George Mason University. Board of Visitors Finance & Land Use Committee Office of the Senior Vice President May 5, 2016

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1 George Mason University Board of Visitors Finance & Land Use Committee Office of the Senior Vice President May 5, 2016

NEW PICTURE HERE I. Call to Order AGENDA II. III. IV.

Fees Closed Session Public Contract (Code of VA: 2.2-3711.A.29) V.

University Controller Review and APA Audit of Financial

2 NEW PICTURE HERE I. Call to Order AGENDA II. III. IV. Approval of Minutes University Operating Budget, Tuition and Fees Closed Session Public Contract (Code of VA: A.29) V. New Business A. University Controller Review and APA Audit of Financial Statements for Year Ended June 30, 2015 B. Higher Education Autonomy VI. Adjournment GEORGE MASON UNIVERSITY 2

3 MASON AT A GLANCE George Mason University is Virginia s Largest Public Research University GEORGE MASON UNIVERSITY 3

MASON ON THE WIRE 150 Under 50 Rankings 2016 The Times Higher Education 150 Under 50

It celebrates young universities that have made a great impact on the global stage in

George Mason University ranked 59 Sally Keith.

landed the prestigious John Simon Guggenheim Memorial Foundation Fellowship.

4 MASON ON THE WIRE 150 Under 50 Rankings 2016 The Times Higher Education 150 Under 50 Rankings 2016 is a ranking of the top 150 universities under 50 years old. It celebrates young universities that have made a great impact on the global stage in years rather than centuries and showcases the future rising university stars. George Mason University ranked 59 Sally Keith. Photo by Ron Aira George Mason University English professor and poet Sally Keith has landed the prestigious John Simon Guggenheim Memorial Foundation Fellowship. Guggenheim Fellowships are typically awarded at midcareer to those who have already demonstrated exceptional creative ability in the arts. GEORGE MASON UNIVERSITY 4

financial aid 69% of first-time freshmen live on campus 26% of undergrads live on campus

5 MASON SERVES Northern Virginia Washington Metro Area Commonwealth of Virginia The Nation The World FAST FACTS ( ) Enrollment ~ 34,000 81% Virginia residents 57% receive financial aid 69% of first-time freshmen live on campus 26% of undergrads live on campus 6,502 employees on 3 campuses 2,634 teaching & research faculty GEORGE MASON UNIVERSITY 5

6 GEORGE MASON UNIVERSITY 6

7 STUDENT PROFILE: WHO WE ARE, WHO WE SERVE George Mason University is Virginia s Largest Public Research University GEORGE MASON UNIVERSITY 7

8 STUDENT PROFILE FY 2016 Enrolled Student Population by Headcount: 33,925 Undergraduate Graduate Full Time Part Time In State Out of State 32% 33% 19% 68% 67% 81% GEORGE MASON UNIVERSITY 8

9 UNDERGRADUATE STUDENT PROFILE FY 2016 Undergraduate Student Population by Headcount: 23,062 First Generation Other Underrepresented Racial/Ethnic Other Over Age 25 at Entry Other 13% 35% 51% 49% 65% 87% 1 in 3 1 in 2 1 in 8 George Mason University serves an incredibly diverse population with a broad array of needs which require investment. GEORGE MASON UNIVERSITY 9

STUDENT SUCCESS NO DISPARITY IN OUTCOMES!

students but only 49% of Latino students and 40% of African American

In public institutions, white student graduation rates surpass those

9% Mason No Disparity of African Americans on average by 16.

10 STUDENT SUCCESS NO DISPARITY IN OUTCOMES! COMMITTED TO EXCELLENCE Graduation Gaps: Nationally, 60% of white students but only 49% of Latino students and 40% of African American students who start college hold bachelor degrees 6 years later. In public institutions, white student graduation rates surpass those of Hispanics on average by 14.9% Mason No Disparity In public institutions, white student graduation rates surpass those of African Americans on average by 16.2% Mason No Disparity Source: The Education Trust, 2010 GEORGE MASON UNIVERSITY 10

11 PELL GRANT GRADUATION OUTCOMES George Mason University named a Standout Institution for Graduation of Pell Students! One of Thirty-Six Institutions named that have: Pell Graduation Rates that are 10 percentage points above the average rate of their peers Pell Grant graduation rates at or above the national Pell graduation rate (50 percent) Completion gaps between Pell and non-pell recipients at or below 3 percentage points Source: The Education Trust The Pell Partnership, Sept 2015 (College Results Online) GEORGE MASON UNIVERSITY 11

