Spring Management Report Meeting - University of Alaska ... · PDF filedistribution of all...

Spring Management Report Meeting

March 24

2010

UAF Spring 2010 Management Report 1

The Financial Year at UAF in Context

FY10 Year-End Expectation UAF has operated throughout FY10 with very limited central resources. In conformance with our adopted budget principles (attachment A), we have operated under the premise that resources are best managed at the core business unit level. Implementing this principle has resulted in maximum distribution of all available resources to schools, colleges and institutes. This coupled with the unintended consequences of implementation the tuition distribution model has resulted in fewer resources available centrally than is prudent (significantly below the established 2% threshold). Although we will close out FY10 with solvency, we are instituting plans to pullback sufficient base and one time funding as we enter FY11 to meet prior-year commitments, central needs, and pending strategic initiatives. To accomplish this and minimize impact on individual units, we have temporarily suspended our maximum carry forward guideline. Units are encouraged to reserve as much as prudent into FY11 in order to minimize the impact of the pending pullback. In fact, after an alarming November management report, we have seen an appropriate increase in projected reserves since announcing this initiative. We believe the units are strategically using existing funds in anticipation of future need. Additionally, we continue to push for improved management report accuracy, thus staying in regular contact with the Deans, Directors, and fiscal officers who are aware of and actively managing their fiscal position. Recharge Center Review and Auxiliary Operations The recharge center review continues. Our focus on the facilities recharge has resulted in a careful review of shop rates and cost structures. That work continues and we expect to see positive change in the coming fiscal year. In conjunction with this year’s rate setting process, we have challenged all centers to carefully consider their operations in light of SW accounting requirements and UAF guidelines. We will be working with those we consider marginal in the coming months. We are also responding to a request from Chancellor Rogers to review those auxiliary and recharge centers managed under Administrative Services and Student Services. Specifically, we have been charged to review business operations in the two units to ensure we are fully leveraging resources to create the optimum student experience at UAF. A key topic is to consider grouping like operations together to maximize management resources and to fully leverage available financial resources.

Institutional Tuition Scholarships (waivers) We continue to implement the UAF budget management principles. We are currently working on the distribution of budget associated with institutional tuition scholarships (tuition waivers and instructional assistantships) to appropriate units. Currently the budget supporting this activity is held centrally but the authority to make awards is distributed. We believe this change properly aligns the authority to grant scholarships with the responsibility to fund those commitments. Planning Forward amid Known Fiscal Gap Another area of focus this spring is to begin addressing a significant looming fiscal gap at UAF. If no structural changes are made, we estimate that by FY13 unrestricted revenue will fall short of requirements by close to $14 million. In addition, there are key strategic investments that must be


made to position UAF for the future. Of course this gap will not materialize because each year we will make necessary adjustments, however the impact of filling it is in fact real, and it must be managed with a two or three-year time horizon, to support decisions that are more holistic and strategic. The gap is largely composed of insufficient general fund revenue increases and the inability to meet necessary non-general fund revenue expectations. Managing the fiscal gap was a key focus area at UAF’s recent Executive Leadership retreat. Attachment E is a presentation on the subject, which was delivered at that event. Although there is much we can do, significant operational and programmatic change will be required to accommodate the gap and still fund the strategic development of the institution. This is and will continue to be a critical focus for UAF in the coming months and years.


1. FY10 Carryforward Analysis UAF’s January management report projects a carryforward of $4.9M in F1. This represents 2.3% of projected F1 revenue. Based on initial carryforward projections, UAF has suspended the maximum carryforward guidelines as stated in the carryforward principles. This will allow departments to strategically use existing funds in anticipation of FY11 needs. It is anticipated that this action will move the anticipated year end F1 carryforward into the $5M to $7M range. Total carry forward projection including recharge and leasing (F7, FE, FL) is $13.2M. In FY09, the newly adopted carryforward policy coupled with the development of “shovel ready” projects enabled UAF to manage down the carryforward balance going into FY10. UAF will continue to active manage our carryforward to ensure that UAF ends FY10 within projected levels. As in prior years the bulk of FY10 carryforward will be returned back to the contributing units. The units with deficits from FY10 will be required to submit a repayment plan that includes identifying contributing factors and the steps they will take to remediate those factors in future years. In accordance with our budget principles, Central management will hold sufficient resources to ensure achievement of institutional goals and to support performance based budgeting requirements.

