(The Center Square) – The operating loss for the Louisiana State University System hit $736 million for fiscal year 2023, up from $164 million the year prior, according to a recent audit.
Louisiana Legislative Auditor Mike Waguespack published an audit for the Louisiana State University System this week that covers finances between July 1, 2022 and June 30, 2023.
The report released on Wednesday shows as the challenges of the COVID pandemic waned, LSU increased its net position in 2023 by $185 million.
While total operating revenues increased by $78 million from the prior year, operating expenses jumped by $650 million, resulting in an operating loss for 2023 of $736 million, or about $572 million more than in 2022. Total operating revenues were approximately $2.4 billion, compared to about $3.1 billion in operating expenses.
At the end of fiscal year 2023, the system had a net position of just over $1 billion.
“The overall increase in operating expenses is largely attributable to an overall increase in appropriations for expenditures, increased research activity, utility costs increases, and higher employee benefit and retirement costs,” auditors wrote. “Partially offsetting these … expenses were decreases in scholarship and fellowship costs.”
The system reported an average increase in net tuition and fees of 4.6% and an increase in state appropriations of 6.2% compared to fiscal year 2023. Enrollment during the fall 2022 semester was 58,517, or an increase of 1,892 from the year prior.
Net tuition and fees, which represent the largest operating revenue behind nongovernmental grants and contracts, was $593 million in 2023, a figure that has slowly increased from about $500 million in 2019. Instruction, the largest operating expense, was nearly $948 million in 2023.
“Increases in operating revenue primarily occurred due to enrollment increases and online program expansion, and increases in both federal grants and contracts and nongovernmental grants and contracts,” according to a report summary.
Nonoperating revenues increased 48.2% in 2023, going from a little over $500 million to nearly $1 billion, driven mostly by gifts and net investment income. While state appropriations increased slightly to $506 million, gifts totaled $204 million and net investment income was about $62 million in 2023.
“If you include non-operating revenues and expenses, the System shows income before other revenues, expenses, gains, and losses of $107 million for fiscal year 2022-23,” auditors wrote. “This level of income represents a decrease of $274 million compared to the $381 million recognized in the previous year.
“This decrease can be attributed largely to the increases in operating expenses outpacing the increased operating and non-operating revenues,” the report read. “Other revenues, expenses, gains and losses which include non-recurring items such as capital appropriations and gifts were $78 million in 2023 compared to $86 million in 2022.”
