3.10.1  

The institution's recent financial history demonstrates financial stability.

RATIONALE FOR COMPLIANCE JUDGMENT

The recent financial history of Nashville State Technical Community College (NSCC), as reflected in the annual Financial Reports (2004 [1], 2005 [2], 2006 [3]), demonstrates financial stability for unrestricted revenues and unrestricted net assets.  Total net assets for 2003-2004 [4] were $26,501,186.16, for 2004-2005 [5] were $29,016,258.59, and for 2005-2006 [6] were $31,441,868.02.  The total increase in net assets over the three-year period was approximately 32.47% [7], representing an annual average increase of 10.82%.  During this time period, the College was planning for migration from the SCT Plus software to Banner software, thereby setting aside funds to purchase and install the software.

The College’s total unrestricted revenues for the year ending June 30, 2006 [8] were $29,173,109.45; for fiscal year ending June 30, 2005 [9] were $27,642,144.69; for fiscal year ending June 30, 2004 [10] were $25,427,060.05.  The increase in unrestricted revenues of 26.7% [11] over the three-year period, which represents an annual average increase of  8.9%, demonstrates a consistent revenue growth.  The major causes for the increase are attributable to an increase in student fee collections of $4,555,412.64 and an increase in state appropriations of $811,100.00.   State appropriations increased 6.19% over the three-year period, representing an average increase of  2.06% annually, while revenue from student fees increased 50.60% over the three-year period, an annual average increase of 16.87%.  While state appropriations have been fairly static and have not kept pace with inflation, student fee increases coupled with stable enrollment have resulted in adequate financial support for the College and its programs.  Overall FTE student enrollment during this three year period increased 8.91% [12], indicating that students are willing to pay the increased fee rates. 

The total restricted revenues [13] as of June 30, 2006 were $9,466,760.63; for the year ended June 30, 2005, total restricted revenues were $9,729,487.89; for the year ended June 30, 2004, total restricted revenues were $7,963,273.61; total restricted revenues as of June 30, 2003 were $6,933,053.97.  Restricted revenues increased $2,533,706.66 between 2003 and 2006. This change increase was attributable primarily to increases in the federal Pell Grant and decreased National Science Foundation grant activity.  At June 30, 2006, 76.6% of restricted funds were in the area of Scholarships & Fellowships.  The remaining restricted funds are attributable to State Grants & Contracts and Private Grants & Contracts, and close-out of funds related to National Science Foundation awards that were expiring.

Endowments, with the exception of the Bennie R. Jones Memorial Endowment valued at $4,739.67 [14], are managed by the Nashville State Technical Community College Foundation. Detailed financial statements for the foundation endowment funds are available in the Office of the Vice President of Finance and Administrative Services.  On June 30, 2006, endowments managed by the Foundation totaled $215,298.16 [15].  The Foundation is a separate, tax-exempt entity organized and operated primarily as a fund-raising organization to supplement the resources that are available to the College in support of its programs. Since the majority of resources held and invested by the Foundation are restricted for use by or for the benefit of the College, the Foundation is considered a component unit of the College and is discretely presented in the College's financial statements. This information is audited in conjunction with the College's audit by the State of Tennessee Comptroller's Office, Division of State Audit. 

In summary, Nashville State Technical Community College has demonstrated financial stability through consistent revenue growth and consistent fund balance increases.