Distributions from central carryforward will be approved via the Chancellor’s Cabinet. The funding priorities are identified during the budget development process and in response to new strategic investment opportunities such as; facilities and space needs (including energy efficiencies), climate, energy engineering and biomedical priorities.

2. FY10 Budget Building Process and Status No FY09 carryforward was used to balance the FY10 budget. However, funding of known commitments would have drawn central resources $2.6M below what was initially available. As noted in our response to question 3 below, a pullback of funding from our units and additional tuition and ICR revenue enabled us to meet these commitments as required throughout the year.

3. Management of Contingencies The initial budget contained a $1.3M in central contingency reserve, which is less than the 2% required. An additional $2M was pulled back centrally in August (see attachment B) to ensure that adequate funding was available to cover centrally allocated costs and strategic investments. A separate $1.4M pool for PBB reallocations was funded at continuation time. Increases in Tuition and ICR revenue over the prior fiscal year helped offset central investments in institutional tuition waivers, assistantships and other strategic needs including $522K for the utilities not covered by the trigger funding. Decisions on use of additional contingency funds which may become available are driven by ongoing commitments, prioritization and one-time funding requests. With the exception of managing to the targeted carry forward range of $5M to


$7M, we do not anticipate significant additional contingency funding will be available for the balance of the fiscal year.

4. FY10 Initiative and Initiative Pool, TVEP Status We are projecting to fully expend all initiative pool and TVEP funds. We will continue to monitor.

5. Debt Strategies and Plans The only new debt related issue we anticipate for FY11 is $106K associated with the High Bay Test Module (Energy Technology Facility phase 1A). Debt for the Life Science Classroom and Lab Facility will not kick in until FY12. Please see attachment C for details.

6. Grants and Contracts Accounts Receivable Analysis Historically, total revenue from restricted grants and contracts has been greater during the first and second quarters, than during the third and fourth quarters. The size of the first two quarters is attributed primarily to increased expenditures during the summer research field season and an increase in funding tied to the start of the federal fiscal year on October 1. The average Accounts Receivable balance during the 2nd quarter of fiscal year 2010 has seen a significant decrease. The balance of the receivables is 11% less than the 2nd quarter of FY08 and 17% less than FY09. The reduction is largely due to the Office of Grants and Contracts Administration (OGCA) ongoing collection and monitoring policy which was instituted the last two quarter of fiscal year 2009. The average restricted revenue in relation to restricted receivables is projected to decrease by 4% from fiscal year 2008 and 14% from fiscal year 2009. The majority of outstanding Accounts Receivable in the past was due to large amounts of uncollected revenue from private entities. The entities included other universities, native corporations, non-profits and corporations. Because of the UAF ongoing collection policy OGCA believes the outstanding balance will have a steady decrease. OGCA is anticipating an increase of restricted revenues this year due to the additional American Recovery and Reinvestment Act (ARRA) funding. The increase is anticipated to climb steadily over the next two years as the grants are expensed. Because the accounts receivable generated from the ARRA funding is paid by electronic means the ratio of outstanding receivables to revenue is also anticipated to decrease for the next two years. See attachment D for details.


ATTACHMENT A


Attachment A – Budget Principles

Coordination

1. Direction A clear set of short and long term objectives will be developed.

2. Community The assignment of responsibilities and authority and the allocation of resources will explicitly reflect the relationship of the parts to the whole. The model will incorporate mechanisms which recognize and incent partnerships and cooperative activities between units.

3. Mission Focus Central management will hold sufficient resources to ensure achievement of institutional goals and to support performance based budgeting requirements.

Motivation

4. Value and Reward Growth and Quality Improvement The system will incent and reward efficiency, effectiveness and growth with particular emphasis in areas which specifically meet institutional mission and goals. It will incorporate straightforward and easily understood mechanisms designed to automatically recognize and reward effective performance.

5. Stability To maximize motivation of desired behavior and ensure operational stability and predictability, the assignment of responsibility, authority and the rules for budget distribution will be known, remain constant and be enforced.

Decision Making

6. Decentralization To optimize decision making and efficiency of operations the system will allow for the distribution of authority and responsibility to the maximum extent possible and reasonable. The closer the point of an operating decision is to the point of implementation, the better that decision is likely to be. Decentralization will be done with a clear sense of purpose and with the intent to avoid duplication of function.


7. Knowledge Information is needed to allow decision makers to arrive at decisions which promote UAF objectives. The system will have processes in place which generate and communicate data in an effective and timely manner.

Stewardship

8. Fiscal Accountability The model will encourage units to generate carry forward amounts within established limits and will contain clear sanctions for units which deficit spend or whose projections deviate from actual in amounts greater than established variances.

