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Budget Update March 13, 2009. AGENDA Overview – President Norton FY2009 Budget update FY2010 Budget reductions Proposed draft Guiding Principles for Budget Actions Next Steps for Departmental and Program Review. Unanswered Questions How much will our budget be reduced?

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Budget update march 13 2009
Budget UpdateMarch 13, 2009


AGENDA

  • Overview – President Norton

  • FY2009 Budget update

  • FY2010 Budget reductions

  • Proposed draft Guiding Principles for Budget Actions

  • Next Steps for Departmental and Program Review


Unanswered Questions

  • How much will our budget be reduced?

    • State appropriation may not be finalized until May, June, July….

  • What financial options may be available to the State?

    • Retirement incentive *Travel Reduction

    • Layoffs *Furlough Days

    • Employee concessions *20% DAS Fleet Reduction

    • Salary freeze *Hiring Freeze

      *Elimination of non-

      essential purchases

      *Freeze Management Salaries


Unanswered Questions

  • Does Southern have the approval to refill critical positions (Faculty, Health & Safety, etc.) for next year?

  • What will our enrollment be for next year?

  • What will tuition and fees be set at in FY2010?


FY2009 Budget Update

Revenue:

Current

Projection

FY2008FY2009

  • Student Tuition and Fees $78,400,258 $82,286,473

  • Student Housing & Food 19,420,806 20,145,333

  • Other Student Fees (app fee, cont. enrollment fee) 4,536,0835,084,052

    • Total Collected from Students $102,357,147 (57%) $107,515,858 (59%)

  • State Appropriation $48,371,011 $47,178,634

  • Fringe Benefits (state contribution for

    employee benefits) 24,357,10723,701,944

    • Total State Support $72,728,118 (40%) $70,880,578 (38%)

    • Other Revenue (rental, interest

      earnings, commission) $5,645,238 (3%) $4,823,162 (3%)

    • Total Revenue $180,730,503 (100%) $183,219,598 (100%)


FY2009 Budget Update

Revenue:

Current

OriginalProjection

FY2009FY2009

  • Student Tuition and Fees $83,499,241 $82,286,473 *

  • Student Housing & Food 19,610,108 20,145,333

  • Other Student Fees (app fee, cont. enrollment fee) 5,282,8705,084,052

    • Total Collected from Students $108,392,219 (59%) $107,515,858 (59%)

  • State Appropriation $46,429,633 $47,178,634

  • Fringe Benefits (state contribution for

    employee benefits) 24,586,40223,701,944

    • Total State Support $71,016,035 (38%) $70,880,578 (38%)

    • Other Revenue (rental, interest

      earnings, commission) $5,351,942 (3%) $4,823,162 (3%)

    • Total Revenue $184,760,196 (100% ) $183,219,598 (100%)

      * Decrease is attributed to Part Time enrollment decline


FY2009 Budget Update

SOUTHERN’S REVENUE IS

ENROLLMENT DRIVEN

95.8% of revenue is from enrollment

75% of SCSU’s expenditure is personnel driven


FY2009 Budget Update

Remaining 25% is operations: Current

Projection

FY2009

  • Utilities $8,843,022

  • Institutional Financial Aid 7,884,491

  • Food Service Contract (pass through) 5,810,403

  • Insurance (pass through) 3,638,301

    26,176,217

  • Professional Services 4,700,604

  • Repairs/maintenance Supplies 2,479,082

  • Library Materials/Books 2,204,510

  • Equipment 1,225,000

  • Other Expenses (travel, advertising,

    waivers, telecom, office supplies, postage)9,859,504

    20,468,700

    Total Operating Expenses $46,644,917 (25%)

    $20,468,700 – Only 10% of budget is discretionary


FY2010 Budget Reduction

Budget Reduction Possibilities

10% 7,795,449 *

15% 11,064,129

20% 14,332,810

25% 18,064,062

30% 21,795,315

* Overall, the State budget gap is greater than 25%

Governor’s current SCSU reduction equals 10%

Each 5% reduction is approximately $3.3 million


FY2010 Budget Reduction

Budget Actions in place this fiscal year to close the FY2010 budget gap

  • $3,402,710 Currently there are 56 vacant or soon-to-be vacant non-teaching positions. This amount represents budgeted savings for FY2010 and includes fringe benefits.

