“William & Mary continues to exceed expectations in its engagement and philanthropy efforts as the university seeks to increase scholarships support, advance teaching and athletics excellence and build on its tradition of educating leaders.”
Samuel E. Jones ’75, M.B.A. ’80
Senior Vice President for Finance & Administration
Fiscal Year (FY) 2018 was a time of excitement for William & Mary. While the university recognized Taylor Reveley’s remarkable tenure as president and wished him well in his retirement, it also celebrated the arrival of Katherine A. Rowe as our 28th president. The 50th anniversary of the university’s first residential African-American students and now the 100th anniversary of coeducation have provided a time of reflection on how far William & Mary has come, and how far it must go to be a stronger and more inclusive community, where diverse perspectives are welcome and valued. Academics remain at the heart of the institution with the ongoing implementation of a revised undergraduate curriculum and expansion of online offerings to better meet the needs of today’s workforce. Finally, the For the Bold campaign continued its relentless march toward a $1 billion fundraising goal, providing critical endowment and discretionary funds in support of the university’s highest priorities.
FY 2018 Overview
William & Mary’s economic health continues to reflect its ability to recruit exceptional students, to raise revenue through tuition and fees, grants and contracts and philanthropy, and to reallocate funds to support the university’s highest priorities. As a result, despite having to fully absorb a reduction in state support that began in FY17, the university remains in a solid financial position.
William & Mary continues to attract, admit and retain top-caliber students even as we compete against the most selective public and private institutions in the country.
Freshman applications to the university continue to be strong, with 14,644 students seeking admission for fall 2018. With an incoming class size of 1,546 students, William & Mary has almost 9.5 applicants for every student enrolled. Given its robust applicant pool, the credentials of admitted students remain strong. These statistics, coupled with the university’s academic reputation, suggest a strong continuing student demand into the future. Similarly, William & Mary’s Virginia Institute of Marine Science (VIMS) continues to see significant success in its academic, research and advisory programs, particularly in high-profile areas such as coastal flooding, sea-level rise and water quality.
University programs are supported from a variety of sources, including state funds, tuition and fees, auxiliary enterprise revenues (auxiliary enterprise activities being those programs that receive no state support such as residence life, food service, athletics, etc.), federal grants and contracts and private funds. This diversity of funding is critical to William & Mary’s overall financial health.
The Commonwealth of Virginia provides partial operating support for the university’s academic programs as well as need-based aid for Virginia undergraduates. The level of state support for operations is a function of general economic conditions and the priority assigned to higher education by the governor and General Assembly as they consider competing demands for commonwealth resources. After ending FY16 with a revenue shortfall, the commonwealth implemented reductions in state support for all public colleges and universities as well as most state agencies. For William & Mary, the actions resulted in one-time reductions in both FY17 and FY18, as well as a base operating reduction for FY18 of approximately $2.2 million, or 5 percent of the state’s base allocation. Despite those reductions, other revenue sources remained strong largely mitigating the impact to the university overall. In addition, the 2018-2020 Appropriation Act adopted by the General Assembly and signed into law by the governor provides significant new investments of state general fund support to William & Mary and VIMS over the course of the upcoming biennium.
Over the last year, the university maintained the William & Mary Promise, an innovative operating model that enhances the quality of a W&M education while improving predictability and affordability for in-state undergraduate students.
Key pieces of the model include improved predictability through a guaranteed four-year tuition for in-state undergraduate students, financial aid for qualifying low- and middle-income Virginia families, more enrollment slots for Virginia students and additional resources to recruit and retain the superb faculty crucial to continued academic excellence.
FY18 budgets were developed within the context of the university’s strategic planning process and the Six-Year Plan as approved by the Board of Visitors. As a result, expenditures in support of the university’s academic program included:
- Infusing significant investment in student financial aid for in-state undergraduates resulting from an increasingly diverse student body along with changes in federal financial aid guidelines.
- Providing merit-based salary increases averaging 3 percent for both faculty and staff in order to
maintain competitiveness in the marketplace.
- Maintaining and enhancing the quality of academic programs through support for a new undergraduate curriculum and expanded online program offerings.
- Recognizing the work of the Task Force on Race and Race Relations, an additional $500,000 was
allocated to recruit faculty whose experiences and backgrounds will increase student engagement and advance diversity and inclusiveness. This funding, managed through the provost’s office, is in addition to $600,000 allocated for this purpose in FY17.
- Adding support for the evolving engineering and design program.
Broadly, FY18 expenditures support the university's strategic priorities as well as those of the commonwealth, including expanded aid for low- and middle-income Virginia families as well as the goal to balance revenue need with student affordability and continue to support efforts to raise private funds and seek other revenue sources.
In support of these investments, William & Mary continued to identify opportunities for academic and business innovation, allowing the university to reallocate $2.65 million to higher priority activities.
How is W&M's operating revenue spent?
Operating expenses, shown below, are divided among the following categories:
Instruction: Instructional faculty, departmental operating costs
Research & Public Service: Targeted, state supported research, community service activities
Academic Support: Library materials, access and services, information technology, academic administration
Student Services: Registrar, admissions, financial aid administration, career services, student organizations, etc.
Institutional Support: Executive management, fiscal services, human resources, police, purchasing, fundraising, etc.
Operation & Maintenance: Buildings/grounds maintenance and repair, plant personnel, utilities
Student Aid: Grants awarded to students to offset their cost of attendance
Auxiliary Enterprises: Dormitories, food services, parking and transportation, recreation centers, student health services
Continue reading about W&M's performance:
This report provides a consolidated view of the financial statements of the university and its related foundations. While this requires a merging of William & Mary’s unaudited statements with the audited statements of the various foundations, it provides a timely and complete assessment of revenue, expense, assets and liabilities. While the university’s statements remain subject to audit by the state auditor of public accounts, we do not anticipate any significant changes to the consolidated statements as presented.