Thompson Rivers University has passed its latest budget and is expecting a surplus of more than $14 million — but that amount is less than anticipated.
TRU is expecting revenues of $233 million in 2019-2020, an amount that has grown due to a surging number of international students.
As a result of the international student growth, the university will spend more than $140 million of that revenue on salaries and $78 million on non-salary expenses.
Remaining is a $14-million surplus. While a surplus bodes well for the university, the figure is about $13 million less than what was projected a year ago.
The explanation behind the reduced surplus has to do with the balance the university is trying to strike between international enrolment — from where TRU gets 59 per cent of its tuition revenue — and what it spends on salaries.
Matt Milovick, TRU’s vice-president of administration and finance, said the university is scaling back its international student enrolment for the time being in order to stabilize.
To start, the university will close its summer programs to new international students.
“Last year, we had a very significant intake into the university in the summer semester and that was pretty overwhelming,” he said. “We managed it, but in certain schools they wanted to take a step back and evaluate.”
The latest report on enrolment shows 3,249 of the 9,184 students at TRU are international arrivals, a cohort that has grown by 25 per cent since last year.
The international student growth over the past couple of years has meant the university has had to hire more teaching staff to accommodate the influx. In this year’s budget, TRU has funded 80 new positions, although the university is not expecting to fill all of them.
At a recent TRU board meeting, Milovick said the increased compensation spending is something that “keeps us up at night.”
“I get concerned when there is a year-over-year change of $16 million. That’s a big number. We have to better understand and manage that number,” Milovick told KTW, noting the university has obligations under its collective agreement with faculty and education standards to maintain.
With compensation spending linked so closely with international students, the university has to keep a close eye on issues ranging from political instability to currency changes.
Milovick said international enrolments aren’t exactly stable and, because of that, the surpluses could disappear “overnight.”
Four years ago, the university had a Saudi Arabian student population of roughly 330. That number began to decline even before the Saudi government stopped paying the tuition for its students in Canada, Milovick said. Today, only a few Saudi students remain.
While the number of students from some countries have declined, the most recent surge is coming from India. Nearly half — 1,536 — of all international students now come from India. Other sources include China (520), Bangladesh (137), Nigeria (132) and Vietnam (81).
The university’s proposed smaller-than-expected surplus may affect how and when the university delivers on its planned capital projects.
Now, Milovick said, the university’s capital planning advisory group has plans for projects totalling about $240 million. Those projects would be funded by surpluses, reserves, government funding and donations.
But where will the money come from?
“That’s a good question,” he said at Friday’s board meeting.
One of the university’s capital projects currently underway, the Nursing and Population Health Building, accounts for $24 million of the $35 million in capital spending proposed for the coming year. The remaining spending will be for renovations to the newly purchased Upper College Heights residential development and various other projects, Milovick said.
All of the university’s diminished surplus will now go to those projects, plus approximately $20 million from its reserves.
To counter the ebb and flow of international students and compensation spending, Milovick said the university is conducting a financial sustainability exercise. The group behind that exercise met for the first time in March.
Despite the unpredictable factors with international students and compensation spending, Milovick characterized the latest budget as “good.
“It’s a growing university — certainly not without its challenges — but we’re in a pretty good spot,” he said.