Monitoring Report to the
Middle States Commission on Higher Education
from
EDINBORO UNIVERSITY OF PENNSYLVANIA
Edinboro, PA 16444
Michael J. Hannan, Ph.D, Provost & VPAA
March 1, 2015

Subject of the Follow-Up Report:
To warn the institution that its accreditation may be in jeopardy because of insufficient
evidence that the institution is in compliance with Standard 3 (Institutional Resources). To
note that the institution remains accredited while on warning. To request a monitoring
report, due March 1, 2015, documenting that the institution has achieved and can sustain
compliance with Standard 3, including but not limited to, evidence of (1) development and
implementation of strategies to measure and assess the sufficiency of institutional resources
to support the institution’s mission and goals; (2) development of a financial plan to address
the FY15 projected budget deficit; (3) review of the enrollment management plan to assess
optimal enrollment; and (4) steps taken to improve the institution’s long-term financial
viability and sustainability. In addition, to request that the monitoring report also document
(1) further development and implementation of a comprehensive planning process that links
long-range planning to decision making and budgeting processes (Standard 2); and (2)
further development and implementation of a sustained assessment process to evaluate and
improve the total range of programs and services and the achievement of institutional
mission, goals, and plans (Standard 7). A small team visit will follow submission of the
monitoring report. To direct a prompt liaison guidance visit to discuss the Commission’s
expectations. The date for the Periodic Review Report will be set when accreditation is
reaffirmed.

Table of Contents
Page
Introduction and Scope of Monitoring Report……………………………………………………………

1

A.1. Development and implementation of strategies to measure and assess the
sufficiency of institutional resources to support the institution’s mission and
goals…………………………………………………………………………………………………………………………….

2

The Past: Inadequate Processes and Reporting…………………………………………………………

2

The Present and Future: New Processes and Leadership…………………………………………..

3

Supporting EU’s Mission and Goals…………………………………………………………………………..

5

A.2. Development of a financial plan to address the FY15 projected budget
deficit…………...........................................................................................................................................................

5

Optimal Enrollment at Edinboro University……………………………………………………………..
A.3. Review of the enrollment management plan to assess optimal
enrollment………………………………………………………………………………………………………………….

6

Enrollment Management Planning: Recruitment, Retention, and Integration…………….

7

Enrollment Management and Changes in Additional Locations…………………………………

8

A.4. Steps taken to improve the institution’s long term financial viability and
sustainability……………………………………………………………………………………………………………....

9

Model Assumptions…………………………………………………………………………………………………

10

Model Outcomes……………………………………………………………………………………………………..

10

B.1. Further development and implementation of a comprehensive planning
process that links long-range planning to decision making and budgeting
processes…………………………………………………………………………………………………………………….

12

A Strengthened Budget and Planning Infrastructure…………………………………………………

12

Integration of Advancement Revenue and Capital Project Expenditures in the
Planning and Approval Process………………………………………………………………………………..

14

6

B.2. Further development and implementation of a sustained assessment process
to evaluate and improve the total range of programs and services and the
achievement of institutional mission, goals, and plans……………………………………………...

14

Progress in Leadership and Organization……………………………………………………

15

Improved Linkages to Planning and Budget………………………………………………...

16

Continued Institutional Assessment and Improvement……………………………………...

17

Summary and Conclusions………………………………………………………………………………………….
List of Exhibits…………………………………………………………………………………………………………….

18
20

Introduction and Scope of Monitoring Report
Edinboro University (EU) is pleased to submit its Monitoring Report to the Middle
States Commission on Higher Education (MSCHE) to provide requested information
associated with the accreditation warning issued by the Commission in June 2014,
which followed a decennial comprehensive self-study and site visit to Edinboro
University in March 2014. The recommendation of the site team, accepted by the
Commission, was that EU met all Standards, with the exception of Standard 3
(Institutional Resources). The focus of this report is to address the specific requests
for evidence identified by the Commission in Edinboro University’s Statement of
Accreditation Status, as listed below. Edinboro University is adding to its many
existing processes and practices related to Standard 3, as identified in the original
self-study and incorporated herein by reference, in order to address the deficiencies
identified by the site visit team. This Monitoring Report documents the University’s
progress in the past eight months toward addressing issues identified by the
Commission. Edinboro University believes this progress to be significant and
substantial, to the extent of establishing full compliance with Standard 3, and is
grateful to the visiting team and Commission for its work to guide its institutional
responses.
A. The Commission has requested a monitoring report documenting that
Edinboro University (EU) has achieved and can sustain compliance with
Standard 3, including but not limited to, evidence of
1. development and implementation of strategies to measure and assess the
sufficiency of institutional resources to support the institution’s mission
and goals;
2. development of a financial plan to address the FY15 projected budget
deficit;
3. review of the enrollment management plan to assess optimal enrollment;
and
4. steps taken to improve the institution’s long term financial viability and
sustainability.
B. In addition, the Commission requests that the monitoring report also
document
1. further development and implementation of a comprehensive planning
process that links long-range planning to decision making and budgeting
processes (Standard 2); and
2. further development and implementation of a sustained assessment
process to evaluate and improve the total range of programs and services
and the achievement of institutional mission, goals, and plans (Standard
7).

