Where does the money go?

1. Where does the money go? First, from where does it come? David English Chief Financial Officer & V.P. for Finance & Administration

2. Sources of Revenue

3. Student – based Revenues • Begin Fall with 2,525 students • End Spring with ~ 2,360 students • Average FTE of ~ 2,443 students • Tuition of ~$34,600; paid by all -$84M • Room of ~$5,500 paid by 75% (~1,800) - $10M • Board of ~$4,575 paid by 70% (~1,700) - $8M • Total Gross Revenue of $102 M • Average revenue of ~$42,000 / FTE Student

4. Student – based Revenues, Cont. • Average Augie grant of $18,000 / student • Previously noted, average gross revenue of ~$42,000 / student • Net Revenue of ~$26,000 student (42K – 18K) • Consequently, a 10 student enrollment swing results in a $260,000 change in revenue • Swings can by caused by lower-than-expected admissions yield or upper-class retention

5. Recap – Revenue Sources So now we know the sources, where does it go?

6. Expenditure Budget • Consistent with other higher education institutions, the majority of Augustana’s budget consists of compensation. • These costs are relatively fixed • Vary little with a marginal change of one student • Make enrollment growth one of the most effective ways of mitigating inflation

7. Expenditure Budget – by Program

8. Compensation • 62% of Total Budget, or $43 million • Components are: • Faculty Salaries $14.9M • Administrator Salaries $9.8M • Staff Hourly Wages $6.3M • Other $2.5M • Benefits $9.6M

9. Benefits • $9.6 million budgeted • Represents 22% of compensation budget; 14% of total budget • Components • Retirement: 28% • FICA: 24% • Medical: 21% • Tuition benefit: 20% • Other: 7%

10. Non-Compensaton Expenses • $26.8 million aggregate budget, 38% of Total Budget • Components • Plant: major and minor buildings and grounds work • Utilities / Insurance: electric, heating, water • Debt Service: principal and interest costs • Other Operating Expenses – Goods & Services

11. Plant • $4.3 million • 6% of total budget • 16% of non-compensation budget • Majority is for major projects • Old Main, CSL, … • Spending “lumpy” and fluctuates across years • Approximately $800K is for recurring maintenance • Painting, sidewalk repairs, other on-going maintenance

12. Utilities / Insurance • $2.9 million • 4% of total budget • 12% of non-compensation budget • Heating, electricity, property & casualty insurance • Utility consumption fairly level over time • Heat with natural gas, so unit cost has improved in recent years • Insurance costs are market-driven

13. Debt Service • $3.5 million • 5% of total budget • 13% of non-compensation budget • Principal and interest payments on debt • As of 6/30/12, College has ~$62M outstanding debt • $20M in variable rate, all-in cost of ~ 1.1% • $42M in fixed rate, all-in cost of ~4.6%

14. Goods and Services • $16.1 million • 23% of total budget • 60% of non-compensation budget • Variety of Categories: • $3M in cost of goods sold, mainly food for Dining • $3M in travel, lodging, professional development • Travel for visiting students, sports teams, foreign programs, conferences • Safety training, professional development • $2.0M in contracted services • External repair work, legal and audit fees, service contracts for equipment • Remaining is across wide variety of expenses

15. Capital Campaign • A $152 million campaign (2005-2012) • Commitments by designation (chart in $ millions)

16. Questions? David English Chief Financial Officer & V.P. for Finance & Administration