President Rita Hartung Cheng – March 11, 2015

Redefining Our

RelationshipsAnd Prioritizing investments

Page

Verde Valley

Prescott

Kingman

Bullhead City

North Valley

Lake Havasu City

East Valley

West Valley

Chandler/Gilbert

Signal Peak

MCAS-Yuma

South Mountain

Glendale

Phoenix

Kayenta

Communiversity @ Queen Creek

Mesa

Tuba City

Chinle

Fort Defiance

Keams Canyon

Ganado

Show Low

Paradise Valley

Whiteriver

Scottsdale

Apache Junction

Thatcher

Aravaipa

Tucson

GateWay

Communiversity @ SurpriseFlagstaff

YAVAPAI

YUMA

PHOENIX BIOMEDICAL

TUCSON NORTH

Phoenix

Tucson

How Far We Have Come

Old

NEW

New

1995 2000 2005 2010 2014

30,000

25,000

20,000

15,000

10,000

5,000

20,131 19,069

27,715

Flagstaff

Online

Community Campuses

Yuma

1995 2005 2015

2,554

20,131 19,069 27,715

$11,974 $13,841 $10,211

2,821 5,034

State & Tuition Supportper Student

Enrollment

UndergraduateDegrees

Red Buildings

9 BUilDiNgS

Physical Sciences

Chemistry

Biological Sciences

Educational Annex

Adel Mathematics

Anthropology

Learning Resource Center

Engineering & Technology

Business Administration

20057 BUilDiNgS

Physical Sciences

Chemistry

Biological Sciences

Academic Annex

North Heating & Cooling Plant

Adel Mathematics

SBS West

20105 BUilDiNgS

Biological Sciences

Physical Sciences

Chemistry

Wall Aquatic Center

Adel Mathematics

20154 BUilDiNgS

Biological Sciences

Physical Sciences

Chemistry

Adel Mathematics

2016

Partnerships

Four Forest Restoration initiative Phoenix Biomedical Campus 1899 Bar & grill

High Country Conference Center American Campus Communities

Economic impact

NAU’s economic impact in Arizona is approximately $1.845 billion.

61% of NAU graduates reside in Arizona and our alumni circulate$1.65 billion in the Arizona economy each year.

Regionally, NAU activity contributes $1.158 billion in CoconinoCounty’s economy and one in every five jobs in this county is aresult of NAU’s presence.

in its second year of operations (2013–2014), NAU’s programs at thePhoenix Biomedical Campus had an economic impact of $17.5 million.

Academic Plans & Student Success

Only at NAU

Student = Partner

FACUlTY

ENviRONmENT

ACTivE lEARNiNg

TECHNOlOgY

STUDENTS

Many traditionally aged (18-22) from diverse backgrounds

First-generation – 42%

But … 1/4 adult learners

Our Students

3.5

Average Freshman Cohort HS gPA

Fall 2014

Flagstaff Community Campuses Online

55% 67% 71%

62% 98% 86%

57% 3% 2%

5% 52% 59%

Female

AZ Resident

Under 21

Over 30

Academic Programsthat Open Doors for Students

Historically strong programs

Education, forestry, HRM, pre-professional, business

New programs serving Arizona’s needs

Health professions, STEM, interdisciplinary

201520152015

learning Community

28%Research

with Faculty

23%leadership in

Student Organizations

5%

201520152015

Culminating Senior Experience

67%Service learning

61%internship or

Field Experience

47%

Defining Quality: High impact Practices

Defining Quality: Faculty innovations for learning

First Year Learning Initiative Built on active learning, early engagement 80+certifiedcoursesserve95%

ofallfirst-yearstudents

Last year prevented 800 “failed” courses ($1.3 million saved costs to students)

Global Learning Initiative Every major, every student has discipline-centered global perspective

DefiningandAssessingLearning Learning goals for each course, each degree program documented (75%ofallprogramsinpast2years)

