When faced with tight budgets, university officials must make tough choices. Very often, even strategically important projects wind up being deferred, simply due to a lack of immediate funds. When these projects relate to technology, however, the perspective shifts. Because technology today has such a short shelf-life—often reaching obsolescence in just a few years—deferring upgrades might make short-term budget sense but can have long-term negative repercussions on the university’s ability to remain competitive.
The struggle, therefore, is to find smart financial solutions that empower schools to make the needed investments on a timely schedule while minimizing the impact to budgets.
Recently, a well-known northeastern university needed to finance a $2.8 million data center upgrade. Firmly on the “must have” list, the project would provide critical updates to the school’s central data storage system, extend the existing network infrastructure, and incorporate redundancy into the school’s disaster planning strategy. Given the sensitive nature and high visibility of the project, a strategic approach would be essential.
The university received several competitive financing offers, including one from the industry leading manufacturer. But while rate was one factor in this financial decision, there were several other important considerations.
A key concern was that the manufacturer would sell the finance package to a third-party bank. This potentially added risk for the university from a management standpoint and particularly with respect to uncertainty over end-of-term procedures for returning the leased equipment. Administration officials preferred to be able to work with a trusted resource capable of overseeing the complex project from start to finish.
First American Education Finance offered simplicity and convenience. The university had partnered with First American since 2008. Over the years, First American had financed 27 projects totaling millions of dollars, and the trust and confidence First American brought to the table was important. Because the university was already familiar with First American and its process, new projects could be implemented quickly and easily.
First American services every lease, on every project. There would be no unknown third parties involved, and the university’s First American Project Manager would handle every detail of the program.
CustomerConnect™ was another value-add for administration officials. This First American online portal gives university staff 24/7 access to lease management tools, including the ability to track leased assets, manage documents and payments, and handle all aspects of the return process.
Because the network and data storage equipment would have a useful life of approximately five years, First American developed a five-year asset renewal program that would ensure the university could return the old equipment at the end of the lease and subsequently launch a new lease term to procure new, more current technology at that time.
First American handled the upgrade from start to finish, and access to CustomerConnectTM meant that university administrators could easily manage every aspect of the project online.The university is now in a position to refresh its network infrastructure every five years, ensuring they are able to capture the full efficiencies and capabilities that state-of-the-art technology can deliver.
The unviersity’s relationship with First American also remains strong. By delivering efficient processes and strategic solutions, First American has maintained its trust with its client and continues to serve as a proven financial resource.