This week’s Financial FAQ:
Q: I understand that the college has a significant fund balance. Please explain what it is and whether it will be used to buffet the anticipated financial cuts from the state.
A: MCC does have a fund balance. One way to think of it is as a savings account. It is there to protect the college during a financial crisis.
SUNY guidelines suggest that community colleges should hold a fund balance equal to 10-15% of its annual operating budget. MCC’s current fund balance is approximately 14% of its operating budget.
State regulations require the College to have a balanced operating budget. Each year, as the college develops its budget, we assess our revenue sources (tuition, state aid and local share) vis a vis our anticipated expenses. Our fund balance is the revenue source of last resort; if tuition, state aid and local share are not sufficient to meet our anticipated expenditures (and they rarely are), we apply a portion of our fund balance to our annual operating budget. Every year, we use a portion of our fund balance to balance our operating budget. Our dual commitment is to have a balanced operating budget and to maintain the strength of our fund balance.
If you have a financial question that you would like answered, send it to <"mailto:marcom@monroecc.edu>. Administrative Services and College and Community Relations will work together to answer your questions in upcoming issues of the MCC Daily Tribune.
Heze Simmons and Cynthia Cooper
Administrative Services, and College and Community Relations
12/17/2008 |