. “One of our goals was to bring together
kids who are interested in the same issues and get
them talking,” she said.
The workshop featured a panel discussion on careers
in peacemaking, a film screening, and dialogue and
role-playing sessions, during which students swapped
stories about their lives and current issues that concern
them. Participants, who came from 16 area high
schools, also enjoyed a pizza lunch with Peace Corps
volunteers.
Sophomore Justin Bibb won the D.C. Mayor’s
Youth Community Service Award for volunteer
work he never anticipated doing. “I never envisioned getting involved in service before I came to
AU,” said Bibb. “I just assumed I’d be working on
the Hill.”
Global Community Service
Six countries and one battered but not broken American city played host to AU students who chose to spend
part of their summer, winter, and spring breaks last year doing community service.
Courtesy of Liang Cai
After participating in AU’s Summer Transition
Enrichment Program, however, Bibb changed his
mind. “He got his first taste helping kids paint a
mural in Southeast,” said service learning coordinator Vanessa Palma. “He got to know some of the
issues . . . so he wanted to come back for more.”
Students traveled to Bolivia, Brazil, Thailand, and China during winter break, and in March a group of students
from Hillel traveled to New Orleans to help victims of Hurricane Katrina gut their houses.
Tim Renner, an SIS graduate student, led the trip to Thailand. The trip was designed to educate participants on the
political situation in neighboring Burma, which has been ruled by various military dictators since 1962.
Bibb has since tutored local preschoolers and
launched D.C. Today–D.C. Tomorrow, a program
helping Thurgood Marshall Academy students engage
in community service in their neighborhoods.
Even the recognition for this work has only made
Bibb want to get more involved. “It’s just a reminder
of how much still needs to be done,” he said.
“This provided a great opportunity to plant some
important seeds in young leaders directly,” said Davis.
Last summer 10 students spent two weeks in Ecuador and 14 others visited Zambia for three weeks as part of the
Community Service Center’s alternative breaks program. In South America the group spent a week in the Andes
Mountains and another with indigenous people in the Amazon River basin, where they learned firsthand how the
people were able to prevent an Argentine oil company from drilling in their land. They also studied labor, trade,
and clean water issues. In Africa the students focused on HIV and AIDS: who it is affecting and what is being done
to fight it.
“My hope is that people made a personal connection to the issue rather than just gaining the insight that one would
by reading off a Web site or newspaper. We met people who had to flee their homes and have been imprisoned. I’m
hoping it sparks a desire to do something to help that otherwise wouldn’t have been ignited.”
Courtesy of Kristina Thompson
Neighbors Flock to Children’s Programs at Katzen
The Katzen Arts Center is fitting right into its neighborhood. Nearly three-quarters
of the children who have flocked to the arts center for a series of popular Saturday
workshops come from the communities around AU.
A winter session that drew about 200 children included theatre and music as well as
the visual arts. The day began with a kid-friendly tour of the latest show, followed by an
art-making session, an “instrument petting zoo” and music session with members of the
music department, and a chance to work with actors to explore colors and shapes.
AU neighbor Janice Barksdale had driven by the Katzen Arts Center almost every day
but had never found a reason to explore it until a fellow parent from the neighborhood
told her about the children’s workshops. “It’s a nice opportunity to get families in,” said
Amanda Brown, also a neighborhood parent.
“They learn very quickly that being a principal is
really a juggling act,” said Crocker, herself a former
principal. “I help them to develop time management strategies so they can focus on learning and
teaching, because that’s what it’s all about.”
200 {children participated in the Katzen winter workshop}
40 {local high school students participated in SIS’s peacemaking workshop}
6 {foreign countries served by AU students on alternative break trips}
24 AU by the Numbers
American University 25
Service Fraternity Lends
Survivor Determined
Throwing Herself into
Helping Hand at Homeless Shelter
to Give Strength to Others
Community Service
After weeks of practice, Adam Hansen had finally
nailed the notes of a Shostakovich cello sonata in
the middle of a crowded Mary Graydon Center.
“It sounded just how I wanted it to sound,” said the
music major.
The tiny homeless shelter at the United Methodist
Church on Nebraska Avenue is probably unknown
to most AU students busy with their own lives on
campus across the street. But when Beth Plewa
found out about it, she decided to get involved.
Too bad no one heard it—he was playing in a soundproof booth. But for Hansen and two dozen other
students, that perfection in isolation reached out to
the larger community.
Plewa ’07, was service vice president of Alpha Phi
Omega, a community service–oriented fraternity.
Last year she and her brothers and sisters worked
at the shelter, which can house up to four people.
Jessica Hollander is a survivor, and she wants
others to follow in her path. Hollander, who
graduated in May with a degree in women’s and
gender studies, was a victim of assault. When
she arrived on campus four years ago, she decided
to help create an event to spotlight the problem
of sexual assault and domestic violence on
college campuses.
Christina Wright always left her all on the field
while throwing the discus and shot put for AU’s
track and field team. She exerted no less effort
when it came to reshaping AU’s Student-Athlete
Advisory Committee and helping raise money for
Children’s National Medical Center in Washington.
Using a transparent practice module, AU’s Spinoza
Practice Club raised more than $2,000 through a
“practice-a-thon” for the local Patricia M. Sitar Center
for the Arts. Club members traded two-hour shifts to
fill the module with music for 24 hours straight and
take donations from passersby, who couldn’t help but
gawk at the sight of a sparkling musical terrarium.
“We would go over there in the evening and hang
out with the residents,” said Plewa, who facilitated
the project. “The people there were very friendly
and appreciative. We learned a lot of really interesting things from the residents, about the city and
their own histories. If you talk to anyone who does
community service, they’ll tell you that whatever
you’re doing can make a difference, no matter how
small or big, in some way.”
Practice Makes Perfect . . .
Fund Raiser
Students Launch First Local
Alternative Break Trip
City Benefits through
Freshmen’s Service
This year, 525 freshmen began their AU careers
by fanning out across their new city to perform
an estimated 13,000 hours of volunteer service
at 44 sites. They served meals to the homeless,
cleaned parks, moved furniture at a nonprofit,
and learned their way around by lending a hand.
The freshman rite of passage in the week before
the start of classes has brought more than 7,000
AU students into the surrounding communities
over the past 16 years. AU’s Freshman Service
Experience is “the largest known program of its
kind nationally,” said Marcy Fink Campos, director
of the Community Service Center.
