East Stroudsburg University
Environmental Scan
and
Five-Year Budget Projection
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Donna R. Bulzoni, CPA, MBA, SPHR
March 1, 2012
March 1, 2012
Table of Contents
Overview…………………………………………………………………………....…..3
Economic Outlook…………………………………………………………….…...…4-5
Government……………………………………….……………………….……..…..6-7
Economic Development………………………………………………….….……...8-9
Facilities…………………………………………………………….……………....10-11
Human Resources………………………………………………………………..….…12
Financial Resources……………………………………………………….……....13-14
Enrollment……………………………………………………………………..…...15-17
Fund Raising……………………………………………………………….…….……..18
Budget Highlights…………………………………………………………..…….…...19
Five-Year Budget Projections………………………………………………....…20-21
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Overview
It is daunting…..
Excerpt from PASSHE ‘s
Statement on Gov. Corbett‟s
2012-13 proposed budget:
“The proposed budget represents the
latest in a cascade of reductions to the
State System in the past 18 months. If
this proposal stands, we will have lost
more than $170 million in state and
federal education and general funding,
compounded by a 50 percent reduction
in our capital allocation and the loss of
Key ’93 funding dedicated to deferred
maintenance. Taken together, these
reductions now mean that we must
increasingly decide whether to renovate
and maintain our existing physical plant
or provide students the courses and
programs they require to graduate.”
We are being challenged as we have never been before. As
this Environmental Scan is prepared, events outside East
Stroudsburg University’s control continue to negatively
impact our University. Just a few short weeks ago, the
Governor requested a 5% freeze, approximately $1.2M for
ESU, of this year’s state appropriation with the promise it will
be released should the Commonwealth’s revenue picture
improve by the close of the fiscal year. As of this writing, the
PASSHE Board of Governor’s has not agreed to this request.
Additionally, last week the Governor made his annual budget
announcement and issued his budget proposal for Fiscal Year
2012-2013. Implications for the Pennsylvania State System of
Higher Education and East Stroudsburg University should it
pass are not good, resulting in further reductions in state
appropriation. The Governor’s budget also called for a 5%
reduction in student aid which could impact enrollment
should students find themselves unable to identify
alternative financing options.
These are very telling times for East Stroudsburg University.
It is becoming more and more difficult to manage resources
when state funding has become so tenuous and students’
behavior is becoming exceedingly unpredictable.
We need to find ways to work smarter, with less resources
(both human and capital), while staying focused on our
mission and keeping our students as our first priority. Our
viability hinges on it.
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Economic Outlook
The National Outlook
States continue to be fiscally challenged as we enter the fifth year of
the current recession. According to the Center on Budget and Policy
Priorities, new state budget estimates for the upcoming fiscal year
indicate states still face a long and uncertain recovery. Twenty-nine
states (see Figure 1-states highlighted in blue) have projected or
have addressed shortfalls totaling $44 billion for fiscal year 2013, the
fiscal year that begins July 1, 2012. This number is also expected to
grow as new projections are released.
In recent years, the extremely large shortfalls in state budgets have
been filled with deep cuts in critical public services like education,
health care, and human services. Given there are fewer options for
addressing the projected shortfalls for next fiscal year, further cuts
in these same areas are expected to fill the new budget gaps.
The American Recovery and Reinvestment Funds provided to the
states by the Federal Government allowed states to avert some of
the most harmful potential budget cuts in 2009, 2010 and 2011
fiscal years. However, those funds have evaporated and we are
expecting some of the deepest cuts to state services since the start
of the recession.
States' fiscal conditions are improving but they have far to go (see
Figure 3). State tax revenue grew 8.3 percent in the 12-month
period ending in June 2011. However, to put things into
perspective, if revenues continue to grow at last year's rate, it will
take seven years to rebound.
Although the revenue outlook is trending upward, the large budget
shortfalls states are facing are huge by historical standards (See
Figure 2). Overall, the economy remains weak and unemployment is
still high.
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growth. The gap between the two rates of growth is expected to reemerge beginning in 2012 and continuing through at least 2015.
The Pennsylvania Outlook
The Commonwealth’s economic performance is largely hinged
upon job growth. During the current recession, Pennsylvania lost
nearly 234,000 jobs. Job growth returned in 2010 but at very
modest levels. The following table shows actual job growth in the
Commonwealth in years 2010 and 2011 and forecasted job growth
for 2012 (by December 2012). As you can see, job growth is
expected to accelerate during 2012.
Pennsylvania Job Growth
Economic Growth
Year
Pennsylvania
Nation
2008
.2%
(.3)%
2009
(1.7)%
(3.5)%
Year
Net New Jobs
2010
3.0%
3.0%
2010
64,000
2011
1.7%
1.7%
2011
60,000
2012 (forecast)
80,000 (by 12/2012)
The Commonwealth’s unemployment rate peaked at 9.3 percent in
July 2010 and is steadily declining. It is forecast to remain relatively
constant at around 8 percent for 2012 and 2013, before declining to
7.3 percent in 2014 and 6.4 percent in 2015.
In 2009, Pennsylvania’s rate of growth in real personal income
declined 2.9 percent while the nation as a whole dropped 4.4
percent. Since that time, the commonwealth’s growth rate has very
closely mirrored that of the national growth rate. For 2012,
Pennsylvania’s growth in real personal income is expected to equal
that of the national average.
Growth in Real Personal Income
Year
Pennsylvania
Nation
2009
(2.9)%
(4.4)%
2010
1.5%
1.9%
2011
2.1%
2.3%
2012
2.1%
2.1%
The Commonwealth has outperformed the national economy during
2008 through 2010. In 2011, the Pennsylvania and national
economies expanded at roughly the same rate of 1.7 percent annual
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Government
Given East Stroudsburg University’s position as a member of the
Pennsylvania State System of Higher Education and a “state-owned”
institution, trends in governmental activity are relevant to our future
financial health.
The burden of addressing this issue has been shifted to the students
by increasing tuition and fees. The following graph compares
appropriation versus tuition and fees only (the previous graph
includes all other E&G revenue sources).
