Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
Budgeting for Excellence
Just Do It
Presentation to the Faculty Senate
November 16, 2004
Update on Budget Advisory Committee
Working Plan Recommendations
This file was formatted to contain all information of the presentation to the Senate including all text pages provided in a handout.
Budgeting for Excellence
Just Do It
Provost’s General Introductory
Comments
What Does This Mean to
Academic Units
1
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
2
Shifting of Sources of GRA:
Academic
Affairs
Division
Academic Affairs - 2002 General Revenue Allocation
$102,057,064
Recovery of
State
F&A
Appropriation
$1,976,060
$53,459,224
2%
52%
Tuition
$46,621,780
46%
Academic Affairs - 2005 General Revenue Allocation $108,581,853
Distribution percentages of General Revenue Allocation within Academic
Affairs calculated identically to the overall composition of the overall GRA for
the entire UMKC operating fund.
Tuition - 46%
State Appropriation - 52%
Recovery of F&A - 2%
Recovery of
F&A
$2,945,775
3%
Tuition
$60,521,726
55%
Note: For illustration purposes, the allocation of GRA by
major source of revenue is based on the %
distribution of the major sources of revenue to the
campus GRA revenue.
Distribution percentages of General Revenue Allocation within
Academic Affairs calculated identically to the overall
composition of the overall GRA for UMKC operating fund.
Tuition - 55%
State Appropriation - 42%
Recovery of F&A - 3%
State
Appropriation
$45,114,352
42%
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
3
UMKC Budgeting for Excellence
Revenue Allocation Model
Enrollment
Driven
Aligns
Resources to
Goals &
Priorities
Responsibility
Center
Based
CURRENT General Revenue Allocation
State
Appropriation $$$$
Incentive/
Performance
Based
Student Tuition
Fees $$$$
Recovery F&A
$$$$
General
Revenue
Allocation
Designated Fees
Allocated directly
to Units
Academic
Units
Campus
Programs
Support
Units
Proposed BFE General Revenue Allocation
Model – Impact to Academic Affairs Units
Student Fee Tuition $$
(Net of Scholarships)
LESS: 10%
for Infrastructure
Existing State Appropriation
LESS: 10%
for Infrastructure
Modulated by
Performance
Assigned Goals
Provost
Office
New State
Appropriation $$$
Just Do It
BAC
Allocated
By
Executive
Cabinet
ACADEMIC
UNITS
Budgeting for Excellence
Update on Budget Advisory Committee
Working Plan Recommendations
Setting the Context
UMKC Budgeting for Excellence
Major Attributes:
ƒ Vision & Value
Driven
ƒ Accountability
ƒ Open
ƒ Responsive
ƒ Strategic
ƒ Documented
Recommendations:
ƒ Stakeholder input
ƒ Aligns resources to
priorities
ƒ Assigns
accountability
ƒ Communication
ƒ Multi-year focused
Budget Advisory Committee
Faculty
Senate (2)
Staff (1)
Assembly
Deans
(3)
Admin (6)
Support
Budget
Budget
Advisory
Advisory
Committee
Committee
Students
(1)
Faculty
(6)
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
4
Budget Advisory Committee
Work in Progress
; COMPLETED: Discussion of proposed New Budget Process that
aligns with the attributes from the Budgeting for Excellence model
; COMPLETED: “Grounded” on the current General Revenue
Allocation model and current appropriation process
; COMPLETED: Need for funding campus priorities prior to any
unit/division allocation of funds
; COMPLETED: Assumptions and methodology for Tuition Revenue
allocations and Tuition Revenue Modeling for AY2003-2004
; COMPLETED: Allocation Strategy for State Appropriations
; COMPLETED: Preliminary discussion concerning process to
identify designated priorities and initiatives
Budget Advisory Committee
Work in Progress
NOT COMPLETED:
ƒ Specific %age allocations for core campus priorities
ƒ Process for developing and reporting performance
results
ƒ Recommendations for campus stakeholder input
ƒ Indirect Cost Recovery – Defer to future phases
ƒ Interim performance criteria for first year until
measures can be developed
Setting the Context
UMKC Revenue Allocation Model
Recommendation 2:
Proposed Revenue Model:
Align resources to the ; Transparent
campus priorities
; Open
ƒ Net Revenue
Allocation Model
; Responsibility centered
ƒ Incentives and
based
rewards based on
performance
; Incentive based
-- Enrollment is everyone’s
ƒ Partnerships and
business
cost-sharing
-- Contributions to Campus
incentives
Goals and & Priorities
Aligning Resources to Campus Priorities
and Processes to Campus Values
Transition to Budgeting for Excellence
Revenue Allocation Model
Old Paradigm
Centralized
Management
Transition Phase:
Exploration
New Paradigm
Responsibility
Centered Management
UMKC Budgeting for Excellence
Revenue Allocation Model
Enrollment
Driven
Aligns
Resources to
Goals &
Priorities
Responsibility
Center
Based
Incentive/
Performance
Based
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
Aligning Resources to Campus Priorities and Processes to Campus Values:
Transition to Budgeting for Excellence: Revenue Allocation Model Recommendations
Old Paradigm:
Centralized Management
New Paradigm:
Responsibility Centered Management
Transition Phase:
Exploration
Reversion of salary savings.
