Calvin University Carillons | The new financial strategy focuses on investments in future growth
Calvin’s Strategy Budget The Review and Calvin Tomorrow initiatives have resulted in a new financial strategy that will shape residence lifeathletics, academic programs, and the physical campus of the university over the next 10 years.
Very difficult decisions have been made over the past five years or more and it has been a very difficult time for all of you.
The strategy asks the university to maximize its existing assets and increase investment in key areas, including undergraduate residence life and growth of non-traditional programs. The university plans to operate in deficit for about the next four years in the hope that the increases in investment it will allow will pay off in subsequent years, according to documents provided to Chimes by Chief Financial Officer Tim Fennema.
“Very difficult decisions have been made over the past five years or more and this has been a very difficult time for all of you,” President Wiebe Boer told faculty and staff at a finance and planning town hall Sept. 7. “And because of these tough decisions and what happened, we are now in a place where we can start looking to grow.
Over the past five years, the university has been forced to absorb a $27 million drop in revenue. This decline contributed to the layoffs of 12 professors in the summer of 2020 and two tenured professors, seven minors and five majors being To cut in the summer of 2021. He also motivated the outsourcing of facilities last year, the implementation of the Voluntary Departure Incentive Program, designed to encourage older faculty to choose retirement, and the ongoing transition from a three-to-four-two credit hour system.
The university’s strategic budget review began in September 2021. The strategic budget review team presented Calvin Tomorrow – a first three-year budget plan designed to avoid further cuts – to the board of trustees in January 2022 , followed by a full plan in April. . Fennema presented this comprehensive plan, which aims to increase revenues from the $76 million projected this year to around $98 million by 2031, to university employees at the town hall.
Invest to grow
When you get to that level, it hurts the student experience, it hurts the university.
Decline in undergraduate enrollment has contributed to lower revenues in recent years. But cost-cutting in response to enrollment could undermine the university’s mission, according to Fennema. ” You can watch [the decline in enrollment] and go, ‘Okay, how could you manage 2500 undergraduates?’ It’s a whole other thing. And when you get to that level, it hurts the student experience, it hurts the university,” Fennema said. Chimes.
Fennema hopes that focusing on investment to grow will help the university be more financially viable by reaching registration goals by the end of the decade.
An increase in staffing spending of $500,000 per year over the next three years will help facilitate increased investments in brand development, targeted marketing efforts, additional admissions counsellors, visitor experiences and the progress of the university’s athletic strategic plan (developed last year). In fiscal year 2023, the university aims to invest a total of approximately $2 million in these areas in hopes that these will help achieve a goal of 3,200 undergraduate student enrollment at the university. ‘coming.
Typically, financial plans are reassessed after the 10th day college census to take into account final enrollment numbers. Because the new plan is multi-year and does not seek to achieve a balanced budget, it will not be reassessed this year, Fennema said at the town hall.
The university also plans to invest in expanded opportunities for degree completion, graduate degrees and certificate courses, as well as enabling underserved learning communities to access programs at all levels. levels, with the aim of increasing graduate enrollment to 1,000-1,500.
The overarching goal of these programs is to “deliver what Calvin has to more people in more places on more platforms,” Boer said at City Hall.
“What we’re trying to do is make strategic investments to grow the university. And we focus on the ones that we think will give us the best, fastest return,” Fennema said.
Four-Two Credit Transition
The four-to-two transition should reduce expenses by about $1.5 million to $2 million, according to Fennema.
Total expenditures this year are expected to be approximately $81 million. The objective for the next 10 years is for expenditure to increase a little less quickly than income. By 2031, expenditures are expected to total about $96 million, about $2 million less than the revenue target for that year.
The expense forecast took into account anticipated savings due to the transition from four credit hours to two, the use of attendants and fellows, and increases in efficiency, but also assumed that it there would be no further reductions in the workforce and increases in wages and salaries.
We are not going to expect you to do more of what you are doing with the limited resources you currently have.
The Education Policy Committee had completed program repackaging approvals for 10 of the 28 departments as of September 6. The committee has been working on this project since July and hopes to complete it by November of this year.
Some faculty members have expressed concern about the increased workload due to the transition and expansion of non-traditional programs. Being asked to do more with less was a key theme of employee concerns raised during a occupational health assessment administered to Calvin by the Better Christian Workplaces Institute earlier this year.
“We’re not going to expect you to do more of what you’re doing with the limited resources you have right now,” Boer said at the town hall. Faculty expansion will come when enrollment increases, according to Boer.
According to Elzinga, the university’s next major global fundraising campaign will pay particular attention to the academic division.
Campus development plans include funding for the new Residential master plan, which is expected to cost around $120 million over the next 10 years, according to the documents. Renovations to the University Center are also planned, along with new projects in the outdoor athletics complex and construction of the Learning Commons (formerly known as Commons Union) and the new School of Health. According to Vice President for Advancement Gregory Elzinga, the university needs to raise about $20 million by summer 2023 to fund the Learning Commons and the planned football stadium.
According to Fennema, the university will not increase its outstanding debt by about $85 million by borrowing more money unless it is needed at the end of the 10-year plan to complete the projects, and only if the registrations increase. Fennema said some new projects, including the Learning Commons, may also be eligible for historic tax credits that the university can sell to outside companies.
Additionally, the plan calls for maximizing the university’s existing physical infrastructure assets by keeping more buildings open year-round and expanding the use of event services, with the goal of increasing event service revenue. at 5 to 7 million dollars.
Infrastructure was also a theme in the January 2022 Calvin Tomorrow update, which recommended selling off ancillary real estate as part of its downsizing plan to cut costs. This summer, the university completed the sale of the Youngsma Center Building and Surge Building, located east of Beltline and north of Ecosystem Preserve, for a combined $2.85 million.