  • 273,858 Reduced out-of-state travel by 50%

  • 251,341 Heating/cooling temperature adjustments

  • 295,948 Reduced University Assistants

  • 189,213 Reduced Overtime

  • 383,268 Reduced associated costs for supplies,

    professional services, and food/refreshment

  • 233,341Management/Confidential salaries frozen for FY2010

    $5,029,679


FY2010 Budget Reduction

Additional reductions that can be made to close remaining FY2010

10% budget gap of $2,765,770

  • $665,736 Not refilling 12 faculty positions that will be vacated by 2 year temporary appointments (includes fringe benefits)

  • 906,600 Reduce non-contractual reassigned time by 66%

    (returns 22.5 FTE faculty to classroom instruction)

  • 401,558 Additional conservation efforts and price/consumption analysis for electricity, natural gas, and oil

  • 618,406 Reduce departmental Operating OE budgets by an additional 5%

  • 110,000 Library materials reduction

  • 63,470 Reduce Non-teaching PT positions (includesfringe benefits)

    $2,765,770


FY2010 Budget Reduction

Recap

  • $2,765,770 Reductions that would have to be made before July 1, 2009

  • 5,029,679 Reductions in place

    $7,795,449 Estimated 10% reduction for FY2010


FY2010 Budget Reduction

Unfortunately, we must be prepared for a larger reduction in state appropriation

15% 11,064,129

20% 14,332,810

25% 18,064,062

30% 21,795,315


FY2010 Budget Reduction

Tuition/Fee Increase

5% Tuition Rate Increase

@ 300 enrollment increase

(12,000 students) =

$4.0 million

This only takes us to the 15% reduction


FY2010 Budget Reduction

Remember:

This is a short term

plan for July 1, 2009 for FY2010

FY2011 and FY2012 will

require additional reductions


Guiding Principles – Development (draft)

  • February 12 President Norton charges the University Budget and Planning Committee and the University Strategic Plan Review Committee with identifying guiding principles which will frame budget actions

    Budget & Planning CommitteeStrategic Plan Review Committee

    Mr. James E. Blake – Chair Dr. Marianne Kennedy - Co-chair

    Mr. Eric Anderson Mr. Andrew Marullo

    Mr. Peter Boppert Dr. Angela Todaro

    Ms. Lise Brule Dr. Annette Madlock

    Mr. William Burton Mr. Brian Johnson

    Dr. Pamela O. Brucker Mr. Christopher M. Piscitelli

    Mr. Greg Cochenet Dr. Christine Unson

    Dr. Nicholas P. Edgington Dr. Glenda Dejarnette

    Dr. Ross B. Gingrich Mr. Greg R. Crerar

    Dr. James M. Granfield Dr. Kenneth Florey

    Dr. Ronald D. Herron Dr. Maria Diamantis

    Dr. Peter R. Madonia Mr. Mark A. Waters

    Ms. Barbara Mallick Dr. Nicholas Edgington – Co-chair

    Dr. Gregory Paveza Dr. Paul Stepanovich

    Ms. Leilannie Quintana Dr. David E. Pettigrew

    Ms. Megan A. Rock Mr. Ray Kellogg

    Mr. Robert G. Sheeley Dr. Stephen Joyner

    Ms. Judith A. Sizensky-Searles Dr. Troy Paddock

    Dr. Selase W. Williams Mr. Robert G. Sheeley

    Dr. Christina D. Baum

    Ms. Judith A. Sizensky-Searles


Guiding Principles – Development (draft)