Learning assessment incorporated into continuous improvement, program review

“NAU is AboUt UNdergrAdUAte edUcAtioN, bUt these stUdeNts Also provide a large motivated research workforce. Much of our international success in pathogen genomics has been driven by undergraduate hard work and devotion. In return, they get a scientific education that is based upon workplace experience in a real life research environment.” – PAUl s. Keim, NAU & tgeN

Defining Success

70%

60%

50%

40%

30%

20%

10%

0%

53%60%

6-year Graduation Rate

52.6% 49.1%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

51%

80%

78%

76%

74%

72%

70%

68%

66%

64%

75%

78%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

73%

Projected

eNterPrise metric 8

eNterPrise metric 7

Freshman Retention Rate

73.6%

51.6%

69.3% 71.6%

meeting Arizona Workforce Needs

EntErprisEMEtric21

Projected

2,972

3,4373,165

Number of Degrees Awarded in High-Demand Fields

2,884

3,090

3,500

3,300

3,100

2,900

2,600

EntErprisEMEtric29

1,350980

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

1,600

1,400

1,200

1,000

800

600

400

200

0

Online Degrees

534

918

1,123

745

4,900

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

6,000

4,500

3,000

1,500

0

Number of Bachelor’s Degrees Awarded

3,203

5,034

3,725

4,513

4,500

EnTERPRISE METRIc 1

EnTERPRISE METRIc 4

Number of Arizona Community College Transfer Students AwardedBachelor’s Degrees

1,300

2,3001,035

1,6521,771

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

2,500

2,000

1,500

1,000

500

0

1,575

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Projected Enrollment Growth – Total Headcount

Master’s Degree in Physician Assistant Studies and Doctor of Physical Therapy Degree started in Fall 2012.

2013 2014 2015 2016 2017 2018 2019Fiscal Years

PHYSiCiAN ASSiSTANT

PHYSiCAl THERAPY

OCCUPATiONAl THERAPY

TOTAl

25 49 73 100 100 100 100

24 51 86 106 116 120 120

25 54 99 120 135

49 100 184 260 315 340 355

Arizonapublicuniversitiesworkingtogether to share faculty, facilities,technology, and supplies to increase highquality, affordable healthcare education.

Phoenix Biomedical Campus

internal Collaboration for Student Success

AcademicAffairs,Extendedcampuses,EMsAallpartneronEnrollmentManagement committee

AcademicAffairs(Universitycollege),EMsApartneronretentioninitiatives

We Are Affordable & Accessible

Pledge guarantee 4-year tuition guarantee, predictable & affordable

Community college partnerships 2nAU

Summer research programs

concurrent enrollment and 90-30programs

Transfer tools Jacksplanner

Expansionofacademic pathways

Strategies: Extended Campuses

AddressingArizona’sworkforceneeds

Student recruitment strategies

nAU-Yumabranchcampus

nAU-Yavapairegionalcampus

personalizedLearning

moving Forward

Percent Change in Public and Nonpublic High School Graduates, by State, 2008-09 to 2019-20

Top 5 States Arizona

California

Colorado

Nevada

Washington

maricopa 11,112

Pima 2,177

Coconino 1,553

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

Greater than 15%

5.01% to 15%

0% to 5%

-5% to 0.01%

-15% to -5.01%

Less than -15%

24,970

30,000

25,000

20,000

15,000

10,000

5,000

0

EntErprisEMEtric9Undergraduate Enrollment

16,654

23,569

22,52729,754

EnTERPRISE METRIc 10Total Enrollment

27,396

22,307

ProjectedProjected

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

27,26326,30820,639

22,407

25,380

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Transfer Students Dedicated transfer recruitment team

