Develop a better understanding of State budgeting and the associated processes Discuss UNCP...

Develop a better understanding of State budgeting and the associated processes

Discuss UNCP budgeting in detail

April 19, 20232UNC Pembroke

The North Carolina Legislature and the State Constitution

The “State Budget Act” as defined in General Statue 143C-1-1 establishes procedures for the following: 1. Enacting the State budget2. Preparing the recommended State

budget3. Administering the State budget.


North Carolina General Statute 143C-2-1 provides that the Governor is Director of the Budget. As such, the Director has responsibility to prepare and recommend the State budget, and the Director’s powers extend to all agencies, institutions, departments, bureaus, boards and commissions of the State of North Carolina.


The Governor may -- and does -- delegate certain powers and authorities of the Governor as Director of the Budget to the Office of State Budget and Management (OSBM) (G.S. 143C-2-1(a)).


The Governor has delegated the authority to OSBM to:1. Prepare the recommended budget2. Certify the ratified budget3. Distribute the budget to state agencies4. Monitor, report, and control the State

budget.


Issues Biennial Instructions for Budget Preparation

Requests State Agencies Develop Budget Request

Prepares Economic and Revenue Forecast

Reviews Agency Budget Requests Governor Finalizes Biennial Budget and

Six-Year Capital Improvement PlanApril 19, 20237UNC Pembroke

Governor Presents Budget Message to General Assembly

Presents Governor's Budget to General Assembly

Appropriation Subcommittees Review All Budget Requests

General Assembly Finalizes Budget and OSBM Certifies


Legal Basis State Executive Budget Act Higher Education Reorganization Act of 1971

Board of Governors’ Role: Presents comprehensive financial plans to General

Assembly Modifies plans based on resources made available

by Legislature Establishes annual budgets which are

administered by the constituent institutions


“A single, unified recommended budget for all public senior higher education.”

Statute prescribes form of budget requests – three categories:§ Continuing Operations (enrollment, utilities, vehicle

replacement) – allocated to institutions§ Academic Salary Increases – lump sum to Board of

Governors and then allocated to campuses§ Expansions/Reductions, when appropriate – by

priority – lump sum to Board of Governors and then allocated to campuses• New and expanded programs• Capital improvements• Increases to remedy deficiencies April 19, 202310UNC Pembroke

Key steps in process of budget preparation:

1. UNC President receives general instructions from Governor via State Budget Office.

2. Budget workshops are conducted separately with three groups:• UNC General Administration Council • Chancellors• Board of Governors


Key steps in process of budget preparation: (continued)

3. In conjunction with the decisions reached at the budget workshops, instructions are provided to the campuses for preparation of institutional budget requests.• Continuation budgets• Academic salary increases• Expansions and improvements

4. Chancellor is responsible for the preparation of budget requests for the institution and the assignment of any institutional priorities that may be applicable. The process of campus involvement is determined by the Chancellor, who appoints delegates to work with UNC General Administration. April 19, 202312UNC Pembroke


5. Institutional budgets are reviewed:• Continuation Budget – reviewed by Vice President-

Finance for general consistency and conformance.• Academic Salary Increases – campus data

reviewed by Senior Vice President for Academic Affairs and the Vice President-Finance in a similar manner to continuation budgets.

• Expansions and Improvements – reviewed by internal review committee, headed by Senior Vice President-Academic Affairs, composed of the General Administration Council.



6. President confers throughout the process with the Chancellors.• Afterward, Vice President-Finance prepares

recommendations for Board and its Budget and Finance Committee.

7. After a final budget workshop for the full Board, the Budget and Finance Committee recommends the adoption to Board.

8. Board takes final action, then submits to Governor and Advisory Budget Commission



9. President represents University in any hearings with Governor.

10.Governor forwards recommendations to General Assembly.

11.President, or his designees, represent University in Legislative hearings.


