FY 2008 Financial Indicators
General Goals for Funding
- The University will increase its funding to support operations at a rate at least equal to the rise in the Consumer Price Index.
The indicator for this goal is the increase of FY 2008 over FY 2007 in unrestricted income for operations, and the benchmark for comparison is the annual increase in the CPI-U (Consumer Price Index for All Urban Consumers).
| Unrestricted Revenues | FY 2008 | FY 2007 | % Increase |
| $178,374,192 | $161,362,903 | 10.5% |
| CPI-U | September '08 | September '07 | % Increase |
| 218.8 | 208.5 | 4.9% |
The University met this goal, aided greatly by the use of the $11.5-million accumulated contributions in funding the construction of the new Sorenson Language & Communication Center building (“SLCC”). Without this transaction, our unrestricted revenues would have been $166,873,326, for an increase of 3.4%, which is below the increase in the CPI-U. - Gallaudet will generate a net annual operating surplus at least equal to the value of the annual depreciation of its facilities.
This goal is considered to have been achieved if the University does not experience a decrease in unrestricted net assets from operations, that is, if the University's income from all unrestricted sources equals or exceeds expenses for operations plus depreciation.
Change in unrestricted
net assets from operations | FY 2008 |
| $16,355,669 |
The University had a substantial operating surplus. This goal was achieved in FY 2008 for the same reason indicated above. Even without the use of the $11.5-million accumulated contributions for the SLCC, the net operating surplus would still be a positive amount: $4,854,803.
Goals for Income
- Increase tuition income by 3% annually.
| Tuition/Fee Revenues | FY 2008 | FY 2007 | % Difference |
| Tuition and Fees | $18,345,823 | $19,312,472 | -5.0% |
| Less scholarship aid | $4,980,150 | $4,389,681 | |
| Net Tuition and Fees | $13,365,673 | $14,922,791 | -10.4% |
This goal was not achieved in FY 2008, as the University 1) continued to experience a downturn in enrollment, and 2) increased the amount of scholarship aid. - Increase other sources of discretionary income by 3% annually.
The indicator for this goal is the sum of income from auxiliary enterprises, investment income, and other sources.
| Other Discretionary Income | FY 2008 | FY 2007 | % Difference |
| $29,291,468 | $27,906,050 | 5.0% |
This goal was achieved in FY 2008, largely due to the increase of the endowment payout rate despite the impact of enrollment reduction on student fees for auxiliary services.
Goals for Financial Well-being and Efficiency
- Gallaudet’s annual net income ratio will be approximately 2% to 4%.
| Net Income Ratio | FY 2008 | FY 2007 |
| 9.2% | 1.8% |
The Net Income Ratio is the ratio of total operating income to total expenses plus depreciation. This is a measure of the University's operating surplus, and the goal of 2% to 4% is suggested in analyses by industry experts. The University met this goal in FY 2008 after barely missing it in 2007. Even without the use of the $11.5-million accumulated contributions for the SLCC, the Net Income Ratio would have been 2.7%, still achieving this goal in FY 2008. - Gallaudet's expendable reserves will increase to approximately two-thirds of the value of the annual operating budget by FY 2010.
The ratio of the University's expendable reserves to its operating budget is a measure of how long it could operate in an emergency with no influx of new funding. A ratio of one would mean that Gallaudet had sufficient reserves to operate for one year. From 64.7% in 2007, this ratio had unfortunately fallen to 29.2% in 2008. There are two primary reasons for the reduction in the ratio. First, the university experienced a $34.9 million reduction in our investments from FY07 to FY08. (This does not include the use of the $11.5 million accumulated contributions in funding the construction of the SLCC.)
The second reason is a large increase in our “land, buildings, and other property” assets of $22.8 million. This is the result of the construction of the Sorenson Language & Communication Center and resulted in conversion of expendable assets to real property/physical plant. The following chart presents information on the University's projection over the next 5 fiscal years, including actual progress from FY 2007 through FY 2008.
- Gallaudet's ratios of programmatic and support service expenditures will fall within a range for a peer group of small liberal arts colleges and universities.
The following chart compares Gallaudet University (university programs only) with the average for a peer group of small, high-cost, liberal arts colleges and universities. The basis of comparison is percentages of total expenses devoted to the various functional categories of expense. According to this analysis, expenses at Gallaudet University have a distribution pattern that is very similar to that of the peer group, some exceptions being that Gallaudet spends considerably more on research and public service, consistent with its national mission. This comparison is taken as a sign of success for this goal.
Goal for Increase in Net Assets
The University does not have a quantitative strategic goal for increasing its net assets, but seeks an increase in this indicator. This indicator unfortunately dropped significantly during FY 2008. The major reason is the decline in our investments due to the turmoil in the stock market.
The chart that follows shows the recent history of growth in the University's assets divided into three categories: property, expendable net assets (reserves), and permanently restricted net assets. Note that in FY 2008, expendable net assets fell along with total net assets; however, the value of plant went up.
| Total Net Assets | FY 2008 | FY 2007 | % Change |
| $324,137,995 | $356,194,067 | -8.9% |
