The Board of Trustees will vote on June 8 to approve the University budget for the upcoming fiscal year, and administrators expect the proposed budget to leave the University with a “modest surplus” of about $400,000, according to Provost and Executive Vice President of Academic Affairs Earl Lewis.
Lewis, who chairs the Ways and Means Committee — which is the organization responsible for formulating the University-wide operating budget each year — explained that the surplus comes from what he described as “auxiliary” sources of revenue for the University such as income received from the Emory Conference Center Hotel. He said Emory will use this extra money to fund various on-campus activities, and administrators will also use the surplus funds generated from the Conference Center Hotel in particular to underwrite conferences organized by faculty and staff.
According to Lewis, the Committee began budget discussions last August. By October, the Committee had started engaging in what he described as the forecasting of the “labor market” to determine faculty and staff salaries. In November, the Committee sent their findings to each division of the University, including all the undergraduate and graduate schools as well as divisions of campus life such as the Financial Aid Office, the library administration and the Michael C. Carlos Museum administration. The University divisions typically report back with their budget requests during meetings that the Committee holds in January and February.
“We load into the budget model what everyone says they want [and] the revenues they have,” Lewis said. “We ask, ‘Is there a gap between what people say they want to invest and spend in the coming years and [their] revenue?’”
According to Lewis, there was a gap of $17 million between projected expenditures and revenue when the divisions originally reported back to the Committee; however, since February, the Committee has redeveloped their budget model, not only closing the gap between University-wide income and expenses but also allowing for a surplus.
In addition, he mentioned that last year’s comprehensive budget allotted $2 billion to the Emory Healthcare system, which is comprised of the various branches of the Emory University Hospital, as well as $1.5 billion of funding towards the University’s academic divisions and research. However, he noted, Emory College — which derives nearly 80 percent of its income from student tuition fees — and the School of Medicine remain in deficit for this fiscal year, meaning that their annual expenses exceeded their income. On the other hand, the Nursing School had this year’s largest surplus.
“In Ways and Means, it is really important that we look at whether we can actually keep costs down or take costs out of the [budget],” Lewis explained. “At the same time, we try to figure out how we can invest the endowment to make every dollar work as powerfully as possible.”
Lewis remarked that the University’s endowment would contribute $245 million to this year’s proposed budget.
The Ways and Means Committee also includes Wright Caughman, the executive vice-president for health affairs; Mike Mandl, the executive vice-president for finance and administration; Charlotte Johnson, the senior vice provost of administration; Edie Murphree, vice president for finance; and Ronnie Jowers, vice president for health affairs.
— Contact Stephanie Fang