1

The remainder of this Monitoring Report is organized to address each of these areas
in turn.
A.1. Development and implementation of strategies to measure and assess the
sufficiency of institutional resources to support the institution’s mission and
goals.
During the first six months of the current fiscal year (FY 2015) EU developed and
began implementation of both short- and long-term strategies to ensure sufficient
resources to support its institutional mission and goals. The first steps in this
process were to fully understand the assumptions underlying the annual budget and
to improve the regular reporting of current year financial results to include routine
budget variance reporting and analysis at the institutional level.
The Past: Inadequate Processes and Reporting
The numerous conflicting reports and messages concerning the state of institutional
finances explicated in the visiting team report reflected a lack of adequate reporting
practices to evaluate financial performance or position. As late as June 2014, based
on a budgeted $5.5 million deficit and despite yearlong efforts to reduce
expenditures, the former CFO reported the year would end with a projected $4.9
million Education & General operating deficit. Barely six weeks later, following yearend closing, the actual operating deficit for these funds was reported to be
approximately $61K (later adjusted in audit to $110K; including designated
activities such as Athletics the total deficit was $412K). (COT Presentation Sep 2014;
Financial Report FY14 to PASSHE; COT Presentation Jul 2014; EU Audited Financial
Statement FY14 )
Upon analysis of the structure of the budget in comparison to current operations at
the start of the 2015 fiscal year, the new Edinboro CFO determined that the
discrepancy between reported and actual deficits in FY 2014 was due to multiple
factors:
1. no budget-to-actual variance analysis had been performed for
revenues or expenses in making year-end projections;
2. no periodic “soft closes” of finances were performed to assess year-todate actual performance in comparison to budget;
3. expense projections had assumed full expenditure of many salary
lines that had been unfilled for much or all of the fiscal year; and
4. budget projections excluded revenue projections for activity not
already recorded and assumed full expenditure of centrally pooled
salary funds that had been conservatively budgeted over multiple
fiscal years and ultimately ended the year with significant positive
variances.

2

In short, EU had not tracked its actual financial performance in the course of the
fiscal year and instead waited until year-end close to evaluate actual revenue and
expense outcomes. Compared to year-end close, the early June projection had
excluded $1.1 million in summer revenue and over-estimated total expenses by $3.7
million. At the conclusion of FY 2014, actual results were significantly better than
both the original budget and midyear forecasts. This inaccurate information had
also been reported to the MSCHE visit team in March 2014 and EU’s Council of
Trustees in early June.
The MSCHE visiting team was also presented with budget projections for FY 2015,
FY 2016, and FY 2017, indicating an $8.1 million deficit projected for FY 2015 and
growing deficits thereafter. (FY15-17 Budget Projections) These projections were
similarly predicated on full year funding of all open positions (including many
positions that had remained unfilled for years) as well as full expenditure of all
pooled funds. In addition to overstating expenses, no management interventions to
increase revenues or reduce expenses were anticipated in these models. Indeed,
the FY 2015 budget projection presented to the MSCHE visiting team failed to
incorporate $7.3 million in E&G expense savings compared to budget that EU
realized in FY 2014.
The Present and Future: New Processes and Leadership
Under new financial leadership beginning in July 2014, a FY 2015 Education and
General budget was recommended to the Council of Trustees predicated on the
(near) breakeven result from FY 2014 plus anticipated changes in revenues and
expenses in the coming year. These included (1) approximately $1 million less in
tuition revenue due to continuing enrollment declines; (2) approximately $2.6
million of added expense for contractual salary and benefit increases; (3)
approximately $500K in salary and benefits for new strategic hires in finance,
enrollment management, institutional research and student retention; and (4) an
additional $600K in institutional contingency funds. (FY15 Budget Summary; COT
Presentation Jul 2014) This yielded a FY 2015 Education and General budget with a
$4.5 million operating deficit. Because many cost-saving initiatives in FY 2014 were
implemented mid-year and would yield a full year’s savings in FY 2015, even this
budget formulation was inherently conservative, while still reducing the deficit
compared to the prior year budget. By the end of the first quarter of FY 2015, and
following EU’s first ever quarterly soft financial close, the projected deficit for the
fiscal year sat at approximately $3.7 million, attributable to these ongoing expense
saving gains from base budget reductions during FY 2014. (FY15 Q1 Closing) The
mid-year close, effective December 31, 2014, showed a projected annual deficit of
$2.1 million, demonstrating further progress in financial management. 1 (FY15 Q2
Closing)
Based on Spring 2015 enrollments subsequent to the 12/31/14 close, the current year deficit may
be as low as $1 million. Beginning in March 2015, EU will conduct monthly financial closes and
budget-to-actual variance analyses.
1

3

In addition to these measures, in the current fiscal year EU reassessed the
availability of unrestricted net assets to support operations going forward. The
2014 visiting team had been told that “EU had $9.4M in reserves at the start of fall
2013. If we do not cut expenses significantly to lessen the shortfall this year and the
projected shortfall of over $10M next year we will run out of all reserve funding early
next year and cannot sustain our operations. (former Interim CFO, Lori Gardea)” In
fact, at the time this alarming statement was conveyed to the visiting team, under
the Pennsylvania State System of Higher Education (PASSHE) Board of Governor’s
Policy 2011-01 outlining “University Financial Health Indicators,” EU had reported
unrestricted net assets of $16.4 million even after conservative, voluntary
encumbrances for all future debt service and lease payments of $18.1 million. In
other words, the university truly had $34.5 million of unrestricted (plant fund) net
assets at its disposal. (Financial Report FY13 to PASSHE, see Tab 12) At the
conclusion of FY 2014, with these voluntary encumbrances removed, and including
commitments for funding several capital projects in FY 2015, EU identified over
$31 million in unrestricted net assets that may be used to fund future
operations. (Financial Report FY14 to PASSHE, see Tab 12) These unrestricted net
assets exclude additional resources from private philanthropy potentially available
to the university should a true condition of fiscal exigency exist. (Gift and
Endowment Balances)
As these accounting process improvements, clarifications and corrections were
being discovered and effected, EU openly communicated and clarified these new
understandings and approaches to both its Council of Trustees and to its faculty. (All
Faculty Meeting Presentation Oct 2014; COT Presentation Jul 2014)
EU’s enrollment declines, increasingly competitive external environment, and the
need to improve services while controlling costs remain serious and significant.
With FY 2014 closed and funding for the FY 2015 budget deficit identified, EU
developed a five-year enrollment-driven revenue and expense budget model. This
revenue-driven model compares available revenues to expenses by program
category (e.g., Instruction, Academic Support, etc.) and is presented in detail in
section A.4 of this report. Based on this model, a portion of annual tuition increases
and support service cost savings will be applied to deficit reduction. At the same
time, strategic initiatives will be funded from new tuition revenues. Under all
probable enrollment scenarios, EU will return to generating net surpluses by FY
2018 and will not consume more than $3.5 million of the $31 million in unrestricted
net assets already identified, at which time those funds will be annually repaid to
the plant fund by the Education and General fund.
EU’s internal assessment of its long-range fiscal outlook was externally validated in
February 2015 by the results of the State System’s comprehensive financial
assessment of all institutions in the System. The Office of the Chancellor developed
its assessment tool as a means of reporting overall and specific institutional risks to
the State System Board of Governors. The analysis utilizes longitudinal assessments
4

