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Update on Budget and Planned Raises

April 4, 2022

Dear members of the SLU community,

I write today with favorable budget news, including updates on one-time bonuses for our lower-paid faculty and staff, and planned raises for next fiscal year.  

We anticipate we will end this year in a strong financial position due to growth from academic enrollment and SLUCare, substantial one-time revenues, carefully managed expenses, and accurate budget projections. As a result, we will be able to invest further in our most valuable resource – our employees – and plan prudently for the years ahead.  ​

The overall budget picture

The FY22 budget can best be understood in terms of our normal operating budget – the revenue and expenses that continue from year to year – supplemented by a set of substantial one-time revenues.

At this point we project ending the fiscal year with an $18.5M surplus. A budget surplus is, without a doubt, a good thing. It is nevertheless essential that we are wise in our use of any non-recurring funds, since they are by definition not predicted to repeat in FY23 and future years. As we look ahead, we must also continue the momentum we have built around graduate and undergraduate enrollment growth and other recurring revenue opportunities.  

Planned compensation increases for FY23

For FY23, we have designated a 4% salary increase pool, composed of 2% unit merit increases and 2% for market and equity adjustments. This applies to staff and to all full-time faculty who are not included in the SLUCare compensation plans. Provost Lewis, Vice President Jacobs, and Vice President Luna will share additional information in emails to their particular employee groups soon.

Acknowledging revenue growth in key areas

The above compensation increases and the recent restoration of the University’s 403(b) retirement plan match to 8% were made possible by our community’s collective work to increase revenue in key areas.  

The normal operating budget – excluding one-time revenues that I will discuss more below – shows this year’s enrollment growth accounts for nearly $6M in revenue above budget projections. In addition, SLUCare’s net revenue exceeded projections by nearly $5M.  

I want to thank all of you for your contributions to this growth, which is a testament to your skill and hard work. You are laying a foundation that will sustain the University’s future.

Managing one-time revenues

It would not be wise to plan continuing expenses (e.g., additional increases to the retirement match) based on one-time revenues. Some of the one-time revenues, like the CARES Act funds, have already been distributed directly to students or allocated to pay for COVID-related expenses. The largest portion of the $18.5M surplus ($15M) consisted of donations that are directed to the construction of the O’Loughlin Family Champions Center and the Jesuit Center.  

We plan to utilize the remainder of the surplus in two key ways:

Further updates to the 403b retirement match

As you know, the 403b match moved from 6% to 8% in January, 2022. The Board of Trustees has agreed to again review the 403b retirement match in the fall, after undergraduate and graduate enrollment and net revenue for FY23 are established. As we have previously indicated, any further updates to the retirement plan match would go into effect on January 1, 2023.

I am grateful to all of you for your contributions to the University’s continued growth. We are exceeding expectations in an environment in which many are struggling. We could not do this without your care for our community and commitment to our mission.  

Sincerely,

Fred P. Pestello, Ph.D.
President