State fiscal watch is where Wright State may be headed even as administrators have said for months that they believed the school would avoid it.
The state measures every public college’s fiscal health with something called a “Senate Bill 6 score,” an annual rating of 0 to 5. Any school that falls below a 1.75 two years in a row is put on notice.
Wright State projected its score last year was a .8, meaning one more year below a 1.75 would put the school on fiscal watch. As recently as January, administrators were projecting a score of 2.2 for the current fiscal year.
Wright State would become just the second university in Ohio to be placed on state fiscal watch if the school is unable to add around $6 million to reserves, which it is unlikely to do at this point, WSU chief business officer Walt Branson told trustees.
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A mix of in-state versus out-of-state students did not enroll last fall, causing a $4.7-million loss of tuition revenue for Wright State. Non-Ohio residents pay more for tuition and fewer than expected came to WSU this year.
Around $3.5 million in scholarship and fellowship costs and about a $6 million increase in health care costs also came as a surprise to the administration.
“We have got to cut it out if we want to save this university…we’re all just shooting ourselves in the foot,” board of trustees chairman Doug Fecher said.
Trustee Bruce Langos said representatives from the state department of higher education told Wright State that it has spent more cash in the last two years than most other state universities. The next few months will have to be different though as they are likely to bring “the tightest belt tightening” ever for Wright State’s finances, Fitzpatrick said.
“We are really focused on accountability and we are focused on doing everything we can at this point to reduce any expenditures that are not critical,” Schrader said. “There is scrutiny happening every day in all of these different budget areas.”
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Trustee Bill Montgomery and others also criticized the administration for its lack of urgency in addressing issues stemming from the budget crisis.
In August, for example, trustees questioned a payment they were asked to approve for the Western Ohio Educational Foundation, which owns the housing facilities at Wright State’s Lake Campus in Celina. During Wednesday’s meeting, trustees were asked to approve the same payment again even though they still didn’t have an answer for their question from eight months ago.
“Here we are approving the exact same number months later as if that conversation never happened,” Fecher told Wright State’s financial leaders. “Do you pay attention to what we ask? It doesn’t appear like it. I just don’t get it.”
By the close of the fiscal year on June 30, administrators and trustees will have a better idea of whether the school is destined for state fiscal watch. If needed, the state’s official fiscal watch designation would come at a later date but trustees will likely receive a projection as part of the FY 2019 budget they’ll consider in June.
“We are on a trajectory toward fiscal watch and that is something I would like to avoid if at all possible,” Fitzpatrick said.
The Story So Far
Then: Wright State trustees slashed more than $30 million from the school's budget last year in an attempt to correct years of overspending
Now: In order to stay on budget and off fiscal watch, Wright State has to save $10 million more before June 30.
Next: If Wright State is put on fiscal watch, the school would have to adopt a three-year recovery plan.