9. Space Accountability Space is a limiting factor for the delivery of programs and services at UAF. The model will encourage efficient and prioritized use of available space.


ATTACHMENT B


Pat Pitney, Vice Chancellor (907) 474-7907

(907) 474-5850 fax [email protected]

www.uaf.edu/adminsvc/

Administrative Services University of Alaska Fairbanks, P.O. Box 757900, Fairbanks, Alaska 99775-7900

MEMORANDUM

TO: Brian Rogers, Chancellor FROM: Pat Pitney, Vice Chancellor Administrative Services DATE: August 17, 2009 SUBJECT: FY10 budget status

UAF is entering FY10 in a very tight fiscal position centrally. This is due to conscious decisions to empower schools and colleges to manage the majority of revenue at the unit level and because of significant budget hits to central reserves. Decisions were made to maximize the level of control schools, colleges, and institutes have to deliver service to their units. The tuition model (coupled with the existing ICR distribution model), the new carry forward principles, and full distribution of available FY10 general fund allocations to operating units, are evidence of those decisions. At the same time we chose to fund major unbudgeted items centrally rather than passing cost on to departmental budget, thus drawing reserves down to near zero. A few significant ones are listed below.

• Legislature’s denial of the utility and athletics travel supplementals - $1.3M and $0.3M respectively

• UAF’s portion of investment losses - $2.1M • Use of general fund to units to cover 100% of FY09 salary increases when ICR and tuition were

required to cover 40% • Additional SW charge backs due to the investment loss - $0.6M

I believe providing maximum management control at schools, colleges, and institutes is appropriate and we will work to maintain and enhance that approach, however, under the conservative revenue assumptions in the attached FY10 budget summary, UAF is approximately $2M below continuation requirements. Central reserves are at less than 1% when 2% is required. To address this shortfall, and to position us to meet existing commitments, I am recommending the creation of a non-base funding pool by collecting the equivalent of 1% of actual FY09 unrestricted receipts from all UAF units. These funds will be managed within the multiple appropriation budget constraints.


mailto:[email protected]�

Memo to Chancellor Rogers re: FY10 Budget Status Recently instituted cost saving measures for unrestricted funded positions will provide unit managers the tools required to minimize the impact of this action.

• Extended Christmas soft closure - $700K potential savings • Managing for extended vacancies - $980K potential savings (60 additional vacant days per

position recruitment)

These cost saving programs coupled with tuition and ICR revenue generating capacity will minimize the operational impact on major academic and research units. Units without revenue generating capacity will be dependent on utilizing the cost saving measures only. Additionally all cabinet members have been requested to;

• Promote energy efficiency • Examine use of university vehicles • Scrutinize travel • Critically examine space utilization.

Alternatives, including a base reduction and a pull back of actual revenue in excess of projected, were considered. These approaches were dismissed due to the temporary nature of the shortfall and because they were considered a violation of base principles calling for preserving as much flexibility at the unit level as possible. I believe this action maintains UAF’s strategic momentum, by minimizing the impact to core instructional and research units and serves as an effective short-term bridging strategy to meet existing priority commitments. It positions UAF sufficiently at this time; however, we will need to revisit our overall fiscal status in the November/December time frame. Current budget distribution status and impact of the 1% by unit are attached for reference. At that time we will have more information on the status of FY10 legislative utilities funding, know tuition and ICR revenue levels, and therefore be in a position to make decisions concerning additional cost saving measures should it be necessary. With your approval a 1% pull will be applied to each unit’s budget by August 24, 2009.