The SCH enrollment change formula is driven by the projected change in student credit hour (SCH) production as classified in a 12-cell funding matrix comprised of 4 areas of instruction assigned a cost category and 3 levels of instruction.


Category IV Category II

14 – Engineering66 – Nursing

Category III25 – Library Science03 – Natural Resources & Conservation51 – Health Professions01 – Agriculture04 – Architecture44 – Public Administration & Services40 – Physical Sciences50 – Visual & Performing Arts11 – Computer & Information Sciences15 – Engineering-related Technologies26 – Biological Sciences

*Student Teaching Courses

13 – Education*05 – Area, Ethnic, Cultural & Gender Studies30 – Multi/Interdisciplinary Studies52 – Business, Management & Marketing24 – Liberal Arts & Sciences, Humanities31 – Parks, Recreation, Leisure & Fitness19 – Family & Consumer Sciences16 – Foreign Languages, Literatures & Linguistics

Category I09 – Communications & Journalism42 – Psychology27 – Mathematics45 – Social Sciences23 – English38 – Philosophy & Religion43 – Corrections & Criminal Justice54 – History


The three levels of instruction are undergraduate, masters, and doctoral. These three levels are based on differences in the cost of instruction associated with average class size.



EXHIBIT 3-1 SCH Enrollment-Change Funding Model Actual UNCP Calculations Regular Term RequestProgram Category Student Credit Hours SCH per Instructional Position Instructional Positions Required

Ugrad Masters Doctoral Ugrad Masters Doctoral Ugrad Masters Doctoral

Category I -2924 -1386 0 708.64 169.52 115.56 -4.126 -8.176 0.000

Category II 5243 1379 0 535.74 303.93 110.16 9.786 4.537 0.000

Category III 2217 790 0 406.24 186.23 109.86 5.457 4.242 0.000

Category IV -311 0 0 232.24 90.17 80.91 -1.339 0.000 0.000

Total 4225 783 0 9.778 0.603 0.000

Total All SCHs 5008 Subtotal Positions 10.382

Campus Ugrad Cost Factor with Positions 20.00% 1.956

data input Total Positions Required 12.337

calculated Instructional Salary Rate of Campus $74,584

model provided Instructional Salary Amount $920,176

Other Academic Cost Rate and Amount 44.89% $413,067

Total Academic Requirements $1,333,243

Library Rate 11.48%

Library Amount $153,056

Gen'l Instt. Support Rate 54.05%

Neg Adjustment Factor 50.00%

Gen'l Instt. Support Amount $720,618

Total Requirements $2,206,918

Calculation of Appropriation Request

Requirements Generated by SCH Model $2,206,918

TuitionRevenue FTE Tuition Revenue$

In-State Ugrad FTEs 342 2060 $704,520

OoState Ugrad FTEs 12 11267 $135,204

Res per GS116-143.6 5 2060 $10,300

In-State Grad FTEs 43 2159 $92,837

OoState Grad FTEs 1 11486 $11,486

Total Expected Revenue $954,347

Request Amount $1,252,571

In general, SCHs are fundable if they are derived from degree creditable instruction in the regular term (fall or spring semester) via on-campus or distance learning efforts. SCHs are deemed non-fundable if covered by other state appropriations, or if tuition is set to cover the full cost of instruction.


Regular term degree credit instruction delivered on campus or at off-campus resident credit centers

Distance education degree credit instruction delivered to NC resident students, regardless of location, summer and regular academic year

Distance education degree credit instruction delivered to non-resident students within NC

