2011 Annual Report - USNH Financial Services - University System ...

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USNH 2011 ANNUAL REPORTMoody’s Investor Service Maintains“Stable” Outlook for USNH – On June8, 2011, Moody’s affirmed its Aa3 ratingand reported that the outlook remains“stable” for USNH.In the opinion, Moody’s provided thefollowing summary rating rationale:“The System’s rating reflects itsimportant role providing public highereducational alternatives, includingthe state’s land-grant institution,within New Hampshire and a historyof positive operating performance.We expect the System to absorbanticipated steep cuts in statefunding through ongoing expensecontainment, increased fund raising,growth of student charges, and atemporary modest use of unrestrictedreserves to balance the budget in FY2012.”The report also cited stronggovernance and management ascritical credit factors. “The strength ofmanagement and governance at USNHis highlighted by the System’s historyof consistently positive operatingperformance, its ability to produce amulti-year budget forecast that tiesto the audited financial statements(including projected unrestricted netasset balances), and good disclosureincluding unaudited interim financialstatements which also tie to theaudited financials.”environmental engineering, was asked to speak before the National Commission on theBP Deepwater Horizon Oil Spill and Offshore Drilling, established by President BarackObama, about the use of dispersants in the response to the drill. She was sought afterfor her expertise by hundreds of national media outlets and members of Congress. Soonafter, Larry Mayer, director of UNH’s Center for Coastal and Ocean Mapping, was tappedto lead the National Research Council’s committee to study the effects of the spill onecosystem services in the Gulf of Mexico. His center received $35.7 million over five yearsfrom the National Oceanic and Atmospheric Administration (NOAA) in recognition of theimportant work of the Joint Hydrographic Center.GSC Offers its First Master’s Degree – In 2011, Granite State College marked animportant milestone in the evolution of the college: it unveiled its first-ever graduateprogram, a Master of Science Degree in Project Management. The new program isunique and was created based upon a keen evaluation of the needs of New Hampshire’sworkforce and understanding of the marketplace. No other college or university in NewHampshire currently offers a distinct degree devoted purely to project management.The first cohort of Master’s candidates – 50 students total – came together in the fall of2011. The program is designed for individuals who want to make a career change, currentproject managers who want to further develop in their profession, and those in otherdisciplines who want to expand their job opportunities.GSC Introduces Bachelor of Science Degree in Health Care Management –Responding to student interest and employment opportunities within the sector, GraniteState College launched a new Bachelor of Science Degree in Health Care Management.The degree provides graduates with specialized skills that prepare them to coordinatetechnology, people and resources efficiently and creatively in hospitals, nursing homesand health-related organizations. The coursework covers health care administration,policy, emerging trends, financial management and health information systems. Coupledwith GSC’s commitment to providing hands-on, practical experience, the degree offersstudents a competitive edge in the health care management field.3. The University System Directs Its Operations Efficiently andEffectivelyThe New Hampshire State Legislature in 2011 tackled a significant projected budgetshortfall for the coming biennium by cutting the overall budget by 11 percent over theprevious budget. As a result, nearly every entity that received state support saw a reductionin that support. Both the University System and the Community College System of NewHampshire were forced to absorb some of the largest year-over-year cuts in terms ofpercentage nationally. Despite these cuts, the USNH Board of Trustees approved a budgetthat offset more than 80 percent of the funding reductions through spending cutbacks.USNH Student CostsAverageAnnual2008 2009 2010 2011 2012 ChangeTuition, room, board, and mandatory feesNH ResidentUNH $ 19,238 20,352 21,617 22,724 24,702 6.4%PSU 15,574 16,574 17,374 18,566 20,358 6.9%KSC 15,748 16,574 17,508 18,530 20,330 6.6%NonresidentUNH 32,198 33,832 35,587 36,694 38,022 4.2%PSU 23,124 24,424 25,544 26,736 27,818 4.7%KSC 23,298 24,424 25,678 26,700 27,790 4.5%Costs reflect tuition, mandatory fees, double room, and typical meal plan.Average Increase 5.7%8