  • February 20 Joint meeting of both committees was convened which resulted in a set of draft principles. It was agreed that a sub-committee composed of members from both committees would refine the principles

  • March 6 Sub-committee met and reached consensus on the final set of draft principles

  • March 9 Final draft principles were circulated to both committees for final comments

  • March 10 Final draft principles were reviewed at President Norton’s staff meeting

  • March 11 Final draft principles were distributed to the University community

  • March 13 Draft Principles discussed at Town Hall meeting


Guiding Principles (draft)

Overarching Principles

  • The vision and mission of the university, as stated in the 2007 – 2012 University Strategic Plan (USP) will serve as the basis for budgetary decisions impacting short term and long term planning

  • In recognition that any budget reduction scheme induces apprehension, the process will be transparent and effectively communicated to all constituents of the University


Guiding Principles (draft)

  • Support and enhance the student academic experience

  • Support and enhance the student life experience on campus

  • Provide for sufficient qualified faculty and staff and an academically sound faculty/student ratio to support the teaching-learning mission of the university

    • Prevent lay-offs of full-time faculty and staff

    • Address budgetary gaps caused by vacancies (e.g., early or scheduled retirements) in a manner consonant with advancement of the USP


Guiding Principles (draft)

  • Maintain enrollment to reflect appropriate mix of students (11,800 and 12,300 students –distributed through retention, transfer students, part-time students and a growing graduate student population, with a maximum enrollment of 1,350 for full-time entering freshman)

  • Maintain a healthy (both physical and psychological) campus environment


Guiding Principles (draft)

  • Maintain appropriate student, faculty, and staff access to the campus, and the University services, such that student success and learning are not impinged

  • Ensure that University assets are safeguarded

  • Comply with all governing laws, policies and procedures set forth by governing bodies (Federal, State, NEASC, CSUS BOT) and accrediting bodies for academic programs/schools within the university


Guiding Principles (draft)

  • Make budget decisions that are driven by facts, data, and reasonable projections without ignoring core values as identified in the USP

    • Do not eliminate a function that we think would have to be reinstated in the near future (2 years)

    • No use of reserves (balanced budget FY2010)

    • Reduce costs in areas that focus on one time expenditures and can be reinstated quickly when the economy changes (positively)

    • Establish alternative revenue streams

    • Before functions (resources, services, programs) are cut, alternative ways of meeting the needs those functions provide must be determined as expeditiously as possible


Guiding Principles (draft)

  • Support faculty and staff efforts to receive external grants

  • In dire budget crises where functions that advance the University Strategic Plan are adversely impacted by cost saving or revenue producing measures (e.g. increased student enrollment with decreased human resources to meet academic and support needs of those students), those functions will be given priority consideration for reallocation/allocation of resources when the economy changes positively


Guiding Principles (draft)

  • Continue support for our University’s academic and/or programmatic ‘unique strengths’

  • Maintain efforts to prepare students to meet the workforce needs of the nation, and particularly the State of Connecticut


NEXT STEPS

Send suggestions/revisions to:

Mr. James Blake – [email protected]

Dr. Nicholas Edgington – [email protected]

Dr. Marianne Kennedy – [email protected]


NEXT STEPS

Academic Departments

  • Confirm the fall 2009 course schedule, instructor assignments, effective course rotation and monitor course fill rate

  • “Formulate an Academic Program Plan that establishes clear goals for the advancement of existing academic programs and sets priorities for new and existing resources.” (USP goal A.1.)

  • Responsibility: Department Chairs, Deans and Provost


NEXT STEPS

Administrative Departments

  • Assuming zero-based budgeting, what would be your level of service?

    • Assess/survey department’s service objectives

    • Prioritize service objectives

    • Minimally, what resources are needed to provide these services?

    • Who are these services provided to (students, faculty, staff, donors, others)?

    • What would be the impact if these services were no longer provided?

      Responsibility: Vice Presidents, Deans, Directors and Department Heads



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