Balanced budget despite financial setbacks early on
Eastern Michigan University’s budget is balanced despite the decrease in state appropriations and the brief decline in portfolio returns that led to last fall’s temporary $4.6 million deficit.
At the Board of Regents meeting on Tuesday, EMU Chief Financial Officer John Lumm told the finance and audit committee that as of March 31, the general fund year-to-date revenues were $222 million and year-to-date expenses were $221.9 million.
Lumm estimated the general fund full year revenues would be between $275 million and $279 million, and full year expenses would be between $277 million and $278 million.
Lumm said as of March 31, the auxiliary fund year-to-date revenues were $34.8 million and year-to-date expenses were $31 million.
Despite these optimistic figures that point to a successful fiscal year, Lumm said there was still uncertainty as to how the year would end.
“We have two revenue variables that could change the outcome,” he said. “Those are spring enrollment and investment income.”
Lumm said despite the new summer semester format, which makes it “a little more difficult to do comparisons” to previous years as he has not seen “significant change.”
Furthermore, Regent Thomas Sidlik said enrollment for the new summer semester is up three percent from last year.
As of March 31, EMU had $76.2 million in its investment portfolio. Of that, $19 million were in short-term investments, $42.1 million were in long-term investments and $15.1 million were in intermediate-term investments.
Despite that EMU’s investments were suffering as of Sept. 30 with portfolio returns $1.9 million in deficit, Lumm said returns are currently on budget at $2.4 million.
Regent Mike Morris said EMU is looking at ways to increase those returns but is being cautious because high-return investments are often high risk.
“What we won’t do and what we shouldn’t do is be over the top,” he said.
Further highlighting budgetary success, Lumm pointed out that “fundraising is quite a positive story for the year.”
Total fundraising for fiscal year 2011 was $5.1 million and at this time last year $4 million had been raised. This year, the goal was $9.5 million and year-to-date $10.3 million has been raised.
EMU Vice President of Advancement, Thomas Stevick, said the increased fundraising was due partly to the $4.7 million from two unprecedented donations. The donation from Bill and Dee Brehm was the largest in EMU history and the donation from the American Electric Power Foundation was the largest from a corporation in EMU history.
Stevick stressed this year has also seen a general increase in donations, with approximately 1,000 more gifts this year than last year.
“A lot of that has to do with the reputation of the university,” he said. “People are feeling good about the university and the progress of the university. When people have that pride, they give.”