of market demand, operating efficiency and financial performance as well as an
assessment of management risk. (PASSHE Financial and Operations Dashboard)
Many of the market and financial indicators overlap with Moody’s institutional
financial strength analysis. As a result of the analysis, PASSHE identifies EU as
having moderate overall risk based largely on strengths in matriculation ratios,
quality and maintenance of physical plant facilities, and unrestricted net assets
available for investment. Institutional weaknesses in costs per student, operating
margins and debt leverage are areas of focus in the institution’s long-range financial
plan. Overall, PASSHE’s assessment of EU is that it poses lesser financial
performance risk than a number of PASSHE peer institutions that do not have its
brand, physical plant and unrestricted net asset strengths.
Supporting EU’s Mission and Goals
To align new investments with the strategic plan, EU has established a new Budget
& Planning Team (BPT) focused on developing detailed annual budget
recommendations for approval by the President and Council of Trustees. This team
is focused on budget allocation recommendations and is co-chaired by the Provost
and CFO. The BPT includes the Director of Budget and Payroll, AVP of Financial
Operations, VP of Student Affairs, VP of University Advancement, a leadership
representative from the faculty union and an additional faculty representative. (See
BPT agenda and review materials: Exhibits 13, 14, 15, 16) The BPT does not replace
the Planning & Budget Committee (PBC), which is comprised of approximately 25
faculty, students, alumni, trustees and administrators; this latter group works on
specific budget initiatives and provides broad input regarding progress in
fulfillment of the EU Strategic Plan. For example, currently three subcommittees of
the PBC are working to identify and operationalize mission-supportive revenue
initiatives to incorporate into the FY 2016 operating budget. (PBC Agendas)
A.2. Development of a financial plan to address the FY15 projected budget
deficit.
As noted above, the FY 2015 projected budget deficit of $8.1 million presented to
the 2014 MSCHE visiting team assumed the expenditure of approved (but not
necessarily filled) faculty and staff salary lines, as well as full expenditure of various
pooled salary funds including FICA/retirement expenses, student wages and
temporary faculty pools that had been conservatively budgeted to prevent overexpenditures. (FY15-17 Budget Projections) When the FY 2015 budget was aligned
with actual FY 2014 operating results (i.e., expense pool budgets were set at the
levels of actual prior year expenditures plus known changes for the coming year),
the projected deficit for FY 2015 was determined to be $4.5 million. At mid-year (as
of 12/31/14), the deficit for FY 2015 was estimated at $2.1 million based on yearto-date actual activity. (FY15 Q2 Closing) EU is continuing to identify and implement
cost savings through potential shared service partnerships with other PASSHE
institutions, by reducing the size of the faculty complement and partially using
temporary faculty to backfill faculty retirements, and by realizing administrative
5

and support cost reductions through workforce reductions and changes in
procurement. (MOU between EU and IUP; Academic Affairs Plan; Shared Service
Meeting Agenda)
In late July 2014, the FY 2015 budget was presented to the Council of Trustees for
approval with a recommendation that the projected deficit be funded via a
repayable loan from plant fund unrestricted net assets. This recommendation was
approved.
Optimal Enrollment at Edinboro University
Historically, EU has depended primarily on traditional undergraduate students from
the state public high school feeder system. Going forward the university is
broadening its program array to expand graduate programming and incorporate
additional nontraditional student populations, while working to improve student
outcomes for its traditional undergraduates. (See Academic Affairs Plan.) The
investments in new strategies to improve retention and recruitment described
above, the promising results of new business models (e.g., Porreco College),
assessment of current program revenues and costs (Net Revenue Analysis by
Department: AY2013-2014, Fall 2014), and commitment to improved student
outcomes (Retention Plan) all bear on the question of determining EU’s optimal
enrollment. Many of these strategies are in their first or second year of
implementation, with others to be implemented in the near future.
During the past four years of enrollment declines, amounting to 17.8% total fulltime equivalent students from Fall 2010 to Fall 2014, EU has reduced its teaching
faculty complement by 14.5%. PASSHE’s recent analysis of EU’s future enrollments,
based on current market shares of high school graduates in Pennsylvania counties,
indicates the “trough” in headcount enrollments will occur in FY 2016 after which
EU’s enrollments will gradually grow to approximately 7,500 headcount by Fall
2019 (PASSHE Financial and Operations Dashboard) compared to 6,839 in Fall
2014. This level of increase is consistent with the assumptions in EU’s long range
financial model discussed in the next section.
EU is working to further improve its data and process infrastructure to support
strategic enrollment management efforts on an ongoing basis. As the initiatives
identified throughout this Monitoring Report are implemented over time, EU
anticipates adjusting its enrollment goals and workforce requirements based on
marketplace realities. EU is realizing significant success through these efforts to
date, and anticipates ongoing improvements going forward.
A.3. Review of the enrollment management plan to assess optimal enrollment.
Edinboro University’s leadership team is keenly aware that its revenue streams are
enrollment-dependent and is actively working to strengthen its competitive position
with strategies to support achievable and sustainable enrollment levels.
6

