RSC construction hurts revenue
Now that the Rhatigan Student Center at Wichita State has been under construction for one year, the real costs of the project are beginning to be realized.
Even though a student fees increase of $247,111 was recommended for fiscal year 2014 to cover additional costs, an additional amount was originally requested by the RSC administrators and denied by the Student Fees Committee.
Now an additional $271,040 is being considered in a supplemental funding bill by the Student Government Association to help cover the large loss in revenue.
“Our revenues from last year are down $352,000. If we take a look at the bookstore itself, it is down $437,000,” RSC Director of Finance Chuck Roush said. “We never anticipated the fence being built up like this and losing as much revenue as we have because people don’t want to venture past the fence.”
Although a portion of the revenue decreases are from the textbook rental program, which rents books out to students for 50 percent of the purchase cost, most of the loss seems to be caused by the construction, which resulted in the REC center to relocate and for food services to operate on a fairly limited basis.
“It’s a broad range of revenue streams that are being cut by the construction,” RSC Assistant Director Kevin Konda said.
It’s expected to get worse. This year, the RSC experienced a large loss of revenue, but for fiscal year 2014, there will be a five-month period when the bookstore will be moved, which is expected to reduce customer traffic.
“We’re going to get hurt,” Roush said. “We’re going to get hammered in revenue. We still have to support this union.”
This decrease is only expected to be for fiscal year 2014 because revenues are expected to return to previous levels after construction is completed.
The Student Fees Committee wanted the RSC to sustain itself through its reserves. However, the RSC’s reserves are more complicated than most. They must have reserves on hand for inventory, operating supplies and emergencies.
“We have to have reserves on hand for emergencies, repairs and maintenance for the building,” Roush said. “We say we’re going to get a brand new building when it’s all renovated, but not all of it’s renovated. The roof’s not renovated. If it starts leaking, a new roof costs $350,000-$400,000.”
Roush said that $5.5 million is the goal to have in reserves but at the end of fiscal year 2012, the RSC had only just over $2 million, $1 million of which is pledged to finish out the construction. This means they need to keep at least $1 million in the account at all times.
Although large renovation projects like the RSC’s come with expenses and difficulties, rewards are sure to be reaped by the future WSU students. Beginning in August, assuming everything remains on schedule, the refurbished wRECk Center will re-open in its original location in the lower level.