For Fiscal Year 2011-2012, after factoring in the Governor’s 5%
appropriation freeze, approximately 21.1% of the University’s
operating budget is derived from state appropriations, now
approximately $20.4 million per year. With the Governor’s latest
proposed reduction for the upcoming fiscal year, it drops to 17.2%
or approximately $16.3M.
Where once the University received approximately 2/3s of its
operating budget through state appropriations, for Fiscal Year 20112012 it received slightly more than 1/5.
FY 2011-2012 Revenue
21%
79%
Appropriation (incl AFRP & Perf Fndg)
Other
For the past 15 years, appropriations have not kept pace with either
student growth or increased costs due to inflation. The following
chart shows PASSHE Appropriation per Student FTE as adjusted for
inflation in 2010 dollars for the period Fiscal Year 2000-2001 through
Fiscal Year 2010-2011.
As a result of this shift, college affordability continues to decline. The
National Center for Public Policy and Higher Education’s Policy, in
their Alert-June 2011, made the following observations regarding
college affordability:
College Affordability…
Many students are not able to keep pace with rising tuition,
because family earnings have lost ground over the past
decade.
Tuition at two-year and four-year institutions has outpaced
median family income in the majority of states—and in all
states where community colleges are most critical to
access to college opportunity and to the baccalaureate
degree.
Student financial aid did not keep pace with tuition costs,
exacerbating the college affordability problem.
Forty-four percent of low-income students (those with a
family income of less than $25,000 per year) attend
community colleges as their first college after high school.
The most underserved populations are among the least
able to afford steeply rising tuition, least likely to enroll in
college, and least likely to complete degrees and
certificates
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PASSHE and its 14 universities, however, have remained
competitively affordable.
An additional issue of some importance to public higher education is
the increased concern on the parts of the executive and legislative
branches of government on accountability. Government expects
public universities to run efficiently and to use the public funds
provided as prudently as possible. Further, government expects
results from the universities it funds in the form of well-trained
students, who move expeditiously through their academic programs
and become capable of contributing to the state’s economy.
According to the PASSHE news post:
East Stroudsburg University and PASSHE have been successful in
meeting these expectations, producing skilled, successful graduates.
According to the most recent data available from the PASSHE
Institutional Resources Office, about 500,000 PASSHE alumni live
and work in the Commonwealth of Pennsylvania.
“PASSHE’s cumulative tuition and fee increases
over the last five years are among the lowest in
the nation. According to the latest national
comparison of tuition and fee rates conducted by
the Washington Higher Education Coordinating
Board, PASSHE’s cumulative increases over the
last five years rank fifth lowest among all public
university systems made up of similar institutions
(comprehensive universities – those focused
primarily on teaching). The System total is about
half the national average.
PASSHE’s annual tuition increases have been
below the rate of inflation in four of the last six
years.
Year
Tuition
$ Increase
% Increase
2005-06
$4,906
$96
2.00%
2006-07
$5,038
$132
2.70%
2007-08
$5,177
$139
2.75%
2008-09
$5,538
$181
3.50%
2009-10
$5,554
$196
3.70%
2010-11
$5,804
$250
4.50%
The average total cost of attendance – combined
tuition, fees, room and board – at a PASSHE
university is $602 below the average among all
public colleges and universities in the nation and
$2,433 below the average in the region. (Based
on annual cost survey conducted by the College
Board. The Middle States region comprises
Delaware, Maryland, New Jersey, New York,
Pennsylvania and Washington, D.C.)”
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Economic Development
Monroe County, with a population of 169,896, is one of the fastest
growing counties in Pennsylvania. Faced with an unemployment rate
of 8.6% (higher than the 7.2% state averages as of December 2011),
the County is focusing on ways to attract, retain and support
businesses in new, knowledge-based industry clusters. Additionally,
Monroe County’s lack of high paying jobs has resulted in over 25,000
people commuting daily for employment opportunities and higher
wages in New York and New Jersey. The county’s tactical location
has resulted in Monroe County being defined as a separate
“Micropolitan” and as an “Exurbia” area which refers to the fastgrowing communities on the outer fringe, beyond the suburbs of
major metropolitan communities, with a growing number of urban
commuters.
These regional economic challenges and geographic opportunities
have positioned East Stroudsburg University as a major hub for
innovation, science and technology in northeastern Pennsylvania. In
2007, ESU established the College of Business and Management to
better prepare students for the global marketplace, and the division
of Research and Economic Development (RED) to address the critical
role higher education plays in economic development and to engage
the university in economic development initiatives within the scope
of its academic mission.
These initiatives, strategically aligned with the university’s Research
and Business Park, Science and Technology Center, Pocono
Mountains Keystone Innovation Center and recently completed
Innovation Center, are attracting entrepreneurial businesses and
collaborative research opportunities to the region. The 51,000 sq. ft.
Innovation Center includes business accelerator space and wet labs
to support start-up companies. Over the past five years, the ESU
Business Accelerator Program created 122.5 jobs, retained 120 jobs,
and relocated/lost 42.5 jobs.
The university’s Business Accelerator Program and Entrepreneurial
Leadership Center are attracting start-up companies and providing
entrepreneurial experiences for students and faculty in competitive
industry sectors including homeland security, financial services,
biotechnology/life sciences, information technology, healthcare, and
advanced manufacturing. These initiatives provide a strong
foundation for regional alliances and academic collaboration that
prepare students to be employed and competitive in a global
economy.
East Stroudsburg University’s contributions to regional economic
development efforts are noteworthy. According to the most recent
data available from PASSHE, East Stroudsburg University is the ninth
largest employer in Monroe County, providing 806 jobs directly and
creating a total employment impact of 1,206 jobs. The university
generates more than $273.5 million annually in direct and indirect
business stimulus in Pennsylvania, $109.9 million annually in
Monroe County, and $18.3M in East Stroudsburg and Stroudsburg.
This encompasses the impact spending by the institution, faculty,
staff, students and visitors. Additionally, ESU is located on 256 acres
located in East Stroudsburg Borough and Smithfield Township that
are valued at $322M.