Enrollment Management Planning: Recruitment, Retention, and Integration
In June 2014, EU hired a new Assistant Vice President for Enrollment Services
reporting directly to the President. The new AVP immediately began assessment of
the institution’s Strategic Recruitment Plan (SRP) for undergraduate students. This
included a full review of staffing, recruitment strategies and support systems, and
scholarship and financial aid awarding practices. The revised SRP defines
recruitment strategies for the University and provides detailed projected
enrollment values expected from those strategies. (Undergraduate Strategic
Recruitment Plan) Projections for student enrollment at the undergraduate level
show modest growth through 2020 based on strategies defined in the report, and
consistent with improved demographics in our traditional in-state catchment areas
as presented in the PASSHE financial analysis for the University. (PASSHE Financial
and Operations Dashboard) Preliminary results for the Fall 2015 in-coming class are
positive. As of February 16, 2015, compared to the same week in the previous year,
freshmen applications are up 13%, admits are up 16.9%, and deposits up 23.5%;
out-of-state freshmen deposits are up 113.2%.2 (Weekly Admissions Summary)
Edinboro’s success is also evidenced through its strong performance in the PASSHE
Enrollment Summary Report (February 2015) showing Edinboro first among the
fourteen universities in annual growth in new freshmen deposits, and second in
growth in applications.
Targets for graduate student enrollment are generated by the Office of the Dean of
the School of Graduate Studies and Research as presented in the Graduate Strategic
Enrollment Management Plan. (Grad School SEM Plan) This plan presents strategies
and initiatives to sustain enrollments in existing programs and to increase graduate
enrollments through strategic marketing and new program development.
In August 2014, EU filled the new position of Director for Academic Success and
Student Retention. This individual provides leadership for the Academic Success
Center, the First Year Experience (FYE) program, and university-wide strategies and
initiatives for student retention. The University Retention Report outlines these
strategies and provides projections for retention rates moving forward. (Retention
Plan)
These recruitment and retention projections provide the foundation for the budget
planning projections through 2020; they influence and are influenced by the
Academic Affairs Program Array and Personnel Plan. (Academic Affairs Plan)
Having experienced significant enrollment declines since 2010, EU has both the
physical plant capacity and sufficient faculty to support additional enrollments and
higher levels of retention with minimal additional marginal costs. While the number
Growth in out-of-state deposits is associated with the University’s pilot tuition project which lowers
the out-of-state rate from 150% of the in-state rate to 105%.
2

7

of FTE teaching faculty have also declined during this period, program moratoria
and course section consolidations have also increased efficiency in the offering of
academic programming.3 Low marginal costs associated with additional
enrollments is one of the drivers behind EU’s out-of-state pricing strategy noted by
the visiting team as a recent accomplishment.
To further support the integration of recruitment and retention goals and strategies,
EU has established a Strategic Enrollment Management Team co-chaired by the
Provost and Vice President for Finance and Administration and includes the AVP of
Enrollment Services, AVP of Financial Operations, Director of Academic Success and
Student Retention, Director of Institutional Research and Assessment, all academic
deans and an academic department chair. This group is charged with planning and
assessing enrollment management activities throughout the academic year. (SEM
Charge and Agendas: Exhibits 28, 29) In addition, the Office of Institutional Research
and the Office of Admissions issue weekly enrollment and recruitment reports to
members of the SEM team and President’s executive staff. (See Weekly Admissions
Summary; Sample Enrollment Management Update)
Enrollment Management and Changes in Additional Locations
To continue to address the alignment of resources with institutional priorities, EU
had evaluated and made the decision to close operations at its additional location in
Meadville (PA). This change took effect with the fall 2014 semester and is consistent
with the recommendation of the March 2014 MSCHE site team. In addition, the
decision was made in spring 2015 to end the offering of Education programming at
the additional location at Lawrence Crossing (Butler County Community College); a
teach-out plan is currently under development along with a substantive change
proposal for the MSCHE in this regard.4
At the same time, EU has expanded offerings at its Porreco campus in Erie.
Enrollments already exceed 200 student in its first year of operations as “The
Community’s College,” offering sub-baccalaureate programming at community
college price points via private scholarship support to decrease student out-ofpocket costs. (Porreco College Summary) Porreco College enrollments are
addressed separately in the undergraduate Strategic Recruitment Plan, with
programming and staffing addressed in the Academic Affairs Program Array and
Personnel Plan. This initiative is part of EU’s 2013-2018 Strategic Plan and directly
supports the institution’s mission to meet the evolving needs of the broader
community.
The Academic Affairs Program Array and Personnel Plan identifies the list of recent program
moratoria and the decline in teaching faculty FTE by 14.5% between 2010 and 2014.
4 A financial break-even analysis demonstrated that there was a low probability of continuing the
program without financial losses. The strategic decision was also made to offer the BSED in Early
Childhood Education online to a broader audience and focus resources on main campus and at the
Porreco College location.
3

8

A.4. Steps taken to improve the institution’s long term financial viability and
sustainability.
Edinboro University recognizes that by far the greatest percentage of its future
operating revenues will derive from student tuition and fees, and its available
funding to support programs and services will be predicated on revenue levels from
those sources. Consistent with recent practice, it is likely that state appropriations
will not change significantly while mandated salary and benefit costs will continue
to inflate. Competition for enrollments based on programs and costs will intensify
among both private and public institutions.
EU’s strategic plan outlines how its institutional initiatives will enable it to thrive in
this new competitive environment, maintaining its public mission and identity while
managing its finances based on available revenues. The past two fiscal years are
testaments to EU’s financial agility.
To provide a framework for future investments, EU has developed a multi-year,
revenue-driven budget model based on enrollments and assuming modest tuition
and fee rate increases with almost no increase in state appropriation support. This
model is similar to budget models utilized by private nonprofit institutions of higher
education and was developed for EU by its new Chief Financial Officer, Guilbert
Brown, who has developed similar models for public and private institutions over
the past 30 years.5
EU’s long range budget model provides for eventual elimination of the current
operating deficit, based on one-half of future tuition increases and three-quarters of
revenues from enrollment growth going toward deficit reduction. Expense
reductions through greater efficiencies in institutional support and plant operation
and maintenance also contribute to deficit reduction. Mission-critical programs of
instruction, student services and academic support grow as a function of tuition rate
increases, changes in enrollment and baseline inflation increases. Within these
assumptions are sufficient funding increase levels to support the academic program
staffing plan, likely levels of collective bargaining compensation increases and
investments supporting strategic initiatives. As EU has successfully done in its last
two fiscal years – for instance, funding significant compensation increases in FY
2015 while still managing to reduce total instructional expenditures – a
combination of incremental funding additions and base budget reallocations will be
used to realize these outcomes based on program revenues and cost savings
opportunities.
One of Mr. Brown’s enrollment and financial models is showcased in the recent AACRAO book, “SEM
and Institutional Success: Integrating Enrollment, Finance and Student Access.” He has also
developed budget model training programs for the National Association of College and University
Business Officers (NACUBO) and the American Association of Collegiate Registrars and Admissions
Officers (AACRAO).
5

9

The base year for EU’s long range model is the projected FY 2015 operating results.
These results have been updated since the second quarter close to include
additional tuition revenues from students who registered in early January.6
Model Assumptions
The model assumptions are summarized below.

