Laurentian University has budgeted $8 million in its 2024-2025 budget to transform its operations following nearly two years of insolvency earlier this decade.
The university presented its second post-insolvency budget at its April 26 board of governors meeting, with a small surplus of $500,000 projected for 2024-2025. That includes revenues of $201.7 million and expenses of $201.2 million.
(You can view the budget documents for yourself on Laurentian’s website).
For the 2023-2024 school year, Laurentian had projected an $8.2 million surplus.
The 2023-2024 school year ends on April 30, so the audited financial statements showing how the university actually did this current school year will be presented at a future meeting, typically happening in October.
The $8 million operational transformation cost in 2024-2025 includes $7.2 million in operating expenses and $800,000 in capital expenses, and covers the salary of a lead transformation officer to lead this project.
Transforming Laurentian’s operations could cost even more than that, though. A financial analysis projected that the costs for the first year of transformation implementation starting May 1 of this year as $8.8 to $13.6 million.
Laurentian said once it hires its lead transformation officer, “and a detailed review of the transformation roadmaps is completed, an updated financial forecast will be provided, as required.”
The university approved an operational transformation plan last November, a legal requirement following its late 2022 exit from creditor protection under the Companies’ Creditors Arrangement Act (CCAA).
Although he was not present at the April 26 meeting, Laurentian senate representative to the board of governors Dan Scott said in a statement read out at the meeting that the university must be vigilant about sticking to the lower estimate.
“I ask the board to ensure that the transformation budget is closely watched and to prevent it from ballooning for the sake of our responsibility as a publicly funded educational institution,” said Scott in his statement.
Sylvie Lafontaine, Laurentian’s vice-president of finance and administration, said she is personally committed to keeping an eye on the transformation budget.
This university’s new president, Lynn Wells, emphasized that “we need to see this work as not only required by the government, but critical to our future.”
Cambrian College also presented its 2024-2025 budget this week, showing a large impact from government cuts to international student applications.
However, Laurentian University is expecting a smaller impact on its enrolment numbers as a result of the international student situation, projecting an increase of 274 FTE (full-time equivalent) domestic students and a decrease of 150 FTE international students, for a total increase of 124 FTE students.
Most Laurentian international students are at the graduate level, which are not impacted by the new caps on foreign student visas.
Lafontaine said work on the 2024-2025 budget began last fall. The university said in a press release that multiple planning meetings were held with budget managers from faculties and administration, including union representatives.
“I believe that Laurentian is uniquely positioned as we invest in our transformation, invest in supporting our strategic plan and priorities and start delivering that experience for our students and researchers,” said Lafontaine.
She said she believes the budget is” a solid forecast for next year of what is needed for the university,” Lafontaine said. “It is based on finishing this year with a solid growth in our enrolment … It is a conservative projection, given the uncertainties from international student visas, and just the impact that could have on our capacity for recruiting new students.”
Laurentian’s budget takes into account the fact that domestic tuition fees continue to be frozen, although its out-of-province domestic tuition fees will be increased three per cent in the next school year, as will international tuition fees.
The university also approved a deferred maintenance budget of $8.5 million for 2024-2025. A press release said these projects will improve critical infrastructure (heating and ventilation, roofing, elevators, food service facilities, exterior stairs, and lighting).
Last year, Laurentian had approved $300,000 in its deferred maintenance budget to examine what it would take to close the long-closed Jeno Tihanyi Olympic Gold Pool. However, the 2024-2025 deferred maintenance budget does not earmark any new funds for the pool.
Although Laurentian exited insolvency in late 2022, it still has ongoing costs related to its insolvency.
The 2024-25 budget includes CCAA restructuring costs of $500,000 and represent the fees
and expenses of counsel to Laurentian, the monitor and its counsel, independent counsel to the
board of governors, with respect to the continued administration and implementation of the plan of arrangement.
Speaking of the CCAA, most of Laurentian’s creditors have still not yet been paid out. The creditors’ pool is to be funded by the sale of certain real estate assets to the province for up to $53.5 million. The budget document said Laurentian “does expect to complete the sale of some of these assets in 2024-25.”
Revenues for the university include $5.6 million in investment income, which is an increase of $1.4 million over the 2023-2024 budget.
Government funding is stable due to post-insolvency funding protection extended to Laurentian, which includes $2.3 million in enrolment corridor and SMA (strategic mandate agreement) performance funding.
Expenses also include labour costs, which include salary increases, filling vacant positions, progression through the ranks and new positions.
Laurentian has been on something of a hiring spree following the CCAA, when many employees quit on top of those cut as part of the insolvency.
The university expects to increase its workforce by 64.10 FTE positions in 2024-2025, which includes academic positions 33.9, academic support 16.8, administration 12.9 and ancillary 0.5 FTE).
“We need to address those critical staffing and operational needs, but also setting the financial foundations for next year,” said Lafontaine.
Laurentian University Staff Union (LUSU) president Tom Fenske said he wants to let the community know about the many job opportunities open at the university right now.
He said LUSU is actually heading into bargaining right now, and through “good bargaining, we’ll have a real good opportunity to turn a corner in regards to recruitment.”
Heidi Ulrichsen is Sudbury.com’s assistant editor. She also covers education and the arts scene.