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H I G H E R E D U C A T I O N P R A C T I C E

Executive Summary
In most respects, FY 2017 was a continuation of the trend that began about six years ago with fewer
project opportunities and smaller project scopes (and budgets). Net revenue continued to decline
and we failed to meet our $1.5M goal for the year due to the continued delay in restarting the
Transportation, Distribution and Logistics (TDL) Center at Olive-Harvey College, whose construction
had been halted in June 2015 due to the State of Illinois budget crisis. Though not facing the same
budget challenges as Illinois, opportunities in Missouri were few and far between as well.

Nonetheless, at the end of FY 2017 and in the first few months of FY 2018, there were some indications
that the higher education market may have bottomed out and that brighter days were ahead. With
legislation passed in July 2017 to establish a budget in Illinois for FY17-18, $127.7M in Capital
Reappropriations and $138.9M in New Capital Appropriations were approved. Though this money
was generally slated to fund projects already underway, including the TDL Center, public universities
throughout the state were relieved to have a clearer understanding of what funding they could
count on. This had the effect of prompting some institutions - the University of Illinois at Chicago and
Illinois State University, for example - to issue multiple RFQs over the last few months. Indeed, in the
first quarter of FY 2018, we responded to six (6) RFQs or RFPS, which is more than half of the total of 10
submissions we made through all of FY 2017.

Challenging Times
We have addressed the downturn in the higher ed market in various ways over the past few years.
With a reduced workload In FY 2017, several senior higher ed personnel (Dave Yandel, Carol Stolt,
and Kyle Kim) are assisting with projects in other practice areas and, anticipating a lower number of
RFQs and RFPs, we reduced our marketing budget accordingly.

The major proactive business development effort for the year involved contacting approximately 90
higher ed institutions located within roughly 100 miles of our NO and SO region offices. Our objective
was to identify any small-scale or maintenance-focused projects that we might pursue. We made
some sort of contact with about half of the institutions and met with approximately 20 of them. Very
few near term projects were identified, but we will continue to follow up with the more promising
contacts for possible future work.

It should also be noted that, apart from the financial challenges that are felt most acutely in Illinois,
the Higher Education landscape in the United States is in a state of much uncertainty. Questions
abound with regard to the value of a college degree, the possibility that distance education can
serve as an effective substitute for on-campus classes, the redundancy of multiple public universities
in an era of declining demographics, a growing divide between elite institutions and the
middle/lower tier, etc. There is a sense that major changes are afoot - and concern with what they
will bring.

Staying Connected with the Higher Ed Community
Despite the lack of project opportunities, we continue to participate in organizations allied with
Higher Ed institutions as a way of interacting with senior leadership at colleges and universities, staying
abreast of trends and best practices, and making our own contributions as thought leaders.

Unlike other practice areas, we have generally attended conferences where booths in exhibit halls
are not available or are generally utilized only by sales reps with products, not professional service
firms. This past year, however, the Higher Ed practice reserved booths at two conferences:

• In June, Higher Ed co-sponsored a booth with the Municipal Practice at the International
Association of Campus Law Enforcement Administrators (IACLEA) Annual Conference in
Milwaukee. We recently joined this organization, which has very few architectural firms in its