Instructional costs
Academic Support
and Student Services
Institutional Support and Plant O&M
Scholarships and Fellowships

Increase by 2.5% annually plus 1/2 the rate of tuition
increases; increase or decrease by the rate of change in
enrollments.
Increase by 1.5% annually plus 1/2 the rate of tuition
increases; increase or decrease by the rate of change in
enrollments.
Decrease by 1.5% per year
Increase by the level of tuition rate increases.

Model Outcomes
Six iterations of EU’s model are included as shown in Exhibit 33 and are
summarized in the table below. EU recognizes that the upcoming FY 2016
represents a low point in Pennsylvania’s high school graduate recruitment pipeline,
a perspective reinforced by PASSHE’s recent financial and operations dashboard
analysis, and is taking aggressive measures to recruit both in- and out-of-state
undergraduates preceding a substantial uptick in high school graduates in FY 2017.
(See EU’s Undergraduate Strategic Recruitment Plan for a summary of initiatives
and projected enrollments.)
The first two scenarios present baseline model outcomes if (1) there were no
changes to EU’s current enrollment levels and mix, and (2) if EU were to experience
a further decline in in-state undergraduate enrollments. These scenarios are
included to show that EU would have sufficient financial reserves to sustain
operations even in the highly improbable events that enrollments remained static or
declined, and EU continued to increase its expenditures for instruction, academic
support and student services.
The financial outcomes from what EU believes to be more likely enrollment
scenarios going forward are shown in model scenarios (3) through (6). These
scenarios include enrollment growth resulting from a combination of
undergraduate recruitment gains, improved retention and new graduate programs.
EU is currently in its first year of a two-year PASSHE pilot pricing initiative whereby
Including those tuition and fee revenues, EU is projecting a current year (FY 2015) operating deficit
of just under $1 million.
6

10

out-of-state undergraduates pay 105% of the in-state tuition rate (shown as “Low
Out-of-State Rate” in the table below). Scenarios (3) and (4) assume continuation of
this initiative beyond its second year (FY 2016) under differing retention
assumptions (“modest” and “more significant” retention gains). Modest retention
scenarios assume that existing cohorts persist at long-term historic rates and only
new incoming cohorts realize retention improvements. The more significant
retention gain scenarios assume the past year’s improved retention trends continue
for all cohorts, and new incoming cohorts realize additional improvements.
Scenarios (5) and (6) assume the current out-of-state pilot pricing initiative is not
continued beyond FY 2016, and reflect the different retention assumptions
described above.

Model Scenario
(1) Steady State Enrollments
Constant enrollments based on FY 2015
projection

(2) Enrollment Decline (3.1% beginning
FY 2016, then constant)
1.8% less than FY 2015 beginning FY
2016, then constant

(3) Low Out-of-State Rate, Moderate
Retention
105% Out-of-State rate, modest
retention gains

(4) Low Out-of-State Rate, High
Retention
105% Out-of-State rate, more significant
retention gains

(5) High Out-of-State Rate, Moderate
Retention
150% Out-of-State rate, modest
retention gains

(6) High Out-of-State Rate, High
Retention
150% Out-of-State rate, more significant
retention gains

Net Operating Surplus (Loss) in Millions
FY
FY
FY
FY
FY
2016
2017
2018
2019
2020

6 Year
Total

$
(0.98)

$
(1.16)

$
(2.52)

$
(2.86)

$
(4.76)

$
(5.24)

$
(17.53)

(0.98)

(2.30)

(3.65)

(4.02)

(5.92)

(6.43)

(23.31)

(0.98)

(1.16)

(1.37)

0.39

0.77

2.45

0.09

(0.98)

(1.16)

(0.55)

1.95

2.77

4.12

6.15

(0.98)

(1.16)

0.09

2.16

2.94

5.46

8.51

(0.98)

(1.16)

(0.23)

2.67

3.84

5.97

10.11

FY 2015
Proj

11

As noted above, model scenarios (1) and (2) illustrate that even were enrollments to
remain unchanged or decline over the next several years, cumulative losses through
FY 2020 would be significantly less than the value of unrestricted net assets
available to the university even with no management interventions to reduce
losses. The more likely future enrollment scenarios (3) – (6) yield operating deficits
for the next one to two fiscal years before turning positive. These scenarios derive
expected enrollments over the period based on the undergraduate and graduate
Recruitment Plans (Exhibits 24, 27), undergraduate retention rates based on the
University’s Retention Plan, and planned changes in the academic program array
and faculty complement through FY 2018.
In addition to this long range operating model, the University is making necessary
and planned investments in its physical plant. Already ranked second of the
fourteen in the PASSHE system based on a composite metric of facility condition and
investments to maintain the quality of the physical plant, EU is investing its own
plant reserves in facility renovations and deferred maintenance projects. (Deferred
Maintenance Schedule)
B.1. Further development and implementation of a comprehensive planning
process that links long-range planning to decision making and budgeting
processes.
This portion of the Monitoring Report relates to follow-up information requested
regarding Standard 2. Over the past nine months, Edinboro University has taken
several measures to strengthen ties between its planning, decision-making and
budgeting processes.
A Strengthened Budget and Planning Infrastructure
The University has established an enterprise model to serve as its framework for
long-range financial planning, established a new Budget & Planning Team (BPT),
and a new Strategic Enrollment Management Team. (See BPT exhibits 13, 14, 35;
SEM Team exhibits 28, 29) In addition it has redesigned its internal budget process
to realize the following goals:





Align budget allocations with available revenues and strategic priorities;
Engage faculty leadership in developing budgeting strategies and budget
recommendations for the President’s and Council of Trustees’ approval;
Provide Council of Trustees review and approval of capital budget plans;
and
Provide for the long-range financial stability of the University by ensuring
ongoing investments in mission-critical operations and realizing
efficiencies in support units.

