By Grace Beckner
The university cabinet met Sept. 29 to map out a plan to address a $6 million shortfall in the budget. Trevecca President Dan Boone said this deficit will be handled through attempts to increase revenue and decrease spending.
“There are a lot of moving pieces in that,” he said.
Trevecca received both Coronavirus Aid, Relief and Economic Security (CARES) as well as Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) aid, which provided both student and institutional funding, said Mariano Monzu, the university’s chief financial officer.
Monzu said this funding was utilized to cover student Covid expenses, room and board refunds and overall lost revenue. He also said the money was offered to students as grants to “cover expenses related to unanticipated travel, additional technology requirements, or other needs related to an emergency situation.”
Boone said this would be the third instance during his presidency where he has had to help the university out of a similar spot.
“We have had a two and a $4 million shortfall to correct before, and this one is a little bigger, but in all honesty it will come back faster,” said Boone. “Because when your small classes graduate and you replace those with large freshman classes, your revenue just begins to come back again.”
Enrollment is by far the biggest contributor to lost university funding, with 80 to 95% of its revenue stemming directly from enrollment, said Boone.
“Covid, for universities, is like a mouse going through a hose pipe. You’ve got this big bulge, and it has to go all the way through it,” Boone said.
But Covid is not out of the enrollment pipeline yet, as the current juniors indicate the portion of the student population who started college during the pandemic, and they are the smallest undergraduate class enrolled at Trevecca.
“It takes four years for a small incoming class to move all the way through to graduation, so we are still living with a decreased revenue because of what was a small freshman class,” Boone said.
Traditional undergraduate enrollment has almost completely bounced back from the pandemic decline, with the current freshman class 60 students shy of reaching an all-time high, said Boone.
“We are really close to being back to where we were in traditional undergrad,” he said.
The adult masters and doctoral programs are where the biggest losses are felt, as the program is almost 700 students behind where it had been pre-pandemic, falling from 2,300 students to approximately 1,600 total enrolled.
“That hits the bottom line for the university, so it creates some financial hardship for us,” he said.
Boone said this decline can be attributed to factors such as parents needing to stop taking classes to care for children, job opportunities available without the need for more schooling, and the additional competition as other university programs move online.
“All of our community college partners that have degree completion programs with Trevecca for adults, all those campuses closed for two years, so we have nobody in the pipeline,” Boone said.
Boone said there are attractions the university is working on to draw in more students to boost revenue, including new lacrosse and stunt teams, a plan to expand the cross country program, and an increase in the amount of seats open in the physician assistant program.
Boone said Trevecca is planning to cut costs through a reduction in the total headcount of employees.
“We normally turnover somewhere in the range of 10 to 15 employees per year, so what we will try to do is do that turnover without having to replace, but handle those jobs internally,” he said.
Personnel cost is about 50% of the operational budget, meaning half of what is spent goes into the salaries of those who work at Trevecca.
“So anytime you are thinking about a tuition increase, half of that tuition increase is just simply to maintain salaries for people,” said Boone.
Boone said the goal is a 10% reduction of controllable expenses.
“The campus is not going to recognize anything abnormal going on across the next two years, it will just be an attempt to get back to the revenue we had prior to Covid,” said Boone.
Students can also expect to see a tuition increase of 2-3% over the next few years, said Boone. This can still be a challenge, as inflation is closer to 8-9% a year.
“We might have made a mistake by not raising tuition during those years of Covid. Our commitment to trying to help students and families who might’ve been affected by it was just so strong, so we are at a point now where we do need to catch up on some of that,” Boone said.
Even with traditional undergrad enrollment expected to exceed pre-pandemic numbers, Melinda Miller, vice president of undergraduate enrollment, said she noticed families are more price-sensitive when it comes to college expenses due to inflation.
“People are very price-sensitive, and inflation is at an all-time high. Even though unemployment is low, families are feeling the effects of inflation. It’s impacting them at the grocery store, and it’s impacting them at the gas pump,” said Miller. “And as such, many families are struggling to figure out how to pay for college, and they are very price-sensitive.”
This means her and the admissions team have to work harder to help these families financially, and convince them Trevecca is worth the investment.
“It creates a challenge for us to be able to convey and sell and share with them the value of Trevecca, the investment that it is to have a Trevecca education, and the return on that investment,” she said.