Unrestricted Pull Back

in 1,000's

Division

Total FY09 Unrestricted

Revenue 1% Pull BackChancellor Chancellor Office Operation $1,043.6 $10.4 Equal Opportunity and Diversity $342.8 $3.4 Governance $191.4 $1.9 Human Resources $1,635.9 $16.4 Information Technology $3,920.5 $39.2 Total Chancellor $7,134.1 $71.3Provost College of Engineering & Mines $11,910.2 $119.1 College of Liberal Arts $14,764.8 $147.6 College of Nat Sciences&Mathematics $11,672.1 $116.7 Cooperative Extension $4,149.1 $41.5 Library $8,010.9 $80.1 Museum $3,482.9 $34.8 Provost Office Operations $5,069.2 $50.7 School of Education $3,612.8 $36.1 School of Fisheries & Ocean Science $11,201.0 $112.0 School of Management $4,891.8 $48.9 School of Nat Res & Ag Science $5,986.7 $59.9 Summer Sessions $2,195.0 $21.9 Total Provost $86,946.3 $869.5VCAS Auxiliary & Business Services $180.9 $1.8 Environ Health&Safety and Risk Mgmt $1,342.4 $13.4 Financial Services $5,745.1 $57.5 Safety Services $2,943.4 $29.4 Facilities Services $20,938.6 $209.4 Physical Plant $477.4 $4.8 Utilities $155.1 $1.6 VCAS Office $868.6 $8.7 Total VCAS $32,651.5 $326.5CRCD Bristol Bay $1,963.4 $19.6 Chukchi Campus $1,176.5 $11.8 Interior-Aleutians Campus $2,759.9 $27.6 Kuskokwim $3,927.6 $39.3 Northwest $2,118.9 $21.2 Rural College $9,524.1 $95.2 Tanana Valley $11,017.5 $110.2 Total CRCD $32,487.8 $324.9VCUA Student Rec Center $647.9 $6.5 Athletics and Recreation $6,034.4 $60.3

Development Office $547.7 $5.5

KUAC $907.9 $9.1

UAF Alumni Association $202.5 $2.0

University Marketing $1,783.8 $17.8

University Relations $408.5 $4.1

VC Advancement&Community Engagement $704.3 $7.0 Total VCUA $11,237.0 $112.4VCR Arctic Region Supercomputing Center $2,263.4 $22.6 Geophysical Institute $9,709.0 $97.1 Institute of Arctic Biology $6,373.9 $63.7 Intl Arctic Research Center $3,784.2 $37.8 Vice Chancellor for Research $7,154.5 $71.5 Total VCR $29,285.1 $292.9VCSES Admissions $2,063.2 $20.6 Enrollment Mgmt Administration $145.2 $1.5 Financial Aid $750.2 $7.5 Freshman & Transfer Services $239.8 $2.4 Registrar $1,289.5 $12.9 Residence Life Programs $1,397.0 $14.0 Student Affairs $3,146.2 $31.5 Wood Center Programs $865.3 $8.7 Total VCSES $9,896.3 $99.0

Grand Total $209,638.0 $2,096.4


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Estimated Soft Closure Savings

Employee CategoryTotal FY09

Exp (103010) Staff Benefits TotalClosure Savings

Executive $5,271,147.9 $1,718,394.2 $6,989,542.1 $78,829.4APT $16,116,728.6 $7,848,846.8 $23,965,575.5 $270,288.4Classified $18,108,744.3 $11,372,291.4 $29,481,035.7 $332,492.9APT Temp $119,166.4 $9,414.1 $128,580.6 $1,450.2Classified Temp $1,444,825.3 $114,141.2 $1,558,966.5 $17,582.3Classified Temp Extended $34,107.8 $14,120.6 $48,228.5 $543.9Total Salary and Benefits $41,094,720.4 $21,077,208.4 $62,171,928.8 $701,187.2

Estimated Utility Savings $7,500.0

Total Closure Savings $568,449.7

Benefit RatesExecutive 32.6%APT 48.7%Classified 62.8%APT Temp 7.9%Classified Temp 7.9%Classified Temp Extended 41.4%

Participation Factor 80.0%Total Work Days in Year 266Total Days in Closure 3Percent of Days in Closure 1.13%Utility Savings Per Day $2,500.0


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$32.

2$1

6.8

$57.

8($

4.4)

$40.

4$2

91.5

$355

.3$5

,625

.7

($1,

318.

3)($

141.

7)($

9.8)

($52

.4)

($41

.0)

($29

.1)

($16

4.6)

($40

.5)

($28

.9)

($17

3.9)

($2,

000.

2)

$417

.8$0

.0$0

.0$0

.4$0

.3$4

.9$1

1.9

$5.4

$68.

3$9

1.0

$600

.0$3

00.0

$300

.0$0

.0$0

.0$0

.0$0

.0$0

.0$0

.0$0

.0$0

.0$6

00.0

$390

.4$7

8.7

$16.

1$5

.1$3

.7$6

.8$1

1.9

$6.6

$18.

4$2

3.3

$560

.9$5

12.4

$103

.3$2

1.1

$6.7

$4.8

$8.9

$15.

6$8

.6$2

4.1

$30.

5$7

36.2

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$0.0

$1,0

55.5

$0.0

$0.0

$19.

6$8

.7$1

2.5

$99.