Former mayor Anthony Williams lauded the
students’ efforts. The challenges of the nation’s
capital should matter to every American, he
said, because “everyone’s heart and second
home should be Washington, D.C.” AU students
come from all over, but every year, hundreds
spend their first week in Washington making a
difference in their new city.
AU student Sereena Hamm had just returned from
a winter break service trip to Thailand last year, when
she read an eye-popping fact in the Washington Post.
“The article said the HIV infection rate in D.C.
was nearly 1 in 20,” she recalled, noting that the
rate is comparable to sub-Saharan Africa’s. “I was
shocked.” Shocked enough to do something about
it, in fact.
That summer Hamm began planning a service
trip a bit closer to home, and a year later she
participated in AU’s first alternative break trip in
Washington, D.C. Doing office work for a local
activist group and distributing safe-sex information
packets outside Metro stations, Hamm and nine
other students found that they didn’t need to travel
around the world to make a world of difference.
“It’s definitely gotten a lot of attention,” said Lucie
Jaronowski, the practice club’s president. “If we were
just sitting here with a sign, we wouldn’t have gotten
nearly as many people to stop.”
“We’re such an internationally focused school, and
there’s wonderful merit in that,” said Hamm, “but
we’re also part of a local community.”
4 {years AU has participated in the national Dr. Seuss Day}
525 {freshmen volunteered during Freshman Service Experience}
26 AU by the Numbers
Take Back the Night, a march and vigil held each
April during Sexual Assault Awareness Month,
has grown in leaps and bounds since 150 people
turned out for the inaugural event in 2004. In
April 2007, more than 400 people participated,
according to Hollander.
“We were able to bring a lot of different people
together,” said Hollander, who has returned to her
hometown of Boston to work for the domestic
violence organization Casa Myrna Vasquez, Inc.
“I really wanted to facilitate what I thought was
lacking on campus when I got here. As a survivor
myself, I tried to get people thinking about
the issue.”
In the summer of 2006, Wright represented AU
at the NCAA’s national leadership conference. She
returned with the motivation to transform the
Student-Athlete Advisory Committee into a more
effective body that also serves its community.
During the winter, the roughly 20 people on the
committee collected donations during basketball
home games and wrestling matches. They raised
about $1,000, which they used to buy toys for
the medical center’s Dr. Bear program, which
decorates the hospital rooms and provides young
patients with birthday and Christmas presents.
“Not only did it develop me professionally, but it
also gave me a sense of pride in my institution,”
Wright said of her involvement. “These are things
that will benefit people across campus.”
AU Celebrates Seuss Day with Local School Kids
You don’t outgrow Dr. Seuss. Just ask the 28 students, faculty, and staff who shared their
favorite Seuss stories with Washington school children in honor of the beloved author’s
birthday in March.
Donning the trademark red and white hats, the group read The Cat in the Hat, Green Eggs
and Ham, and other Seuss classics to kids at Bancroft and Brightwood Elementary Schools
in northwest Washington. The students also handed out special Seuss bookmarks in honor
of what would have been Theodor Seuss Geisel’s 103rd birthday.
“Seeing the joy on their faces was just wonderful,” said junior Raquel Fernandez, who
organized the event on behalf of the Community Service Center.
This was the fourth year AU participated in the national Dr. Seuss Day celebration.
American University 27
From the
Vice President of Finance and Treasurer
Financial statements summarizing the university’s operating results for the year ended April 30, 2007,
are presented on the following pages. I am pleased to report that American University experienced
another very successful year. We are especially proud of the growth of our endowment. For the first
time in the history of the university, our endowment value exceeded our operating budget. As of April 30,
2007, the endowment was valued at $396 million while our operating budget was $381 million. Net
assets increased by $71 million, or 13 percent, to $634 million, and total assets now stand at $978 million.
Total return for the endowment pool was 20.1 percent for the year ending June 30, 2007.
Report of Independent Auditors
To Board of Trustees of American University:
The university has been working on several important capital improvement projects to enhance our
facilities, ensuring an optimum environment for academic programs. In order to meet student housing
needs, construction to convert Nebraska Hall into a contemporary-style residence hall has been
completed. The building provides new housing for 113 students. Construction of Mary Graydon Center
was completed, providing the University Center complex a more contemporary design. It is the next
step in the development of a high-quality, comprehensive student center.
In our opinion, the accompanying balance sheets and the related statements of activities and of cash flows present fairly, in all material respects,
Construction started for the renovation of the Butler Instructional Center for use by the Kogod School
of Business. The renovation, which is scheduled to be completed by fall 2008, will connect the two
buildings and provide eight contemporary classrooms, a financial services computer lab, and office
space for career services. Design was completed and permit applications were filed for construction
of a 75,000-square-foot new home for the School of International Service. It will provide classroom,
faculty, staff, and meeting space and a 300-space underground parking garage. It is being designed
as a “green” building with many environmentally sensitive features. Construction is expected to be
completed by fall 2009. Planning continues on the project to renovate and expand McKinley into a
state-of-the-art building for the School of Communication.
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
All of our accomplishments this year are further steps to ensure academic growth and financial stability
for the university. In the year ahead, we look forward to the challenges before us as we continue efforts
to meet the growing needs of our institution.
the financial position of American University (the University) at April 30, 2007 and 2006, and the changes in its net assets and its cash flows for
the years then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are
the responsibility of the University’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America. Those
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.
July 30, 2007
Donald L. Myers
28 AU by the Numbers
American University 29
American University {balance sheets, April 30, 2007 and 2006}
(In thousands)
Assets
1 Cash and cash equivalents
$
2 Accounts and loans receivable, net
3 Contributions receivable, net
4 Prepaid expenses
5 Investments
6 Deposits with trustees/others
7 Property, plant, and equipment, net
8 Deferred financing costs
9 Interest in perpetual trust
10 Total assets
$
2007 2006
83,958 $ 64,432
23,645 19,521
21,770 23,458
915 2,011
469,616 395,589
29,227 476
329,102 323,306
4,641 3,771
15,211 14,109
978,085 $ 846,673
Liabilities and Net Assets
Liabilities:
11 Accounts payable and accrued liabilities
$
12 Deferred revenue and deposits
13 Indebtedness
14 Swap agreements
15 Assets retirement obligations
16 Refundable advances from the U.S. government
17 Total liabilities
Net assets:
Unrestricted
18 General operations
19 Internally designated
Capital
20 Designated funds functioning as endowments
21 Designated for plant
22
Total unrestricted
23 Temporarily restricted
24 Permanently restricted
25 Total net assets
26 Total liabilities and net assets
$
See accompanying notes to financial statements.
