Academy Journal Volume 54 | Page 32

the academy journal ers than projected – 218 vs. 236. • Capital Campaign and other gift receipts (shown in the Capital Section of Exhibit A) were also stronger than originally expected by more than $200 thousand. • Endowment Payout was higher than budget by $188 thousand as a result of reductions in the deficit. A lower deficit leads to lower withdrawals from our endowment which results in more payout generated for operations. However payout for the operating budget is now approximately $4.0 million less than Fiscal 2009, contributing significantly to our deficit spending. Why? The New Church Investment Fund cut its payout for Fiscal 2010 by 10% in response to the market downturn of 2008/2009 and kept payout flat in Fiscal years 2011, 2012, 2013and into 2014. Endowment withdrawals to cover deficits and capital spending also reduce payout. • The stock market was up this year and our endowment return was a positive 9.6%. Because we cover deficits with endowment withdrawals, our payout rate on operating funds was approximately 8.5% on a 3-year market value average, 9.0% of yearend values. We continue to make strides in deficit reduction which will allow us to return these rates to more sustainable levels. • A comprehensive review of our employee benefits has resulted in several changes which has provided significant savings to the institution and will continue to help keep future costs manageable. See page 34 for further discussion. • Fund for the Academy/ Private Gifts & Grants totaled $3.0 million for fiscal 2013 and was $2.3 million over the amount received in fiscal 2012. It represents an 11.2% favorable variance to the budget of $2.7 million. I believe this significant increase in operating gifts from our donors is a reflection of their support in our attempts to bring our financial position under control through reduced expenditures and increases in revenues. We need our donors to continue their financial support as we work through these difficult times. • Beginning July 1, 2013 we began reporting on a new internal division of the endowment approved by the Board in February 2012. The purpose is to assist the leadership of each of the Academy schools in planning and decision making. This division allocates endowment to cover our debt servicing needs and also includes assets held for post-retirement benefits while a portion of the endowment is assigned to each of the schools. • Transfers & Other Income were greater than budget by $228 thousand due in large part to transfers from funded reserves for various expenses and transfers from restricted gifts received for operations in a prior year. ACADEMY OPERATIONS AND CAPITAL ITEMS SUMMARY (Exhibit A) Operations Section Details • Salaries & Benefits were under budget by $471 thousand due in large part to college faculty retirements and filling certain positions with adjuncts, reductions in library staff, changes in health clinic and admissions staffing and allocations of staff to research largely funded by external grants. Severance payments made in 2013 did reduce some of the savings from staff reductions. • Student Revenues. Total enrollment was lower than projected – 436 vs. 484.1 As a result net Tuition & Fees was lower than budget by $699 thousand though we did see improvement in the student discount rate. Government Grants in support of student tuition were higher than budget by $309 thousand. Net Room & Board was greater than budget by $143 thousand despite having less board- 1 • Facilities Costs were under budget by $734 thousand due to maintenance and custodial staff layoffs, lower energy costs as a result of a mild winter, and renegotiated contracts. The installation of a new boiler in Glencairn and For a 10-year enrollment history, see Chart 1 at Exhibit B 32