March 22, 2013 Revenue Generation Task Force Meeting
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March 22, 2013 Revenue Generation Task Force Meeting

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  • http://www.eab.com/Research-and-Insights/Community-College-Forum/Custom/2011/05/Responding-to-Budget-Cuts-with-Alternative-Sources-of-Revenue
  • The Education Advisory Board catalogues ideas for enhancing alternative revenues supplemental to the core income sources of tuition, research, and development. Knowing not every idea is suitable or every institution, this initiative endeavors to help university leaders understand a full range of activity across higher education and sure they are not overlooking suitable to local culture and physical assets.
  • Notes from phone call with Keppler (3-21-13)LSU Residential Life SnapshotSix thousand students presently live on campus. Eighty-five percent of freshmen live on campus. Research indicates the 15 percent of freshmen that live off-campus chose to do so for various reasons (independence, campus is within close proximity of family home, etc.).  Requiring Freshmen to Live on Campus…Currently, requiring freshmen to live on campus is not feasible, as LSU residence halls have reached capacity with more than 700 students on a waiting list. Requiring freshmen to live on campus would not generate more revenue; it would be a revenue neutral decision at this time. If you require all freshmen to live on campus, it would force LSU to require upperclassmen to move off campus after completing their first year. This is a concern for both in- and out-of-state undergraduate and graduate students, as well as students without vehicles.Revenue will only grow by increasing the number of beds.
  • Notes from phone call with Dr. Keppler (3-21-13) Department of Residential Life: Vision 2020 Strategic Plan, http://studentlife.lsu.edu/sites/studentlife.lsu.edu/files/attachments/Vision%202020%20-Update%201-2012.pdfHousing Master Plan: As LSU Residential Life completes a residence hall’s renovation, it takes another hall “off line” to begin its renovation. In fall 2012, LSU Residential Life completed the renovation of Laville Honors College In fall 2013, Annie Boyd Hall will re-open, adding 160 beds. New Residence Hall projectIn August 2015, LSU Residential Life will introduce a new residence hall to grow inventory by 300 to 350 beds. LSU Residential Life also has plans for the installment of another new residence hall in 2016, with approximately 300-350 beds. At this point (in 2016), Dr. Keppler believes more than 85 percent of freshmen will live on campus, and there will be more upperclassmen and graduate students living on campus due to the increase in inventory (beds). Dr. Keppler is very interested conducting a tour of one of the newly renovated facilities, particularly East Laville.
  • Knowledge is powerUpfront preparation is crucialSelection of assets and projects must be driven by holistic policy goalsTransparency, terms and timetableEnsure investor confidence with clear, structured processInvestor data room should have as much information as possibleWell-vetted agreement; flexible methods of meeting criteriaFixed yet realistic timetable for transaction executionStakeholder communications strategy Early engagement with political and community leaders to shape issue and concerns Political risk is a major bidder concern Identify and cultivate public private partnership champions, spokespeople and supporters Public agency must be the steward of public trustManaging the message and expectations Clear communication of policy objectives to relevant organizations and the general public Seek to understand before being understood Invite supporters and potential opponents to the table Leave no question unanswered Proactively educate the mediaMonetary value + favorable market conditions + political will = SUCCESS All successful transactions require each of these elements The best advisory team should have constant knowledge of these three variables