36,824 $ 32,064
18,154 15,813
255,875 213,974
20,911 10,002
3,956 3,762
7,911 7,818
343,631 283,433
5,586 111,454 5,380
98,083
322,301 271,410
104,199 102,345
543,540 477,218
13,198 13,603
77,716 72,419
634,454 563,240
978,085 $ 846,673
American University {statement of activities, year ended April 30, 2007}
Unrestricted net assets
Temporarily Permanently
General
Internally
restricted
restricted
(In thousands)
operations designated
Capital
Total
net assets
net assets
Total
Operating revenues and support
1 Tuition and fees
$ 310,633 $
868
$
-
$ 311,501
$
- $
- $ 311,501
2 Less scholarship allowances
(60,579)
(2,918)
- (63,497)
-
-
(63,497)
3 Net tuition and fees
250,054 (2,050)
-
248,004 -
-
248,004
4 Federal grants and contracts
509
13,388 -
13,897 - - 13,897
5 Private grants and contracts
6,554
8,070 2,028
16,652 - -
16,652
6 Indirect cost recovery
2,513
- -
2,513 -
2,513
7 Contributions
5,692
3,079 439 9,210 4,626
2,327 16,163
8 Endowment income
630
4,604 -
5,234 - -
5,234
9 Investment income
4,958
3,194 4,920
13,072 - -
13,072
10 Auxiliary enterprises
49,471
106 -
49,577 - -
49,577
11 Other sources
1,269
638 11
1,918 - -
1,918
12 Net assets released from restrictions
-
4,308 723
5,031 (5,031)
-
13 Total operating revenues and support
321,650
35,337 8,121
365,108 (405)
2,327 367,030
Operating expenses
14 Instruction
105,244
816 9,957
116,017 - -
116,017
15 Research
213
12,344 -
12,557 - -
12,557
16 Public service
9,251
206 553
10,010 - -
10,010
17 Academic support
30,146
5,959 4,426
40,531 - -
40,531
18 Student services
27,939
304 4,426
32,669 - -
32,669
19 Institutional support
46,400
1,980 5,531
53,911 - -
53,911
20 Auxiliary enterprises
27,185
-
30,424 57,609 - -
57,609
21 Facilities operations and maintenance
31,584
- (31,584)
- - -
22 Interest expense
9,322 -
(9,322)
- - -
23 Total operating expenses
287,284
21,609 14,411
323,304 - -
323,304
24 Excess (deficiency) of operating revenues and
support over operating expenses
34,366
13,728 (6,290)
41,804 (405)
2,327 43,726 25 Transfer among funds
(34,160)
(357)
33,017
(1,500)
- 1,500
-
Nonoperating items
26 Investment income
-
-
-
- - 367 367
27 Realized and unrealized net capital gains
-
-
29,000
29,000 - 1,103 30,103
28 Excess of nonoperating revenue over
nonoperating expense
- -
29,000
29,000 - 1,470 30,470
29 Change before effect on refunding of long-term debt
206
13,371 55,727
69,304 (405)
5,297 74,196
30 Effect on refunding of long-term debt
-
-
(2,982)
(2,982)
- -
(2,982)
31 Change in net assets
206 13,371 52,745
66,322 (405)
5,297 71,214
32 Net assets at beginning of year
5,380
98,083 373,755
477,218 13,603 72,419 563,240
33 Net assets at end of year
$ 5,586 $111,454 $ 426,500
$ 543,540 $13,198 $77,716 $ 634,454 See accompanying notes to financial statements.
30 AU by the Numbers
American University 31
American University {statement of activities, year ended April 30, 2006}
Unrestricted net assets
Temporarily Permanently
General
Internally
restricted
restricted
(In thousands)
operations
designated
Capital
Total
net assets
net assets
Total
Operating revenues and support
1 Tuition and fees
$ 293,160 $ 810
$
$ 293,970
$
- $
- $ 293,970 2 Less scholarship allowances
(57,114) (2,481)
-
(59,595)
- -
(59,595)
3 Net tuition and fees
236,046 (1,671)
-
234,375 - -
234,375 4 Federal grants and contracts
613 6,840 -
7,453 - -
7,453 5 Private grants and contracts
4,727 5,524 2,708 12,959 - -
12,959 6 Indirect cost recovery
2,703 -
-
2,703 - -
2,703 7 Contributions
5,373 1,985 1,587 8,945 1,605 2,400 12,950
8 Endowment income
413 4,422 -
4,835 - -
4,835 9 Investment income
5,283 1,085 3,526 9,894 - -
9,894 10 Auxiliary enterprises
48,369 10 -
48,379 - -
48,379 11 Other sources
1,001 2,715 -
3,716 - -
3,716 12 Net assets released from restrictions
- 7,041
1,196 8,237 (8,237)
-
-
13 Total operating revenues and support
304,528 27,951 9,017 341,496 (6,632)
2,400 337,264 Operating expenses
14 Instruction
99,679 198 8,732 108,609 - -
108,609 15 Research
347 10,594 -
10,941 - -
10,941 16 Public service
8,231 120 485 8,836 - -
8,836 17 Academic support
28,051 8,398 3,882 40,331 - -
40,331 18 Student services
27,130 60 3,881 31,071 - -
31,071 19 Institutional support
49,144 794 4,851 54,789 - -
54,789 20 Auxiliary enterprises
25,469 -
26,678 52,147 - -
52,147 21 Facilities operations and maintenance
28,124 -
(28,124)
- - -
-
22 Interest expense
8,637 -
(8,637)
- - -
-
23 Total operating expenses
274,812 20,164 11,748 306,724 - -
306,724 24 Excess (deficiency) of operating revenues
and support over operating expenses
29,716 7,787 (2,731)
34,772 (6,632)
2,400 30,540 25 Transfer among funds
(29,436)
8,231 21,205 - - -
-
Nonoperating items
26 Investment income
- -
-
- - 607 607 27 Other revenue
- -
3,000 3,000 - -
3,000 28 Realized and unrealized net capital gains
- -
53,213 53,213 - 1,270 54,483 29 Excess of nonoperating revenue over nonoperating expense
- 8,231 77,418 56,213 -
1,877 58,090 30 Change before cumulative effect
280 16,018 74,687 90,985 (6,632)
4,277
88,630 31 Cumulative effect of a change in accounting principle
- -
(3,048)
(3,048)- -
(3,048)
32 Change in net assets
280 16,018 71,639 87,937 (6,632)
4,277 85,582 33 Net assets at beginning of year, as previously reported
5,100 82,065 297,322 384,487 20,235 68,142 472,864 34 Adjustment to the beginning of year net assets
- -
4,794 4,794 - -
4,794 35 Net assets of beginning of year, as restated
5,100 82,065 302,116 389,281 20,235 68,142 477,658 36 Net assets at end of year
$ 5,380
$ 98,083 $373,755 $ 477,218 $13,603 $72,419 $ 563,240 See accompanying notes to financial statements.
