Fiscal Fitness: Running COD like a business benefits students, taxpayers
When explaining College of DuPage's impact on the community, we often report human stories, educational outcomes or economic benefits.
But every public college has a fiscal impact, too.
Because of that fiscal impact, COD President Dr. Robert L. Breuder believes colleges should be run like businesses.
In COD's case, the business is a big one, with more than 29,000 students, nearly $500 million in net assets and more than $250 million in annual revenues.
So what fiscal measures matter and how is College of DuPage faring?
Q. How much does COD cost students and taxpayers?
A. Levy freeze. Tuition cut. Tuition freeze.
It's common knowledge that higher education costs are climbing.
But COD is bucking the trend in three ways.
First, COD trustees unanimously approved a no-increase tax levy for fiscal year 2014. That benefits every taxpayer in the district.
Second, for the current semester, COD trustees rolled back tuition and fees to $140 per credit hour.
Then, trustees locked in that lower rate for all of fiscal year 2016.
In a recent survey of district residents, 82 percent strongly agreed that COD's tuition is a good value, while 66 percent strongly agreed that their tax investment in COD is a reasonable expenditure.
"Because we have our fiscal house in order, we are in a unique position to keep our tuition reasonable and open up higher education to many students who might otherwise be unable to attend college," said College of DuPage Board Chair Erin Birt. "By maintaining our fiscal health, we keep our focus where it belongs—on student success."
Q. Do you have healthy reserves to weather inevitable fiscal storms?
A. Yes. At levels the community—and bond raters
No one can predict the future, except to say that in public higher education, it's always changing and frequently threatened.
Because the state's finances are in such distress, Illinois' new governor wants to cut nearly $400 million in higher education funding. Some, including COD's president, believe fiscally challenged states increasingly will focus on K-12 education while further cutting support for colleges and universities.
Whatever the challenges, a well-run school needs healthy reserves to even out the fiscal roller-coaster ride.
In that same community survey, 64 percent of respondents said a college should have nine to 18 months of operating reserves. Currently, COD's $177 million falls in the middle of that range.
The public isn't the only stakeholder supporting strong reserves. Bond rating agencies also approve. That, in turn, keeps COD's borrowing costs low for state-of-the-art teaching facilities.
"COD has managed its finances in a very conservative manner over the past six years," said Breuder. "This has enabled the College to build reserves that have contributed to our stellar triple-A ratings with Moody's and Standard & Poor's."
Q. Do outside auditors give your finances a clean bill of health?
A. Yes. The best possible.
After COD's most recent audit, Crowe Horwath partner Christine Torres wrote: "We are providing College of DuPage with an unmodified, clean opinion. All numbers are materially correct and there are no deficiencies in the College's financial statements."
An auditor provides a "clean" or "unmodified" opinion when the firm does not have any significant reservations about the matters contained in the financial statements, and when financial conditions, positions and operations are fairly presented in the financial statements.
It is the best type of report an auditor can provide.
"Our fiscal strength remains the envy of many other colleges and universities," said Birt. "We operate in the same manner our taxpayers would run their own homes. We do not spend more than we take in, we set aside savings for unexpected emergencies and opportunities, and we have shown resourcefulness and commitment to meeting state funding challenges head-on."
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College of DuPage
425 Fawell Boulevard
Glen Ellyn IL 60137
College of DuPage
425 Fawell Blvd., Glen Ellyn IL, 60137
(630) 942-2800 (Main)
(630) 942-3000 (Student Services)
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