3$9

.7$0

.0$0

.0$1

,205

.3

$2,6

76.2

$482

.0$3

7.2

$31.

9$1

7.5

$33.

0$1

38.8

$30.

3$1

10.9

$144

.8$3

,702

.5

$1,7

71.5

Viro

logy

M&

R (f

unde

d on

e tim

e) C

ES

(Fun

ded

one

time)

CE

S/A

CE

P/E

ngin

eerin

g O

utre

ach

(fund

ed)

AC

EP

(fun

ded

one

time)

Hea

lth P

rogr

ams

(fund

ed)

Tota

l Bas

e O

blig

atio

ns

Viro

logy

M&

R (f

unde

d on

tim

e)

FY

10 C

ompe

nsat

ion

Incr

ease

(les

s ex

ecut

ive

sala

ry re

duct

ion)

Bal

ance

Rev

enue

Adj

ustm

ents

FY

10 T

uitio

n R

even

ue -

Cha

nge

in R

ate

(+5%

)

M&

R (f

unde

d)

CE

S/A

CE

P/E

ngin

eerin

g O

utre

ach

Tota

l Pot

entia

l Sol

utio

ns

CE

S (f

unde

d on

e tim

e)

AC

EP

(fun

ded

one

time)

Hea

lth P

rogr

ams

(fund

ed)

M&

R (f

unde

d)

SW

Cha

rge-

Bac

ks

Sta

ff B

enef

it R

eser

ve

Tota

l Rev

enue

Adj

ustm

ents

Inc

reas

ed IC

R ($

3.2M

Add

ition

al R

estri

cted

Act

ivity

)

FY

09 E

nrol

lmen

t Inc

reas

e an

d/or

Enr

ollm

ent P

atte

rn S

hift

Sta

ff 4.

5% G

rid A

djus

tmen

t (60

%)

AC

CFT

and

Uni

ted

Aca

dem

ics

Mar

ket A

djus

tmen

t (60

% F

1) A

djun

ct F

acul

ty C

ompe

nsat

ion

(AA

UP

- FT

) A

HE

TCE

Com

pens

atio

n (L

6070

- C

R,C

T) (6

0% F

1)

Bas

e A

djus

tmen

ts

New

Bas

e B

udge

t Obl

igat

ions

(Req

uire

d):

AC

CFT

and

Uni

ted

Aca

dem

ics

Com

pens

atio

n (U

AFT

/UN

AC

- A

9/F9

) (60

% F

1)

Tota

l New

Bas

e B

udge

t Obl

igat

ions

(Req

uire

d)

Oth

er B

ase

Adj

ustm

ents

:

Tota

l Oth

er B

ase

Adj

ustm

ents

FY

09 M

arke

t Adj

ustm

ent (

A9

and

F9 M

arke

t plu

s E

xecu

tive

Rai

se)

FY

10 M

AU

PB

B P

ool P

ull B

ack

(1%

of G

F) F

Y10

MA

U P

BB

Poo

l rea

lloca

tion

1% U

nres

tric

ted

Pullb

ack

Pote

ntia

l Sol

utio

ns

Util

ity E

xpos

ure

(Ass

umes

$2.

687

Trig

ger F

undi

ng)

Fue

l Sup

plem

enta

l

Sof

t Hol

iday

Clo

sure

(3 d

ays)

Tw

o W

eek

Forc

ed V

acan

cy U

tility

Sav

ings

(2%

ene

rgy

cons

erva

tion

effo

rt)

Enr

ollm

ent I

ncre

ase

(2%

)

3/23

/201

0D

RA

FTU

AF

Bib

le 0

8_07

_09.

xlsx


ATTACHMENT C


UA

F D

ebt P

aym

ents

FY

09 to

FY

19(A

ll am

ount

s in

thou

sand

s)

Cat

egor

y / D

escr

iptio

nD

ebt

Am

ount

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17

FY18

FY19

Cur

rent

Deb

tSE

RIES H - CCD Project Diesel E

ngine Generator

848

$

647

$

-$

-$

-$

-$

-$

-$

-$

-$

-$

SERIES J - Refinance A & B (S

RC)

516

432

-

-

-

-

-

-

-

-

-

SERIES K - WRRB, R

efinance C & I

1,040

1,044

1,042

1,042

1,041

656

653

654

654

657

655

SERIES L - W

RRB, A

thletics, CRA, Electric Line

565

538

540

542

538

534

406

405

404

403

671

SERIES M - Hutchison Upgrade, IAB (R

eallocated)