32 AU by the Numbers
American University {statements of cash flows, years ended April 30, 2007 and 2006}
2007
(In thousands)
Cash flows from operating activities
1 Increase in net assets
Adjustments to reconcile increase in net assets to net cash
$
71,214 $
2006
85,582
provided by operating activities:
2 Cumulative effect of change in accounting principle
- 3,048
3 Effect of refunding of long-term debt
2,982 4 Net realized and unrealized capital gains (30,103) (54,483)
5 Depreciation and amortization 18,625 13,695
Changes in assets and liabilities
6 (Increase) decrease in accounts and university loans receivable, net (4,337) (2,611)
7 Decrease (increase) in contributions receivable, net
1,688 8,308
8 Decrease (increase) in prepaid expenses
1,096 (1,032)
9 Increase in accounts payable and accrued liabilities
4,760 3,239
10 Increase (decrease) in deferred revenue, deposits and
other refundable advances
2,434 (4,565)
11 Contributions collected and revenues restricted for long-term investment (4,228) (4,113)
12 Net cash provided by operating activities
64,131 47,068
Cash flows from investing activities
13 14 15 16 17 18 19 Purchases of investments
Proceeds from sales and maturities of investments
Additions of property, plant, and equipment
Proceeds from deposits with trustees
Capitalized interest
(Increase) decrease in deposits with trustees/other, net
Net cash used in investing activities
(147,177) (176,104)
113,060 180,647
(23,274) (20,576)
- 1,106
(697)
(28,751)
5,945
(86,839) (8,982)
Cash flows from financing activities
20 Student loans issued
(1,751) (2,017)
21 Student loans repaid
1,964 1,677
22 Payments on indebtedness (62,182) (1,450)
23 Issuance of debt
99,975 Proceeds from contributions restricted for
24 Investment in plant
785 3,442
25 Investment in endowment
3,443 671
26 Net cash provided by financing activities 42,234 2,323
27 Net increase in cash and cash equivalents 19,526 40,409
28 Cash and cash equivalents at beginning of year
64,432 24,023
29 Cash and cash equivalents at end of year
$ 83,958 $ 64,432
Supplemental disclosure of cash flow information
30 Cash paid during year for interest
$ 11,262 $
10,777
See accompanying notes to financial statements.
American University 33
American University {notes to financial statements, April 30, 2007 and 2006}
is restricted by explicit donor stipulations or by law. Expirations of temporary
restrictions recognized on net assets (i.e., the donor-stipulated purpose has
been fulfilled and/or the stipulated time period has elapsed) are reported as
reclassifications from temporarily restricted net assets to unrestricted net assets.
Temporary restrictions on gifts to acquire long-lived assets are considered met
in the period in which the assets are acquired or placed in service.
( 1) American University
American University (the University) is an independent, coeducational
university located on an 85-acre campus in northwest Washington, D.C. It was
chartered by an Act of Congress in 1893 (the Act). The Act empowered the
establishment and maintenance of a university for the promotion of education
under the auspices of the Methodist Church. While still maintaining its
Methodist connection, the University is nonsectarian in all of its policies.
American University offers a wide range of graduate and undergraduate degree
programs, as well as nondegree study. There are approximately 575 total faculty
members in six academic divisions, and approximately 11,500 students, of
which 6,300 are undergraduate students and 5,200 are graduate students. The
University attracts students from all 50 states, the District of Columbia, Puerto
Rico, and nearly 150 foreign countries.
(2) Summary of Significant Accounting Policies
Basis of Presentation
The financial statements of the University have been reported on the accrual
basis of accounting.
Classification of Net Assets
Net assets, revenues, gains, and losses are classified based on the existence or
absence of donor-imposed restrictions. Accordingly, net assets of the University
and changes therein are classified and reported as follows:
Contributions, including unconditional promises to give, are recognized as
revenues in the period received. Conditional promises to give are not recognized
until the conditions on which they depend are substantially met. Contributions
of assets other than cash are recorded at their estimated fair value at the date
of gift. Contributions to be received after one year are discounted at a rate
commensurate with the risk involved. Amortization of the discount is recorded
as additional contribution revenue and used in accordance with donor-imposed
restrictions, if any, on the contributions. Allowance is made for uncollectible
contributions based upon management’s judgment and analysis of the creditworthiness of the donors, past collection experience, and other relevant factors.
The University follows a practice of classifying its unrestricted net asset class
of revenues and expenses as general operations, internally designated, or
capital. Items classified as general operations include those revenues and
expenses included in the University’s annual operating budget. Items classified
as capital include accounts and transactions related to endowment funds
and plant facilities and allocation of facilities operations and maintenance,
depreciation, and interest expense. All other accounts and transactions are
classified as internally designated.
Unrestricted—Net assets that are not subject to donor-imposed stipulations.
Transfers consist primarily of funding designations for specific purposes and
for future plant acquisitions and improvements.
Temporarily Restricted—Net assets subject to donor-imposed stipulations
that either expire by passage of time or that can be fulfilled by actions of the
University pursuant to those stipulations.
Permanently Restricted—Net assets subject to donor-imposed stipulations that
they be maintained permanently by the University.
Nonoperating activities represent transactions relating to the University’s longterm investments and plant activities, including contributions to be invested
by the University to generate a return that will support future operations,
contributions to be received in the future or to be used for facilities and equipment, and investment gains or losses.
