Fall Budget Forum: David L. Eisler, president Sally DePew, director, budgetary planning & analysis November 20, Thank you, dave eisler

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1 Fall Budget Forum: 2014 Fiscal Results, 2015 Budget, Performance Funding, Enrollment, and Future Prospects I have placed explanatory comments throughout this slideshow using the Adobe "sticky notes" feature. Sticky notes are not accessible through many Internet browsers. To see these comments, save the file to your computer and then access through an Adobe product. When you mouse over the comment icon or click on it, the comment will appear. Thank you, dave eisler David L. Eisler, president Sally DePew, director, budgetary planning & analysis November 20, 2014

2 Outline for Today Federal and State economic trends, budget Ferris budget information Look back at 2014 fiscal results Information on 2015 budget Higher education formula funding Enrollment Looking forward to 2016

3 Federal Budget No Federal Budget for 2015 Continuing Appropriations Resolution through December 14, 2015 Unemployment 5.9 percent in September First time below 6 percent since July 2008 Continued support for Federal Pell Grants FY 2015 funding of $33.3 Billion Scheduled to increase to $34.4 Billion for 2016

4 Michigan Economy & Budget Michigan unemployment rate fell to 7.2% in September Well above National 5.9% rate Down from August 7.4% State revenues are improving General fund 3.4% growth for School Aid Fund 3.1% growth FY 15 State budget of $52.3B from all funding sources General Fund/General Purpose budget $9.8B (19.3% of total) Higher Education funding $1.5 billion Federal $ 97 million 6.4% School Aid Fund $ 205 million 13.5% General Fund $1,215 million 80.1%

5 Human Services Community Health Total Corrections Transportation School Aid Community Colleges Higher Education -13.5% 19.3% 11.7% 6.0% 27.8% 21.4% 46.0% 68.9% Michigan Budget Priorities One-Year (2014) and Ten-Year Change in Gross State Appropriations -2.1% 13.4% 5.4% 0.6% 3.4% 3.5% 9.6% 2.2% One-Year Ten-Year

6 University Fiscal Results Operating Funds Revenues $293 Million Amounts in Millions Designated Fund $20 General Fund $201 Auxiliary Fund $42 Expendable Restricted Fund $30

2013-2014 University Fiscal Results $199.

7 University Fiscal Results $199.5 M General Fund Spending Purpose of Expense Amounts in Millions Compensation $133.5 Operating Support $47.1 Financial Aid $18.9

8 University Fiscal Results $199.5 M General Fund Spending Purpose of Expense Amounts in Millions $160 $140 FY10 FY11 FY12 FY13 FY14 $120 $100 $80 $60 $40 $20 $0 Compensation Operating Support Financial Aid

9 University Fiscal Results General Fund Expenditures $199.5 Million Amounts in Millions State Reported HEIDI Instruction and Academic Support $ % Student Services $15.0 8% Plant $14.0 7% Institutional Support $ % Financial Aid $18.9 9% Transfers $16.1 8% Research/Public Service $0.6 0%

10 Michigan Public University Spending Patterns Fiscal year 2013 Percent of General Fund Expenses by Function of Expense 44% 39% 13% 12% 6% 5% 7% 9% 10% 10% 0% 4% 8% 7% 9% 11% 2% 1% Instruction Academic Support Student Services Plant Institutional Support Research/Public Service Transfers Financial Aid Auxiliary FSU Average

11 Net Assets Net Assets difference between assets and liabilities Accumulated one-time balance June 30 th Includes actual dollars and paper transactions Classifications Capital Assets (net of debt) infrastructure assets Restricted by outside agencies or persons, i.e. Federal and State restricted scholarships and loans Unrestricted without external restriction to use or purpose.

12 University Fiscal Results Net Assets / Net Position $341.3 Million Amounts in Millions Invested in Capital Assets $163.0 Restricted for Nonexpendable Scholarships $21.3 Restricted for Expendable Scholarships, Loans and Grants $24.0 Unrestricted $134.0

13 University Fiscal Results Unrestricted Net Assets Development (including Foundation) Plant projects in progress Maintenance reserve Held for University maintenance needs Includes general fund and auxiliary budgets Ferris Facility Condition Index stands at 27.6% Reserves are 5% of physical plant replacement value General fund maintenance is less than 1% of replacement value Auxiliary operations Student loan funds Fiscal year-end balances (encumbered and unencumbered) Other unrestricted amounts (provision for self insurance, booked unrealized gains, legal contingency, unallocated investment income waiting for distribution)

14 University Fiscal Results Unrestricted Net Asset Comparison Amounts in Millions Maintenance Reserve Plant Projects in Planning Development All Other Divisional Carryover/Encum. Auxiliary Operations Student Loan Funds $2.0 $1.8 $0.3 $0.2 $17.0 $14.0 $11.6 $11.0 $23.1 $28.5 $30.7 $41.4 $41.6 $38.6 FY $134.0M FY $127.9M