Repeated courses Degree credit instruction offered via

electronic delivery

April 19, 2023UNC Pembroke 21

Non-degree-credit instruction Certain instruction offered below the

baccalaureate level Instruction to students auditing courses Instruction generating continuing education

units (CEU’s) On-campus instruction delivered during the

summer term Distance education delivered outside NC to

non-resident students Instruction to university employees where

employee tuition waiver is claimedApril 19, 2023UNC Pembroke 22

April 19, 202323

REVENUE 2007 2008 2009 2010

Unrestricted

State Appropriations $50,606,593 $57,624,051 $50,448,094 $53,580,406

Student Tuition and Fees $15,176,812 $18,038,017 $19,614,674 $21,167,374

Other Revenue $1,710,090 $657,179 ($284,703) $230,767

SUBTOTAL UNRESTRICTED $67,493,495 $76,319,247 $69,778,065 $74,978,547

Sales and Services $10,323,642 $13,835,062 $14,697,312 $14,975,706

Restricted

Federal Grants and Contracts $10,162,452 $11,804,653 $14,872,757 $21,881,143

State and Local Grants and Contracts $271,605 $769,624 $405,523 $476,452

Nongovernment Grants and Contracts $48,168 $49,760 $96,368 $166,606

Capital Appropriations $10,716,197 $6,127,194 $1,709,530 $3,234,143

Additions to Endowments $473,304 $433,656 $1,188,853 $660,489

SUBTOTAL UNRESTRICTED $21,671,726 $19,184,887 $18,273,031 $26,418,833

Total Revenue $99,488,863 $109,339,196 $102,748,408 $116,373,086

UNC Pembroke

April 19, 2023

Sales and Services:

Sales and Services of Aux Enterprises:

Residential Life $4,670,966

Dining $3,379,254

Student Union Services $45,479

Health, Physical Ed, Recreation $767,875

Bookstore $3,941,642

Parking $257,511

Athletic $181,194

Other $1,168,696

Sales and Services of Ed and Rel Act. $284,695

Total Sales and Services $14,697,312

UNC Pembroke 24

Division Adj. Requirements % of Subtotal

Chancellor $5,480,194 7.15%

Instruction $43,141,048 56.25%

Academic Support $10,570,599 13.78%

VC Business Affairs $9,564,651 12.47%

VC Student Affairs $1,962,079 2.56%

VC Enrollment $3,630,214 4.73%

VC Advancement $766,207 1.00%

VC University Relations $1,577,422 2.06%

Sub Total $76,692,414 100.00%

Utilities $2,802,272

Student Financial Aid $1,998,036

SUM $81,492,722


Operational Funding Over-arching parameters provided by

VC for Business Affairs as set by General Administration.1. Continuation Budget Request – developed

and entered into GA budget system by Director of Budget and Financial Planning. Various divisional employees provide input especially facilities staff.


2. Expansion and Reduction Requests• Divisional input solicited from appropriate

departments, prioritized, and submitted to Budget Director.

• Budget Director summarizes input to be shared with the executive staff (ES) and Chancellor.

• ES sets University priorities.• Chancellor approves priorities or modifies.• Approved data entered into GA budget system.


3. Capital Budgeting (new projects, appropriated and non-appropriated as well as repair and renovation requests)• Asst. VC for Facilities directs the process with

direction given by General Administration.• Six year plans for new projects and for the repair

and renovations.• Divisions- Request for projects or needs is made to

departments and prioritized and shared with Asst. VC for Facilities.

• Asst VC- Summarizes all requests by category. Shares with ES and Chancellor.

• Chancellor- Approves or modifies the recommendations.


2011 Enrollment Growth

Academic Affairs

Institutional Support

Total

Faculty salaries/benefits (20.09 positions)