Revenues are reported as increases in unrestricted net assets unless use of the
related assets is limited by donor-imposed restrictions. Contributions are
reported as increases in the appropriate category of net assets. Expenses are
reported as decreases in unrestricted net assets. Gains and losses on investments
are reported as increases or decreases in unrestricted net assets unless their use
34 AU by the Numbers
American University {notes to financial statements, April 30, 2007 and 2006}
Deposits with Trustees/Others
All highly liquid cash investments with original maturities at date of purchase
of three months or less are considered to be cash equivalents. Cash equivalents consist primarily of money market funds. The carrying amount of cash
equivalents approximates fair value.
Property, Plant, and Equipment
Investments
Cash Equivalents
Deposits with trustees consist of debt service funds and the unexpended
proceeds of certain bonds payable. These funds are invested in short-term,
highly liquid securities and will be used for construction of, or payment
of debt service on, certain facilities.
Equity securities with readily determinable fair values and all debt securities
are recorded at fair value in the balance sheet and the fair value of these investments is based upon values provided by the external investment managers or
quoted market values. In the limited cases where such values are not available,
carrying value is used as an estimate of fair value. All cash and money market
funds in the investment accounts are recorded as investments. Real estate
and other investments are recorded at historical cost or fair value at date of
donation. Endowment income included in operating revenues consists of
interest and dividends from investments of endowment funds. All realized and
unrealized gains and losses from investments of endowment funds are reported
as nonoperating revenues. Investment income included in operating revenues
consists primarily of interest and dividends from investments of working capital
funds and unexpended plant funds.
The fair value of alternative investments in limited stock partnerships is determined by using the University’s percentage of interest in each of the limited
partnerships and the partnership’s estimated fair value, as disclosed in such
partnership’s audited financial statements. The estimated fair value of a partnership is determined by the general partner based upon the fair value of the
partnership’s investments. These valuations necessarily involve assumptions
and estimation methods which are uncertain, and therefore the estimates could
differ materially from actual results. The University reviews and evaluates the
values by the investment managers and agrees with the valuation methods and
assumptions used in determining the fair value of the alternative investments.
Alternative investments are less liquid than the University’s other investments.
The investments in these limited stock partnerships, as well as certain mutual
funds classified as equity securities, may include derivatives and certain private
investments which do not trade on public markets and therefore may be
subject to greater liquidity risk.
Property, plant, and equipment are stated at cost on the date of acquisition
or at estimated fair value if acquired by gift including interest capitalized
on related borrowings during the period of construction, less accumulated
depreciation. Certain costs associated with the financing of plant assets are
deferred and amortized over the terms of the financing. Depreciation of the
University’s plant assets is computed using the straight-line method over asset’s
estimated useful life, generally over 50 years for buildings, 20 years for land
improvements, 5 years for equipment, 10 years for library collections, and 50
years for art collections.
Refundable Advances from the U.S. Government
Funds provided by the United States Government under the Federal Perkins
Loan Program are loaned to qualified students and may be reloaned after
collections. Such funds are ultimately refundable to the government. Approximately 20% and 15% of net tuition and fees revenue for the years ended April
30, 2007 and 2006, respectively, was funded by federal student financial aid
programs (including loan, grant, and work-study programs).
Income Taxes
The University has been recognized by the Internal Revenue Service as exempt
from federal income tax under Section 501(c)(3) of the U.S. Internal Revenue
Code, except for taxes on income from activities unrelated to its exempt purpose.
Such activities resulted in no net taxable income in fiscal years 2007 and 2006.
Fair Value of Financial Instruments
The carrying amount of cash and cash equivalents, accounts receivable, deposits
with trustees, and accounts payable, and accrued expenses approximates fair
value because of the short maturity of these financial instruments.
A reasonable estimate of the fair value of the loans receivable from students
under government loan programs could not be made because the loans
receivable are not salable and can only be assigned to the U.S. government or
its designees. The fair value of loans receivable from students under University
loan programs and real estate and other investments approximate carrying value.
Investment income is reported net of management fees and rental real estate
property expenses.
American University 35
American University {notes to financial statements, April 30, 2007 and 2006}
The carrying amount of indebtedness approximates fair value because these
financial instruments either bear interest at variable rates, which approximate
current market rates for loans with similar maturities and credit quality, or the
discount on the fixed rate indebtedness approximates a current market adjustment.
The University makes limited use of derivative financial instruments for the
purpose of managing interest rate risks. Current market pricing models are
used to estimate fair values of interest rate swap agreements. The fair market
value of all other financial instruments in the financial statements approximates reported carrying value.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect: (1) the reported amounts of assets and liabilities; (2) disclosure
of contingent assets and liabilities at the date of the financial statements;
and (3) the reported amounts of revenues and expenses during the reporting
period. Significant items subject to such estimates and assumptions are the
value of non-traditional investments, the asset retirement obligations and the
postretirement benefit plan. Actual results could differ materially, in the near
term, from the amounts reported.
Reclassifications
Certain prior year balances have been reclassified to conform to the current
year presentation.
New Accounting Pronouncement
In September 2006, Financial Accounting Standards Board Statement No. 158,
Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plan
(FAS 158) was issued. This standard will be effective for the University’s April
30, 2008, year end. FAS 158 requires organizations to record a net liability or
asset to report the funded status of their defined benefit pension and other
postretirement benefit plans on their balance sheets. Management is determining
the impact of FAS 158 on the financial statements.
36 AU by the Numbers
American University {notes to financial statements, April 30, 2007 and 2006}
(3) Accounts and Loans Receivable
Accounts and loans receivable, net, at April 30, 2007 and 2006, are as follows
(in thousands):
Accounts receivable
1Student
$
2Grants, contracts, and other
3Accrued interest
4Student loans
5
6Less allowance for uncollectible
accounts and loans
7
2007
2006
4,084 $ 3,949 7,157 6,347 1,358 412 11,719 9,379 24,318 20,087 (673)
$ 23,645 (566)
$ 19,521 (4) Contributions Receivable
As of April 30, 2007 and 2006, unconditional promises to give were as follows
(in thousands):
2007
2006
Amounts due in:
8Less than one year
$ 6,743 $ 9,627
9One year to five years 17,201 16,246 10Over five years
228 148
11 24,172 26,021
12Less unamortized discount (576)
(737)
13Less allowance for doubtful
accounts (1,826) (1,826)
14
$ 21,770 $23,458 Contributions receivable over more than one year are discounted at rates
ranging from 3% to 6.5%, which approximates the risk-free rate of return
for the expected term of the promise to give at the date of gift. As of April 30,
2007 and 2006, the University had also received bequest intentions and conditional promises to give of $15.3 million and $10.2 million, respectively. These
intentions to give are not recognized as assets. If the bequests are received,
they will generally be restricted for specific purposes stipulated by the donors,
primarily endowments for faculty support, scholarships, or general operating
support of a particular department of the University. Conditional promises to
give are recognized as contributions when the donor-imposed conditions are
substantially met.
