Part Two: Economic Operations of the University Revenue and Operating Expenditures
E
CU is a significant economic force by virtue of its position as a major employer and purchaser of goods and services in the East. The impact of the university on the local economy can be measured, in some ways, by the amount of revenue it injects into the regional economy. In 2009, East Carolina University generated more than $696 million in revenue. Of this, $400 million was operating revenue, which came largely from student tuition fees (18.0 percent), patient services (20.8 percent), auxiliary services (12.4 percent), and grants and other contracts (5.9 percent). With the state appropriation of $242 million (accounting for 35.0 percent of the revenue), total revenue rose to $642 million. The remaining revenues came from gifts, interest earned, and other operating revenues. The 2009 state appropriation of $242 million shows a 10-percent decline from the 2008 figure of $268 million, thus reflecting the financial difficulties that the state continues to face. Despite these challenges, ECU is still the largest source of revenue in the region.
In terms of expenditure, in 2009, the university spent $695 million in operating expenses. A breakdown of the expenses into the respective categories shows that a majority of the expenses was for salaries and benefits (67 percent), followed by services (13 percent) and supplies and materials (10 percent). It is important to note that the $695 million total expense reflects the cash outlay in 2009; it does not include capital expenses. For the purpose of evaluating ECU’s economic impact, capital expenses will be evaluated separate from operating expenses because capital expense allocations are based on multiyear scheduling. Similarly, since salaries and benefits account for the largest share of the operating expenses, and employees’ expenses have problems of leakage from the regional economy—the expenses associated with the purchase of goods and services outside the region—salaries and benefits will also be examined under a different category. Thus, after making the necessary adjustments—taking out salaries and benefits—the remaining operating expenditure of the university in 2009 was $189 million.
2009 Revenue
2009 Operating Expenditures
Patient services $145,123.50
Salaries and benefits 67%
20.8% Student tuition and fees $125,070.00 18.0%
12.4% 5.9%
Other
7.9% (gifts, interest earned, other operating revenues) $56,336.70 35.0%
State appropriations $241,751.80
Total $695,669
14
Auxiliaries $86,465.60
Grants and contracts $40,921.40
Depreciation Utilities
3% 3% 4%
Scholarships and fellowships
10%
Supplies and materials
13% Services
Total $694,975