In the area of Sponsored Projects and Research, in FY 2010-2011,
ESU faculty and staff submitted 94 external grants and contracts
totaling $6.5M and successfully secured $3.9M. Over the past five
years, the Office of Sponsored Projects and Research secured over
$18M in support of faculty research, student services, construction
and economic development efforts.
The following chart shows funds requested and funds awarded for
Fiscal Years 2007-08 through 2011-12, to date.
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Millions
$25.00
$20.00
$15.00
Request
$10.00
Award
$5.00
$0.00
Millions
The next chart shows how the funds received were invested back
into the University, economic development and faculty/student
initiatives and projects.
$12.00
$10.00
$8.00
$6.00
$4.00
$2.00
$0.00
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Workforce development initiatives during FY 10-11 included
administering $280,269 in employee-training grants involving 28
businesses and training over 1360 employees. The Entrepreneurial
Leadership Center (ELC) sponsored ESU’s Entrepreneurial Boot
Camps and Student Business Plan Competitions. Since the launch of
the ELC in 2008, over 1,000 student has been introduced to
entrepreneurship through the efforts of the 31 faculty and staff who
participated in Entrepreneurship Across the Colleges. Additionally,
through the support of a $100,000 Keystone Innovation Grant (KIG),
secured by ESU on behalf of the Pennsylvania State System of Higher
Education (PASSHE), a total of 236 students, representing the 14
PASSHE universities, submitted business ideas in the First Annual
PASSHE Student Business Plan Competition. The grant also funds
faculty commercialization and marketing efforts for the PASSHE
Technology Transfer and Commercialization Resource Network. The
Network provides an integrated approach to protecting intellectual
property and advancing faculty and student commercialization
across the fourteen PASSHE universities. The KIG grant also supports
PASSHE’s partnerships with the Penn State Research Foundation
(PSRF). PSRF currently serves as PASSHE’s Technology Transfer and
Communication Office.
ESU is currently commercializing Lyme-Aid, a tick testing kit for
people and pets. Lyme-Aid was created through the ESU Student
Business Plan Competition.
Legislative appropriations supporting economic development
initiatives during FY 10-11 included a $459,500 grant from the
Monroe County Local Share Account – Gaming Funds to expand the
University’s Business Accelerator Program. Funding secured for the
construction and facilities in the ESU Innovation Center totaled
$5.8M while ESU economic development initiatives secured $2.4M.
Facilities
Capital Budget
The Capital Budget of the Commonwealth of Pennsylvania provides
for the acquisition, design, construction, and/or renovation of new
or existing Commonwealth buildings, facilities, physical betterments
or improvements.
Specifically in the area of education, the Commonwealth’s Capital
Budget provides for construction, expansion, renovation and
conversion of classrooms and auxiliary buildings, utilities and
recreational facilities for the State System of Higher Education,
state-owned schools and state-related universities.
Over the past five fiscal years, East Stroudsburg University was
approved funding for the following projects:
Project
Science & Technology
Building
Renovation of Monroe
Hall
Keystone Commons
Library Renovation
Amount Approved
$20,600,000
$ 7,800,000
Facilities Status
$75,000,000
$25,000,000
An analysis of our physical assets shows a large part of our building
inventory has moved across the 25 year threshold. While the
expected acquisition of the Innovation Center, the life cycle
renovation of Monroe Hall and replacement of residence halls will
help, the situation will not improve until the completion of the
Keystone Center. In addition, the loss of a funding stream dedicated
to revitalization, i.e. Key 93 or deferred maintenance funds, as
previously mentioned, is expected to adversely affect the physical
plant, if left unaddressed, and tax the operating budget. Many of
the projects, including back-fill and some deferred maintenance
needs, have been placed on hold because of the budgetary
constraints. However, essential repairs and critical needs have been
adequately addressed using operating funds
For Fiscal Year 2010-11, PASSHE had received $130M in capital
appropriation from the Commonwealth. This amount was cut in half
to $65M for Fiscal Year 2011-12. We are still uncertain whether this
cut will have any impact on the funding of Keystone Commons.
Key 93
Historically, PASSHE and its 14 universities have received a share of
the Commonwealth’s transfer tax revenue to be used to fund
deferred maintenance on PASSHE campuses. ESU’s annual share
was approximately $700k. This allocation was lost during Fiscal Year
2010-2011 but restored during the current fiscal year only to be lost
again for Fiscal Year 2012-13. This is forcing PASSHE universities,
including ESU, to identify other funding sources for deferred
maintenance. Given studies conducted by Sightlines, Inc. have and
continue to show a growing backlog of deferred maintenance
requirements for ESU (see chart that follows for latest available
assessment), it is critical we address these needs in order to
maintain and preserve our existing physical plant. Therefore, ESU
has added a line item to the Education & General Operating Budget
in the amount of $700k for deferred maintenance.
As proposed in the Campus Facilities Master Plan, approved by the
Council of Trustees in April 2010, the design to build a new Keystone
Center which will house the library, the student center, the
computing and telecommunications department and various
multicultural programs was awarded by the Department of General
Services to the joint venture of Ewing Cole and WTW Architects.
This new building will be constructed in two phases on the site of
the existing Center for Hospitality Management and the University
Center. The student referendum for the student center portion of
the new building passed in November 2010. The Office of Budget
and the Governor released design funds for the first phase of the
project on December 10, 2010.
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The Campus Facilities Master Plan proposes the University will
continue to grow to a headcount of 8,500 students over the next 10
to 15 years. Growth is currently constrained due to the need for
more student residence halls, additional classroom and faculty office
space, and parking. However, projects are on the horizon to move
us in the right direction.
For example, the life cycle renovation of Monroe Hall is well
underway, with expected completion in Summer of 2012. Afterward,
LaRue and its annexes will be demolished.
University Properties, Inc., an affiliated non-profit organization,
under a contract with Allen & O’Hara Development Corporation of
Memphis, Tennessee, built 969 beds of new suite style housing in
two buildings on the campus northwest of the intersection of
Normal and Smith Streets. Planning is currently underway to
demolish Hawthorn and Hemlock Residence Halls and the Campus
Police Station to create a site where one additional building +/- 500
beds will be constructed. The newly built residence halls include
offices for Residence Life, Campus Police and a new Fitness Center.