Amortization of the discount is recorded as additional contribution revenue
and is used in accordance with the donor-imposed restrictions, if any, on the
contributions. An allowance is made for uncollectible pledges based upon
management’s judgment and analysis of the creditworthiness of the donors, past
collection experience, and other relevant factors.
(5) Investments
Investments by type at April 30, 2007 and 2006, are as follows (in thousands):
Cost
Fair Value
Cost
Fair Value
2007
2007
2006
2006
1Money market
$ 6,836 $ 6,836 $ 5,256 $ 5,256
2 U.S. government
obligations
882 866 853 820
3Fixed income funds116,623 114,737 106,100 103,079
4Corporate stocks114,300 149,509 94,882 117,164
5Equity mutual funds 5,872 6,711 5,687 5,761
6International equity funds 49,026 78,645 50,501 76,880
7Alternative asset funds 47,370 72,888 43,025 61,670
8Real estate funds 19,002 19,470 10,440 17,249
9Real estate and other 19,954 19,954 7,710 7,710
10
$379,865 $ 469,616 $324,454 $395,589
Investments in debt securities and equity securities consist primarily of
investments in funds managed by external investment managers.
At April 30, 2007 and 2006, the assets of endowments and funds functioning as
endowments were approximately $396 million and $340 million, respectively.
(6) Property, Plant, and Equipment
Property, plant, and equipment and related accumulated depreciation and
amortization at April 30, 2007 and 2006, is as follows (in thousands):
2007
2006
11Land and improvements
$ 39,192 $ 39,141
12Buildings384,105 379,546
13Equipment 78,055 77,185
14Construction in progress 23,829 9,759
15Library and art collections 58,801 54,530
16583,982 560,161
17Accumulated depreciation and
amortization(254,880)(236,855)
18
$329,102 $323,306
Construction in progress at April 30, 2007 and 2006, relates to building
improvements and renovations.
For the year ended April 30, 2007 and 2006, depreciation expense was
approximately $18.3 and $13.3 million, respectively.
(7) Indebtedness
The University classifies its debt into two categories: core debt and special
purpose debt. Core debt represents debt that will be repaid from the general
operations of the University and includes borrowings for educational and
auxiliary purposes. Special purpose debt represents debt that is repaid from
sources outside of general operations and includes borrowings for buildings,
which house some administrative offices, along with rental space.
Indebtedness at April 30, 2007 and 2006, consists of the following (in thousands):
2007
2006
Core Debt
19 District of Columbia variable rate weekly demand
revenue bonds, The American University
Issue Series 1985, maturing in 2015
$ 48,900 $ 48,900
20 District of Columbia variable rate weekly demand
revenue bonds, The American University Issue
Series 1985A, maturing in 2015 12,000 12,000
21 District of Columbia University Revenue Bonds,
American University Issue Series 1996, maturing
in 2026, net of discount of $1,136 in 2006
- 58,074
22District of Columbia University Revenue Bonds,
American University Issue Series 1999,
maturing in 2028 21,000 21,000
23District of Columbia University Revenue Bonds,
American University Issue Series 2003,
maturing 2033 37,000 37,000
24District of Columbia University Revenue Bonds,
American University Issue Series 2006,
maturing 2036 99,975 25 Total core debt218,875 176,974
Special Purpose Debt
26Note payable, variable rate, due in full in 2021 22,000 22,000
27Note payable, variable rate, due in full in 2020 15,000 15,000
28 Total special purpose debt 37,000 37,000
29 Total indebtedness
$255,875 $213,974
American University 37
American University {notes to financial statements, April 30, 2007 and 2006}
American University {notes to financial statements, April 30, 2007 and 2006}
The principal balance of bonds and notes payable outstanding as of April 30,
2007, are due as follows (in thousands):
Year ending April 30:
60,900
15,000
22,000
21,000
37,000
99,975
255,875
1
2015
$
2
2020
3
2021
4
2028
5
2033
6
2036
7
$
District of Columbia Bonds Payable
The Series 1985 and Series 1985A bonds are secured by deeds of trust on
certain of the University’s real property and by bond insurance policies. The
bond insurance policies allow the bond trustee to pay the principal and
interest on the bonds and to pay the purchase price of the bonds, which are
not remarketed to the extent that monies are not available from other sources.
Interest on both of these bond issues is at a variable rate. The variable rate
was effectively changed to a 4.6% fixed rate by the University entering into
an interest rate swap agreement with Ambac Assurance Corporation.
The Series 1996 bonds were advance refunded from proceeds of the Series
2006 bonds issued August 16, 2006.
The Series 1999 bonds bear interest at a variable rate and are general unsecured
obligations of the University. The variable rate was effectively changed to a
4.1% fixed rate by the University entering into an interest rate swap agreement
with Morgan Stanley Capital Services. The proceeds from the bonds were used
to repay a mortgage note prior to its scheduled maturity.
Notes Payable
38 AU by the Numbers
In 2001, the University issued a $22 million note for the purchase of a building.
The note payable bears interest at a variable rate. The University is obligated
to make monthly interest payments only on the unpaid principal amount of
the loan, which is payable in full on September 7, 2021. The variable rate was
effectively changed to a 5.54% fixed rate by the University entering into an
interest rate swap agreement with Morgan Stanley Capital Services.
Interest Rate Swaps
The Series 2003 bonds bear interest at a variable auction rate and are general
unsecured obligations of the University. The proceeds were used to fund
construction and renovation projects relating to the Katzen Arts Center and
Greenburg Theatre.
The Series 2006 bonds bear interest at a variable auction rate and are general unsecured obligations of the University. The proceeds were used to advance refund
the Series 1996 bond issue, thus reducing the University’s overall interest costs,
and to fund construction and renovation projects including Nebraska Hall and
the School of International Service building. The effect of the refunding of the
Series 1996 bonds is a nonoperating charge of $2,981,903 which includes the
write-off of unamortized bond issuance costs and original issue discount.
