Every spring, the president’s cabinet meets to project a budget for the upcoming school year based on enrollment rates and revises the budget on actual rates in the fall.
This year, however, the cabinet got a “surprise” when their enrollment predictions ended up considerably lower than expected, Vice President for Business & Finance Ken Birkenholtz said.
“We really missed on every count last year,” Birkenholtz said. “We missed on new freshmen, we missed on transfers and we missed on returning students.”
To make up for the $1.4 million deficit, the committee decided to pull money from travel, deferred loans, unfilled positions and to cut excess money from budgets around campus.
Staff and faculty didn’t receive pay increases this year and the college dipped into the contingency fund in order to make up for the deficit after cuts were made.
Approximately $400,000 of the contingency budget was used to balance the budget.
“It’s the fact that we have it in the budget that keeps us from having an emergency,” Simpson College President John Byrd said. “We put the money in the budget so we do have the money for unexpected expenses.”
The contingency is designed to smooth out the budget so there is money for the college to lean on in years when enrollment is down.
Byrd anticipates higher enrollment next year.
“I’m very excited and very positive about the work that I see to bring our enrollment back up next year,” Byrd said.
Because of the surprise brought on by this year’s budget, Byrd has elected to start a core committee of faculty members to work on the budget throughout the year.
The committee will sit two members from each of three committees: the Budget Liaison Committee, the Education Policy and Curriculum Committee and the Faculty Personnel Committee.
“We’re working on the budget almost all the time in terms of planning for the future,” said Steve Griffith, senior vice president and academic dean.
Besides enrollment, the economy plays a role in how much money the college brings in. Simpson receives 5 percent of the college’s endowment, which is based on how prolific the market is in any given year.
The annual fund brings the college about one million dollars each year. This money comes from alumni and friends of the college that choose to make an annual gift to the college.
Salaries were also not increased this year. Byrd said he got the reaction that was expected from employees and that he believes there is a mutual understanding for why this was necessary for the college.
This is not uncommon, however. Just two years ago, staff and faculty didn’t receive a pay increase. Griffith said they did receive other benefits.
After the actual enrollment rate was finalized, it took the budget committee a matter of days to balance the budget. The cabinet has a method for developing a sound budget, which makes the balancing process happen very quickly.
“We were able to develop a solution very quickly and while we’re anxious to add money back to the budget, I believe that we’ve protected our core activities,” Byrd said.
Despite a lower budget for the college, Byrd pointed out that each student is receiving 4 percent more in college dollars than in previous years.
“We always want to prioritize the experience of students and the education that they’re getting,” Griffith said. “All the decisions that we make on the budget are stemming from making sure it’s a quality experience.”
While the budget is being balanced, Byrd and other financial staff attempt to make sure students aren’t the ones to notice the change.