Net revenue sharing FY02
Limited management of operating budget
components (manage expenses but not revenues).
Provost Leverage fund-FY03
Incremental budgeting.
Professional school tuition
distribution-FY04
Restrictions on use and transfer of funds between
operating expense categories.
Net tuition fees less "off-the-top" funding for core
educational support (library, instructional
equipment, instructional facilities R & R, academic
excellence enrollment management, reserve)
allocated directly to Schools/Colleges
Proposed funding of operating cost
for new facilities in academic units
(SOD)-FY05
Silo effect, no shared goals directing resource
allocation.
State funds allocated to:
Central administration assumes all responsibility for
financial health of institution.
Chancellor's innovation fund- FY04
Proposed 2% Performance AllocationFY05
Financial flexibility maximized.
Property rights principle protects base budget.
Proposed fund balance tax for
facilities M & R-FY05
$14.0 Million "off budget" items.
Supplemental fees & charges
allocated to unit-FY04
Graduate cluster fee allocated to unitFY05
1. Core administrative support functions
2. Campus-wide infrastructure and
improvements:
a) Library
b) Institutional Excellence
c) Non-instructional capital R & R
d) Research Equipment
d) Technology
f) Reserve
3. Balance of state funds to support for
teaching, research and service
missions based on performance.
Allocate supplemental fees & charges directly to unit
generating the revenue.
Proposed Technology infrastructure
fee allocated to IS. Required
expenditure for infra-structure and
ASP - FY05
5% of the amount of F & A recovery allocated to the
campus reserved for research support & academic
excellence, including partnerships.
Dental School Construction Grant
Match-FY02
Support faculty research through matching funds support.
Reengineering Resources Allocation System
Envision Resource Allocation as an Exercise in Investment: Scare Resources are Put to the Best Possible Use
Draft 2/9/04
5
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
6
FY 2005 Original Budget Sources of Revenues - $353,662,010
Transfers and
Other Revenue
$11,590,009
3%
Grants and
Contracts
$35,700,000
10%
Recovery of F&A
$4,779,409
1%
Endowment / Gift
$15,546,473
4%
Non-Taxable Sales
$17,076,915
5%
Beginning Balance
$46,865,354
13%
Tuition
$105,159,700
31%
Sales
$35,240,812
10%
State
Appropriations
$73,196,344
21%
Other Student Fees
$8,506,994
2%
Setting the Context
UMKC FY 2005 Original Budget
$353,662,010 – All Current Funds
Unrestricted Funds
Operating Fund
$ 234,293,307
Auxiliaries & Enterprise
43,316,586
Setting the Context – GRA as a Component of the
FY 2005 Original Operating Budget - $234,293,307
Total Unrestricted Funds
$ 277,609,893
Restricted Funds
$
40,352,117
Grants & Contracts
$
35,700,000
FY 2005 Budget
$ 353,662,010 *
* Including budgeted beginning fund balance
General Revenue Allocation
State Appropriation
Tuition Fees
Recovery of F&A
GRA Total
$ 73,080,834
98,309,713
4,779,409
$ 176,169,956
Other Revenues in Units
$
32,586,044
Beginning Fund Balances
$
25,537,307
TOTAL Operating Fund
$ 234,293,307
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
7
CURRENT General Revenue Allocation
State
Appropriation $$$$
Student Tuition
Fees $$$$
New Model For General Revenue
Allocation
Recovery F&A
$$$$
Existing
State
Appropriation
Net
Tuition Fees
(Net of Operating Fund
Scholarship/Fee Waivers)
General
Revenue
Allocation
Designated Fees
Allocated directly
to Units
Academic
Units
Campus
Programs
(and F/A Recovery)
10%
Upfront
Funded
Campus Priorities
Support
Units
90% Existing State $$$
to Academic &
Support Units
Performance
Based
Incentives
90%
Net Tuition Fees
to Academic Units
Enrollment
Incentives
Future Year
New State
Appropriation
$$
Designated
Programs
& New
Initiatives
Revenue Allocation Model
Day-to-Day Campus Priorities
Proposed Off the Top Funding Set-asides
ƒ
ƒ
ƒ
ƒ
ƒ
ƒ
ƒ
Instructional and institutional library support
Instructional and capital research equipment
Facilities M& R and Capital Improvements for both
