Adams State University improving its financial position
Adams State University officials said they agree with recommendations from an independent audit and have already made progress toward improving the university's financial position. Commissioned by the State Auditor's Office, the performance audit was presented to the Legislative Audit Committee February 21.
"We ended fiscal year 2016 with noticeable improvement over 2015. This report will help us focus on additional changes to assure our financial health," said Adams State University President Beverlee J. McClure. "This is one of our top priorities and is key to fulfilling our mission to provide quality higher education to underserved populations." During fiscal year 2015-16, the university's current assets increased by $1.5 million, according to Adams State Chief Financial Officer Heather Heersink.
Located in the rural San Luis Valley, Adams State has an undergraduate student body that is 45 percent minority - making it Colorado's most diverse public, four-year institution. It also has the highest percentage of low-income, Pell-grant eligible students among the state's public, four-year institutions.
The report, conducted by Huron Consulting, stated, "The new leadership team is highly attuned to and recognizes the financial position of the university and the need to make changes to achieve financial stability." Noting the largest expense increases during 2011-15 were for instruction, interest, depreciation, and student services, the report concluded, "Adams' critical strategic challenge will be to achieve revenue gains through increased enrollment without equal increases in costs." It recommended increasing operating cash flows by at least $3 million above fiscal year 2015 levels.
"Several years of non-existent or insufficient state capital and controlled maintenance funding left us having to fill a deficit in order to maintain our buildings and facilities to stay competitive," Heersink pointed out. The university implemented a student capital fee to fund campus improvements in the absence of state support. The report also recognized Adams State has multiple initiatives underway to improve enrollment and retention, including the top two goals of its Strategic Plan 2020, which focus on academic excellence and student success.
One such initiative is a four-year guaranteed tuition program, begun in fall 2016. "This will help families to better plan for college expenses and give students incentive to complete their degrees in four years," McClure said. The university has also revamped its New Student Orientation and First-year Immersion programs, contributing to a 5 percent improvement in retention of students from the first to second year.
"These types of initiatives to improve student retention take time before the impact will be visible on our financial statements, but we are hopeful they will help improve our position," McClure added.
Acknowledging that student services are important to the success of Adams State's historically underserved student population, the report also noted the university has begun steps to better coordinate advising, tutoring, and support services. "By streamlining our student services, we will optimize operating costs while benefiting our students," McClure said.
Adams State concurred with the report's observation that it cannot rely upon tuition increases to improve revenue. "Our unique role and mission, serving historically underserved students in rural Colorado, means large tuition increases would negatively affect our students," McClure pointed out. "Our long-term viability also depends on the continued ability of the state to invest in rural higher education."
By Julie Waechter