Approval of the Minutes: Minutes of the meeting of October 31, 2005 were approved as distributed.

Fiscal 2006 Quarterly Financial Results as of September 30, 2005

Mr. Puddester presented the University's financials showing an operating surplus of $76.7 million, higher than the budgeted surplus of $35.7 million.

Total revenues received through September were $824.7 million, $38.7 million (4.9%) more than anticipated for this period due in large measure to the early receipt of a large gift ($21 million) at the School of Public Health. Most revenue sources were at or over budget. Through the first quarter of FY 2006, revenue growth over last year stands at 7.1%.

Tuition revenue is $3.8 million higher than budgeted. There are higher than budgeted increases at the Schools of Public Health, Engineering, Nursing and the School of Advanced International Studies. All other schools are at budget. Overall, tuition revenues are 6.5% higher than last year at this time.

Organized research revenues were less than budget through September ($4.7 million, 4.2%). Organized research revenue has grown 6.5% from last year Increases at the School of Public Health (up $842 thousand, 4.7% over budget) are attributed in part to activity in International Health. All other schools are under budget. The School of Medicine is below budget by 5.9% as many departments report lower spending. Revenues were down $426 thousand (8.2%) in the School of Engineering with activity below budget in several departments and Centers. The School of Arts and Sciences is slightly below budget through September ($224 thousand, 2.5%). The "All Other" category is $251 thousand under budget due primarily to decreases at the School of Professional Studies.

Other sponsored revenues were $4.7 million (12.3%) below budget and 5.6% lower than last year. Declines are concentrated in the Schools of Public Health and Medicine and in JHPIEGO.

Facilities & Administrative cost recoveries were less than budget ($1.8 million) but are $2.1 million (3.7%) higher than last year at this time. Recoveries at the School of Medicine are down $1.3 million compared to budget due to more conservative spending on existing awards. The School of Engineering received $176 thousand less in recoveries than budgeted through September. Finally, in the "All Other" category the Institute for Policy Studies experienced lower than budgeted recoveries due to the repayment of an over-recovery on an expired award. Recoveries at the Schools of Arts and Sciences and Public Health are at budget through September.

Clinical services revenue is 4.2% higher ($3.1 million) than expected.

Total expenditures through September were consistent with budget up only 0.1%. Increased clinical activity and higher clinical supplements drove clinical services spending $4.3 million over budget. Offsetting this increase is lower spending in libraries due to a timing issue on the pre-payment of journals which is expected to normalize in the second quarter. All other categories of spending are at or below budgeted levels.

Tuition Rates for Fy2007

Dr. Knapp shared the plan for increasing in the full-time undergraduate tuition at the Homewood schools. He noted the existing policy developed in 1997 which limited tuition increases to a rate 0.1% below the prior year's median percentage increase of peer institutions. This policy had the desired effect of moderating tuition increases. The University's tuition is now significantly below the median of its peers. The schools are under increasing pressure to increase financial aid and absorb large increases in security and energy costs while also making improvements in the undergraduate experience called for by the 2003 report of the Commission on Undergraduate Education (CUE). The Board of Trustees approved a deviation from the existing formula resulting in undergraduate tuition for the Homewood schools of $33,900, a 7.2% increase over last year. Further discussion was held regarding price sensitivity in the market and the true cost of educating an undergraduate.

Budget & Planning Assumptions for Fiscal 2007 - 2011

The Committee reviewed budget and planning assumptions for fiscal 2007 through 2011:

Maryland State aid has increased as the state fiscal condition has improved. FY 2007 assumes a statutory increase from $1,206 to $1,268 per capita.

Facilities and administrative cost recovery rates have been negotiated through FY 2008. On-campus organized research will be budgeted at 63.5% for FY 2007 and 64% for FY 2008. For planning purposes, FY 2009 through FY 2010 rates will remain at 64%. Other rates will be 25% for off-campus organized research, 32.2% for on-campus other sponsored activity and 18.8% for off-campus other sponsored activity.

Subject to approval by the Board of Trustees Investment Committee, endowment payout assumes no growth in FY 2007. The payout for fiscal 2008 and fiscal 2009 is projected to increase by 1.0% annually. Thereafter, increase are 2% annually. A $3 million budget enhancement for Development is included in FY 2007 and FY 2008 increasing to $3.75 million in FY 2009 and $4 million in FY 2010 and beyond.

Salary budget increase guidelines are 3.0%.

Fringe benefits negotiations will begin in early 2006 for FY 2007 to FY 2009. Planning rates are 33% for FY 2007, 33.5% for FY 2008 and 34% thereafter.

Capital Projects

Dr. McGill presented an overview of the capital projects underway throughout the University. He paid particular attention to three projects, the shared Nursing and Bioethics building, the Nanjing Center and the Decker Quad. Fundraising has begun and an architect has been hired for the Nursing/Bioethics building. Estimates have increased to approximately $32 million due to rising construction costs. The Nanjing Center is being constructed during a building boom in China with concrete and steel in high demand. The facility is expected to be completed by the fall of 2007. The Decker quad is on schedule and the first two bids have been consistent with budget.

HopkinsOne Update

Dr. Steinwachs reported on the HopkinsOne Faculty Advisory Committee's efforts. The committee has been valuable in generating questions from the faculty regarding infrastructure and business practices. The committee agrees that does not want to roll out a project that does not work. They believe that training is critical and have included local support centers as part of the discussion and planning. Further discussion was held about the mood of the faculty, and in general the project has not begun to affect them. Faculty will begin to feel the impact of the project when their staff begins attending training and at go live. Dr. McGill followed up with some details on the project plan. He indicated that the design and configuration was three months behind causing the original go live date to be impracticable without sacrificing training time. The team is engaged in a re-planning effort to determine a new go live date.

Respectfully submitted,
Frederick W. Puddester

© 2006 The Johns Hopkins University. Baltimore, Maryland. All rights reserved.
Last updated 18Mar06 by dgips@jhu.edu