An Overview of William & Mary's Financials

Stabilize and Move On
William & Mary’s Financial Reality

Fiscal year 2011 provided the College a reprieve from funding cuts as the Commonwealth of Virginia deferred additional state funding reductions until fiscal year 2012. One-time federal stimulus funds allowed for critical investment in programs and activities, which enabled the College to catch its breath after three years of state funding reductions; set the stage for balancing the 2012 operating budget; and implement selected aspects of its strategic plan.

The diversity of funding sources supporting William & Mary programs provided some level of stability amidst the general uncertainty surrounding national and state economies. While state funding as a percentage of the College’s operating budget declined to 14.8 percent, revenue from tuition and fees; self-supporting auxiliary activities such as residence halls and food service, grants and contracts; and private giving remained strong.

A rebound in endowment value that began in fiscal year 2010 continued through fiscal year 2011. By June 30, the consolidated value of endowments held by all the various entities supporting William & Mary and its programs totaled $624.7 million, an increase of 15.8 percent for the year, and a record high for the College. Strong investment performance across a diversified portfolio combined with the College’s ongoing fundraising efforts supported this result.

The College continued to construct new facilities in fiscal year 2011 with the opening of the School of Education and the Sherman and Gloria H. Cohen Career Center. Construction of the School of Education was primarily funded by the state and allowed the College to consolidate the School’s activities into a single facility. State-of-the-art classrooms combined with expanded meeting and program space support both the instructional and outreach missions of the School. The privately funded Cohen Career Center provides quality space at a prime location nestled between the Sadler Center and Zable Stadium. Its impact has been immediate, with student contacts increasing 54 percent in the first year.

Long-Term Plans

In the short term, fiscal year 2012 operating budgets approved by the Board of Visitors allow the College to address the full impact of base reductions in state funding. At the same time, budgets approved by the Board and The College of William & Mary Foundation continue to make targeted  investments to move the institution forward. The College is using all available revenue sources to support its various programs and activities while reducing budgets where appropriate.

Long-term planning is taking center stage as the College updates its strategic plan and responds to new state planning requirements. On July 1, the College submitted to the Commonwealth an initial draft of a six-year plan developed in response to the recently passed Higher Education Opportunity Act of 2011 (TJ21). This initial draft was discussed with a state-wide review committee, and a revised draft was then approved by the Board of Visitors during the September meeting.

The six-year plan recognizes William & Mary’s unusual position in the Commonwealth’s system of higher education. During the century since the College became part of Virginia’s public higher education system, the state has played a major role in building the College into what it is today—an internationally recognized educational asset of the Commonwealth. Governor McDonnell’s Higher Education Commission recognized this fact,  referencing “the Commonwealth’s commitment … to having a distinctive ‘public ivy’ at William & Mary.”

The College’s six-year plan is rooted in this commitment, the goals set out in William & Mary’s own strategic plan, and the objectives of the TJ21  legislation. Beginning in 2008, the College embarked on comprehensive strategic planning. The result has been a “living” roadmap, updated annually and  endorsed by the Board of Visitors, defining where the College needs to go and how best to get there. The six-year plan brings together our “public ivy” nature, reflected in our strategic plan, with the goals of TJ21.

The plan acknowledges that the Commonwealth will continue to play an important role in the College’s future, providing both operating and facilities support. However, we do not expect that the state will restore those funds lost since 2008. Competing pressures for resources, and a state revenue base that is driven solely by economic factors, will limit the dollars available to higher education. As a result, College-generated revenue, private support, and a focus on cost-effective service delivery must provide the resources  necessary to our success.

The College remains committed to its small size and human scale. Enrollment growth over the next six years will be limited to 200 additional undergraduates. The College will maintain its longstanding commitment to the Commonwealth of an undergraduate student body that is at least 65
percent in-state.

Priority expenditures within the six-year plan reflect the College’s commitment to people—students, faculty and staff. Given the lack of salary increases over the past several years and a growing gap from our benchmark institutions, support for faculty (5 percent annual) and staff (4 percent annual) salaries is the College’s highest priority. Undergraduate student financial aid is our second-highest priority, followed by support for the  increased enrollment, the marine science minor and graduate financial aid.

As noted above, the College’s six-year plan is informed by two factors: (1) William & Mary’s unique characteristics within the Commonwealth’s system
of higher education, reflected in the College’s ongoing strategic plan; and (2) objectives included in TJ21 legislation. The College’s particular educational qualities, offering a “public ivy” education focused on engaged learning, offers an invaluable source of developing the state’s (and  country’s) future leaders in every walk of life, from business to law, politics to finance, science to the arts, and education to medicine. In formulating the College’s six-year plan, we build on that foundation of excellence while remaining cognizant of the state-wide objectives included in the TJ21 legislation.