Shelbie Harris
News Editor
Despite a decrease of nearly five percent in total student enrollment for the fall 2015 semester, Idaho State University’s unrestricted net position for fiscal year 2015 exceeds $109 million.
According to audited financial statements for ISU, revenues have exceeded expenses for the past nine years, and the unrestricted reserve fund is larger than both Boise State University’s and the University of Idaho’s.
“I know that it is strongly recommended state institutions have a rainy day fund,” said Blake Youde, chief communications and legislative affairs officer for the Idaho State Board of Education (SBOE). “In terms of the accepted general accounting practices, [state institutions] should have a couple months of reserve.”
Unrestricted net assets consist of assets available for expenditure by the institution for any lawful purpose, according to ISU’s audited financial statements. Reserves in an organization act the same way your personal savings account might.
The statements also indicate an increase of nearly $70 million over the past 10 years, with the largest increase of $19 million occurring last year.
“There are a number of obligations that will eat up that amount,” said Brad Batiuk, assistant vice president of finance and administration and budgeting officer at ISU. “We have debt payments and a number of things we have to fund. We go through an exercise with the State Board to try to determine the actual available balance that can be put towards strategic initiatives on campus.”
One strategic initiative members of the ISU administration mention frequently is deferred maintenance.
According to a document posted to the ISU facilities services website, “Deferred Maintenance is maintenance work that has not been performed due to a labor shortage or lack of budget. From a budget perspective there is no written guideline for the difference between maintenance and deferred maintenance.”
“A list was originally put together by the ISU facilities staff looking through various buildings, and we came up with a document that’s 2,000 pages or something,” said Phil Moessner, associate vice president of ISU facilities services. “That document was put together in 2012 with numerous line items of things that need to be done or have been put off for a period of time and need to be done within the next five to 10 years before it fails on its own.”
The 2,000 page document referenced by Moessner indicates ISU has a deferred maintenance amount of $352 million.
A potential issue with quantifying the amount of deferred maintenance is that it changes constantly from one day to the next.
“It’s a constant moving target,” Moessner said. “As we do construction projects, we may be doing something new to the building or some of it may address deferred maintenance.”
The SBOE requires a reserve fund minimum of five percent of operating expenditures. Additionally, the Government Finance Officers Association (GFOA) recommends, “at a minimum, that general-purpose governments, regardless of size, maintain unrestricted fund balance in their general fund of no less than two months of regular general fund operating revenues or regular general fund operating expenditures.”
For fiscal year 2015, ISU’s operating expense was roughly $229 million. This would indicate the five percent minimum for reserves would be roughly $11.5 million and two months of regular operating revenues would mean the reserve should total at least $38 million.
Of the total $109 million unrestricted net assets, some amounts are obligated or designated to other items such as debts, equipment replacements and academic programs.
The obligated amount totals $31 million and the designated amount totals $43 million, according to Batiuk, leaving a balance of about $35 million reported to the board for fiscal year 2015.
Students at ISU think the administration could appropriate the remaining free reserve balance in ways to improve their academic experience such as purchasing the land soon to be available by the demolition of the old hospital, improved WiFi in various buildings on campus and better food options.
“What are we doing with all this money?” asked Jodi Dunn, an ISU student in the graduate program, adding, “Oh yeah, nothing.”
Without seeing the financial statements and the associated numbers, President of ASISU, Makenzie Smith, said she was unable to comment on possible allocations of the reserve fund, however, Jordan Withers, member of the finance committee and senator for the division of health sciences, offered his insight regarding how the reserves are spent.
“I believe funds like this are held to ensure students receive necessary advancements to their education while adhering to the established financial goals of the university,” Withers said.