The new building will house the Health and Counseling Center.
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Parking continues to pose a challenge for the University. As a
condition of the Borough’s approval of the first phase of the UPI
Student Housing project, the University implemented a parking
management plan to better manage, allocate, and control parking
and to possibly add parking, if required. The Borough of East
Stroudsburg is in the process of revising their zoning ordinance with
respect to parking requirements for the University IU Zoning. The
preliminary analysis of this draft ordinance indicates the Borough
will require the University to construct 400 to 1,000 additional
parking spaces before it will approve any future new construction
projects. Surface parking spaces cost approximately $6,000 per
space while a new parking garage is estimated to cost $15,000$20,000 per space. Although we can all agree that more convenient
parking is desirable, there is no source of funds for new parking lots
or garages except parking fees. The University is thus moving
forward a plan to build a parking structure for 600 to 800 cars and a
funding model based on a new student fee is currently being
developed.
Human Resources
One of ESU’s greatest resources is it’s human resources.
In Fall 2011, there were 686 full‐time employees and 157 part‐time
employees at East Stroudsburg University. Of these, 298 were
full‐time faculty and 69 were part‐time faculty. 89% of the full‐time
faculty was tenured or on tenure‐track and 82% held the doctorate
or other terminal degree.
At this juncture, however, given the recent proposed cut in state
appropriation and largely unpredictable rollercoaster-like
enrollments, it is becoming extremely difficult to keep our human
resource complement entirely intact.
In comparison, in Fall 2010, there were 731 full‐time employees and
76 part‐time employees at East Stroudsburg University. Of these,
332 were full‐time faculty and 61 were part‐time faculty. 84% of the
full‐time faculty was tenured or on tenure‐track and 75.7% held the
doctorate or other terminal degree.
The following pie chart depicts the allocation of salaries between the
various bargaining units and management.
5%
16%
16%
…the real value of our human resources
lies in the human capital of this
institution. It is about the skills,
knowledge, personality, experience and
creativity that can and do make us a
dynamic institution and a place our
students (and we) want to be.
60%
3%
APSCUF
SCUPA
Managers
AFSCME
Other
The value of our Human Resources, however, does not lie in
numbers…..the real value of our human resources lies in the human
capital of this institution. It is about the infinite value of each
individual employee and his or her contributions to our campus and
our students’ success stories….It is about the skills, knowledge,
personality, experience and creativity of our human resources that
can and do make us a dynamic institution and a place our students
(and we) want to be.
Administration recognizes the infinite capital of our human
resources. Therefore, in an effort to preserve this human capital,
several significant budgetary decisions were made in recent years
based on three principles:



Save full-time faculty positions
Maintain the quality of education and services to our
students
Save permanent, full-time staff
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Financial Resources
East Stroudsburg University is fiscally sound, receiving an unqualified
opinion on its audited financial statements for Fiscal Year 2010-11.
For the past five fiscal years, ESU has enjoyed increases in net assets
as follows:
(Note: state appropriation is considered non-operating revenue
and, thus, excluded from this table.)
As is the case with revenues, University operating expenditures have
been consistent and predictable. To follow is a Total Operating
Expenses summary (in thousands).
2011
2010
2009
2008
2007
46,395
44,969
42,560
40,637
39,024
535
1,065
1,237
1,276
1,793
2,274
1,913
1,592
1,264
1,184
10,661
11,641
10,063
7,077
6,841
8,618
8,614
8,170
8,155
8,114
Institutional
Support
15,789
16,145
16,653
16,272
14,461
Operations
&
Maintenance
of Plant
7,641
7,602
8,234
7,160
8,407
Depreciation
6,984
6,105
5,623
3,827
3,886
Student Aid
3,817
3,434
2,844
2,790
2,710
Auxiliary
Enterprises
13,554
12,516
12,171
12,300
10,381
116,268
114,004
109,147
100,758
96,801
Instruction
Research
Public
Service
Academic
Support
The sources of the University’s operating revenues have been
consistent and predictable. To follow is a Total Operating Revenues
summary (in thousands).
2011
Tuition & Fees
Grants &
Contracts
53,253
14,218
2010
2009
51,658
49,561
13,887
11,497
2008
2007
46,253
43,585
10,362
12,804
Sales &
Services of
Educational
Departments
1,775
Auxiliary
Enterprises
20,277
19,634
19,086
16,927
15,960
64
748
703
619
687
89,587
87,205
82,299
75,356
74,089
Other
Revenues
Total
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1,278
1,452
1,195
Student
Service
1,053
Total
The Board of Governors adopted Policy 2011-01 on April 7, 2011.
The purpose of the policy is to establish expectations for long-term
financial health of System entities through the measure of
unrestricted net assets and operating margins.
The policy requires Presidents and the Chancellor to maintain
adequate unrestricted net assets at each PASSHE entity to:
of the University’s current year Educational and General revenue.
Additionally, Universities are required to maintain an operating
margin annually within the range of 2% to 4%.
a. Protect the System and individual PASSHE entities in cases of
sudden revenue reductions;
b. Provide resources to address unanticipated expenses, including
emergencies; and,
c. Prepare for multiyear planning needs.
ESU met these requirements for Fiscal Year 2010-2011, reporting a
Ratio of Unrestricted Net Assets to Education & General Revenue of
13.42% and an Operating Margin of 4.27%.
The policy goes on to state that University unrestricted net asset
balances shall be maintained annually within the range of 5% to 10%
University Financial Health Indicators (per BOG Policy 2011-01)
1. University unrestricted net asset balances shall be maintained annually within the range of 5% to 10%
of the University's current year Educational and General Revenue.
