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September 29, 2011

FY11: A very good year for Pitt

Despite a decrease in state support, fiscal year 2011 was a good year for the University. Pitt’s endowment showed record returns and research expenditures rose to a new high.

“It was a very good year,” said chief financial officer Arthur J. Ramicone, following the Sept. 21 meeting in which the Board of Trustees audit committee approved the University’s audited financial statements for the year ended June 30, 2011. “The endowment returned 22.4 percent. That’s the highest in our history as far as we can tell. It’s excellent,” he said.

As of the fiscal year-end, Pitt’s endowment investments totaled nearly $2.55 billion, up from nearly $2.05 billion at the end of FY10.

According to Pitt’s financial statements, sponsored research activity in FY11 was $801.2 million, up from $737 million the prior year. “We had a record year in research,” Ramicone said.

The University ended FY11 with $3.49 billion in net assets, a gain of nearly $604.3 million.


The University’s total revenues for the year were more than $1.96 billion, up from nearly $1.85 billion in FY10.

Pitt’s commonwealth appropriation fell 0.5 percent, from $185.4 million in FY10 to just under $184.6 million in FY11.

However, higher tuition and an enrollment mix that included more out-of-state and international students resulted in a 7.5 percent increase in net tuition revenue, Ramicone said.

According to the 2011 Fact Book, in fall term 2010, 74 percent of Pitt students were Pennsylvania residents, 19.7 percent were from out of state and 6.3 percent were international students. In comparison, in fall 2009, the mix was 75.6 percent in-state, 18.5 percent out-of-state and 5.9 percent international students.

According to the financial statements, Pitt’s FY11 net tuition revenue was more than $491 million, up from $457 million in FY10.

Gifts and contributions rose to $68.5 million, up from $54 million in the prior year.


The University’s FY11 expenses rose to $1.85 billion, up from $1.76 billion. Total compensation — salaries and wages plus fringe benefits — was up 5.4 percent, rising to $1.09 billion from nearly $1.04 billion a year ago.

The salaries and wages line item totaled $840 million, up 5.5 percent from $796.2 million in the prior year; benefits costs were nearly $253 million, up 5 percent from nearly $241 million a year ago.

Supplies, business and professional, maintenance and facilities and depreciation expenses all increased in FY11, but utility costs fell 6.3 percent, to $51.2 million, due to lower natural gas rates.

Interest expenses also were lower in FY11 due to the payoff of some outstanding debt and the reissuance of notes at much lower interest rates, Ramicone said.


The FY11 financial statement showed a surplus of nearly $111 million, but Ramicone cautioned that while more is better, that figure “is not cash free and clear,” but rather reflects revenues recorded as a result of money pledged this year, with no offsetting expense because the money had not been spent, since the pledged gifts have not been received.

Pitt’s endowment

Endowment earnings of nearly $24.5 million and net gains of $464.7 million combined for a total endowment return of $489.2 million. Gifts added $18.78 million and net transfers added $57.8 million. After net distributions of $77.5 million, the endowment net assets stood at nearly $2.51 billion, up 24.2 percent from $2.02 billion at the prior year-end.

The complete audited financial statement is posted at

In other business, the committee approved KPMG LLP as the University’s independent auditor and tax adviser for fiscal year 2012.

—Kimberly K. Barlow

Filed under: Feature,Volume 44 Issue 3

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