1. Approval of the minutes of the meeting of December 14, 1999

The minutes of the meeting of December 14, 1999 were approved with the addition of attachments showing investment results and endowment ranking. The minutes and attachments will be posted on the faculty budget advisory committee web site at the request of the chairman, Dr. Peyton Young.

2. Financial aid to undergraduates: Trends and peer group comparisons

The Provost led a discussion on undergraduate financial aid and comparisons between JHU and COFHE peer institutions in the discount rate that is, the percentage of tuition covered by grants (see attachments). The Director of Student Financial Services was present at the meeting to answer questions. Traditionally, Hopkins has provided less financial aid to its undergraduates than many of its peer institutions, though the situation has improved recently. Over the past five years, for example, Hopkins has increased its rate from 19.2% to 23.3% while the average rate has remained about constant. The COFHE average is over 25 percent, and the range is 18.8% (Georgetown) to 39.1% (University of Rochester). The Hopkins rate is expected to increase further over the next several years due to the Bloomberg gift. This year the Bloomberg money will enable Hopkins to replace loans with grants for 35 entering students. As a result of increased aid, Hopkins has become more selective, increasing its yield and attracting more competitive students. At the end of the discussion a list of trends and highlights from COFHE was distributed to the Committee (see attachments).

3. Operating results through December 31, 1999 and projections to year-end

The Committee reviewed financial operating results through December 31, 1999 and projections to year-end and key revenue indicators including clinical services revenues, facility and administrative cost recoveries, research bases, and tuition revenues.

The University's surplus as of December 31, 1999 is $5.3 million, which is projected to decline to $3.6 million by year-end, compared to a budgeted surplus of $2.2 million. The University has recognized $410 million of general funds revenue or 52% of budget.

Tuition and fee revenue is ahead of budget at $155 million, including all summer and fall semester revenues, and is projected to be $3.3 million above budget at year- end.

Facility and administrative cost recoveries are $67.6 million or 47% of budget. The projected figure is $1.3 million higher than budget and recoveries normally increase during the second half of the fiscal year. F&A recoveries are 8.5% higher than last year at the same time, and the research base is 7% higher than last year. About $3.6 million has been added to reserves for one-time capital expenditures.

Clinical services revenue is $92.5 million or 51% of budget. The division is projecting revenue of $186 million, $7 million over budget. Clinical services expenditures are projected to be $6.1 million ahead of budget.

General funds revenue at the Applied Physics Laboratory (APL) is $21.7 million, or 54% of budget. APL projects revenue to be $2.3 million higher than budget at year-end due to increases in capital reserve, interest earned and investment return. APL projects general funds expenditures at $31.5 million or $1.4 million higher than budget.

Instruction and research expenditures are projected to be $1.5 million over budget. The Krieger School of Arts and Sciences (KSAS) projects a $957 thousand increase due to higher than anticipated start-up costs for new faculty. The Academic and Cultural Centers as well as the School of Professional Studies in Business and Education are projecting substantial increases due to higher enrollments.

There is a budgeted transfer of $1.4 million from reserves, but current projections are to transfer in $717 thousand, a change of $2.1 million from budget. CTY projects a transfer of $851 thousand to reserves, KSAS projects no transfer (budgeted to transfer $798 thousand from reserves), and the Whiting School of Engineering projects to transfer $532 thousand less than budgeted from reserves.

The Committee requested an explanation of the differences between organized research and other sponsored activity : organized research includes all research and development activities. Other sponsored activities includes programs and projects financed by Federal and non-Federal agencies and organizations which involve the performance of work other than instruction and organized research. Examples are health service projects and community service programs.

The Committee expressed an interest in analyzing the MTDC base and estimating the extent to which costs are not fully recovered, thus subsidizing research from endowment income and tuition. Questions were raised regarding the impact of research growth on the financial resources of the university. The issue was also raised whether universities are treated comparably with non-academic research institutes in the allowance for F&A recoveries. The Committee proposes to put these items on the agenda for discussion next fall.

4. Status report from the business process improvement committee

The Senior Vice President for Administration reported on the work of the business process improvement committee. A list of the steering group to examine university-wide business practices is attached.

The faculty made several comments and requested the addition of basic orientation for young faculty on administrative leadership to the project list. The faculty requested departmental administrators be involved with the financial business practices work group and the development of a process to warn project investigators of underspending and well as overspending on grants and contracts. Timeliness of information is another issue of concern by faculty.

5. Concluding points

The next meeting may need to be rescheduled due to a conflict with the School of Hygiene and Public Health's convocation ceremony, and the Committee will be polled regarding another meeting date. The Committee is encouraged to generate additional agenda items, both for the next meeting and for next fall.

At the next meeting, the Committee plans to have a discussion regarding the source and size of funds for supporting graduate students in different units, and how Hopkins can enhance support for these students without draining resources for faculty and non-sponsored research. The School of Engineering has written a school-wide report on this subject and plans to share it with the Committee at the next meeting.

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Last updated 30Jan01 by dgips@jhu.edu