Indiana State University’s enrollment decline means less tuition revenue and a reduced general fund budget for 2019-20.

The ISU board of trustees Friday approved a nearly $188.9 million general fund for 2019-20, down from $195.3 million in 2018-19.

Despite a tuition increase and higher state appropriation, student numbers — and tuition revenue — are expected to decline this fall, when headcount is projected at 11,892 [a figure that does not include high school students taking College Challenge, or dual credit, courses].

Earlier this year, officials projected an enrollment decline of about 4 percent.

To meet priorities and commitments, ISU had to reallocate $7.9 million to fund increases in compensation and student scholarships and maintain a balanced budget. Reallocation means funds are cut from some areas in order to fund others.

“That included eliminating 26 vacant staff positions,” said Diann McKee, senior vice president for finance and administration. “No employee in an active position was harmed in any way.” Those vacant positions were “all across the board and not in any one particular area.”

The university also made cuts in various supply and expense lines and it reduced budgeted reserves, she said. For example, in 2018-19, ISU set aside about $5.4 million in student tuition revenue reserves to absorb any potential revenue shortfalls; for 2019-20, that amount has been reduced by about $1.4 million to $4 million.

“We went through an internal process of identifying expenditures that we could reduce,” McKee said.

Student tuition represents 51.8 percent of the total general fund revenues, compared to 43.7 percent from state support.

“It’s never easy to come up with a budget like that,” ISU President Deborah Curtis said in an interview. “First and foremost, we will live within our means. That was a key piece.”

She praised McKee for her oversight of ISU finances. “She is quite good at doing what she does,” Curtis said. “This institution has maintained a responsible, yet somewhat conservative view, of budgeting that serves us well when things happen like we’ve seen with this decline in enrollment in the last year.”

ISU has “reset a budget that we can live with,” Curtis said. Now, ISU is working to stabilize enrollment.

With the number of college-going 18-year-olds declining in the Midwest, ISU is looking to diversify its student body through more online, transfer and graduate students,Curtis said. It also is working to improve retention and graduation rates, which also will increase numbers.

ISU also wants to serve more of the 700,000 Hoosiers who have some college but no degree.

In a news release, McKee said, “An increase in state support through the Performance Funding Formula, internal budget adjustments and a modest increase in tuition allows the university to continue to provide a quality education for Hoosier students. We are grateful for the continued support by the Indiana General Assembly and in particular our local legislators, who are tremendous advocates for Indiana State University.”

Indiana State’s 2019-20 operating budget includes a projected 1.5 percent across-the-board increase for employees with satisfactory performance. “We will make a determination after official fall enrollment is known as to whether or not we will proceed with that,” McKee said during a trustee finance committee meeting.

The budget also reflects a 1.5 percent increase in student wages and a 2 percent increase in university scholarships.

ISU’s budget includes $14.2 million for student scholarships and fee remissions, or 7.5 percent of the total general fund operating budget.
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