The Need for Institutional Fiscal Responsibility
Author: Institute for Higher Education Policy
Date: 2011-02-00
Type: Reports - Evaluative
Subjects: Higher Education,Economic Factors,Social Influences,Institutional Administration,Tribally Controlled Education,Black Colleges,Educational Finance,Money Management,Knowledge Level,Consumer Education,Resource Allocation,Student Loan Programs,Interpersonal Communication

Colleges and universities across the nation face a number of economic and social conditions that affect institutional operations. Limited financial resources due to the nation's economic recession, increased calls for improved degree productivity to meet civic and labor market demands, and shifting demographic patterns create a challenging environment for postsecondary leaders and place a premium on sound institutional practice. For minority-serving institutions (MSIs), these conditions challenge already restrictive operations and limited resources. For the past three years, the Institute for Higher Education Policy (IHEP)--with the support of USA Funds[R], the nation's largest student loan guarantor--has convened representatives from Historically Black Colleges and Universities (HBCUs), Hispanic Serving Institutions (HSIs), and Tribal Colleges and Universities (TCUs) to examine institutional practices and discuss how these practices relate to broader institutional goals such as financial literacy and retention. The symposium aims to broker stronger networks across MSIs, provide resources to enhance institutional services, and frame fiscal literacy and student success within broader policy contexts. Recent discussions at the symposium were driven by the underlying observation that postsecondary financial literacy efforts seldom view fiscal responsibility holistically--as a campus-wide discussion that ultimately requires linking student fiscal literacy with sound fiscal management at all levels of institutional administration. Thus, few efforts try to reach outside their natural constituencies when providing financially focused programs. Rarely do student-focused fiscal literacy initiatives intersect with discussions of overall institutional financial management, and not often are institutional financial management conversations accessible to campus practitioners with non-financial job functions. To build on the efforts of the symposium and keep the momentum going, this brief was commissioned to focus on the role of institutional financial management and provide an overview of tools for measuring institutional fiscal health. Fiscal health metrics are increasingly popular for measuring trends in institutional finance and alignment with strategic goals. They can provide a foundation for a campus dialogue on how best to meet institutional and societal goals for postsecondary education in challenging fiscal times. The brief reviews several tools used to assess institutional fiscal health, discusses the components of one widely used tool in detail, and concludes with a call for more campus-wide dialogues on fiscal accountability and responsibility. The information in this brief is meant to encourage institutions, both MSIs and non-MSIs, to revisit or begin meaningful conversations about assessing institutional financial health as a way to support student success. (Contains 8 footnotes.)