As a research university, Johns Hopkins partners with the federal government and other funding sponsors in seeking answers to humanity’s most important and pressing questions on issues ranging from human health to the nature of existence. It is not surprising, therefore, that the predominant revenue source for the University is sponsored research, comprising 54.6% of the total.

Other sources of revenue, equally critical to serving the University’s mission, include instruction and related revenues (tuition, fees, housing, food service) representing 11.6% of the total. Clinical service revenues, primarily from the delivery of health care by the faculty of the medical and nursing schools, represent 9% of the University’s revenues. Most of the balance is from philanthropy and investments.

The University is pleased to report an operating surplus of $213.9 million. This figure compares to the fiscal year 2000 total of $87.0 million. The current year’s surplus includes $120.8 million in the unspent portion of two exceedingly generous anonymous gifts in support of the development of the Johns Hopkins Malaria Institute and the Johns Hopkins Institute for Cell Engineering. These funds are classified as temporarily restricted, and they will be spent for their intended purposes in future years.

The University continues to improve its business processes, focusing on providing more cost-effective service in areas as diverse as grants management, purchasing, travel, and internal mail delivery. Also, a plan to replace and upgrade information systems for existing administrative and support services has been completed and is beginning implementation.

The University has been investing in its future with the construction of a number of facilities that will enhance student amenities, allow expansion of research activities, and provide overall improved support for Hopkins programs. Completed during the 2000–2001 fiscal year were:

• The Mattin Center, Homewood Campus
  
• Downtown Center, Baltimore

Currently under way are several other major construction projects. They include:

• Clark Hall, Homewood Campus
• Hodson Hall, Homewood Campus
  
• Student Recreation Center, Homewood Campus
  
• Broadway Research Building, School of Medicine
  
• Additions to the Bloomberg School of Public Health
  
• Peabody Institute renovations
  
• Several buildings at the Applied Physics Laboratory
  

In addition, the already beautiful Homewood campus has been transformed with the replacement of asphalt walks and drives with brick and stone, landscaping, and other amenities.

To a large extent, these projects are being financed by donations from Johns Hopkins supporters. The State of Maryland’s generous support of its independent higher education sector has also been critical to some of these improvements. Some debt is being used for the new research and teaching facilities in the School of Medicine and the Bloomberg School of Public Health.

The University continues its rolling five-year financial planning process. Every year, in conjunction with the development of its annual budget, each of the University’s divisions projects detailed estimates of revenue and expense. They are subjected to analysis by University management and reviewed in depth by the Finance Committee of the Board of Trustees. For the first time, the five-year plan includes a capital plan, documenting the facilities needs across Hopkins through 2005–2006. The five-year plan provides a basis for financial planning and assures that the consequences of near-term decisions are understood in a long-term context. Coupled with a debt policy adopted by the trustees a year ago, the University has the fiscal tools to manage its financial resources prudently.

James T. McGill
Senior Vice President for Finance and Administration