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University Budget Basics

University Budget Basics. December 2010. First - The Basics. Fiscal year Fund Types - Unrestricted vs. Restricted Object Codes Responsibility Organization Codes Budget vs. Actual Operating Units - Academic or Service Auxiliary Units System Campuses. 38 – Moore School of Business

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University Budget Basics

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  1. University Budget Basics December 2010

  2. First - The Basics • Fiscal year • Fund Types - Unrestricted vs. Restricted • Object Codes • Responsibility • Organization Codes • Budget vs. Actual • Operating Units - Academic or Service • Auxiliary Units • System Campuses 38 – Moore School of Business 15000A000 – DMSB 40140 – Fall Tuition Revenue 52024 – Domestic Travel 10-10-1-11-38-00 2

  3. More Basics – System Overview Flagship Institution - USC Columbia Senior Campuses USC Aiken USC Beaufort USC Upstate Regional Campuses USC Lancaster USC Salkehatchie USC Sumter USC Union The System Campuses have approximately 33% of the enrollments of the system and 18% of the total current funds budget. 3

  4. Basics Continued – Alphabet Soup Total Current Funds - Unrestricted and Restricted At USC, this includes funds: A, B, C, D, E, F, G, H, J, K, L, S, R & RP Excludes funds: T, V, W, X, Y & Z General Operating – State Appropriations, Tuition & Fees Departmental – Student Activities, Sales and Service Auxiliary – Enterprise services Grants, Contracts and Gifts 4

  5. Where is the University Budget? http://busfinance.admin.sc.edu/budgethttp://www.scstatehouse.gov/html-pages/budget.htm

  6. Why Do We Need to Budget? The University budget and unit budgets are spending plans that: • Determine sources of funds • Allow maximum use of resources • Control spending • Coordinate activities to meet goals & objectives • Serve as a communication tool 6

  7. Why Do We Need to Budget? State law Accreditation standards Board bylaws 7

  8. What Does the Budget Office Do? Prepare the annual budget document for consideration by the Board of Trustees that reflects the mission and vision of the University of South Carolina. Assist business officers and administrative heads of colleges, campuses and other University units in executing the Board-approved budget and in maximizing their use of limited resources to meet the University's mission of providing high quality instruction, research and public service to its customers.Prepare and submit the University's state budget to appropriate agencies and assist legislative contacts in justifying budget requests. Assist executive University staff and other Division of Finance and Planning staff in ensuring that the University maintains a sound financial status and operates within the budget limitations established by the General Assembly and the Board of Trustees. 8

  9. What Does the Budget Office Do? 9

  10. What Does the Budget Office Do? 10

  11. How much is it? How much do you think USC’s budget is?

  12. How much is it? • $ 76,919,624 • $ 121,345,898 • C) $ 538,065,932 • D) $ 1,125,137,838 • E) $ 1,121,838,000 12

  13. Everyone wins! • $ 76,919,624 • - Columbia Athletics Department Budget • $ 121,345,898 • -System State Appropriations Budget • C) $ 538,065,932 • - Columbia “A” Fund Operating Budget • D) $ 1,125,137,838 • - System Total Current Funds Budget • E) $ 1,121,838,000 • - USC State Budget Total 13

  14. FY11 Total Current Funds Revenue Budget

  15. FY11 Base Cut – State Appropriations Bill

  16. USC System - State Appropriation Reductions

  17. Total Current Funds Revenue Sources

  18. Operating/General funds Majority provided from tuition and fees and state appropriations These funds are also called Education and General – or “E & G” funds “A” funds are unrestricted - dollars may be used to accomplish the goals of the unit within the constraints of State and University policies, procedures & procurement guidelines What are “A” Funds? 18

  19. USC System “A” Fund Budgets At July 1, 2010 – USC System “A” Funds RevenueTuition and Fees $ 440,365,81176.37%State Appropriations $ 121,345,89821.04%Grants, Contracts and Gifts $ 6,257,4971.09%Sales, Services & Other Sources $ 8,643,6961.5%Auxiliary Enterprises $ 0 0.0%Total “A” Fund Budgets $ 576,612,902

  20. USC Columbia In-State Undergraduate Tuition & Required Fees

  21. Undergraduate Tuition & Required Fees Comparisons South Carolina Public Higher Education Baccalaureate Institutions FY 2011

  22. FY2011 Tuition and Required Fee Comparison Public SEC Schools

  23. What About the Lottery? The South Carolina Education Lottery provides funds to South Carolina students based on merit for use at public and private institutions in the state. 24

  24. HEPI Higher Education Price Index Similar to the Consumer Price Index (CPI) Calculated by the CommonFund in Washington • Interim reports periodically • Annually updated in July • 2.0% last year • .9% this year HEPI is made up of 8 variables – most personnel • Faculty, administrative, clerical, and service salaries • Fringe benefits • Misc. services • Supplies and materials • Utilities 25

  25. Why Does Tuition Go Up? • Labor -% of budget for personnel & fringe -Health insurance and retirement increases -Academic labor market • Technology • Utilities • Enrollments go up • Fund new initiatives 26

  26. Other Fees • Technology Fee • Enrichment/Program Fees • Lab Fees • Housing, Food, Parking, etc 27

  27. Who has input into developing the budget? 28

  28. External Budget Development & Execution • Budget Development • Commission on Higher Education • Governor • General Assembly • Budget Execution • Budget & Control Board • State Treasurer • Comptroller General 29

  29. External Budget Process 30

  30. FY2012 External Budget Process Governor’s Executive Budget House Ways & Means Budget Senate Finance Budget Conference Committee Budget 31

  31. Internal Budget Process 32

  32. The Baseball Bat • For Columbia • Plan on tuition increase each year • Increase student population systematically • Cut budgets over two years and use one-time funds to bridge • Overcut – Risk of mid-year cut • – Estimation Risk • Reduce budgets strategically (not across board)

  33. The Baseball Bat Tuition Fee Increase Enrollment Increase Overcut from FY 2010 Recurring Expense Reduction = Total State Reduction Columbia: Example Only

  34. Cost Management Measures • Travel Restrictions • Faculty & Staff Hiring Freeze • Post-Retirement Hires • Retirement Incentive Plan and Voluntary Separation Plan • Under Consideration – Cell Phones, Parking • Focus Carolina – Cost containment & efficiency study with Huron Consulting

  35. USC Columbia Campus – FY 2011

  36. USC Columbia Campus – FY 2011

  37. Strategic Planning & Budget Development System-wide strategic planning; inclusive and transparent Budgets are calibrated to strategic plans Core Mission and Access & Affordability Two-year modification of Columbia budget model Strategic finance – includes capital and operating budgets

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