Wright State asserts it will avoid fiscal watch
But state won’t verify until spring of 2019, university says.
Wright State University is set to avoid fiscal watch, the school’s chief business officer told the campus via email Tuesday morning.
The state measures every public college’s fiscal health with something called a “Senate Bill 6 score,” an annual rating of 0 to 5.
Half the score is based on the school’s reserve fund, essentially how much cash the school has in the bank. The other two factors
include a viability score that calculates the university’s ability to service its debts and an income ratio that measures the school’s change in net assets, according to the FY 2018 WSU budget.
Any school that falls below a 1.75 two years in a row is put on notice.
Wright State projected its score for fiscal year 2017 was .8, meaning one more year below a 1.75 would put the school on fiscal watch. The school is now projecting its score for FY 2018 will be 2.2, chief business officer Walt Branson said in a Tuesday campus-wide email.
T he st a te will not announce the school’s offi- cial score until the spring of 2019 though, Branson said. But Branson said WSU officials can say they have avoided fiscal watch “with much certainty.”
“In my opinion we have stopped the financial freefall of previous years, a sig- nificant feat in and of itself,” Branson said in his email. “However, we have not yet re-established a solid financial foundation. It will likely take several years before we fully accomplish that.”
Wright State is trying to recover from a financial crisis that forced trustees to slash more than $30.8 million from the school’s budget in 2017. Those cuts ended up not being enough though and the school reduced spend- ing by around $53 million in fiscal year 2018.
In June, trustees approved a FY 2019 budget that projected another $10-million decline in revenue.
Wright State generated a $10-million surplus last year, the school’s first since 2011. Branson said the surplus was achieved because of the sacrifices made by many on campus.
Some of that $10 million, however, will go toward budget shortfalls that have already occurred this fall. Fall enrollment was under projections, which trans- lated to tuition and fee revenue coming in $2.5 million under budget for fiscal year 2019, which started July 1.
Wright State’s board of trustees is scheduled to meet at 8:30 a.m. Friday and finances are expected to be discussed.
The email comes days after a report was made public that stated it would take Wright State “more than 20 years” to rebuild the reserve funds it had in 2012. The report was submitted to a fact-finder as part of ongoing contract negotiations with the university faculty union.
The report was created by the university administration to make a case for its stance on contract negotiations.
The administration has offered faculty a three-year contract with no raises and reduced health benefits, said Martin Kich, president of the Wright State chapter of the American Association of University Professors. A final fact-finder’s report on negotiations is due out at the end of October and the faculty union has threatened to strike if a deal is not reached.
In his Tuesday email, Branson pushed back on the news from the report, saying it was created before the end of the fiscal year on June 30.
“While it is true that it may take us 20 years to restore reserves to what they were six years ago, (financial) sustainability will come much sooner as we build revenue and regularly realize an operating surplus,” Branson said in his email.