To develop recommendations for allocating revenues within each program area, the
University has established a Budget Planning Team chaired by the VP of Finance and
12

Administration. The team also includes the Provost/VPAA, Director of Budget &
Payroll, Associate Vice President for Financial Operations, Vice President for
Student Affairs, Vice President for University Advancement, a leadership
representative from the faculty union, and a faculty member representative. The
purpose of the team is to review all institutional financial projections including the
work of the Strategic Enrollment Management Team and larger Planning & Budget
Committee, discuss alternative funding strategies for achieving institutional
strategic goals, and recommend a budget proposal to the President for approval.
(BPT Charge and Membership)
The larger Planning & Budget Committee (PBC), which was in place at the time of
the MSCHE visiting team’s report, remains engaged in the university planning and
budget processes as a resource for exchanging perspectives and information about
the university’s financial and strategic plans, and to evaluate specific budgetary
proposals and initiatives. For example, in the current budget development cycle the
PBC has divided into three working groups to examine new revenue initiatives in
targeted areas that would be consistent with the University mission and goals as
defined in the Strategic Plan. Working from the Education Advisory Board’s “200
Ideas from the Frontier: Alternative Revenues in Higher Education,” the working
groups have identified potential revenue initiatives for FY 2016 and are working
with unit managers to craft implementation plans for those initiatives. At the same
time, the PBC remains updated on progress with regard to the University’s Strategic
Plan. Any revisions to the Plan will be made by the President’s Executive Council
and brought to the PBC for comment. (PBC Agendas; Strategic Plan Progress Report)
Finally, EU has established a Strategic Enrollment Management Team that meets
monthly throughout the year. This team was created to monitor and evaluate all
aspects of the strategic enrollment management process including goal-setting
recruitment and retention strategy, and to continually assess effectiveness of the
process based on outcomes. The SEM Team is co-chaired by the Provost and Vice
President for Finance and Administration, and includes the AVP of Enrollment
Service, AVP of Financial Operations, Director of Academic Success and Student
Retention, Director of Institutional Research and Assessment, all academic deans
and an academic department chair. (SEM Team Charge and Meeting Agenda)
A key characteristic of the university’s approach to budget and program planning is
that it seeks to be proactive rather than reactive. Edinboro University recognizes
that it continues to face considerable enrollment and financial challenges. The
university also has the financial resources to withstand a period of modest
operating deficits as it restructures its academic programs, strengthens its
recruitment and enrollment management functions, builds student success and cocurricular support programs and services, and streamlines institutional support
functions to realize greater operating efficiency. Initiatives undertaken in only the
past few months are expected to yield substantial and lasting improvements to both
revenue attainment and student success. Edinboro University is making
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investments to support positive impacts on the quality of our programs and the
success of our students.7
Integration of Advancement Revenue and Capital Project Expenditures in the
Planning and Approval Process
In addition, to ensure financial resources are utilized to support the highest
institutional program priorities, Edinboro University will be taking a “full funds”
approach to annual budget development to include the allocation of endowment
proceeds and current fund gifts. Historically, allocation of these funds –
representing substantial annual resources supporting scholarships, operating and
capital expenses – has been managed largely by the area charged with fundraising
(University Advancement) and not incorporated into the institutional budget
planning processes. The university will also be taking more a deliberate approach to
ensuring the annual budget reflects EU’s very successful and systematic efforts to
raise funds in support of strategic goals.8
The University is also changing its approach to capital project approval and
management. Capital project funding comes from three primary sources: state
appropriations, plant fund reserves and private gifts. In the past, only state
appropriation capital plans were presented to and approved by the Council of
Trustees. In the future, all capital spending plans, including the use of plant fund
reserves and private gifts, will be presented to and approved by the Council of
Trustees.
B.2. Further development and implementation of a sustained assessment
process to evaluate and improve the total range of programs and services
and the achievement of institutional mission, goals, and plans.
The measurement and evaluation of institutional effectiveness has continued its evolution
since the MSCHE team visit in spring 2014. A number of committees, teams, and new
employees have been dedicated to the work of achieving our mission, goals, and plans.
Many of the visiting team’s recommendations can be seen woven into the ongoing work
of assessing our institutional effectiveness. While Edinboro recognizes the important role
that student learning assessment plays in the effectiveness of the institution, the following
The Academic Affairs Program Array and Personnel Plan discusses the institution’s work to
transform its program array to address new student markets and revenue streams, including the
elimination of lower-enrolled programs, and associated personnel actions and investments. Beyond
this plan, other recent investments in student success include the approval and filling of the new
position of Director of Academic Success and Student Retention, and the multi-year commitment of
release time for a faculty coordinator to expand and improve the University’s First Year Experience
program. Both of these latter initiatives are directly tied to supporting achievement of elements of
the University’s Strategic Plan.
8 This will complement the fact that Edinboro’s advancement team has met performance funding
target levels for fundraising in each of the last two years and is a leader in the State System in terms
of funds raised per size of advancement staff.
7

14

brief synopsis focuses heavily on the progress of the greater institutional (i.e. nonacademic) components of standard 7.
Progress in Leadership and Organization
The roles of the Director for Institutional Research and Assessment and the Institutional
Effectiveness Committee (IEC) have been more firmly defined during the last several
months. One of the major responsibilities of the Director is to be the single point of
contact for institutional assessment needs.9 The IEC serves as an advisory group to the
Director, reviewing both the institutional assessment process, and data and information
emerging from the many measures associated with the University’s Assessment Plan, as
summarized below. (IEC Charge and Role)
Institutional