12 INVESTING IN THE FUTURE Mason Transfer Students ROI is even better! GEORGE MASON UNIVERSITY 12

13 INVESTMENT IN ACCESS AND AFFORDABILITY Student Financial Aid profile Sources of Financial Aid FY 2015 Increase in Financial Aid FY 2016 Federal $194.8M State & Institutional $7.0M State $17.8 Expected Increase in Financial Aid FY 2017 Institutional $33.0 Private (Philanthropic) $27.7 State & Institutional $4.2M Total $273.3M Two Year Increase = $11.2M GEORGE MASON UNIVERSITY 13

14 THE WORLD IS CHANGING George Mason University is Virginia s Largest Public Research University GEORGE MASON UNIVERSITY 14

Improving the Student Experience Initiative Exploring Partners for Online Graduate

15 The World Is Changing Rapidly Mason needs to make investments to attract and retain students. Improving the Student Experience Initiative Exploring Partners for Online Graduate Degrees Increasing Demand for Student Services Commitment to Diversity and Inclusion Support Stay Mason Increase Undergraduate and Graduate Financial Aid GEORGE MASON UNIVERSITY 15

16 FINANCIAL FRAMEWORK REVENUES EXPENSES State Appropriations Tuition & Fees Retention & Enrollment Mix Philanthropy New Programs Mandatory Cost Increases and Regulatory Environment Academic & Administrative Enterprise Debt Service NET RESOURCES Operating and Capital Reserves Capital Infrastructure Physical Plant GEORGE GEORGE MASON UNIVERSITY MASON UNIVERSITY 16 16

17 MASON IS EFFICIENT AND EFFECTIVE Accessible Diverse Student Body No Disparity in Outcomes Affordable Great ROI High Quality Tuition and Fees less than most VA doctorals Lower Core Spending than Peers Great Return on Investment Best Student Loan Default Rate in Nation GEORGE MASON UNIVERSITY 17

18 LONG TERM FINANCIAL SHIFT FROM TAXPAYER TO STUDENT 1985 George Mason University General Fund vs. Tuition and Other as a Percent of the Educational and General Budget 33% 67% 80% 70% 67% State Appropriations Tuition & Other 72% % 50% 43% 57% 40% 33% 30% 28% % 10% 28% 0% 72% *State imposed 20% tuition reduction for in-state undergraduate students in FY2000 and rates were held flat through FY2001 and FY2002. ** ARRA included in General Fund GEORGE MASON UNIVERSITY 18

19 MASON IS DOING MORE WITH LESS Mason is very efficient. MASON Faculty/Staff to Student 1:8 Doctoral Average 1:5.6 William and Mary 1:3.6 VCU 1:7.1 Mason would need to add over 1,000 people to be comparable with state average. GEORGE MASON UNIVERSITY 19

20 THERE ARE INCREASING PRESSURES ON THE INSTITUTION Two Years Base Budget Cuts Increased Demand for Student Services Tuition Sensitivity Rapid Enrollment Growth Compensation and other employment cost pressures Changing Regulatory Landscape GEORGE MASON UNIVERSITY 20

Starting Point FY 2016 Two years of state base budget cuts.

Changing Landscape Student Demographics Mandatory

Accessibility High Quality Increased state funding

compensation BALANCED BUDGET Robust Financial and Academic

Initiatives Diversity & Inclusion Graduate Enrollment

21 Starting Point FY 2016 Two years of state base budget cuts. Advocacy for additional state funding. Changing Landscape Student Demographics Mandatory Increases More Competitive Market FY 2017 Affordability Accessibility High Quality Increased state funding Faculty/Staff/Student pressure for services and compensation BALANCED BUDGET Robust Financial and Academic Foundation University Strategic Plan Student Success Initiatives Diversity & Inclusion Graduate Enrollment Strategy Budget Model Redesign Enrollment Initiatives Financial Aid Initiatives Research GEORGE MASON UNIVERSITY 21

22 FY 2017 PROPOSED REVENUE BUDGET $1.0B pie chart in millions GEORGE MASON UNIVERSITY 22

23 FY 2017 PROPOSED EXPENSE BUDGET $1.0B pie chart in millions GEORGE MASON UNIVERSITY 23

24 How do we remain affordable, accessible, and provide a high quality education? Affordability GEORGE MASON UNIVERSITY 24

Examine the Base: Base Budget Efficiency & Effectiveness Measures Debt Deauthorization: 3 Year Total $197M FY 2013-2016 Asset Reutilization Mason Inn Conversion* Historical Loss $12M Mason Hall Phase