Unrestricted net assets
Educational & General Revenue (excludes Auxiliary and Restricted)
Ratio of Unrestricted Net Assets to E&G Revenue
12,648,919
94,285,069
13.42%
2. The University operating margin shall be maintained annually within the range of 2% to 4% .
(Per Moody's calculation)
Total Operating Revenues
Reduced by Student Aid expense
State appropriations, general and restricted (including ARRA)
Investment income, net of related expenses
Gifts for other than capital purposes
Net Operating Revenues (denominator)
89,587,000
(3,817,170)
27,467,244
788,228
1,324,439
115,349,741
Total Operating Expenses
Less Student Aid
Interest expense on capital asset-related debt
Less change in postretirement benefits liability
Net Operating Expenses
116,267,992
(3,817,170)
2,298,210
(4,324,051)
110,424,981
Operating Margin (numerator)
Operating Ratio
4,924,760
4.27%
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Enrollment
The Division of Enrollment Management prepares a Freshman &
Transfer Enrollment Plan for each Fall semester. This plan includes
enrollment target recommendations for the upcoming Fall semester,
retention strategies, financial considerations, and an enrollment
goals time table.
Historical Enrollment Trends
The Division of Enrollment Management recognizes the need for
both short-term and long-term enrollment management plans that
encompass summer, winter, academic year, graduate students and
alumni. With the search for a new Vice President for Enrollment
Management complete and the appointment of a new vice
president, we are hopeful work on a comprehensive plan will begin
in the Spring of 2012.
ESU continues to see growth in its undergraduate programs.
However, our graduate school program was heavily based in teacher
education and, as a result of the Governor’s cuts in K-12 funding, we
are beginning to feel the effects in our graduate school enrollment.
We are looking at the next few years as building years as we develop
new programs and expand our graduate distance education
programs.
Until such plan is available, ESU’s budget projections will continue to
be prepared in collaboration with the University’s Office of
Academic and Institutional Effectiveness. Historically, the
university’s enrollment goals have been loosely organized around a
sense of our potential for growth, which has been considered great,
tempered by the desire to retain the intimate instructional
atmosphere that has characterized the university for many years.
When the university last completed a master plan, the figure settled
on for total enrollment was 8,500 over a 10-15 year period. While
unofficial annual projections have been for 1% growth in
undergraduates and to allow graduate enrollment to float naturally
as capacity for graduates is less constricted, in six of the last seven
years, enrollment increases have exceeded those projections.
To follow are detail enrollment statistics and graphs displaying
trends in enrollment over the past five fiscal years.
Enrollment highlights include:

Consistent increase in headcount and
credit hours from Fall 2007 to Fall 2011

11.7% increase in Undergraduate
student headcount from Fall 2007 to
Fall 2011

36.3% decrease in Graduate student
headcount from Fall 2007 to Fall 2011

Consistent increase in AfricanAmerican student enrollment
15 | P a g e
East Stroudsburg University has experienced consistent enrollment
growth over the past five years in both headcount and full-time
equivalency (FTE).
Total Headcount – Fall 2007 – Fall 2011
7800
7600
7400
7200
7000
6800
6600
Headcount
2007
2008
2009
2010
2011
7053
7234
7576
7387
7353
Undergraduate Headcount
Graduate Headcount
7000
1500
6500
1000
6000
500
5500
Undergraduates
2007
2008
2009
2010
2011
5959
6099
6391
6372
6656
0
Graduates
2007
2008
2009
2010
2011
1094
1135
1185
1015
697
Total Credit Hours – Fall 2007 – Fall 2011
105000
100000
95000
90000
85000
Credit Hours
2007
2008
2009
2010
2011
92134
94602.5
98789.5
97799.5
99546
16 | P a g e
Future Enrollment Projections
ESU understands our growth is constrained by a number of factors:

We cannot grow resident enrollment without new student
housing.

We cannot grow commuter enrollment without additional
parking.
To address these issues, University Properties, Inc., as discussed in
the Facilities section of this scan, constructed a new 969 bed
residence hall on ESU property. While these are replacement beds
for Hawthorn and Hemlock halls (which will be torn down), a second
phase of privatized housing is being explored which will add beds to
the complement. Additionally, the University is pursuing the
construction of a parking garage on campus which will be funded
with a student fee. It is anticipated this garage will relieve the
current stress on the campus and reduce spillover into the
neighboring community while affording us the opportunity for
growth.
Additional enrollment growth opportunities exist through the
recruitment of the non-traditional student, transfer students, and
off-campus students. As indicated earlier, with the appointment of
a new Vice President for Enrollment Management, the development
of both short- and long-term enrollment management plans is on
the not so distant horizon.
17 | P a g e
Fundraising
Now more than ever, private support through the East Stroudsburg
University Foundation (ESUF) Annual Fund is crucial for East
Stroudsburg University to make up the losses realized in declining
support from the state. Supporting the University’s number one
fundraising priority, increasing support for its operating budget, has
been the Foundation’s first focus in building fundraising programs.
The ESUF Annual Fund provides support for:






Financial assistance to students through scholarships
Grants to faculty for research
Funding for all Alumni events, reunions and activities
including Homecoming
Charitable incentives, sponsorships and prizes for ESU
philanthropy initiatives
Special Alumni affinity mailings invitations and newsletters
Raising student awareness to embrace a culture of
philanthropy
The ESUF Annual Fund has been gaining momentum since fiscal year
2009-2010.
Year
Total
Amount Restricted
to ESU Programs
2010
$521,927
$355,566
2011
$698,777
$461,505
2012 (through 0131-2012)
$493,181
$327,508
The ESUF is cautiously optimistic that we will reach the $800,000
goal this year since 62% of goal has been raised so far this fiscal year
with five months remaining.
The case to increase support for the ESUF Annual Fund through
annual scholarships has begun to resonate with alumni and friends.
So much so that the ESUF is pleased to report in FY 11-12 (through
January 31, 2012), 23 new annual scholarships to benefit students
have been funded for a total of $49,080.
In FY 11-12 (through January 31, 2012), the Foundation awarded
$232,565 endowed scholarships to 235 students compared to
$215,781 to 230 students in FY 10-11. The amount of annual
scholarships has increased this fiscal year in both dollars awarded
and number awarded over the total of last fiscal year. FY 11-12
through January 31, 2012, the Foundation has awarded $187,228
annual scholarships to 175 students compared to $164,773 to 169
students in FY 10-11. The number of awards and amount awarded
for the current fiscal year 2011-2012 reflect disbursements through
January 31, 2012. Spring scholarships have yet to be advertised,
selected or disbursed.
