University cuts operating budgets
University cuts operating budgets
Published: Thursday, October 11, 2012
Updated: Friday, October 12, 2012 19:10
$5.1 million is being cut from the university’s operating budget for this fiscal year, said Rev. Kevin Wildes, S.J.
The revenues the university projected for this fiscal year were $161 million. These cuts are being made in order to make certain the university finishes the fiscal year, ending July 31, 2013, with a “slight surplus to the budget” as projected, Wildes said.
“While cutting is never easy, cutting the operating budget seemed to be the least painful way to meet our goals,” Wildes said.
If the university administration had not decided to make cuts from the operating budgets within the university, the salaries of those who work within the university would have suffered cuts, Wildes said. This is because the two-pronged budget of the university is composed of salaries and operating budgets.
Both first-year student enrollment and graduate student enrollment being less than what the university expected prompt the budget cuts.
“The entering first-year class was approximately 30 students short of the budgeted 900 first-year students. In addition, retention rates across all student classifications were lower than projected, and we have smaller graduate enrollments than expected,” Wildes said.
According to provost and vice president of academic affairs Marc Manganaro, the university administrators are in the process of determining why those 30 students chose not to stay at Loyola for this semester. “We’re still trying to figure out why we’re 30 below. Enrollment management is not an exact science,” Manganaro said.
Wildes said Loyola is not the only university to feel the decline in enrollment and retention. “The shortfall experienced at Loyola reflects similar occurrences at the other universities in the New Orleans area, and the graduate shortfall also reflects a national trend,” Wildes said. Most other Jesuit universities are having similar problems, which Wildes attributes to the “economic times.”
This cut is likely to affect all parts of the university, Wildes said. “All areas of the university have an operating budget. And all areas will have less in their operating budgets,” Wildes said.
The budget cuts will take effect “immediately” and will be in place for this year only, Wildes said.
Wildes said the budget cuts will not affect construction. “The campus construction is budgeted and paid for out of the capital budget, and that money to finance the construction comes from the sale of bonds,” Wildes said.
Because “Loyola went to the bond market successfully in recent years to finance the current construction,” the operating budget, where the cuts will be made, is separate from the capital budget, which covers construction.
Though the $5.1 million in cuts to be made is a noticeable change “we have done this repeatedly in the years since Katrina and met our goals,” Wildes said. “We can and will do it again this year.”
In paying attention to remedying as much of the cuts as possible, Wildes said he has asked Manganaro, vice president of student affairs Cissy Petty and vice president for enrollment and associate provost Sal Liberto “to review our retention and graduation profile.”
Wildes said reviewing the retention and graduation profile of the university is important because these issues are “immediately tied to the
financial aid issues.” He said, “Improving our retention and graduation profile will give us better assumptions as we prepare budgets in the future. This will also reflect a better quality of service to our students and will improve the reputation of the university.”
Wildes said Loyola’s retention rate is 74 percent. On a four-year average, Loyola’s retention is 6 percent higher than the national four-year average for other private colleges and universities, Wildes said.
Wildes said they do not anticipate the tuition increasing next semester more than usual based on the budget cuts. He said the cuts in the budget will not mean decreased financial aid and scholarships for future or current Loyola students.
Wildes said cutting from operating budgets around the university is the best way he sees to preserve faculty and staff. “I am confident that we can take structural and organizational steps this year to do a better job in creating budgets in the future, which will allow us to better serve our students,” Wildes said.
Aaren Gordon can be reached at email@example.com