Both
National Survey of Student
Engagement

Student Learning
Student Learning Outcomes
Assessment Reports

Performance Funding
Monitoring

Alumni Survey

ETS Proficiency Profile

Divisional Assessment Reports

Annual Program Evaluations

Graduate School Student
Satisfaction Survey

“Great Colleges to Work For” Campus Climate
Sightlines (Facilities)

Academic program reviews (5year schedule)
Advising Quality Survey

Strategic Plan Monitoring

The Director and IEC evaluated the role of institutional (non-academic) assessment on
campus in 2015. The original assessment plan had called for non-academic review at the
individual department level. However, the time and resource commitment for such a task
was not efficient given the 55 individual departments identified. The Committee agreed
to begin requesting higher, divisional-level assessment reports, and in particular to focus
on those areas tied most directly to the goals of the 2013-2018 Strategic Plan and
Performance Funding Indicators, as these most strongly reflected institutional and State
System priorities. A schedule was also developed to more systematically review the
elements of the Assessment Plan. (IEC Assessment Plan Review Schedule) These actions
represent an example of evaluation of the assessment process itself for improvement. In
addition, the IEC identified specific areas for which the institution should develop
assessment teams. One of the teams focusses on Strategic Enrollment Management
(SEM) with the goal to evaluate and assess recruitment and retention goals and strategies,
two areas directly tied to the University’s Strategic Plan 2013-2018. (SEM Charge and
Agendas, exhibits 28, 29) The need for such a group was also noted in the visiting team
report. Other groups that are providing similar institutional assessment include the Data
Quality Team and the Porreco College Planning Team. 10

9

This directly addresses a recommendation made by the March 2014 MSCHE visiting team.
The Porreco College Planning Team relates directly to assessment of Strategic Plan Goal 5.

10

15

Improved Linkages to Planning and Budget
During Edinboro’s 2014 site visit, the team suggested that clearer communication
regarding the roles of the Institutional Effectiveness and Planning and Budget
Committees were needed. Just as the role of the IEC has been clarified, the linkage of the
Planning and Budget Committee to institutional effectiveness has also been made more
evident. The following diagram shows this linkage.

• Reviews and reports key
institutional assessment
information including the
strategic plan,
performance funding,
campus climate, student
learning and division
assessment reports.
Director of IR and
Assessment & Institutional
Effectiveness Committee

Planning and Budget
Committee

• Uses reports provided by the
Institutional Effectiveness
Committee in conjunction with
additional resources, such as
financial updates, to generate
guidance on university
operations and strategy

•As an executive level
committee, develops and
proposes the budget to the
President using Planning
and Budget Committee
input and other data.
Budget Planning Team

The Planning and Budget Committee (PBC) has increased its focus on budget
transparency through the leadership of Mr. Guilbert Brown, Vice President of Finance
and Administration. The Planning and Budget Committee includes 25 members from
faculty, administration, trustees, students, and staff. Originally developed to construct the
Strategic Plan, the committee spent much of the last year evaluating ideas to contain
expenses and generate new revenue, consistent with the University’s mission and goals.
Presentations on Edinboro’s current financial position are regularly provided to the
committee; the PBC also receives updates on progress regarding to the Strategic Plan and
Performance Indicators, as provided through the Director of Institutional Research and
Assessment. This type of information is to inform the PBC as decisions are made
regarding updates to the Strategic Plan and for making resource allocation
recommendations. This information flow will be expanded as the IEC’s systematic
review of the elements of the Assessment Plan continues.
As discussed earlier in this report, the Budget Planning Team (BPT) was formed since
the time of the site visit in 2014. This expanded structure was based on a recognition that
a more focused, executive-level group was needed to assimilate information from the
PBC and other sources to develop and evaluate budgets for recommendation to the
President and Council of Trustees. (BPT Charge and Membership)

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Continued Institutional Assessment and Improvement
Beyond the work noted above, other institutional assessment practices have both
continued and improved at the University.
For instance, it is recognized that the University’s Strategic Plan (2013-2018)
encompasses those goals most critical for the advancement of the University for meeting
its mission. Likewise, Performance Funding Indicators are important to University
success, but also reflect factors of strategic importance to the State System, of which
Edinboro is a member. Therefore, both of these areas are integral to defining what is
assessed at the University to ensure institutional improvement.
To address the visiting team’s recommendation (Standard 1) to systematically monitor
the strategic plan on a systematic basis. A dashboard was developed with metrics to
assess the goals of the Strategic Plan to better inform PBC evaluations and executive
leadership team decisions. This will allow for adjustment and focus to those areas with
high need. Recommendations on areas of need will also be key for the Budget Planning
Team as they will recommend budgets for the each fiscal year. Some of these measures
include: target graduation rates for the institution, colleges, and programs (Strategic Plan
Goal 1, Objective D), target number of new applicants (SP Goal 3, Objective C), and
target retention numbers (SP Goal 3, Objective D). The measures are updated at various
times throughout the year. (Strategic Plan Progress Report) The strategies and tactics
associated with the Plan are still in place and as their implementation continues; the goal
is for the Director of Institutional Research and Assessment and the Institutional
Effectiveness Committee to monitor achievement using the dashboard.
Also since last year, there has been new focus on defining more appropriate institutional
metrics associated with performance funding elements. The measures are split amongst
categories of student access, student success, and stewardship. Therefore, the metrics are
important, not just due to the impact on funding, but by nature they are essential to
Edinboro’s institutional success and support State System priorities. President Wollman
has dedicated significant effort to ensure Edinboro’s focus on these measures, including
negotiating the optional measures chosen for the university. As shown above, the
measurement and evaluation of performance funding metrics are central to the work of
institutional assessment. (Performance Funding Reports for FY13 and FY14)
As another example of institutional assessment in practice, EU has recently been
recognized by the Chronicle of Higher Education as a “Great College to Work For.”
While the accolades are welcomed, the instrument was introduced by the President to be
a legitimate catalyst and barometer for campus climate and improvement. President
Wollman has held numerous campus focus groups and forums to review the results and
get feedback on needs. (Great Colleges Invitation to Focus Group, Invitation to Forums,
Summary Presentation for Forums) An assessment of these findings led to a series of half
day workshops in fall 2014 provided to all employees on customer service improvement,
an initiative consistent with fulfilling Strategic Plan Goal 4.C. Edinboro will continue
17

this process in the future and has set a target of being recognized in three new survey
areas by 2018.
As discussed above, Edinboro continues its commitment to ongoing institutional
assessment. Beyond that presented above, many examples of assessment recognized by
the 2014 site team continue at Edinboro, including: consistent updating of TracDat to
manage planning and assessment data, implementing the National Survey of Student
Engagement (2014, 2015), participating in Sightlines (2014), participating in the Great
Colleges to Work For survey (2014, 2015), and a new Advising Quality Survey (2014,
2015).