63

63

63

63

63

63

63

63

63

63

323

SERIES N - Intertie, Chiller, BiRD, Patty Ice, Aurora, Elvey

1,615

1,618

1,613

1,617

1,609

1,614

1,613

1,722

1,671

1,668

1,341

SERIES O - Lena Point, M

useum, A

rctic Health, V

irology

951

949

947

935

942

948

948

952

945

951

278

SERIES P - R

efinancing Series H

& J

-

117

1,248

1,242

1,251

1,249

1,248

1,246

1,244

1,245

779

S

ub-T

otal

: Deb

t Ser

vice

on

Cur

rent

Deb

t Iss

ues

5,59

8$

5,40

8$

5,45

3$

5,44

1$

5,44

4$

5,06

4$

4,

931

$

5,

042

$

4,

982

$

4,98

8$

4,

046

$

Percent of U

nrestricted Revenue

2.2%

2.1%

2.0%

1.9%

1.8%

1.6%

1.5%

1.4%

1.4%

1.3%

1.0%

Proj

ects

with

Ant

icip

ated

Deb

t Fun

ding

(1) (2)

Life Science Classroom

and Lab Facility (P

roject Cost $108.6M

)20,625

$ -

$

-$

-$

815

$

1,630

$

1,630

$

1,630

$

1,630

$

1,630

$

1,630

$

1,630

$

Energy Technology Facility 1A

(Site W

ork and Test M

odules) (3)

3,000

$

-

-

106

150

-

-

-

-

-

-

-

Energy Technology Facility 1B

(Project Cost $29.6M)

14,300

$ -

-

-

-

572

1,144

1,144

1,144

1,144

1,144

1,144

S

ub-T

otal

: Deb

t Ser

vice

on

Ant

icip

ated

Deb

t Iss

ues

-$

-$

106

$

965

$

2,20

2$

2,77

4$

2,

774

$

2,

774

$

2,

774

$

2,77

4$

2,

774

$

Percent of U

nrestricted Revenue

0.0%

0.0%

0.0%

0.3%

0.7%

0.9%

0.8%

0.8%

0.8%

0.7%

0.7%

Deb

t Ser

vice

on

Cur

rent

and

Ant

icip

ated

Deb

t Iss

ues

T

otal

: Deb

t Ser

vice

on

All

Deb

t Iss

ues

5,59

8$

5,40

8$

5,55

9$

6,40

6$

7,64

6$

7,83

8$

7,

705

$

7,

816

$

7,

756

$

7,76

2$

6,

820

$

Percent of U

nrestricted Revenue

2.2%

2.1%

2.0%

2.2%

2.5%

2.5%

2.3%

2.2%

2.1%

2.0%

1.7%

Tot

al U

nres

tric

ted

Rev

enue

(F

orec

ast)

248,

861

$ 26

1,30

4$

274,

370

$ 28

8,08

8$

30

2,49

3$

317,

617

$

333,

498

$

350,

173

$ 36

7,68

2$

38

6,06

6$

405,

369

$ In

tern

al D

ebt A

rran

gem

ents

U

A M

useum Settlement

2,650

$

265

$

265

$

265

$

265

$

265

$

265

$

265

$

265

$

265

$

265

$

-$

B

ookstore/Tech Center D

eficit Repayment

2,165

$

-

365

450

450

450

450

-

-

-

-

-

Life Sciences P

lanning (Pay-off w/ L

ife Sciences D

ebt Issue) (4)

1,000

$

-

-

-

-

-

-

-

-

-

-

-

Signers' H

all O

ne-Stop Renovation

700

$

-

200

200

200

100

-

-

-

-

-

-

D

igital T

V Equipment

400

$

-

100

100

100

100

-

-

-

-

-

-

S

ub-T

otal

: Int

erna

l Deb

t Arr

ange

men

ts265

$

930

$

1,015

$

1,015

$

915

$

715

$

265

$

265

$

265

$

265

$

-$

Percent of U

nrestricted Revenue

0.1%

0.4%

0.4%

0.4%

0.3%

0.2%

0.1%

0.1%

0.1%

0.1%

0.0%

Add

ition

al It

ems U

nder

Con

side

ratio

n C

ommunity Cam

pus A

cquisition

400

$

-$

-$

50$

50$

50$

50$

50$

50$

50$

50$

-$

Note 1: BiRD and Virology build-out projects h

ave been removed from

this schedule until new hires associated with a Life Sciences facility would make these advanced laboratory sp

aces a higher priority.

