The institution manages its financial resources in a responsible manner.
x Compliance o Non-Compliance o Partial Compliance
UL Lafayette manages its financial
resources in a responsible manner. The University’s financial ratios and bond
ratings, discussed in detail in Standard 13.1, indicate that the institution’s
resources have been managed responsibly, and that it is operating within its
means. From the adoption of an annual operating budget to the preparation of
financial statements, the University has maintained consistent operating
performance. Despite significant reductions in state appropriations, UL
Lafayette has maintained and grown its academic programs, facilities, and
administrative and operational support. The
University has continued to invest strategically in facilities, academic
programs, student life, athletics, and parking, all of which have helped to
ensure continued strength in enrollment and concomitant revenue stability. The University has continued to show
growth in enrollment, graduation rates, and self-generated revenue over the
past ten years. The University’s financial ratios demonstrate financial stability and a
well-managed financial organization.
Since 2010, the University's dependency on
student tuition and fees has become even more critical for the University's
long-term viability. Tuition rates increased 10 percent per year as authorized
by the Louisiana Legislature beginning in FY2010-2011. The additional revenue
resulting from these increases has been maximized by the University's ability
to maintain a reasonably stable enrollment over the course of the past several
years. The authority to increase tuition extended through FY2015-2016, as the
University continued to meet the performance objectives outlined in the
Louisiana Granting
Resources and Autonomy for Diplomas (GRAD) Act. Also, Act 377 of 2015 (extended
by Act 293 of 2017) gives the University the authority to establish mandatory
fees to be charged to students. This authority exists through FY2019-2020.
Given the increases in tuition and decreases in state funds over the last decade,
the relative proportion of total operating funds from these two sources has
changed drastically, from 56 percent self-generated and 44 percent state funds
in FY2009 to approximately 86 percent self-generated and 14 percent state funds
in FY2019. Chart 13.3 – 1 illustrates this trend.
Chart 13.3 — 1: State
Appropriations Compared to Self-Generated Revenues
Despite the significant increases
in tuition rates, UL Lafayette's tuition still remains comparable to the
average for similar SREB institutions, and
enrollment has
remained steady. Chart 13.3 – 2 illustrates enrollment for the last five fiscal
years.
Chart 13.3 – 2:
UL Lafayette Fall Enrollment Headcount
UL Lafayette has seen a
reduction in Total Net Assets of $323.2 million as presented in the financial
reports. The University must report Compensated Absences, Other Post-Employment
Benefits (OPEB), and Net Pension Liability as required by Generally Accepted
Accounting Principles. The University does not receive funding for these items
through the State, thus causing a reduction in Total Net Assets until this
expense/liability is totally recognized. When the expenses/liabilities are
added back to the financial statements, Total Net Assets have increased from
$372.8 million to $391.2 million over the same five-year period, as shown in
Chart 13.3 – 3.
Chart 13.3 — 3: Total Net
Assets FY2014-2018
The University has seen a
reduction in Unrestricted Net Assets of $22.6 million as presented in the
financial reports. Chart 13.3 – 4 shows the unrestricted net assets, exclusive
of plant and plant-related debt. The Compensated Absences, OPEB, and Net Pension
Liability have been added back to Unrestricted Net Assets. When these
expenses/liabilities are added back to the unrestricted net assets,
unrestricted net assets (exclusive of plant and plant-related debt) shows a
decrease from $65.6 million to $42.9 million. This decrease is attributable to
the University reinvesting in its infrastructure and personnel.
Chart 13.3 — 4:
Unrestricted Net Assets FY2014-2018
The University has shown a positive “bottom line” over
the past five years, as shown in Chart 13.3 – 5. While there has been a gradual
decline in operational results, primarily due to continued declines in state
funding, these reductions have been partly offset by tuition increases.
Chart 13.3 — 5: Operations
“Bottom Line” Without Depreciation FY2014-2018
The operation cash flows have been
positive over the past five years, as illustrated in Chart 13.3 – 6.
Chart 13.3 – 6: Cash Flows
Before Capital Items FY2014-2018
Over the ten-year period reported in
Chart 13.3 – 7, UL Lafayette has reinvested in its campus facilities and
infrastructure. The maintenance, acquisition, construction, and improvements of
University facilities are critical to the University’s continued health. To
fulfill its mission, UL Lafayette makes ongoing strategic capital investments
for additional academic, student life, athletic, residential life, and parking
facilities. UL Lafayette funds its capital requirements through state capital
appropriations, donations, and issuing bonds.
Chart 13.3 – 7: Current
Debt Comparted to Long-Term Debt FY2009-2018
