University of Akron President Matthew Wilson yesterday released the outline of a plan meant to stabilize and reverse falling revenues, following the completion of an analysis on University finances by management and accounting firm Ersnt & Young.
The report, whose $350,000 cost was paid for by an anonymous donor, says a combination of factors have weakened University finances and, if not addressed soon, “the annual deficit could grow significantly and create even greater challenges in the near term.”
In a letter published online, Wilson said the report can be summarized as follows: “expenses still outpace [University] revenues despite a cut of about $20 million from our budget last year.”
The University is currently operating on an $18 million deficit for the 2016-2017 academic year, which has been covered by a reserve fund of $66 million. The deficit would have been closer to $30 million, the report says, if not for personnel savings and debt refunding implemented recently.
Declining through the last five years, enrollment has been the major cause of the University’s financial troubles. Even though it began to increase after Wilson’s appointment as interim president last summer, enrollment was still down eight percent total and 20 percent in full-time freshmen this year.
“The University faces the financial realities associated with a downturn in enrollment,” wrote Wilson. “In recent months, we have explored various approaches to address those realities,” one of which was to have the Ernst & Young report done.
Through all this, Wilson says he “remains encouraged and optimistic.”
Accompanying the report and the letter, Wilson outlined future strategies to fix the University’s finances in a 20-minute video on the same webpage. These include:
Voluntary buyouts for all faculty and staff, specifics of which have not been laid out yet.
An update to graduate assistantship programs.
Enhanced retention and recruitment initiatives (specifically for international students, and evening, weekend and online offerings).
Increased fundraising efforts.
A remodeling of the scholarship system.
Enhancements to the efficiency of University systems and processes.
This plan, which Wilson refers to as “Stabilize – Invest – Grow,” will be put into effect over the next two years, starting in July 2017.
“As President Wilson has said and demonstrated, keeping the focus on serving students and enhancing their educational experience is the top priority,” UA spokesman Wayne Hill said.
The full letter from Wilson, as well as the video and the draft of the Ernst & Young report, can be found on uakron.edu/budget.