Note 2: Utilities projects, including Critical Electrical Distribution, Pow

er Plant Revitalization, W

est R

idge Energy Conservation, and M

ain Waste Line Repairs have been removed from

this schedule in

anticipation of State R&R funding. Should such funding fail to materialize in timely fashion, debt financing is a fallback proposal.

Note 3: ETF

debt associated with Phase 1A paid off w

ith bond proceeds in ETF

Phase 1B; otherwise scheduled at $280K

annually beginning in FY12.

Note 4: W

orking capital loans on Life Sciences w

ould be paid off with bond issue. In the event that L

ife Sciences d

oes n

ot move forward in a timely manner, paym

ents would be made beginning in FY11

scheduled at $400K

, $150K

, $150, $150K

, and $150K

through FY

15.

Additional Notes:

Assum

es 5% annualized growth in unrestricted revenues

Assum

es debt service at $80,000 per $1,000,000 project costs

FY10 SMR - DEB

T 032310[1]


ATTACHMENT D


Att

achm

ent

D


ATTACHMENT E


3/23/2010

1

FY10 Budget Status

1

FY09 Budget

$8.5M Non‐General Funds Required to Maintain Existing Programs!(Only $1.6M Additional NGF Earned in FY09)

Compensation Increase$4.6M General Fund$3 7M Non‐General Fund

Maintenance & Repair$506K General Fund$670K Non‐General Fund$3.7M Non General Fund $670K Non General Fund

Other Fixed Costs$1.0M General Fund$4.1M Non‐General Fund

Programs$2.6M General Fund$2.8M Non‐General Fund

2

FY10 Budget

$8.2M Non‐General Funds Required to Maintain Existing Programs!($7.4M projected additional in FY10)

Compensation Increase$4.2M General Fund$3 3M Non‐General Fund

Maintenance & Repair$434K General Fund$657K Non‐General Fund$3.3M Non General Fund $657K Non General Fund

Other Fixed Costs$150K General Fund$4.2M Non‐General Fund

Programs$1.1M General Fund$2.7M Non‐General Fund

3


3/23/2010

2

Reasonable Carry Forward

• Based upon Carry Forward Guidelines:

– Minimum of 1% or $3,574,249

– Maximum of 2% to 4% or $10,296,954

• Projected Carry Forward Based Upon YTD Revenue and Expense Activity

– Between $5M and $9M

4

F1 Carry Forward Projectionsas of November 2009

UnitProjected Carry

Forward

Chancellor $17,539

VC For Rural, Community & Native Education $326,571

Provost $758,500

5

$ ,

Vice Chancellor for Students $83,792

VC Advancement & Community Engagement <$460,130>

Vice Chancellor for Administrative Services $155,764

Central Obligations (Scholarships, debt service, utilities etc.) <$1,577,045>

Vice Chancellor for Research $1,639,551

Total $944,542

Suspend Maximum Carry Forward Guideline

• For FY10 there will be no sweep of carry forward in excess of levels specified in the guidelines

• The accuracy guideline will remain in effect

6


3/23/2010

3

Institutional Needs

• Institutional Shortfall ‐ $2.6M– Un‐Budgeted Scholarships– Critical Needs

• Fuel – Non General Fund Portion• Departmental Needs

– International Programs– Development OfficeDevelopment Office– Arctic Policy– School of Management

• Infrastructure– One Stop– Initial Capital Project Development

• Structural Deficit Funding– KUAC– Bookstore/Tech Center– Athletics– OIT

7

Lay of the Land

How We Evolved Financially From yFY05 to FY09

8

FY09 Unrestricted Expenditures by NCHEMS

FY09 Actual ‐ % of Total – FY05‐FY09 Direction of ChangeAcademic Support ‐ $21.2M/5.2% ‐ ↑

