During its meeting Oct. 30-31, the Bethany College Board of Directors affirmed actions to reach a balanced budget at this end of this fiscal year.
During his State of the College Address on November 3, Bethany College President Edward F. Leonard III shared with the campus community performance results on strategic goals and an updated financial state of the college.
Of 21 metrics in the strategic plan set forth by the Bethany Board of Directors in October 2008, Bethany is trending successfully in 15 categories including enrollment, retention and alumni loyalty, but challenges in development of the annual fund and financial resources still exist.
“Through assessment and continued improvement, focusing on outcomes and delivering on our promise to students, Bethany will soar bigger, better and stronger. There are many good things happening at Bethany, but our finances still challenge us,” President Leonard said.
Bethany’s financial challenges date back to the mid-1990s and can be directly related to the operating budget. Financial concerns were raised during the re-accreditation site visit in 2000. A follow-up visit, focused on finances, occurred in 2003 and close communication with the Higher Learning Commission (HLC) has continued over the past decade. There have been three prior attempts by the college to right the operating budget, in 1995, 1999 and 2003. “In retrospect, those three efforts did not deliver a sustainable fix,” President Leonard pointed out.
As a result of the college’s ongoing financial challenges, the HLC has placed the college under a financial review panel, and in result, Bethany has submitted a financial recovery plan. Progress reports are required to be submitted periodically.
The next accreditation site visit is scheduled for November 15-17, 2010. The expectation is very clear that Bethany College must demonstrate a turnaround in financial position. “My communication with the HLC has persuaded me that the pressure is on us to right our operating budget and demonstrate financial health and future viability for Bethany College,” President Leonard stated.
Currently, the college is closely analyzing every available revenue stream and the expense structure to determine the right budget model for the current year and the next few fiscal years. For the college to reconcile the fiscal situation, a financial equilibrium must be reached. Steps toward this stability include a balanced budget, without creating hidden liabilities such as deferred maintenance, projected rates of change in revenues and expenses must be maintained and endowment use should be limited to preserve its long-term purchasing power.
Three ad hoc working groups, consisting of campus wide representation, have been identified to delve deeper into the financial challenges of the college. The groups will be enabling technology, righting our economic model and Imagineering the 21st Century Bethany College.
The first group, enabling technology, will immediately bring closure to ensuring the college has the capabilities to record and report on the financial condition on a real-time basis.
Focusing on the college’s short-term financial issues and righting this year’s operating budget is the goal of the second working group, righting our economic model. Next, the group will focus on creating a realistic budget model for the near-term.
Imagineering the 21st Century Bethany College working group will focus on exploring value innovation opportunities by creating significant leaps in the realized value of the Bethany experience. The Imagineering process fuses imagination, the fundamental tool of invention and problem solving, with engineering, the process of analysis, design, development, implementation and maintenance to achieve innovative solutions.
“An imagineered Bethany will result in a deep understanding of our students’ needs, our competitive environment and our economic realities,” President Leonard said.
Specific actions will be determined as the working groups begin to confront data. Each group has individual deadlines and all information will be gathered by the end of this academic year.