Strategic Plan 2016

from Focus 2016: Design for the Future, the Strategic Plan of Columbia College Chicago

Original here: http://www.colum.edu/focus2016/info/finances.php

[emphasis added]

Finances

Columbia’s mission, increased competition for students, economic constraints on students and their families, and new government accountability for student costs motivate the college to limit tuition increases. Yet, the same forces (mission, competition, a tight economic climate and accountability—in this instance for student learning) dictate ongoing investments in new programs and the quality of the student learning experience. Additionally, the long-term financial health of the college impels investment in the college’s endowment and its capital assets. Two years of declining enrollment and tuition revenue (fall 2009 and fall 2010) compel the college to make swift and significant changes to its financial model.

Columbia’s financial objective, therefore, is to remain affordable for a diverse student population and price competitive with its market competitors while generating sufficient revenue for operations, strategic objectives and to grow the endowment. The college will accomplish this through measured increases in revenue and significant reductions in expenditures.

To accomplish these interrelated objectives, the college will rebuild enrollment to at least 2008 levels, limit undergraduate tuition increases, and modestly increase institutional student aid. As importantly, the college will significantly reduce its level of financial commitment to some of its current programs and will fund strategic initiatives primarily through the reallocation of funds from other functions. The college will accomplish this by reducing operating costs and establishing a financially sustainable level of instructional and non-instructional programming. In addition, the college will significantly increase gift and grant revenue to augment funding for student aid, capital facilities, and the endowment.

The college will pursue strategies for: 1) student costs; 2) tuition revenue; 3) gift and grant revenue; 4) managed financial commitments; and 5) strategic expenditures.

Student Costs

  • The college will increase undergraduate tuition in the range of 3% to 5% annually and will set graduate tuition by program based on comparable market rates. The college will increase institutional student financial aid annually in the range of 1% to 2% of tuition increases to a maximum of 15% of gross tuition revenue.
  • The college will award graduate and undergraduate aid on a combination of need and merit to meet recruitment and persistence to graduation goals.

Tuition Revenue

  • The college will generate at least 4% to 5% increases in annual gross tuition revenue typically through a minimum 1% enrollment growth; undergraduate tuition increases not exceeding 5%; and graduate tuition increases consistent with tuition trends at comparable programs.

Gift and Grant Revenue

  • The college will raise a total of $100M in comprehensive funding over fiscal year 2011 through fiscal year 2016 and, in doing so will complete the current comprehensive campaign by the end of fiscal year 2014. (Comprehensive fund raising includes all gifts and grants from individuals, corporations, foundations, governments, and other donors and purchases of tickets and goods related to fund raising activities of the college.)
  • The college will set and achieve specific fund raising performance goals based upon performance benchmarks of a group of peer institutions with mature and successful fund raising functions and in the context of Columbia’s recent past performance.

Managed Financial Commitments

  • The college will aim to keep annual incremental increases in continuing operating expenses to 2% and 3%, and will budget a minimum of $14M of gross revenue for Focus 2016’s strategic objectives.
    The college will maintain operating revenues in excess of operating expenses ratio at 5% to 10% and a minimum positive cash flow to the long-term investments (i.e., the endowment) at 2% to 4% of total revenues.

The college will accomplish this by:

  • Reducing operating expenses through streamlined business and operating processes, and optimizing utilization of human and capital resources;
  • Utilizing technology to improve the productivity of business and operating processes;
  • Reducing the current level and maintaining a financially sustainable number of undergraduate courses and programs;
  • Positioning graduate education to reach and maintain budgetary break-even by September 2015;
  • Committing to adult education reaching budgetary break-even by September 2015 and profitability by September 2016;
  • Committing to substantially reducing college operating revenue support for engagement and outreach activities by September 2014;
  • Implementing limits on budgetary and in-kind support of grant-funded activities.

Strategic Expenditures

The college will develop flexible, strategic budgeting practices that enable allocation and, as importantly, reallocation of funds to accomplish specific strategic purposes. The college will establish evidence-based practices for determining where to increase and decrease funding to accomplish strategic purposes.

More specifically, the college will:

  • Adjust funding for instructional costs with changes in enrollment;
  • Give budget priority to: academic program development; adult education, student recruitment and persistence to graduation; student learning experience; the development, maintenance and sustainability of the college’s capital assets and productivity initiatives that clearly advance the Focus 2016 strategies for student learning, enrollment, and finances.

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