Athletic fundraising is gaining momentum. In FY 11-12 through
January 31, 2012, $252,958 has been raised for athletic purposes
compared to $232,831 for all of FY 10-11. Athletic fundraising has
the potential to continue to increase this fiscal year as we move into
spring solicitations for FESUA.
The Faculty and Staff Campaign kicked off on February 13th and is in
full swing. Unfortunately, results have been dismal. There have
been no new donors from the faculty or staff to date.
As of January 31, 2012, the ESUF Annual Fund has raised $493,181
toward its $800,000 goal. Of the $493,181, $327,508 is restricted to
programs at the university and is enhancement to department
budgets. In comparison, for FY 10-11, $698,777 was raised, of which
$461,505 was restricted to programs at the university thus
enhancing department budgets. Further comparison shows that the
ESUF Annual Fund grew 33.5% from FY 09-10 to FY 10-11.
18 | P a g e
Notes
19 | P a g e
Budget Highlights
State Appropriation
A great deal of uncertainty surrounds this tenuous revenue source.
The budget projections that follow reflect the 5% freeze requested by
the Governor in January, 2012 as well as an additional 20% reduction
as proposed by the Governor in February, 2012.
Off-Campus Revenue Opportunities
East Stroudsburg University continues to pursue off-campus
opportunities in Philadelphia and Lehigh Valley. These additional
revenues and related costs are reflected in the budget.
Performance Funding
A new methodology for performance measurement is currently being
implemented. As it is difficult to predict the impact of the new
methodology, we are holding this revenue source constant.
Banner Implementation
The Banner Implementation is ongoing and requires additional
human resources to ensure the project’s success (consultants,
temporary employees, and student workers) is anticipated to
continue through Fiscal Year 2014-2015 and is included in the
budget.
Purchase of Innovation Center
The University anticipates closing on the Innovation Center in March
2012, with no lease expense anticipated in FY 2012-13 and forward.
Deferred Maintenance
Due to the loss of Key 93 funding and in an effort to maintain our
existing plant, a new line was added to the Education and General
Budget in the amount of $700k for deferred maintenance.
The 2012-2013 Education and General Budget
Early projections show a projected deficit of $4.4 million.
A number of mandatory costs were considered in the development of this budget. A total of $824k in pension and healthcare cost increases are
built into the budget. Other costs include $4.6M of debt service due to capital projects committed to and/or completed in prior years.
The budget that follows was prepared using the following assumptions:
East Stroudsburg University
Education & General Budget Assumptions
Fiscal Year 2012-2013
State Appropriation
20% reduction on top of 5%
freeze
Performance Funding
No increase or decrease
Tuition
3% tuition increase; 1%
enrollment increase
Fees
Same as tuition
Salaries & Benefits
Per PASSHE Budget Assumptions
plus LV and Philadelphia
Operating Budgets
No increase or decrease
Debt Service
No new debt issuances
20 | P a g e
21 | P a g e
96,377,566.84
TOTAL REVENUE
HEAT, LIGHT, WATER & SEWER
TELEPHONE AND PANET
POSTAGE
SHUTTLE SERVICE
DESIGNATED REVENUES EXPENSE
SUMMER CONFERENCES DIRECT EXPENSE
COOPERATING TEACHERS (Object 625.25)
CENTRAL CHARGES
PAYMENTS MADE CHANCELLOR'S OFFICE ON BEHALF OF ESU
IUP COLLABORATIVE DOCTORAL PROGRAM FEE
MARINE SCIENCE CONSORTIUM MEMBERSHIP DUES
PRESIDENTIAL AWARDS
AUDITOR FEES
LEGAL FEES
$2,411,327.00
$301,234.66
$192,170.46
$230,000.00
$697,000.00
$592,848.00
$148,000.00
$960,237.00
$468,000.00
$35,000.00
$100,000.00
$75,000.00
$53,000.00
$75,000.00
$67,789,153.74
TOTAL EMPLOYMENT COSTS
OPERATING EXPENSES:
$25,497,618.31
$1,208,483.96
$6,888,308.08
$6,647,344.49
$1,958,215.27
$685,625.00
$1,581,996.43
$2,400,000.00
$259,438.00
$763,015.00
$257,880.00
$55,500.00
$36,300.00
$237,862.00
$108,514.00
$3,573,428.77
$120,000.00
$412,913.00
$564,629.95
$5,987,245.95
$3,703,052.58
$89,537.21
$3,871,370.81
$44,784.00
$836,090.93
SALARIES - APSCUF - INSTRUCTIONAL
SALARIES - SCUPA
SALARIES - STATE UNIVERSITY MANAGERS
SALARIES - AFSCME - 37.5 HRS
SALARIES - PLANT GUARDS, NURSES, FT COACHES
WAGES
STUDENT EMPLOYMENT
FACULTY SUMMER SCHOOL PAY
FACULTY OVERLOAD REGULARLY SCHEDULED CLASSES
OTHER PAY
OVERTIME
SHIFT DIFFERENTIAL
HIGHER CLASS
SICK LEAVE PAY OUT
ANNUAL LEAVE PAY OUT
SOCIAL SECURITY CONTRIBUTIONS
