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IU Officials Point to Rocky Predictions for the Future

Budget officials say, while the school is currently financially sound, increasing cost and a poor economy could mean IU is heading for rough times.

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Photo: Indiana University

Indiana University's Bloomington campus remains the largest in the system.

In a presentation to the Board of Trustees, IU Chief Financial Officer Neil Theobald said the university has hit a high water mark in terms asset generation.  He says increasing healthcare cost and an aging faculty are cutting into the bottom line…  at the same time, he notes limits on tuition increase and increased pressure on other income sources are slowing down revenue streams.

Theobald says the university’s health care cost could double to over 300-million dollars in the next few years.

“As we try to be as affordable as possible,” Theobald said, “we are trying to increase the revenue on the tuition side as little as possible.”

IU Finance Committee Chairman Tom Reilly says the university has been relatively fortunate in recent years in having a number of strong revenue sources… including state appropriations, tuition, and research grants.  He also notes low interest rates have allowed the university to take out necessary bonds without overburdening the school with debt.  However, Reilly says many of these funding sources are drying up and are no longer able to provide the same level of support.

“A lot of those revenue items are gonna slow down their rate of growth and maybe some of them might even turn negative.”  Reilly said. “And on the other side, there are certain expense items that are gonna continue to move up.”

The university has started a new benchmarking project which is designed to identify additional cost cutting measures by comparing IU operations with those of other types of businesses.

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