Expandedrelationshipswithcommunity collegesand2nAUprograms

Improved transfer tools and pathways

Financial aid strategies for transfer students

international Students 72countries

Worktostrengthentheacademic infrastructure for international students

Develop and nurture strategic relationships withuniversitiesandorganizationsbasedoverseas

construction of International Pavilion facility

2,6822,870

3,205 3,356 3,336 3,347

878813750829

719765

2,4692,5232,6062,3762,1511,917

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

AZ Transfers All Other Transfers

Total International Enrollment

2008 2009 2010 2011 2012 2013 2014

1,400

1,200

1,000

800

600

400

200

0

506573

866 911989

1,0801,246

China

Saudi Arabia

Kuwait

Brazil

germany

Top 5 Countries

3,500

3,000

2,500

2,000

1,500

1,000

500

0

Students from 107 Tribes

Top 5 Tribal Affiliations

Navajo Tribe

Cherokee Nation, OK

Hopi Tribe

Choctaw Tribe of Oklahoma

Pascua Yaqui Tribe

First-time Freshman CohortHeadcount – Hispanic/Latino

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

1,2001,000

800600400200

0

NAU Reflects Arizona’s Diversity100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

AZ 2013 Census Hispanic/latino

Asian

Native Hawaiian/Oth Pac island

White

Black/African American

American indian/Alaska Native

Two or more

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

First Time Freshman Cohort: IPEDS Ethnicity

Commitment to Veterans

Q&A

ResearchExcellence

Strategic Research Strengths

Addressing issues important to Arizonans

1. Infectious diseases

2.nativeAmericanhealth

3. Forest restoration

4. Land management

Microbiology and bioengineering

Health sciences

Environmental sciences and sustainability

Forest restoration and landscape conservation

Astronomy

Informatics and big data analytics

Partnership for Native AmericanCancer Prevention nIH-funded, directed by

LauraHuenneke

collaborationwithUA

inoperationfor12years

$15+milliontonAUinsupport of research with and for nativeAmericans

The Center for microbial genetics and genomics

Directed by Regents Professor Paul Keim (joint appointment with TGen)

$60+millioninexternalfunding since2002

400+ students, staff, and research scientists

researchonMrsA,c-dif,valleyfever, crE(kleb)andothers

Native American Health and infectious Diseases

Forest Restoration & land management

The Ecological Restoration institute

since2002,$35millionin externalfunding

300+students;200+partners

The landscape Conservation initiative

Effective rangeland management directedbytomsisk

Diablo Trust

“The science has strengthened our collaborative process, and by co-hosting dozens of NAU classes and interns, we’ve worked together to train the next generation of land stewards.” —JUdy Prosser, bAr t bAr rANch

“NAU’s longstanding relationship with the Diablo Trust provides for a working laboratory where significant natural resource matters are examined and addressed.”—mANdy metzger, FlyiNg m rANch

Partnerships generating impact

TGen north/TGen

northernArizonaHealthcare– THRIVE

Diablo Trust

Babbitt Ranch

Lowell Observatory

Discovery channel Telescope

naval Observatory

U.s.Geologicalsurvey

U.s.Forestservice

nationalparkservice

scienceFoundationArizona

northernArizonacenter for Entrepreneurship

AsUandUA

Research Expenditures2014Highlights Federal government: $17 million

State & local government: $6 million

Institutional funds: $6 million

industry:$850,000

non-profits:$1million

Other: $1million

$50,000

$45,000

$40,000

$35,000

$30,000

$25,000

$20,000

$15,000

$10,000

$5,000

02009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Research & Development Expenditures (in $1,000s)

