The Board of Trustees expressed satisfaction with the university's financial standing yesterday, at one point praising its foresight at reducing debt.
Bill Decatur, senior vice president for Finance and Administration, told the board's Resource Committee yesterday that Ohio University's viability ratio - a measure of whether the school could settle its debts immediately if necessary - has improved over the past four years.
Trustee Larry Schey pointed out after Decatur's presentation that several board members have been urging more careful use of debt over the past several years, and that he was glad to see those suggestions being implemented.
Decatur said his philosophy is to use debt strategically.
The important question for me when we consider debt is
'Are we using it to further the strategic mission of the institution?' Decatur explained. So from an absolute sense in comparison to the other Ohio publics our debt is certainly not out of line
but in comparison to the ratios ... that's our weakness.
The ratios Decatur referred to were in expendable net assets - funds the university has on-hand at any given time. Decatur said increasing OU's expendable net assets is a top priority. Because of a drop in investment income, the university's net income ratio, which measures profitability, is at a seven-year low.
Overall, Decatur presented good news to the board, showing OU's rating under Senate Bill 6 is 3.5. If an institution has a rating of 1.75 or lower under SB6 for two years, the state puts it under fiscal watch and can appoint a board to oversee a restructuring or re-budgeting for the school.
Board Chairman C. Daniel DeLawder said he was pleased with the report.
Great report. Progress
DeLawder told Decatur.
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Emily Grannis
