The Johns Hopkins University
Financial Report 1996

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Introduction

Johns Hopkins reached a new level of financial stability in fiscal 1996. The University's net assets increased by $249 million, or 17 percent, to a total of $1.7 billion. This base of "equity" provides a secure underpinning for the University's ambitious programs of instruction, research, and public service; and balances what would otherwise be a high level of long-term debt. The solid equity base and the broad diversity of the University's revenue sources--full-time and part-time tuitions, research funding from hundreds of public and private programs, steady demand for clinical services, and growing gifts and endowment--provide a buffer against the potential consequences of economic downturns or shifts in government policy or regulation.

The $249 million increase in net assets included a $51 million surplus from operations and was made up of $112 million in unrestricted assets, $56 million in temporarily restricted assets (primarily gift pledges not yet redeemed), and $81 million in permanently restricted assets. In addition, at year-end the University had in hand grants and contracts for future research work amounting to approximately $800 million, or nearly a year's worth of sponsored research. During the year, the University reached agreement with the Federal government on facility and administrative cost rates for the next three years; and for the third year in a row, reduced its long-term debt, while investing $68 million in facilities and equipment from internal sources. At year-end, the $900 million Johns Hopkins Initiative had reached 66 percent of its fund-raising goal, well ahead of schedule.

This year's strong financial performance mirrored the University's programmatic success. Undergraduate applications were up in 1996--in number and in quality. The Peabody Conservatory admitted its largest class ever, with a good balance of undergraduate and graduate students. Applications for the graduate schools were up as well, with 3,839 applying for 120 openings in Medicine. Hopkins rose to 10th in the national ranking of undergraduate programs published by U.S. News & World Report. The Johns Hopkins Hospital--staffed by School of Medicine faculty--again was ranked as best in the country by the same publication. And again the University far outstripped all others in receipt of Federal research grants and contracts, the surest measure of research quality. In fact, NASA turned over the entire management of a space mission to the University's Applied Physics Laboratory, the first time an outside organization has been given such responsibility. Testing NASA's "smaller, cheaper, faster" approach, the Laboratory developed the spacecraft and instruments for the NEAR (Near Earth Asteroid Rendezvous) mission that will travel 1.3 billion miles to asteroid 433 Eros to study its size, shape, mass, and magnetic field to gain insight into the origin of meteorites and the relationship among asteroids, meteorites, and comets.

This past year saw Dr. William R. Brody named president of Hopkins, succeeding Interim President Daniel Nathans, who guided the University so effectively during his year in office. It also saw the chairmanship of the Board of Trustees pass to Michael R. Bloomberg from Morris W. Offit, who worked tirelessly during his seven-year term to assure financial stability and continued programmatic growth for his beloved Hopkins. In the years ahead new leadership undoubtedly will take the University into new areas of achievement that can be only dimly perceived at this time. Hopkins enters the Brody-Bloomberg Era strong financially and with a track record of successful adaptation to change. A large, decentralized organization with strong central financial systems, Hopkins is prepared to continue its traditions of academic excellence and prudent financial management.

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