$26,183$30,751

$34,978

$43,432

$31,590$30,516

EnTERPRISE METRIc 13

Technology Transfer

2014Metrics inventiondisclosures:24

U.s.patentsissued:3

ipincome:$32,000

Start-up companies: 1

Public Service

institute for Tribal Environmental Professionals

Civic Service institute

gEAR UP

institute for Human Development

Other nativeAmericanculturalcenter/tribalLeadership

nAUEarntoLearn:Assetsforindependence

northernAZconsortiumofHistoryteachers

Family Violence Institute

Projected

Expenditures Related to Service and Engagement Activities

EntErprisEMEtric20

$34,321$26,878

$40,000

$35,000

$30,000

$25,000

$20,000

$15,000

$10,000

$5,000

0

$28,794$30,733

$32,772

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

$25,585

tHO

UsA

nD

s

Building Future Research Capacity

Bioengineering research

Ecosystem science

Health and healthcare research

High performance computing and “big data” research

Strategic recruiting

Building Future Research Capacity

New Center for Bioengineering innovation

$1millionW.M.KeckFoundationaward

Translating research on muscle contraction to improve prosthetic devices

New Center for Ecosystem Science and Society (ECOSS)

From microbial systems to whole Earth systems

$1.3millioninnewexternalfunding

Building Future Research Capacity

Translational Health Research initiative (THRivE)

partnershipwithnorthernArizonaHealthcare

$400,000FlinnFoundationgrantsforpersonalized translational medicine

informatics and Computing Program (iCP)

“Big data” research

Research-intensive academic unit in cEFnS

Integrate big data analytics into interdisciplinary research focused on improving patient outcomes

FliNN PROJECT

SHi’HOOgAN PROJECT

THRivE

Q&A

Financial Planning

Office of the governorOfficeofstrategicPlanning and Budgeting

Joint LegislativeBudget committee

nAULeadership•president•cabinet•strategicplanning

and Budget councilMaster PlanEvery 5 Years

Strategic PlanEvery 2-3 Years

PerformanceEvaluationEvery Year

Macro BudgetEvery Year

TaskForces

Organizedgroups

ExternalStakeholders

FacultyStudents

Staff

StandingCommittees

Strategic Priorities

Every Year

ArizonaBoardof Regents

Vision2020

Divisional PlansEvery Year

Planning Culture

Financial Highlights FY 2014

Total assets: $1.1 billion net assets: +$4 million

Total revenue sources: $490.3 million

Total expenses: $486 million

monthly days cash on hand: 132 Days

The FY14 debt ratio: 5.7% (without SPEED), 6.9% (with SPEED)

Maximumallowedis8%

Debt capacity is $180 million Debt capacity estimated at June 30, 2015:$190million

WyomingNorth Dakota

AlaskaNew Mexico

HawaiiIllinois

NebraskaNorth Carolina

MississippiArkansas

ConnecticutMarylandAlabama

UtahCalifornia

GeorgiaNew York

KansasWest Virginia

IowaOklahomaKentucky

MinnesotaSouth Dakota

IndianaTexasIdaho

LouisianaDelawareTennesseeMontana

New JerseyWashington

VirginiaMassachusetts

FloridaWisconsin

MaineSouth Carolina

OhioMichigan

OregonNevada

MissouriRhode Island

VermontColoradoArizona

PennsylvaniaNew Hampshire

$0 $100 $200 $300 $400 $500 $600 $ 700

$136Arizona Arizona

-21%

Net Tuition/Fee and State Appropriation Revenue

iNFlATiON ADJUSTED gENERAl FUND PER FTE gENERAl FUND AND NET TUiTiON PER FTE

$7,600$13,757

$12,614 $12,089 $12,066$11,331 $11,260 $11,817 $12,199

$6,094$5,257

$4,804

$3,780 $3,570 $3,573 $3,579

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015

Educational and General Expenses per FTE Enrollment

$22,000

$20,000

$18,000

$16,000

$14,000

$12,000

2009 2010 2011 2012 2013

ABOR Peers MedianNAU

(Est.)(Est.)

