$10M expected loss from enrollment drop depletes 90% of FAMU’s performance funds

Performance funding in the State University System of Florida (SUS) is supposed to give schools an extra boost. But most of the performance funds that FAMU expects to receive will be used to plug the budget hole created by the projected drop in enrollment for 2016-2017.

FAMU expects to lose 920 students in 2016-2017, which will lead to budget cuts.

“The FY 16-17 budget has been prepared with an anticipated 920-student decline in enrollment,” the FAMU Division of Finance and Administration said in a budget workbook for the Board of Trustees (BOT). “The decrease in enrollment is expected to be off-set by reallocation of vacant positions, performance base funding, and budget adjustments to all divisions’ operating budgets.”

FAMU is anticipating about $11M in performance funding for 2016-2017. But the university won’t see much of a gain because it will have to use most of those funds to cover the money it's going lose from the enrollment decline.

“$10M of the $11M [in performance funding] was applied to what we called an enrollment gap,” BOT Chairman Kelvin Lawson said of the 2016-2017 budget at a committee meeting on June 9th.

That means the enrollment drop will deplete 90 percent of the total performance funds that FAMU is slated to receive.

Lawson added that he saw some problems in the 2016-2017 budget prepared by the administration. He said the administration hadn’t gone far enough to make the adjustments that were necessary.

“The revenue stream is dropping quickly and the expense line is relatively flat,” he said.

The Florida auditor general reported that FAMU lost $9.2M in tuition and fees due its enrollment drop in 2014-2015. The FAMU Division of Finance and Administration told the BOT that the university lost more than $9M after the enrollment decline in 2015-2016.