25 Examine the Base: Base Budget Efficiency & Effectiveness Measures Debt Deauthorization: 3 Year Total $197M FY Asset Reutilization Mason Inn Conversion* Historical Loss $12M Mason Hall Phase I & II Cost Avoidance $13M Science & Technology Campus Base Budget Cuts & Reallocation 4 Year Total $24.1M FY 2013 $4.7M FY 2014 $2.0M FY 2015 $9.4M FY 2016 $8.0M Future Challenge Pension/Healthcare Increases 4 Year Total ~$20M *Mason Inn conversion with the INTO partnership covers approximately $3.0M debt service annually GEORGE MASON UNIVERSITY 25

Moving Forward FY 2016-18 INITIATIVES Budget Model Redesign Analyze business services to increase efficiency and minimize cost Increase Financial Flexibility with the State

Multidisciplinary Research/Education Platform for Educational Innovation Institute for Biomedical Innovation Major clinical partnership(s) Innovation and Entrepreneurship Center

26 Moving Forward FY INITIATIVES Budget Model Redesign Analyze business services to increase efficiency and minimize cost Increase Financial Flexibility with the State Sustainability Initiatives Housing Solution Restructure Debt Debt Policy Reserve Policy Establish College/School Dashboards Establish College/School Faculty Workload Guidelines Multidisciplinary Research/Education Platform for Educational Innovation Institute for Biomedical Innovation Major clinical partnership(s) Innovation and Entrepreneurship Center Online Graduate Program Partnership Meet Enrollment, Retention and Completion Goals Meet Executive Education Revenue Target Increase Study Abroad and International Enrollments GEORGE MASON UNIVERSITY 26

27 INVEST IN CRITICAL PROGRAMS & SERVICES, AND STAGE THE RUNWAY FOR FUTURE SUCCESS Compensation Increases for Faculty and Staff Increase Financial Aid for Undergraduate and Graduate students Increase services and programs related to Diversity and Inclusion Invest in Student Enrollment and Access Initiatives Increase for Critical Student Services, includes writing center, counseling center Invest in Research, includes Institute for Biomedical Innovation GEORGE MASON UNIVERSITY 27

28 Forecasting Forward what if increase tuition more than 3%? GEORGE MASON UNIVERSITY 28

Room and Board increase; and approval of the proposed budget as provided

29 Board Recommendation The Finance & Land Use Committee recommends approval by the Board of Visitors of the FY 2017 proposed Tuition, Fees, Room and Board increase; and approval of the proposed budget as provided in the (PROPOSED) Executive Budget Summary. GEORGE MASON UNIVERSITY 29

30 CLOSED SESSION 30 GEORGE MASON UNIVERSITY 30

31 UNIVERSITY CONTROLLER REVIEW AND APA AUDIT OF FINANCIAL STATEMENTS JUNE 30, 2015 Auditor of Public Accounts (APA) completing audit for year ended June 30, 2015 Highlights for the year: The University implemented GASBS 68 record net pension liability Prior year ending net position restated downward $204.9 million Net pension liability at June 30, 2015 is $187.7 million *The University s total net position increased $60.3 million, or 14% Total operating revenues increased by $23.1 million, or 4% Total operating expenses increased by $14.6 million, or 2% **Unrestricted net position increased by $25.8 million, or 23% *Compared to restated FY14 total net position (FY15 MD&A Statement of Net Position) **Compared to restated FY14 unrestricted net position (FY15 MD&A Statement of Net Position) GEORGE MASON UNIVERSITY 31

32 UNIVERSITY CONTROLLER REVIEW AND APA AUDIT OF FINANCIAL STATEMENTS JUNE 30, 2015 Link to the draft unaudited financial statements was provided in December Subsequent events have been added and some minor cosmetic changes There are no material weaknesses There were no changes to the ratios or financial data in the report or in the information presented in December Audited report will be made available on the Fiscal Services website APA presentation of findings and opinion APA present any new accounting pronouncements affecting FY16 GEORGE MASON UNIVERSITY 32

33 INCREASED UNIVERSITY AUTONOMY As part of a five-year pilot program, George Mason University is authorized, for a period of five years, to exercise additional financial and administrative authority in three functional areas of information technology, procurement and capital projects GEORGE MASON UNIVERSITY 33

34 Live as if you were to die tomorrow. Learn as if you were to live forever. --Mahatma Gandhi GEORGE MASON UNIVERSITY 34

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Trends in Student Aid and Trends in College Pricing 2012 NYSFAAA Conference Katrina Delgrosso Senior Educational Manager Agenda What is the College Board Advocacy & Policy Center? Trends in College Pricing