Tuition, Fee, and State Appropriationsper Degree Awarded

ABOR Peers – IPEDS FY 2013

Univers

ity of

Main

e

The U

nivers

ity of

Alab

ama

Univers

ity of

Akr

on M

ain C

ampu

s

Northe

rn Il

linois

Univ

ersity

Bowlin

g Gree

n Stat

e Univ

ersity

Univers

ity of

Neva

da ~

Las Ve

gas

Univers

ity of

Nort

h Car

olina

at G

reensb

oro

West

ern M

ichiga

n Univ

ersity

mEDiA

N

Kent S

tate U

nivers

ity ~

Kent

South

ern Il

linois

Univ

ersity

~ Car

bond

ale

Georgia

State

Univ

ersity

Ohio U

nivers

ity ~

Main

Cam

pus

Northern

Ariz

ona Unive

rsity

Wich

ita St

ate U

nivers

ity

George

Maso

n Univ

ersity

Old Dom

inion

Univ

ersity

$120,000

$100,000

$80,000

$60,000

$40,000

$20,000

0

NAU PER DEgREE

$57,732$65,741

investments

Personnel Over60%ofuniversityexpenditures

Averagesalariesfrommarketmedian $29.2milliontoreachmarket

Classified Staff

Service Professionals

Faculty

0%

-2%

-4%

-6%

-8%

-10%

-12%

-14%

-16%

Fall 2012 Fall 2013 Fall 2014

-12.8%-9.9%

-10.4%

Tuition Differentiation

UnDErGrADUAtE

GrADUAtE

Flagstaff $9,165

Extendedcampuses $8,554

Yuma $8,554

Flagstaff Pledge $9,989

Extendedcampuses $7,032

Yavapai $5,345

Yuma $6,902

personalizedLearning $5,000

Percent of all undergraduates on Pledge = 75%

Resident Tuition + Fees Starting Fall 2014

Nr grad1%

50%

40%res Ug

Nr Ug

resgrad

9%

FY2015

online8%

yuma1%

communitycampuses

6%

Flagstaff

85%

FY2015

Flagstaff Enrollment Driving Tuition Revenue

FY 2015 Est. Tuition Revenue by Residency by Academic level

FY 2015 Est. Tuition Revenue by Campus

$250,000

$200,000

$150,000

$100,000

$50,000

0

$250,000

$200,000

$150,000

$100,000

$50,000

2011 2012 2013 2014 2015Fiscal Year

2011 2012 2013 2014 2015Fiscal Year

RES grad RES Ug

NR grad NR Ug

Online Statewide

Yuma FlagstafftH

OU

sAn

Ds

tHO

UsA

nD

s

Projected Revenue Sources

other

12%

Auxiliaryrevenue

11%

gov’t grants & contracts & Fin Aid

15%

40%tuition and

Fees

22%

Total Revenue: $519m Enrollment: 27,715

FY2015

state general

Fund

other

12%

Auxiliaryrevenue

10%

gov’t grants & contracts & Fin Aid

16% 42%tuition and

Fees

20%FY

2020

state general

Fund

Total Revenue: $610mEnrollment: 32,284

Total Revenue: $400m Enrollment: 21,352

state general

Fund

Auxiliaryrevenue

9%

gov’t grants & contracts & Fin Aid

14%

25%

other

12%

40%FY

2008

tuition and Fees

Budget Planning Scenarios for 2020 goals

Assumptions Enrollment growth:

Growthto32,284

Tuition rates: commitment to Pledge Maintaining tuition differentiation

State appropriation: performancefundingFY17toFY20

personalizedLearninggrowth $9millioninFY20

continued investments in personnel, technology, programs and facilities

continuedfocusonefficiencies

Outcomes netpositioninFY20:+$5million

Total revenue: $610 million totalexpenditures:$605million

Debt service: 4.5%ofexpenditures

Days cash on hand target120-130Days

Projected Debt Service

credit Ratings: A1(Moody’s) A+(s&p)

stableoutlook

Debt Ratio: 5.7%(withoutspEED) 6.9%(withspEED) 8%cap

Projected Debt Service

Debt Capacity Projection Fiscal Year (Without SPEED)

