In order to cover deficits, Temple’s Office of University Housing and Residential Life will most likely need to raise room and board rates.
Ken Kaiser, Temple’s chief financial officer and treasurer, recently told The Temple News by email that future room and board rate increases were likely.
“I do not think Housing will be able to generate enough alternative revenue to eliminate the need for rate increases for the foreseeable future,” Kaiser wrote in the email last week.
The office faces a projected deficit of more than $2 million for Fiscal Year 2015 and will receive more than quadruple the university funds to support it, in the form of subvention, than it received in Fiscal Year 2014, amounting to nearly $1.3 million.
In a February meeting of the trustees’ Student Affairs and Campus Life and Diversity committees, the trustees approved increases of about four percent to room and board rates after viewing the housing office’s budget and realizing it needed more revenue.
Kaiser said at the meeting that the new rates were “being held to the lowest possible levels” except for “very strategic increases based on demand.”
He told the trustees the goal is to “make housing profitable by 2018.” According to the conclusion to the proposed budget, this can be achieved by “controlling expenses while implementing new efficiencies and diversifying revenues.”
At the February meeting, now-former trustee John Campolongo asked Associate Vice President for Student Affairs Michael Scales what other revenue could be brought in to forestall future room and board increases.
Scales mentioned the newly built Morgan Hall and said he was hopeful it could draw revenue from hosting conferences and other events.
“It is one of our objectives to grow revenue as much as possible,” Scales said in a phone interview last week. “We will wean ourselves off [of university subvention].”
Scales said Temple’s most successful conference venture is with Teach for America, for which visitors stay in 1300 residence hall or Temple Towers.
“Morgan isn’t defining our conference programs,” Scales said. “It just added to it.”
Morgan Hall, he said, could generate more interest in higher-end conferences, but that market was still developing. There is hope that visitors to Philadelphia will look at Temple as a “good alternative” to Center City hotels, Scales added.
“Say there’s a group that wants to come to Philadelphia for a conference and doesn’t want to pay $200 a night,” Scales said. “They could come stay with us for $60 a night.”
The building’s 27th floor boasts a view of Center City and has hosted trustees meetings and luncheons honoring notable alumni. Scales declined to reveal plans for utilizing that space, but he said the most popular space in Morgan was on the third floor of the dining complex.
Conference revenue is listed as “other income” on the housing budget and amounted to $1.6 million for the office in Fiscal Year 2014. The February projections listed $1.8 million in conference revenue for Fiscal Year 2015.
Kaiser said the conference revenue would not be enough to prevent a future increase, but noted that “ some schools that do generate a significant amount of income from conferences.”
Under Temple’s decentralized budget plan, arms of the university are responsible for their own revenues and expenses. Some offices, like housing, receive university subvention, or money from the central body of the university to help cover expenses.
Offices must also pay their share of costs incurred by the central body of the university. The last fiscal year, the housing office paid $2.5 million in sharing central costs, but this fiscal year’s share of central costs will be about $4 million.
Joe Brandt cant be reached at firstname.lastname@example.org and on twitter @JBrandt_TU.