In 2003, the University issued a $15 million note payable to replace a 1998
note. The note is payable in full in April 2020. The interest rate is LIBOR plus
0.45%, payable monthly.
The University has entered into interest rate swap agreements to reduce the
impact of changes in interest rates on its floating rate long-term debt. At April
30, 2006, the University had outstanding interest rate swap agreements with
Ambac Assurance Corporation, a AAA-rated bond insurance company, for
its Series 1985 and Series A bonds, and an interest rate swap agreement with
Morgan Stanley Capital Services, an A+-rated investment banker, on its Series
1999 bonds and 2001 note payable. The four interest rate swap agreements
have a total notional principal amount of approximately $104 million. These
agreements effectively change the University’s interest rate to a 4.6% fixed
rate for Series 1985 and Series A bonds, a 4.1% fixed rate for the Series 1999
bonds, and a 5.54% fixed rate for the 2001 note payable. The interest rate
swap agreements mature at the time the related notes mature. The University
is exposed to credit loss in the event of nonperformance by the other parties to
the interest rate swap agreements. However, the University does not anticipate
nonperformance by the counter parties.
In December 2005, the University also entered into forward-starting interest
rate swap agreements with Morgan Stanley Capital Services for interest rate
swaps with a total notional principal amount of approximately $113 million.
These agreements fixed the University’s interest rate at 5.26% on $62,825,000
of refunding bonds beginning October 1, 2006, 4.38% on $30,000,000 of
new money bonds beginning October 1, 2006, and 4.46% on $20,000,000
of new money bonds beginning October 1, 2007.
The accumulated unrealized loss that was recognized for these swaps as of April
30, 2007 and 2006, was $10,909,000 and $862,000, respectively, and is included in realized and unrealized net capital gains in the statement of activities.
The transition obligation was established at May 1, 1993, and is being amortized
to postretirement benefit cost over 20 years.
The weighted discount rate used in the actuarial valuation at the January 31,
2007 and 2006, measurement dates are as follows:
( 8) Employee Benefit Plans
Eligible employees of the University may participate in two contributory
pension and retirement plans, one administered by the Teachers Insurance
and Annuity Association and College Retirement Equities Fund and the other
administered by Fidelity Investments. Under these plans, contributions are fully
vested and are transferable by the employees to other covered employer plans.
Participating employees contribute a minimum of 1% up to a maximum of 5%
of their base salary. The University contributes an amount equal to twice the
employee’s contribution.
2007
2006
12End of year benefit obligation 6.00% 5.75%
13Net periodic postretirement benefit cost 6.00% 5.75%
An 11% healthcare cost trend rate was assumed for fiscal 2004, with the rate
decreasing 1% each year to an ultimate rate of 5% in fiscal year 2010 and thereafter. An increase in the assumed healthcare cost trend rate of 1% would increase
the net periodic postretirement benefit cost by approximately $165,000 and
$134,000 for 2007 and 2006, respectively, and the accumulated postretirement
benefit obligation at April 30, 2007 and 2006, by approximately $1.2 and $1.4
million, respectively. A decrease in the assumed healthcare cost trend rate of 1%
would decrease the net periodic postretirement benefit cost by approximately
$138,000 and $113,000 for 2007 and 2006, respectively, and the accumulated
postretirement benefit obligations at April 30, 2007 and 2006, by approximately
$1.4 and $1.2 million.
Benefits were paid during the fiscal year 2007 and 2006 in the amounts of
approximately $1,331,000 and $1,452,000, respectively.
The University’s contribution to these plans was approximately $10.0 million
and $9.9 million for the years ended April 30, 2007 and 2006, respectively.
Postretirement Healthcare Plan
The University provides certain healthcare benefits for retired employees. The
plan is contributory and requires payment of deductibles. The University’s policy
is to fund the cost of medical benefits on the pay-as-you-go basis. The status of
the University’s postretirement benefit plan is summarized, as follows, at April
30, 2007 and 2006 (in thousands). The plan’s measurement dates are January
31, 2007 and 2006.
2007
2006
1Accumulated postretirement
benefit obligation in excess of
plan assets
$ (20,691)
$(21,028)
2Fair value of plan assets- 3 Funded status of plan
$ (20,691)
$(21,028)
4Unrecognized net gain 5,639 6,553
5Unrecognized transition obligation 4,005 4,672
6
Accrued postretirement benefit cost $ (11,047)
$ (9,803)
Net periodic postretirement benefit cost for the years ended April 30, 2007 and
2006, includes the following components (in thousands):
2007
2006
7Service cost
$
448 $ 472
8Interest cost 1,167 1,136
9Amortization of transition
obligation over 20 years
667 667
10Amortization of net loss
293 349
11 Net periodic postretirement
benefit cost
$ 2,575 $ 2,624
The expected contributions by the University to the plan are as follows
(in thousands):
Net of Without
Medicare
Medicare
Part D
Part D
Year ending April 30
Subsidy
Subsidy
14
2008
$ 1,521 $ 1,709
15
2009
1,584 1,791
16
2010
1,648 1,874
17
2011
1,691 1,934
18 2012
1,702 1,962
19
2013–2017 8,281 9,854
American University 39
American University {notes to financial statements, April 30, 2007 and 2006}
(9) Expenses
For the years ended April 30, 2007 and 2006, the University’s program services
and supporting services were as follows (in thousands):
2007
2006
Program services
1Instruction
$ 116,017
$ 108,609
2 Research 12,557 10,941
3Public service 10,010 8,836
4Academic support 40,531 40,331
5Student services 32,669 31,071
6 Total program services 211,784 199,788
Supporting services
7 Institutional support 53,911 54,789
8 Auxiliary enterprises 57,609 52,147
9 $ 323,304 $ 306,724
For the years ended April 30, 2007 and 2006, the University’s fundraising
expenses totaled approximately $9,220,000 and $10,003,000, respectively, and
are included in institutional support in the accompanying statement of activities.
( 10) Deferred Revenue and Deposits
Deferred revenue and deposits include credit balances held in the accounts of
organizations that sponsor students attending the University. Sponsor credit
balances amounted to approximately $729,000 and $755,000 at April 30,
2007 and 2006, respectively.
