Faculty Senate Updated: May 7, 2008 American University Vice President of Finance and Treasurer

2 Section 1 Financial Management American University

3  A direct link between university goals and annual and long-term resource allocations  Two-year budget process implemented since FY as part of the 15-Point Strategic Plan  FY will be the third two-year budget cycle  Open and collaborative budget process involving campus constituencies: President’s Cabinet University Budget Committee Faculty Senate Instructional Budget and Benefits Committee Enrollment planning by the deans and the Office of Enrollment Town hall meetings Staff Council University Budget Process Financial Management

4 American University  Board of Trustees’ approvals: Budget formulation guidelines in November A formal two-year budget proposal in February Periodic budget status reports to the BOT Finance and Investment Committee and the full Board University Budget Process Financial Management

5 American University FY2009 Revenue Budget Student Fee Dependency FY 2009 = 94% FY 1984 = 95% FY2009 Revenue Budget = $427.7 (in millions) Financial Management $311 $346 $325 $12 $347 $32 $26 $11.7 $12

6 American University FY2009 Expenditure Budget Financial Aid % of Budget FY 2009 = 18 % FY 1984 = 11.3% FY2009 Expenditure Budget = $427.7 (in millions) $6.5 $74 Financial Management $188 $78 $195 $16.8 $10 $7.4 $120

7 Financial Management Financial Safeguards FY2008FY2009 Enrollment Contingency (1.5% of tuition)$ 4.9 M$ 5.2 M Transfer to Quasi Endowment (2% of budget)$ 4.0 M (1%)$ 8.5 M Pre-fund Salary Increases $ 3.8 M$ 3.9 M Deferred Maintenance (incl. residence halls) $ 8.7 M$ 9.1 M New Budget Initiatives since 2002 PC Replacement Fund$ 1.0 M$ 1.0 M Furnishings/Capital Equipment Renewal Fund$ 1.8 M$ 2.1 M Facilities Modernization Fund$ 1.8 M$ 2.1 M Total$ 26.0 M$ 31.9 M Percent of Operating Budget 6.5 % 7.5 %

8 American University Financial Management Revenues and Expenditures (in millions)

9 American University Financial Management Endowment Funds Fiscal Year Endowment Funds ($ Million)

10 American University Financial Management Endowment Performance

11 Financial Management Asset Allocation Endowment Asset Allocation As of 4/30/07 Alternative assets are comprised of half hedge funds and half energy related funds American University

12 American University Financial Management Debt Portfolio - As of April 30, 2007 Core DebtAmount Series 1985$48,900,000Tenley Campus, Sports Center, Refinancing Series A$12,000,000Centennial Hall Series 1996$0Residence Halls Renovations, Ward Circle, (Refinanced with Series 2006 Issue) Myers-Hutchins, Battelle-Tompkins Series 1999$21,000,000WCL Purchase & Renovation Series 2003$37,000,000Greenberg Theatre & Katzen Arts Center Series 2006 *$99,975,000SIS (partial), Nebraska Hall, Series 1996 refinance Special Purpose Debt SunTrust Loan$15,000, Wisconsin Ave. SunTrust Loan$22,000, New Mexico Ave. Total $255,875,000 * Net debt service increase = $1.9 million

13 American University Financial Management Peer Comparison * S&P upgraded AU’s rating outlook from stable to positive and affirmed its ‘A’ rating on February 8, 2008.

14 Section 2 Capital Projects and Facilities Management American University

15 American University Facilities Management 2000 Campus Plan

16 American University Facilities Management History of Growth in Facilities

17 American University Facilities Management Condition of Facilities

18 American University Facilities Management Improvement Projects Kogod School of Business Expansion Classrooms Computer lab Student Service offices Spring 2009 School of International Service New Building Classrooms Faculty/staff offices Meeting/function space Underground parking Spring 2010 McKinley Renovation School of Communication Classrooms Faculty/staff offices Theater Converged Newsroom Timetable under discussion