March 22, 2013 Revenue Generation Task Force Meeting Presentation Transcript

  • 1. REVENUE GENERATION TASKFORCE MEETINGMarch 22, 2013 | 3 to 5 p.m.LSU AgCenter, 214 Efferson Hall
  • 2. Lee Griffin, Finance and Revenue Sub-Committee Co-ChairWELCOME ANDINTRODUCTIONS
  • 3. Meeting Information3 This meeting is streaming live at:www.lsu.edu/tat For more information about this task force and theTransition Advisory Team visit:www.lsu.edu/lsu2015
  • 4. Today’s Objectives4 Hear from LSU Vice-Provost for Academic Affairs Gil Reeveabout online learning Discuss other universities’ revenue enhancement initiatives Review the Department of Residential Life’s Vision 2020Strategic Plan Discuss Vice Chancellor for Student Life & Enrollment Services Dr. KurtKeppler’s comments about the current and future state of LSU-BR’s on-campus housing Examine LSU property management Public private partnership trends in higher education Identify key priorities and recommendations to date
  • 5. Gil Reeve, LSU Vice-Provost for Academic AffairsONLINE LEARNING
  • 6. Dr. Christel Slaughter, SSA ConsultantsREVENUE ENHANCEMENTINITIATIVES AT OTHERUNIVERSITIES
  • 7. “Responding to Budget Cuts with AlternativeSources of Revenue” | Research Questions7 What initiatives are institutions planning on to generaterevenue given changing budget dynamics? What efforts have institutions already implemented? How successful have these programs been at generatingrevenue? What was the process involved in implementing theseinitiatives; who was involved, what was the timeline, whatwere the costs? How have institutions identified and assessed potential newrevenue streams?Source: Education Advisory Board
  • 8. Ideas for Enhancing Alternative Revenues forHigher Education
  • 9. New Educational RevenuesCapturing High-Growth Student Populations and Instructional Services9 International student recruitment Applied and professional master’s Distance learning and course licensing Summer and intersession blended learning Customized corporate training Testing and certification Distance learning articulation agreements Senior enrichment programs Faculty consultingSource: Education Advisory Board
  • 10. Academic Entrepreneurship InfrastructureCritical Capabilities for Identifying, Launching and Scaling Viable Programs10 Business planning support Fast-cycle program launch Cost-effective marketing Curriculum development Enrollment management Outsourcing and joint venture modelsSource: Education Advisory Board
  • 11. Branding, Licensing and AffinityExpanding Product Categories and Sellable Space11 Increasing branded merchandise demand Alumni, parent and community affinity programs “STEALTH” advertising and sponsorship Diversifying athletics revenuesSource: Education Advisory Board
  • 12. Auxiliary ServicesIncreasing Demand While Reducing Fixed Costs12 Premium-priced healthy and convenient foods Future bookstore Shared-cost luxury amenities Favorable vendor rebatesSource: Education Advisory Board
  • 13. Student FeesCharging for Convenience and Choice13 Convenience fees Sharing costs of inefficient scheduling Differential instructional costSource: Education Advisory Board
  • 14. Campus OperationsTurning Cost Centers into Revenue Producers14 Campus health center Selling administrative services Surplus goods disposal Sustainable energy purchase power agreementsSource: Education Advisory Board
  • 15. Facilities and Real EstateGenerating Cash Flow from Underutilized Space15 Event rentals Development of joint ventures Long-term leasing Asset acquisition and disposalSource: Education Advisory Board
  • 16. Dr. Christel SlaughterLSU TODAY
  • 17. Department of Residential Life
  • 18. Department of Residential Life 6,000 students live oncampus 85 percent offreshmen live oncampus Residence halls havereached full capacity 700 students on waitinglist Revenue neutral Would requireupperclassmen andgraduate students tomove off campusLSU-BR Campus Housing SnapshotCurrent Issues with RequiringFreshmen to Live on Campus
  • 19. Department of Residential LifeVision 2020 Strategic Plan19 Housing master plan Identified residence halls to renovate – as onerenovation completes, another hall is taken “offline”to begin its renovation. Fall 2012: Laville Honors College Fall 2013: Annie Boyd Hall (adding 160 beds) New Residence Hall Project 660 new beds August 2015: 330 beds 2016: 330 beds
  • 20. LSU Property Management
  • 21. An Analysis of Public Private Partnerships inHigher Education
  • 22. Public Private Partnership Overview22 Contractual agreement between a public agencyand private partner to achieve all, one or acombination of the following: Monetize an existing infrastructure asset Design, construct, finance, and/or operate andmaintain an infrastructure project Transfer risks A public private partnership is not an outright saleof a public asset.Source: William Blair & Company
  • 23. Advantages and Benefits23 Private sector financing Equity, longer-term debt and wide array of financing tools Design-build Reduced construction costs and faster project delivery Operations and Maintenance Savings Long-term Risk Allocation and Transfers that allow thepublic agency to better concentrate on its core functions Access to the best operational expertise and innovativetechnology Long-term contract provides tax benefits to private partnerthat can flow through savings to public agencySource: William Blair & Company
  • 24. Public Private PartnershipLessons LearnedValuation Execution Use of ProceedsInternal due diligence Thorough internal and external duediligenceLong-term: debt reduction,capital projects, pensionfunding, revenue replacementUpfront analysis/modeling Gradual increases in user fees Hybrids possibleUnderstand value-drivers Customer service impact Avoid spending upfrontproceeds for short-termpurposesRobust and transparent biddingprocessDon’t rush operational andtechnology transitionsCreate stakeholder valueManage bidder and stakeholderexpectationsValue for Money (VFM)Understand value of risk transferSource: William Blair & Company 24
  • 25. Public Private PartnershipLessons Learned (continued)Source: William Blair & Company 25 Knowledge is power Transparency, terms and timetable Stakeholder communications strategy Managing the message and expectations Monetary value + favorable market conditions +political will = SUCCESS
  • 26. Group DiscussionKEY FINDINGS ANDRECOMMENDATIONS TO DATE
  • 27. Save the DateNext Meeting:April 15, 2013LSU AgCenter, 212 Efferson HallLSU-Baton Rouge
  • 28. Lee Griffin, Finance and Revenue Sub-Committee Co-ChairADJOURNMENT