15 General Fund Budget - $207.6M Amounts in Millions Tuition $ % Other $4.6 2% State $ % Compensation $142 Operating 71% Support $ % Revenue Expense Student Aid $ %

16 General Fund Budget - $207.6M Compared to Amounts in Millions Revenue $148 $153 $133 $134 Expense $47 $50 $44 $46 $18 $19 $6 $5 State Appropriation Tuition Other Compensation Operating Support Student Aid

17 Budget General Fund Allocations Amounts in Millions Academic Affairs $109.3 University Advancement and Marketing $4.3 Student Affairs $8.0 Kendall College of Art and Design $20.9 Governmental Relations General Counsel $1.5 General expenses $33.9 Executive $2.5 Administration and Finance $27.1

18 Budget Housing/Dining Budget Revenues In Millions Dining $ % Housing $ % $34.2M Total

19 Budget Housing/Dining Budget Revenues Compared to Actual In Millions $20.2 $19.3 $14.4 $14.8 FY 2014 FY 2015 Housing Dining

20 Higher Education Ferris State Funding Formula Supports Ferris Mission Ferris received second-highest percentage increase in appropriations for FY 15 Ferris 15 General Fund budget is $207.6 million $49.5 (23.8%) base funding from state Tuition supports majority of General Fund

21 Higher Education Performance Funding and Tuition Restraint Higher education budget included $81.9 million increase $37.3 million for Performance Funding $37.3 million to restore former cuts $3.3 million for MSU AgBioResearch/Extension Performance funding 6 measures, 50% of performance funding Critical Skills Undergraduate Degrees/Certificates Research and Development Expenditures Three measures scored against Carnegie Peers Six-Year Graduation Rate Total Degree Completions Institution Support Students Receiving a Pell Grant (new for FY15) Restoration of prior cuts 50% of performance funds Requirement to not increase tuition more than 3.2%

22 Higher Education Ferris State University Appropriation FY 11 to FY 15 (Amounts in Millions) $48.6 $41.3 $44.3 $46.1 $50.2 FY 11 FY 12 FY 13 FY 14 FY 15

$50 $54 $50 $49 $49 $41 $44 $46 $50 FY 02 FY 03 FY 04 FY 05 FY 06

23 FSU Appropriation History Financial Statement Amounts Base Appropriations plus MPSERS In Millions $56 $56 $50 $49 $49 $50 $44 $50 $54 $50 $49 $49 $41 $44 $46 $50 FY 02 FY 03 FY 04 FY 05 FY 06 FY 07 FY 07 Paid FY 08 FY 08 Paid FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15

24 Higher Education Performance Funding and Tuition Restraint Performance Measures Appropriated FSU Amount FSU %/Total Critical Skills Degrees Research Carnegie Metrics (FSU 10 of 117 points 8.5%) Total $8,293,056 $4,146,528 $24,879,167 $37,318,750 $690,720 $ 0 $1,482,329 $1,351, % 0% 6.0% 6.2% Reinstatement FY11 Cut $37,318,750 $1,277, % Total FSU State Increase 7.6% $3,450, %

25 Tuition Rate Resident Undergraduate Lower Division Tuition Percentage Increase 6.4% 2.4% 3.5% 1.9% 4.4% 5.3% 4.7% 5.1% 2.6% 2.2% 2.2% FY FY FY FY FY FY FY FY FY FY FY 14-15

26 Fall Headcount Enrollment and Annual Full Time Equivalent (FYES) 14,000 12,000 10,000 8,000 6,000 4,000 2, FSU FYES

27 Average Student Debt BS Graduates with Debt Ferris State University $28,483 $31,356 $34,767 $35,468 $35,476 $36,930 $37,

28 Michigan Public University Average Debt of Graduates with Debt And Proportion of Graduates with Debt $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Avg Debt Graduates with Debt

29 Looking Forward Issues to Watch Desire for greater legislative control Performance funding formula stability Measures Political pressures Perceived inequity Competition in the School Aid Fund Community College Baccalaureate MPSERS Strong pressure to restrain tuition Federal support for Pell grants; Perkins Loans Tuition Incentive Program

30 FY 2016 FSU Priorities Strategic Plan Enrollment Plan and Student Success Student Debt External Support

31 Questions, Comments, Discussion Thank you Thank you for your continued efforts for our students and to move Ferris State University forward David L. Eisler

Fall Budget Forum: 2016 Fiscal Results, 2017 Budget, Revenue, Performance Funding, and Future Prospects

Fall Budget Forum: 2016 Fiscal Results, 2017 Budget, Revenue, Performance Funding, and Future Prospects David L. Eisler, president Sally DePew, director, budgetary planning & analysis November 10, 2016