VIRGINIA BEACH Va.
Regent University plans to more than double its undergraduate enrollment this year as a first step toward balancing its budget.
The university founded by the Rev. Pat Robertson is aiming for 2,500 undergraduates, up from 1,046 last year and 236 in 2004-05. The goal is 10,000 undergraduates within five years, said Tracy Stewart, the university’s undergraduate program director.
The school had 3,220 graduate students last year.
Regent was faulted in 2006 by credit rating agencies Moody’s Corp. and Standard & Poor’s for years of deficit spending and heavy withdrawals from its endowment. S&P reported that Regent planned to regain financial stability “primarily by growing revenues associated with the recently established undergraduate program.”
Moody’s slightly downgraded Regent’s bond rating in 2005, as did S&P in 2006. The moves still left Regent in the preferred investment-grade category, but lower bond ratings can increase borrowing costs.
Regent borrowed $99 million through bonds in 2006 to build student housing and refinance existing debt.
Fiscal health could be a factor when Regent seeks reaccreditation in 2008-09. To be accredited, a school must demonstrate financial stability, according to the Southern Association of Colleges and Schools.
Dean Wooten, Regent’s vice president for finance, called the credit reports factual but said the analysts were “being conservative.” He said the school expects a balanced budget by 2010.
Regent had operating budget deficits of $12.6 million in 2005-06, $12.5 million in 2004-05 and $13.7 million in 2003-04, according to the school’s IRS tax statements. The 2006-07 statement is not yet available.
Moody’s and S&P said Regent covered deficits by tapping its $258 million endowment.
Stewart acknowledged that the university withdraws “quite a bit more than is healthy” from the endowment. To reduce endowment dependence, Regent is pushing fundraising and undergraduate enrollment, she said.
Stewart said that unlike graduate student fees, undergraduate tuition typically more than covers the cost of instruction, leaving a net revenue gain for the university.
– Associated Press
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