President
Fallon discusses strategy for devising future budgets,
controlling healthcare costs
If Eastern Michigan University sees a 1 percent increase
in enrollment and raises tuition 7 percent, it will be
looking at a $4.8 million budget surplus in next year's
budget. If the University experiences a 1 percent loss
in enrollment and only institutes a 1 percent tuition hike,
the University faces a $6.4 million deficit for FY 2007.
These are but a few of the potentially different budget
scenarios that were reviewed by EMU President John Fallon
during a series of three budget forums he hosted in McKenny
Union's Ballroom April 20-21 and 24. The first session
provided an overview of how the University builds its budget;
the second looked at budget options for the year ahead;
and the third addressed healthcare costs.
Cost Quandary
The following are increased base expenditure dollar
numbers that Eastern Michigan University will have
to figure out how to pay in its FY 2007 budget.
The total figure does not include any employee
salary increases that may be approved. These include:
Utilities $1.5 million
Financial Aid $1.7 million
Fringe Benefits $1.9 million
Other $1.3 million
Total: $6.4 million |
Not counting any employee salary increases, Fallon said
the University faces $6.4 million in budget increases next
year. The breakdown includes a $1.5 million increase for
utilities; $1.7 million more for financial aid; $1.9 million
for increases in healthcare costs; and $1.3 million in
an "other" category, which includes restoration of a previous
academic budget reduction and an increase to the salary
base incurred during fiscal year 2006.
To cover that cost, Fallon and Steve Holda, interim director
of business and finance, presented the audience with potential
scenarios of tuition increases of 1, 3, 5 and 7 percent
coupled with enrollment possibilities ranging from a 1
percent decrease to a flat enrollment figure to a 1 percent
increase. A 1 percent increase in enrollment translates
to approximately $1.4 million, Holda said.
Fallon said no scenario has been finalized, but stressed, "We
are reaching the ceiling, we think, on the extent as to
which our students are able to pay. If we continue to ratchet
up tuition going forward, it increases slamming the door
in a number of students' faces."
"My sense is, we can't think of a tuition increase anywhere
near what we did last year," he said.
Last year, the Board of Regents approved a 13.5 percent
tuition increase for FY 2006, with 4 percent of that figure
earmarked specifically for much-needed improvements to
classrooms, laboratory facilities and academic facilities.
More on this story...