$2,215,382 $2,215,382

Library $232,219 $232,219

Institutional Support $1,145,375 $1,145,375

Prior Year Enrollment Growth & Focus Growth

$2,342,574 $2,342,574

Total $2,447,601 $3,487,945 $5,935,550


April 19, 202330

Budget Changes Budget Amounts

Accounted For

To Be Accounted For

Flex Reduction $2,500,000

Tuition Offset $1,335,200 $1,164,800

Legislative Mandates

Reversion 1% $558,488

Recruitment $508,227

UNC Pembroke

April 19, 202331

Description Recurring Nonrecurring

Recruitment $350,000

Workman Compensation $350,000

Longevity $121,000

SciQuest Implementation $45,000 $45,000

Campus Police Officers - 3 $121,000

SCT Consultant $160,000

Shared Services $65,000

Audit Fees $55,000

Other Controller $ $42,800 $20,000

UNC Pembroke

April 19, 202332


Student Conduct Database $5,500

Leadership Program $12,000

Student Voice Assessment $17,860

Restore Selected Permanent Cuts

$43,113

Maintenance postage equipment

$21,748

Assistant Budget Director $82,171

Staff Tuition Waivers $14,000

Business Services - nonrecurring

$64,000

Human Resources $23,700 $14,000UNC Pembroke

April 19, 202333


UNCP Today $30,000

Level Three Body Armor $12,600

Touring Bus $250,000

Campus Maintenance and Appearance

$172,000 $125,000

Building Leases – Lowery Properties

$24,000

Maintenance .80 FTE $33,112

UNC Pembroke

Budget Memo # 1 Expansion/Reductions Submit top 3 expansion requests Plan for 5% and 10% reduction of base

budget GA will request funds for enrollment growth GA will consider requests for

1. Salary increases2. Campus safety


General Planning Information Tuition Increase Approved – 218/yr

6,676 FTE @ $218 = $1,455,368 9% Tuition increase

Additional Tuition Increase - $500/yr 6,676 FTE @ $500 = $3,338,000 20.6% tuition increase

Reductions 5% = $3,000,000 10% = $6,000,000

Prior Year Unallocated Enrollment Growth ???


April 19, 202336

Budget Memo # 2• Capital

1. Appropriated six year plan2. Non-appropriated six year plan3. Repair and renovations six year plan

UNC Pembroke

Instructions for Preparation of the 2011-13 State Budget http://www.osbm.state.nc.us/files/pdf_files/BudgetInstructions1_2011-13.pdf

The UNC Budget Development Process http://www.northcarolina.edu/finance/budget/Budget_Process.pdf

NC General Assembly Senate Bill 897 http://www.ncga.state.nc.us/Sessions/2009/Bills/Senate/PDF/S897v8.pdf

Enrollment Change Funding Model http://qed.ncat.edu/ir&p/funding-manual.pdf


Divisional Requests

Recurring

Non-recurring


1. How/what to fund from unallocated resources.

2. How current year decisions impact next year’s budget challenges.

3. Concern that many administrative departments are under funded and under staffed.

4. How to maintain current student/faculty ratios during this period of enrollment growth with budget reductions and reversions.


1. Anticipated 10% budget reduction ($6.0M)

2. Approved tuition increase $218 (9% increase, $1.5M additional revenue)

3. Possible reversions (1%-3%)4. Possible programmatic reductions

(administrative and academic)5. Consider possible additional tuition

increases (per General Administration, up to $500/year 20% increase ,$3.4M)

6. Prior year unallocated budgetsApril 19, 2023UNC Pembroke 40


Undergraduate Student Charges/Year

2009 - 2010

2010 -2011

Change Amount

Change Percentage

Tuition $2,060 $2,423 $363 17.6%

Fees $1,676 $1,717 $41 2.4%

Subtotal $3,736 $4,140 $404 10.8%

Room/Board $5,740 $5,990 $250 4.4%

Total Costs $9,476 $10,130

$654 6.9%


Budget Reduction of 10% $6.00M

Anticipated Budget Reversion of 2% $1.20M

Total Reduction/Reversion $7.20M

Possible Resolution

Approved Tuition Increase $1.50M

Restate FY 2011 Reversion $.56M

Unallocated Funds from Prior Years $1.50M

Programmatic Reductions (Administrative & Academic)

$2.30M

Additional Tuition Increase ($200/yr or 8.2%) $1.34M

Total $7.20M

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