UNEMPLOYMENT COMPENSATION
WORKER'S COMPENSATION (.5%)
EMPLOYEES' HEALTH AND WELFARE FUND
EMPLOYEES' HOSPITALIZATION INSURANCE
ANNUITANTS' HOSPITAL
EMPLOYEES' GROUP LIFE INSURANCE FUND
RETIREMENT CONTRIBUTIONS
CELL PHONE STIPENDS
TUITION WAIVER-EMPLOYEE & DEPENDANTS
PERSONNEL EXPENSES
18,049,360.00
319,436.00
2,020,456.00
60,626,115.14
4,396,665.01
1,985,638.69
560,536.00
1,069,543.00
2,785,030.00
3,575,000.00
989,787.00
STATE APPROPRIATION - BASE
STATE APPROPRIATION - AFRP
STATE APPROPRIATION - PERFORMANCE FUNDING
TUITION
INSTRUCTIONAL SUPPORT FEE
OTHER STUDENT FEES
INCOME ON INVESTMENTS
SUMMER CONFERENCE REVENUE
INSTRUCTIONAL TECHNOLOGY FEE
OTHER INCOME
RETURN OF PEBTF DEF PREMIUM CONTRIBUTIONS
REVENUE:
2011-2012
2,310,040.00
301,234.66
197,170.46
230,000.00
697,000.00
592,848.00
148,000.00
960,237.00
468,000.00
35,000.00
100,000.00
75,000.00
53,000.00
75,000.00
$69,305,338.30
25,836,526.06
1,236,983.96
6,934,590.39
6,740,407.31
1,958,215.27
685,625.00
1,581,996.43
2,400,000.00
259,438.00
763,015.00
257,880.00
55,500.00
36,300.00
237,862.00
108,514.00
3,633,381.58
120,000.00
412,913.00
610,776.75
5,996,576.47
4,005,167.57
93,188.69
4,434,523.16
44,784.00
861,173.66
94,772,497.23
13,971,509.60
319,436.00
2,020,456.00
63,651,395.75
4,677,903.37
2,045,207.85
566,141.36
1,069,543.00
2,875,904.30
3,575,000.00
2012-2013
2,379,341.20
301,234.66
197,170.46
230,000.00
697,000.00
592,848.00
148,000.00
960,237.00
468,000.00
35,000.00
100,000.00
75,000.00
53,000.00
75,000.00
$71,209,228.34
26,301,583.53
1,259,249.67
7,059,413.02
6,861,734.64
1,993,463.14
685,625.00
1,581,996.43
2,400,000.00
259,438.00
763,015.00
257,880.00
55,500.00
36,300.00
237,862.00
108,514.00
3,692,188.74
120,000.00
412,913.00
659,638.89
5,996,576.47
4,325,580.97
93,191.24
5,115,771.73
44,784.00
887,008.87
97,601,445.89
13,971,509.60
319,436.00
2,020,456.00
66,197,451.58
4,865,019.51
2,106,564.09
571,802.77
1,069,543.00
2,904,663.34
3,575,000.00
2013-2014
2,450,721.44
301,234.66
197,170.46
230,000.00
697,000.00
592,848.00
148,000.00
960,237.00
468,000.00
35,000.00
100,000.00
75,000.00
53,000.00
75,000.00
$74,283,081.25
27,090,631.04
1,297,027.16
7,271,195.40
7,067,586.68
2,053,267.04
685,625.00
1,581,996.43
2,400,000.00
259,438.00
763,015.00
257,880.00
55,500.00
36,300.00
237,862.00
108,514.00
3,791,964.89
120,000.00
412,913.00
712,410.00
6,475,556.15
4,671,628.44
93,195.57
5,881,172.32
44,784.00
913,619.13
100,541,906.32
13,971,509.60
319,436.00
2,020,456.00
68,845,349.64
5,059,620.29
2,169,761.01
577,520.80
1,069,543.00
2,933,709.98
3,575,000.00
2014-2015
Fiscal Years 2011-2012 through 2015-2016
EAST STROUDSBURG UNIVERSITY
2,524,243.08
301,234.66
197,170.46
230,000.00
697,000.00
592,848.00
148,000.00
960,237.00
468,000.00
35,000.00
100,000.00
75,000.00
53,000.00
75,000.00
$78,187,844.56
28,309,709.43
1,355,393.38
7,598,399.20
7,385,628.08
2,145,664.06
685,625.00
1,581,996.43
2,400,000.00
259,438.00
763,015.00
257,880.00
55,500.00
36,300.00
237,862.00
108,514.00
3,946,119.03
120,000.00
412,913.00
769,402.80
6,993,600.64
5,045,357.64
93,200.07
6,640,515.09
44,784.00
941,027.71
103,598,310.25
13,971,509.60
319,436.00
2,020,456.00
71,599,163.63
5,262,005.10
2,234,853.84
583,296.01
1,069,543.00
2,963,047.08
3,575,000.00
2015-2016
Increases vary per year
Held constant
$.01 incr 1/2012
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
PASSHE bgt assumptions + LV,Philadelphia
PASSHE bgt assumptions + LV,Philadelphia
PASSHE bgt assumptions + LV,Philadelphia
PASSHE bgt assumptions + LV,Philadelphia
PASSHE bgt assumptions + LV,Philadelphia
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Held constant
Latest salary increase and benefit assumption data available
Held constant
Held constant
Latest salary increase and benefit assumption data available
Latest salary increase and benefit assumption data available
Latest salary increase and benefit assumption data available
Latest salary increase and benefit assumption data available
Latest salary increase and benefit assumption data available
Held constant
3% Tuition Increase
5% add'l decr 2012, 20% decr 2013; constant after
Held constant
Held constant
3.0% Tuition incr; 1% Enrollment incr + LV, Philadelphia
3.0% Tuition incr; 1% Enrollment incr + LV, Philadelphia
3% Increase (1% enrollment + 2% fee increase)
Decr 2013 to actual 2012 +1% Increase
Held constant
1% Enrollment incr; no rate incr + LV,Philadelphia
Held constant
Prior year adjustment received in 2012
Budget Assumptions
22 | P a g e
$5,535,616.00