Debt Service ‐ 3.7M/.9% ‐ ↗

Institutional Support ‐ $34.9M/8.6% ‐ ↑

Instruction ‐ $69.5M/17.2% ‐ ↗

I ll i A hl i $5 3M/1 3% ↑

Research

AcademicSupport

InstitutionalS t

9

Intercollegiate Athletics ‐ $5.3M/1.3% ‐ ↑

Library Services ‐ $8.6M/2.1% ‐ →

Physical Plant ‐ 51.4M/12.7% ‐ ↗

Public Service ‐ $9.3M/2.3% ‐ ↑

Research ‐ $43.4M/10.7% ‐ ↗

Scholarships ‐ $3.0M/.7% ‐ →

Student Services ‐ $13.1M/3.2% ‐ →

Support

PhysicalPlant

Instruction


3/23/2010

4

Relative SizeFY09 General Fund and Non‐General Fund Revenue

General Non‐General Percent

Unit Fund Fund Total Of Total

Chancellor $4,688.1 $587.3 $5,275.4 1.5%

Provost $61,574.7 $61,635.3 $123,210.0 34.0%

CRCD $19,849.9 $23,604.0 $43,453.9 12.0%

VCR $13,063.7 $71,734.7 $84,798.4 23.4%

VCACE $7,231.1 $5,945.3 $13,176.4 3.6%

VCSES $7,435.4 $21,200.2 $28,635.6 7.9%

VCAS Operating $9,760.7 $10,416.3 $20,177.0 7.0%

Physical Plant & Utilities $21,961.2 $9,577.4 $31,538.6 4.4%

VCAS Institutional $4,160.5 $7,837.5 $11,998.0 3.3%

Total $149,725.3 $212,538.0 $362,263.3 100.0%

10

General Fund Over Time

$40,000.0

$50,000.0

$60,000.0

$70,000.0

FY05

$0.0

$10,000.0

$20,000.0

$30,000.0FY06

FY07

FY08

FY09

11

Annual Growth Rate in General Fund Revenue

FY05 – FY09 Annualized

8.00%

10.00%

12.00%

14.00%

16.00%

‐4.00%

‐2.00%

0.00%

2.00%

4.00%

6.00%

12


3/23/2010

5

Annual Growth Rate in Non‐General Fund Revenue

FY05 – FY09 Annualized

15.00%

20.00%

25.00%

30.00%

‐5.00%

0.00%

5.00%

10.00%

13

Where Are We Going

FY11 and Beyond

14

Assumptions

• Annual 3% Salary Increase

• Annual 15% Benefit Increase

• Annual 5% Tuition Rate Increase / 7% in FY12

• Change in Enrollment – Unit Specific

• Indirect Cost Recovery – Unit Specific

15


3/23/2010

6

Meeting Priorities While Costs Continue To Increase

• Salaries• Staff Benefits (Health Care)• Utilities/Fuel• SW Assessments

– Network– Data Tapes

Skillsoft– Skillsoft– Roxen

• Board of Regents Maintenance and Repair Requirement• Risk Management• Debt Service (Life Sciences, Energy)• Custodial Services Contract• Scholarships• Other Inflationary Items• Structural Deficits

16

Main Revenue Drivers

• Enrollment

• Tuition Rates

• Restricted Activity and Corresponding ICR

• General Fund

• Fund Raising

• Auxiliaries

• Bake Sales

17

Potential Increased Revenue

• Tuition Rate Increase Only – $1.6M• ICR on Sponsored Activity

– 1% – $280K– 5% – $1.4M

E ll t I ( t FY11 T iti R t )• Enrollment Increase (at FY11 Tuition Rates)– 1% ‐ $330K– 5% ‐ $1.6M

• Federal Revenue– 1% ‐ $880K– 5% ‐ $4.5M

18


3/23/2010

7

FY11FY11

19

FY11 BudgetGovernor’s Proposal

$8M Non‐General Fund Required to Maintain Existing Programs!

Compensation Increase$3,674 General Fund$3,550 Non‐General Fund

Maintenance & Repair$795 General Fund$790 Non‐General Fund

Other Fixed Costs$1,282 General Fund$ 3,655 Non‐General Fund

Programs$950 General Fund$2,668 Non‐General Fund

20

FY12FY12

21


3/23/2010

8

How Do We Meet The Challenge?

22

Unrestricted Revenue GapBased Upon FY05 to FY09 Annualized Data

$320,000.0

$340,000.0

$360,000.0

$3.5M Gap

$8.3M Gap

$13.8M Gap

23

$220,000.0

$240,000.0

$260,000.0

$280,000.0

$300,000.0

FY09 FY10 FY11 FY12 FY13

Projected Expense

Projected Unrestricted Revenue

Annualized Expense Increasing at 8.42%Annualized Revenue Increasing at 6.86%

$4.2MSurplus

Breakeven

How Are We Going To Address Priorities

• Raise Revenue

• Reduce Cost

• Reallocate

• Transform• Transform

• Stop Doing

• Incentives to Encourage What Practices/Behaviors

• Key Strategic Investments

24


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Transcript of Spring Management Report Meeting - University of Alaska ... · PDF filedistribution of all...