Financial Projections and Analysis: 2018-2027

Financial Projections and Analysis: 2018-2027

Mathias Memmel | president@utsu.ca
Thursday March 15h, 2018
Full Report: Financial Projections and Analysis: 2018-2027

 

Executive Summary

The Student Commons will open in September 2018.

Last year, the Student Commons was projected to run a deficit of $500,000 in its first year of operation. As a result, the UTSU was projected to have an accumulated deficit of $2,300,000 by year five of operating the building, rising to $3.9m by year ten. Bankruptcy would have been inevitable.

Now, the Student Commons is projected to run a deficit of $33,000 in its first year of operation. The UTSU is projected to have an accumulated deficit of $63,000 by year five. By year ten, however, the UTSU will have an accumulated surplus of $43,000.

This change is the result of 1) increasing revenue and 2) cutting expenses. Projected annual revenue has increased by $450,000. Most of the new revenue will be rent paid by university departments and external tenants, all of which will offer student-facing services directly to students. We cut expenses by eliminating non-essential services and staff positions, saving $250,000 per year. The cost to students has not increased, and there’s been no change to the amount of space set aside for clubs. Lastly, only 50% of the cost of operating the Student Commons will be borne by students.

The Student Commons was designed by a different UTSU. Their plan was to give the UTSU more control over other student groups. Their demand for “student space” was really just a demand for space controlled by the UTSU. We reject this philosophy of control. Now, instead of private offices for each member of staff, we’ve left spaces for students to organize and collaborate in an autonomous way. We see U of T not as a single community but as a “community of communities”, each of which will be a partner in making the Student Commons a success. That is our vision.

If the current plan is followed, the Student Commons will survive and eventually thrive. However, there is no guarantee that the UTSU will not revert to–for example–nepotistic overspending on salaries and other free spending habits. If one looks at the recent history of the UTSU, it is difficult to not worry about what the future holds. Still, with our restructuring, there is finally cause for optimism, and that is something to celebrate.