USNH 2011 ANNUAL REPORTOperating Budget – In June 2011, the USNH Board of Trusteesapproved a $970 million “all funds” operating budget forFY12 that included significant cuts across the entire systemto address very substantial reductions in state support. Thestate appropriations reductions total $48.4 million, of whichmore than 80 percent will be offset through expense savings.Despite the unprecedented budget challenges faced by a 48percent reduction in support in a single year, the overall cost ofattendance (i.e., the “sticker price” for all tuition and fees for atypical student living on campus) increases for in-state studentswere held to 8.7 percent at the University of New Hampshireand 9.7 percent at Plymouth State University and Keene StateCollege. The increase at Granite State College is 5.8 percent. Thebudget includes the elimination of upwards of 200 positions,reductions in employee benefits, hiring and salary freezes, costcutting across the campuses, and modest use of reserves.USNH has a positive long-term outlook, despite its near-termbudget challenges. For this reason, the Board has made strategicbudget decisions that will strengthen USNH and enable it tothrive well beyond FY12. Importantly, the FY12 budget did notreduce its commitment to deferred maintenance of campusfacilities, or to campus presidents’ strategic initiatives. Nor didUSNH increase nonresident tuition to the point USNH will nolonger be competitive, thereby avoiding loss of the net tuitionfrom nonresidents it depends on. Instead, the Board increasedits strategic investment in campus advancement infrastructureto enhance private giving; it invested in new academic programssuch as nursing at PSU and KSC; it invested in strategic buildingprojects such as the Peter T. Paul College of Business at UNH andthe KSC Technology, Design and Safety Center; and it increasedits commitment to need-based financial aid to ensure continuedaccess and affordability.Strategic investment made at a time of financial stress isthe hallmark of a Board that is disciplined in its fiduciaryresponsibility to provide the people of New Hampshire withhigh-quality educational resources over the long-term. USNHis 48 years old this year and is in good financial health. TheBoard of Trustees is charged with making sure USNH staysfinancially healthy for at least another half century. The key toaccomplishing this is to properly balance today’s needs withlong-term needs for reinvestment by generating a sufficientoperating margin, even in the most difficult of times.The USNH budget included a significant increase for financialaid. The neediest New Hampshire students continue to faceescalating challenges to cover the cost of higher education in avery difficult economic climate. More than 30 percent of USNHin-state students are currently eligible for the federal Pell grantsprogram, which is based on family income. In response to theincreased need, USNH will spend more than $130 million forstudent financial aid next year. Over the past ten years, USNHinstitutional grant/scholarship dollars for in-state undergraduatestudents has increased by more than five times.NH Public Television Adjusts to Loss of State Funding – Asa result of losing all its state funding ($2.7 million) as of July 1,2011, New Hampshire Public Broadcasting/New HampshireOn June 13th, Granite State College celebrated the graduation of over 500 studentsfrom its Bachelors and Associates programs at the Capitol Center for the PerformingArts in Concord. GSC also presented an Honorary Doctorate in Humane Letters toWMUR personality Fred Kocher, the Granite State Award to Northeast Delta DentalCEO Tom Raffio, and the 2011 GSC Distinguished Faculty Award to Craig Nevins.NEW HAMPSHIREPUBLIC TELEVISIONPublic Television (NHPB/NHPTV)underwent a major restructuringat the end of FY11 to offset the 30percent reduction in its $8.8 millionannual budget. Under the directionof the USNH Board of Trustees andNHPB Board of Directors, NHPTVeliminated twenty full-time positions,reduced staff salaries and thestation’s 403(b) staff retirement plan contribution, cancelled andrenegotiated dozens of contracts and services to reduce cost,and reduced the station’s educational engagement services.In addition, NH Outlook and Granite State Challenge, two locallyfocused programs produced by NHPTV, were placed on hiatusuntil additional funding can be secured. NHPTV is airing thefull PBS national broadcast schedule, and some locally-focusedprograms. It is offering limited community engagement andonline educational services.Going forward, NHPTV is exploring ways to implement furtheroperational efficiencies. This includes potential collaborationwith other New England public broadcasters to develop astrategic and sustainable model that will allow it to deliverquality PBS national and local programs throughout the region.NHPTV continues to operate from its broadcast center inDurham, as New Hampshire’s only locally owned and operatedstatewide television network.9
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