TOTAL CAPITAL COSTS
$5,501,870.23
TOTAL TRANSFERS
$97,979,838.78
($1,602,271.94)
EXPENDITURES AND TRANSFERS TOTAL
REVENUE LESS EXPENDITURES AND TRANSFERS
TOTAL:
$93,043.00
$50,000.00
$258,585.54
$1,547,752.28
$912,547.30
$526,056.00
$359,744.42
$328,601.00
$147,887.78
$554,408.91
$319,436.00
$252,808.00
$151,000.00
SUMMER CONFERENCES SCHOLARSHIP COMMITMENT
HARDSHIP GRANTS
DEBT SERVICE ON MASTER PLAN PROPERTY ACQUISITIONS
DEBT SERVICE ON SCIENCE & TECHNOLOGY BUILDING
DEBT SERVICE ON GESA PROJECT
DEBT SERVICE ON PED SAFETY/STORM WATER MGMT PROJECT
DEBT SERVICE MARINE SCIENCE CONSORTIUM
SYTEC PROJECT (SAP)
DEBT SERVICE ON BANNER
DEBT SERVICE ON BOND ON RESEARCH PARK BUILDING
ACADEMIC FACILITY RENOVATION PROGRAM - BUDRPT DATA
CAPITAL INFRASTRUCTURE IMPROVEMENT COMMITMENT
BANNER CONSULTANT COSTS
TRANSFERS:
$40,000.00
$30,000.00
$1,758,666.00
$2,785,030.00
$538,269.00
$383,651.00
$19,153,198.80
$150,000.00
$60,000.00
$120,000.00
$348,967.24
$20,000.00
$1,900,000.00
$6,314,344.92
$701,800.00
$164,883.43
$808,955.59
$175,000.00
$9,450.00
$21,000.00
$20,000.00
$75,000.00
$1,924,980.50
****** General Support Inst Fee Amt (60.0% ) ****** Non-Add
PRESIDENTIAL INITIATIVES FUNDING
CLASSROOM FURNITURE
INSTRUCTIONAL SUPPORT FEE EXPENSE
INVESTMENT IN INSTRUCTIONAL TECHNOLOGY
LIBRARY ACQUISITIONS BUDGET
SUMMER CONFERENCE PROCEEDS ALLOCATION
CAPITAL:
TOTAL OPERATING COSTS
PRESIDENTIAL SEARCH
BANNER CONSULTANT (FROM PASSHE)
CHANCELLORS .5% SHARE OF TUITION & FEES
A. COHN MEMORIAL JAZZ COLLECTION
SERVICE AGREEMENT WITH ESU FOUNDATION
DEPARTMENT OPER BUDGTS
LEASE - CENTER FOR RESEARCH & ECONOMIC DEVELOPMENT
RED BLDG MAINTENANCE
ACADEMIC AFFAIRS BUDGET HEARING REQUESTS
TRANSPORTATION EXPENSE - COACHES
UPWARD BOUND MATCH
UPWARD BOUND ROOM & BOARD
NEW FACULTY MOVING EXPENSE REIMBURSEMENTS
INSURANCE-DGS
TUITION WAIVER-OTHER THAN EMPLOYEE
DEFERRED MAINTENANCE
BAD DEBT EXPENSE
OPERATING EXPENSES - Contd.:
2011-2012
175,000.00
9,450.00
20,000.00
2,042,211.81
700,000.00
150,000.00
175,000.00
9,450.00
20,000.00
1,982,729.92
700,000.00
150,000.00
($4,380,758.08)
$99,153,255.31
$5,546,006.07
93,043.00
50,000.00
259,726.15
1,547,871.47
$912,333.69
525,750.56
358,410.41
382,406.00
156,350.00
587,870.79
319,436.00
252,808.00
100,000.00
$5,738,985.65
$40,000.00
$30,000.00
$1,871,161.35
$2,875,904.30
538,269.00
383,651.00
($3,775,128.95)
$101,376,574.83
$5,706,622.53
93,043.00
50,000.00
259,886.22
1,548,231.30
911,151.66
525,994.94
358,493.75
401,698.00
157,750.00
588,129.66
319,436.00
252,808.00
240,000.00
$5,842,591.15
$40,000.00
$30,000.00
$1,946,007.80
$2,904,663.34
538,269.00
383,651.00
$18,618,132.83
164,883.43
164,883.43
$18,562,925.29
$380,368.49
20,000.00
1,900,000.00
6,744,387.77
2013-2014
87,692.00
$366,252.06
20,000.00
1,900,000.00
6,744,387.77
2012-2013
($4,282,046.05)
$104,823,952.37
$5,825,939.90
93,043.00
50,000.00
259,617.78
1,547,158.98
913,145.43
525,745.00
358,243.75
682,250.00
156,500.00
587,991.96
319,436.00
252,808.00
80,000.00
$5,949,478.09
$40,000.00
$30,000.00
$2,023,848.11
$2,933,709.98
538,269.00
383,651.00
$18,765,453.13
2,103,478.17
700,000.00
150,000.00
20,000.00
175,000.00
9,450.00
164,883.43
$395,042.20
20,000.00
1,900,000.00
6,744,387.77
2014-2015
Fiscal Years 2011-2012 through 2015-2016
EAST STROUDSBURG UNIVERSITY
($5,362,887.68)
$108,961,197.93
$5,796,252.00
93,043.00
50,000.00
259,767.01
1,547,301.91
913,572.69
525,974.65
359,327.08
682,250.00
155,000.00
587,771.66
319,436.00
252,808.00
50,000.00
$6,059,769.11
$40,000.00
$30,000.00
$2,104,802.04
$2,963,047.08
538,269.00
383,651.00
$18,917,332.26
2,166,582.51
700,000.00
150,000.00
20,000.00
175,000.00
9,450.00
164,883.43
$410,295.35
20,000.00
1,900,000.00
6,744,387.77
2015-2016
Held constant
Held constant
Assumes no additional financing
Assumes no additional financing
Assumes no additional financing
Assumes no additional financing
Per bond statement; assumes 3 participants
As per PASSHE SAS Budget
Per bond statement
Per bond statement
Held constant
Held constant
Computing Center estimate
Held constant
Held constant
3.0% Tuition increase; 1% Enrollment increase
Cgs w/enrollment; assumes 1% increase per year
Held constant
Held constant
to 2/20/2013
Increase at the same rate as tuition and fees
Held constant
Held constant
+Philadelphia, Lehigh Valley 2013; held constant
Bldg purchased 2012
Held constant
One time 2012
Held constant
Held constant
One time 2012
Held constant
Fleet cars returned 2012-now Enterprise
3% Tuition increase
Loss of Key 93 funding
Held constant
Budget Assumptions