2015 $190,000,000

2016 $215,000,000

2020 $340,000,000

73

25

77

28

96A

30

55

27

96B

24

62

59

16

68

46

58

37A

3

69

88

1

30A

81

58

17

37

26

35

6370

82

18

65 64

52

86

66

96C

4342

90

61

47A

2

67

54

59

14

51

15

80

72 76

98C

98D

2944

38

31

39

53

45

21

40

75

5

75

9

56

4

2019

79

4859

2223

6

59

3A

58A

8

92

83

10

12

91

33

98F

30B

11

9595

33A

30C

27A

13A 13

50B

5050

95

95

50B

98B

16A

77A

95

98A

21B

71

71

71

71

71

57

71

50B

50B

50

80B

50B

5049

54

32

96

80

97

23A

54B

47

18A

74

80

8077A

77A

67

82B 77A

50B

5959

5959

55

30D

36

84

78

75

75

50

50

53

60

7A

89

85

L10

P

0 250 500 750 1,000125Feet

Science & HealthBuilding

North Campus Athletic & Recreation Center

Student & Academic Services

STRATEGIC PROJECTS MAPFiscal Year 2014-2015

Under Construction

New Construction & Renovation

Deferred Maintenance

Other NAU Facilities

NORTHERN ARIZONA UNIVERSITY

73

25

77

28

96A

30

55

27

96B

24

62

59

16

68

46

58

37A

3

69

88

1

30A

81

58

17

37

26

35

6370

82

18

65 64

52

86

66

96C

4342

90

61

47A

2

67

54

59

14

51

15

80

72 76

98C

98D

2944

38

31

39

53

45

21

40

75

5

75

9

56

4

2019

79

4859

2223

6

59

3A

58A

8

92

83

10

12

91

33

98F

30B

11

9595

33A

30C

27A

13A 13

50B

5050

95

95

50B

98B

16A

77A

95

98A

21B

71

71

71

71

71

57

71

50B

50B

50

80B

50B

5049

54

32

96

80

97

23A

54B

47

18A

74

80

8077A

77A

67

82B 77A

50B

5959

5959

55

30D

36

84

78

75

75

50

50

53

60

7A

89

85

L10

P

0 250 500 750 1,000125Feet

Science & HealthBuilding

North Campus Athletic & Recreation Center

Student & Academic Services

STRATEGIC PROJECTS MAPFiscal Year 2014-2015

Under Construction

New Construction & Renovation

Deferred Maintenance

Other NAU Facilities

NORTHERN ARIZONA UNIVERSITY

NORTH CAmPUS

SOUTH CAmPUS

Facilities

Under Construction

New Construction & Renovation

Deferred maintenance

Other NAU Facilities

meeting Space Needs

northcampusAthleticsandrecreationcomplex

Science and Health

studentandAcademicsupportBuilding

Future needs: Research Infrastructure Phase II

NAU Foundation

“Only at NAU” Campaign startedin2009 publicphasebeganin2013 At$83millionwithtarget

of $100 million

FOUNDATiON ASSETS$160,000$140,000$120,000$100,000

$80,000$60,000$40,000$20,000

0

$63,381

$92,480 $95,337$109,075

$136,248

2010 2011 2012 2013 2014Fiscal Year

5-year Since Inception

NAU Foundation 15.2% 7.9%

moderate growthComposite index 13.6% 8.0%

ANNUAlizED RATE OF RETURN

tHO

UsA

nD

s

Q&A

Our Partners

John coe, Principal, Marshall Elementary Magnet School

Leah Bornstein, President, coconino community college

Jeffrey Hall, Director, Lowell Observatory

David Engelthaler, Director of Programs, TGen north

23,569

2020 goals

16,654

5,034

60%

50%

6-year graduation

$31.6m

$26.1m

1,350$43.4m

4,900

Comm college to bachelor’s

Comm college transfers

Freshman retention

Research expenditures

Annual bachelor’s

78%

Online degrees

51.6%

73.6%

1,123

1,771

2,469

1,917

1,035

534

3,151

71.5%

Undergraduate enrollment

3,800

2,300

25,531