Summary and Conclusions
Edinboro University is a sound, financially viable institution committed to
excellence, student success, and continuous improvement through assessment.
Through its decennial MSCHE self-study process, EU has gained a greater
understanding of its challenges and has developed and implemented strategies for
improvement. Through this Monitoring Report, EU has addressed the MSCHE
Commission’s concerns as stated in Edinboro’s Statement of Accreditation Status.
The University believes that it has provided strong evidence of compliance with
Standard 3, and has demonstrated continued development and implementation of
activities associated with Standard 2 and Standard 7. Briefly summarized,


EU has provided evidence to show that the financial status of the
University was not accurately represented to the 2014 visiting team by
the then CFO. Unrestricted net assets were greatly understated and did
not reflect the significant assets later shown to be available.



The budget deficit reported for FY 2014 to the 2014 site visit team was
significantly larger than was actualized at year-end closing. The projected
deficit of $5.5 million was shown in audit to be approximately $110K for
the fiscal year.



The budget projections for fiscal years 2015, 2016, and 2017 were greatly
overstated to the 2014 visiting team by the then CFO. These projections
failed to incorporate millions of dollars in E&G expense savings. This
monitoring report presents multiple budget scenarios demonstrating
much more favorable budget outcomes under reasonable assumptions. In
all cases, the individual year and cumulative (through 2020) net
operating surpluses (or losses) are easily within the scope of the
institutions net assets.



New budget and financial processes have been established since the
Commission decision, further strengthening the University’s ability to
understand and control its financial future.
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

The enrollment management system has been strengthened with the
addition of new leadership in key recruitment and retention areas, and
the development and improvement of strategic enrollment management
plans at both the undergraduate and graduate levels.



The division of Academic Affairs has formalized its plans for the
University’s academic program array and has aligned faculty personnel
planning accordingly. There is a clear link between enrollment
management, academic affairs planning, and institutional financial
planning.



The link between assessment, planning, and budgeting has been
strengthened through improvements in existing structures and the
creation of new working groups and teams.

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List of Exhibits
(All exhibits are PDF documents unless otherwise indicated.)
Exhibit 1 – COT Presentation Sep 2014
Exhibit 2 – Financial Report (FINRPT) FY14 to PASSHE (Spreadsheet)
Exhibit 3 – COT Presentation Jul 2014
Exhibit 4 – EU Audited Financial Statement FY14
Exhibit 5 – FY15-17 Budget Projections (March 2014)
Exhibit 6 – FY15 Budget Summary
Exhibit 7 – FY15 Q1 Closing
Exhibit 8 – FY15 Q2 Closing
Exhibit 9 – Financial Report (FINRPT) FY13 to PASSHE (Spreadsheet)
Exhibit 10 – Gift and Endowment Balances (Spreadsheet)
Exhibit 11 – All Faculty Meeting Presentation Oct 2014
Exhibit 12 – PASSHE Financial and Operations Dashboard
Exhibit 13 – Budget Planning Team (BPT) Charge and Membership
Exhibit 14 – Budget Planning Team (BPT) Meeting Agenda Nov 4 2014
Exhibit 15 – Budget Planning Team (BPT) Review Materials Nov 4 2014
Exhibit 16 – Budget Planning Team (BPT) Meeting Materials Nov 18 2014
Exhibit 17 – Planning and Budget Committee (PBC) Meeting Agendas
Exhibit 18 – MOU between EU and IUP
Exhibit 19 – Academic Affairs Program Array and Personnel Plan
Exhibit 20 – Shared Services Meeting Agenda
Exhibit 21 – Net Revenue Analysis by Department AY2013-2014
Exhibit 22 – Net Revenue Analysis by Department Fall 2014
Exhibit 23 – Retention Plan
Exhibit 24 – Undergraduate Strategic Recruitment Plan
Exhibit 25 – Weekly Admissions Summary Feb 16 2015 (Spreadsheet)
Exhibit 26 – PASSHE Enrollment Summary Report Feb 2015
Exhibit 27 – Graduate School Strategic Enrollment Management Plan
Exhibit 28 – SEM Team Charge and Meeting Agenda Jan 30 2015
Exhibit 29 – SEM Team Meeting Agenda Feb 20 2015
Exhibit 30 – Sample Enrollment Management Update (Spreadsheet)
Exhibit 31 – Porreco College Summary
Exhibit 32 – 2013-2018 Strategic Plan
Exhibit 33 – Budget Model (Spreadsheet)
Exhibit 34 – Deferred Maintenance Projects Feb 24 2015
Exhibit 35 – Budget Planning Team (BPT) Meeting Agenda Nov 18 2014
Exhibit 36 – Strategic Plan Progress Report
Exhibit 37 – Institutional Effectiveness Committee (IEC) Charge and Role
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Exhibit 38 – IEC Assessment Plan Review Schedule
Exhibit 39 – Edinboro Performance Funding FY13 Report
Exhibit 40 – Edinboro Performance Funding FY14 Feb 2 2015 Update
Exhibit 41 – Invitation to Focus Groups for Great Colleges to Work For Results
Exhibit 42 – Invitation to Great Colleges to Work For Forums
Exhibit 43 – Great Colleges to Work For Focus Group Results

21