13Permanent endowment funds,
for scholarships and related
academic activity
$
14Interest in trust assets
15Student loans
16
$
2007
Contingencies
Amounts received and expended by the University under various federal
programs are subject to audit by governmental agencies. In the opinion of
the University’s administration, audit adjustments, if any, will not have a
significant effect on the financial position, changes in net assets, or cash
flows of the University.
The University is a party to various litigation arising out of the normal
conduct of its operations. In the opinion of the University’s administration,
the ultimate resolution of these matters will not have a materially adverse effect
upon the University’s financial position, changes in net assets or cash flows.
During 2002, the University was named as a defendant in several lawsuits related
to claims arising from ongoing investigation into environmental matters. These
matters date back to military activities conducted on and around the University’s
campus during World War I. As of June 2007, all of the lawsuits related to this
issue have been successfully resolved, either through settlement or dismissal
actions. The remediation and investigative work of the Department of Defense
is anticipated to continue through 2011.
2006
58,321 $ 54,367
15,103 14,079
4,292 3,973
77,716 $ 72,419
(12) Operating Lease
The University has two leases for buildings that are used for student housing
and office space. The lease for the building used for student housing expires in
2012. The lease for the building used for office space expires in 2010 and lease
payments are at below market rates. The minimum lease payments under these
agreements are as follows (in thousands):
Year ending April 30:
2008
$ 8,473
18
2009
8,811
19
2010
8,882
20
2011
8,675
21
2012
9,022
22
Thereafter
2,277
23
$ 46,140
( 14) Cumulative Effect of Change in Accounting Principle
The University adopted Financial Accounting Standards Board (FASB)
Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations
(FIN 47), an interpretation of FASB Statement No. 143, Accounting for Asset
Retirement Obligations (SFAS 143), on April 30, 2006. FIN 47 requires that
the fair value of the liability for the asset retirement obligations (ARO) be
recognized in the period in which it is incurred and the settlement date is
estimable, even if the exact timing or method of settlement is unknown. The
ARO is capitalized as part of the carrying amount of the long-lived asset
retroactively to the time at which legal or contractual regulations created the
obligation. Our ARO is primarily associated with the cost of removal and
disposal of asbestos, lead paint, and asset decommissioning.
As a result of implementing FIN 47, the University recorded a cumulative
effect of change in accounting principle of approximately $3,047,633.
The ARO as of April 30, 2007 and 2006, is $3,956,354 and $3,762,454,
respectively, and is a non-current liability on the balance sheet.
17
(11) Net Assets
Temporarily restricted net assets consist of the following at April 30, 2007
and 2006 (in thousands):
2007
2006
10Unspent contributions and related
investment income for instruction
and faculty support
$ 8,678 $ 12,835
11Gifts received for construction of
facilities 4,520 768
12
$ 13,198 $ 13,603
40 AU by the Numbers
Permanently restricted net assets were held, the income of which will benefit
the following at April 30, 2007 and 2006 (in thousands):
American University {notes to financial statements, April 30, 2007 and 2006}
Rent expense in both 2007 and 2006 was approximately $8.4 million.
(13) Commitments
At April 30, 2007 and 2006, commitments of the University under contracts
for construction of plant facilities amounted to approximately $5.8 and $5.6
million, respectively.
The University has a line of credit with the Student Loan Corporation totaling
$50 million. As of April 30, 2007 and 2006, the University had no amounts
outstanding under this line of credit.
American University 41
University Administration
Board of Trustees
Cornelius M. Kerwin, President
Ivy E. Broder, Interim Provost
Gail S. Hanson, Vice President of Campus Life
Mary E. Kennard, Vice President and General Counsel
Donald L. Myers, Vice President of Finance and Treasurer
Robert A. Pastor, Vice President of International Affairs
David E. Taylor, Chief of Staff
Gary M. Abramson,* Chairman
Thomas A. Gottschalk, Vice Chairman
Gina F. Adams*
Stephanie M. Bennett-Smith
Edward R. Carr*
Jack C. Cassell*
Gary D. Cohn*
Pamela M. Deese*
Jerome King Del Pino
David R. Drobis*
Marc N. Duber*
Fuad El-Hibri
Hani M. S. Farsi*
C. A. Daniel Gasby
Gisela B. Huberman*
C. Nicholas Keating Jr.*
Cornelius M. Kerwin*
Haig Mardirosian, Dean of Academic Affairs
Richard M. Durand, Dean, Kogod School of Business
Louis W. Goodman, Dean, School of International Service
Claudio M. Grossman, Dean, Washington College of Law
Larry Kirkman, Dean, School of Communication
William M. LeoGrande, Dean, School of Public Affairs
Kay J. Mussell, Dean, College of Arts and Sciences
Linda Bolden-Pitcher, University Registrar
William A. Mayer, University Librarian
42 AU by the Numbers
Margery Kraus*
Jonathan Loesberg
Charles H. Lydecker*
Robyn Rafferty Mathias*
Alan L. Meltzer*
Regina L. Muehlhauser*
Matthew S. Pittinsky*
Arthur J. Rothkopf
Mark L. Schneider
John R. Schol
Neal A. Sharma*
Jeffrey A. Sine*
Marc Tomik*
Gary R. Weaver
*Alumna or alumnus of
American University
Nondiscrimination Notice
American University does not discriminate on the basis of race, color, religion, national
origin, sex, age, marital status, personal appearance, sexual orientation, gender identity and
expression, family responsibilities, political affiliation, disability, source of income, place of
residence or business, and certain veteran status in its programs and activities. The following
persons, located at 4400 Massachusetts Avenue, NW, Washington, DC 20016, have been
designated to handle inquiries regarding the university’s nondiscrimination policies:
Dean of Students, 202-885-3300
Executive Director for Human Resources, 202-885-2451
Provost, 202-885-2127
Produced by University Publications, American University
Suzanne Bechamps, Editor
Adrienne Frank, Writer
Maria Jackson, Designer
Jeff Watts, Photographer
Sally Acharya, Matt Getty, Mike Unger, Contributing Writers
UP08-005
By using environmentally friendly paper for this annual report,
American University saved the following resources:
5 {trees preserved for the future}
1,713 {gallons of wastewater flow saved}
3,000,000 {BTUs energy not consumed}
250 {pounds solid waste not generated}
464 {pounds net greenhouse gases prevented}
Source: environmentaldefense.org
American University 31
4400 Massachusetts Avenue, NW
Washington, DC 20016