academic and support facilities
Special Incentives for Academic Excellence and
Institutional Excellence
Central Emergency/Contingency Reserve
Enrollment Management Initiatives
Technology Improvements
Proposed Revenue Allocation Model Assumptions
(Based on Most Current Tuition Rates)
Assumptions:
Includes
Excludes
Fiscal Year
Prior Year SCH 2004
None
Term
AY 2003-2004
None
Course Jurisdiction
On Campus SCH
Continuing Education – On/Off
Campus
Univ of MO Video Network
Student Jurisdiction
On Campus
Continuing Education – On/Off
Campus; High School Advanced
Credit Program; UMKC
Northland; Ft. Leavenworth
Residency Status
All Residency Designations
None
Student Level
Undergraduate/Graduate/
Professional
Dual High School; PACE; EMBA
Net Student Credit Hour (SCH)
Allocation Criteria
Student Level
Undergraduate
Majors Taking Home Academic Unit Courses
100% of Net SCH to Academic Unit Course
Provider at the designated undergraduate
tuition rate
Net Student Credit Hour (SCH)
Allocation Criteria
Student Level
Undergraduate
Graduate
100% of Net SCH to Academic Unit Course
Provider at the designated graduate tuition
rate
100% of Net SCH to Academic Unit Course
Provider at the designated professional
school tuition rate
80% of Net SCH to Academic Unit providing Course Instruction at the
designated Undergraduate tuition rate
20% of Net SCH provided by Other Schools for its Majors at the
designated Undergraduate tuition rate
Graduate
Professional Schools
Majors Taking OTHER Academic Unit Courses
80% of Net SCH to Academic Unit providing Course Instruction at the
designated Graduate tuition rate
20% of Net SCH provided by Other Schools for its Majors at the
designated Graduate tuition rate
Professional Schools
100% of Net SCH to Academic Unit providing Course Instruction at the
designated campus Graduate tuition rate (1)
100% of Net SCH to Professional School Academic Unit LESS NET SCH
provided by Other Schools at the regular campus rate Graduate tuition
rate
(1) Except for Year 1& 2 Medical Students allocation at undergraduate rate)
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
EXAMPLE –Nursing School Revenue Sharing
Gross SCH Tuition:
Less: Allocated Unit Scholarships/Waiver
Less: 10% Set Aside
$ 2,420,000
(470,000)
(195,000)
Total SCH Net Tuition $$$
$ 1,755,000
Nursing School
100% SCH from
Majors
80 – 20
Plan
Nursing Majors
Taking SCH
Outside of School
Earned by
Providing Courses
to Other Schools
TO Other Schools
LESS 80% SCH
($285,000)
As Home Unit & Provider
Earned 100% SCH
$1,399,000
From Other Schools
80% SCH
As Home Unit
Earned 20%
$88,000
$71,000
Tuition $$$ from Model
$1,558,000
EXAMPLE – Law School Professional Revenue Sharing
Gross Tuition from SCH:
Less: Allocated Unit Scholarships/Waiver
Less: 10% Set Aside
Total Net Tuition $$$
$ 7,861,000
( 1,172,500)
( 669,000)
$ 6,019,500
100%
Provider
Plan
Law School
100% SCH from
Majors
As Home Unit & Provider
Earn 100%
$5,964,000
Earned by Providing
Courses to Other
Schools
From Other Schools
PLUS 100% at Campus
Graduate Rate
$4,000
Law Majors
Taking SCH
Outside of School
To Other Schools
LESS 100% SCH
at Campus Graduate Rate
($38,400)
As Home Unit
Earn 100% of SCH
LESS Provider Share
(At 100% Campus Graduate Rate)
Tuition $$$ from
Model
$5,985,000
$17,000
Preliminary Modeling Results for Net
Tuition Fees – Enrollment Incentive
FY 2005
Academic Units GRA
$89,937,261
Available Net Fee $$$
from Model
$68,327,562
Funding Gap
Current GRA to Model
$(21,609,698)
8
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
9
DRAFT - EXAMPLE OF BASE BUDGET ALLOCATION MODEL
Unit
Budgeted FY05 Base
GRA
Fee Income Earned
from Model
Variance Base to
Model Fees
Academic Units
18,681,845
19,318,359
636,514
Biological Sciences
6,427,754
2,543,469
(3,884,285)
Business & Public Admin.
5,430,233
4,089,118
(1,341,115)
Conservatory of Music
4,602,832
2,011,195
(2,591,637)
Computing and Engineering
5,280,619
3,350,373
(1,930,246)
14,564,998
7,543,824
(7,021,174)
Education
4,913,349
4,014,183
(899,166)
Graduate Studies
1,611,275
161,275
(1,450,000)
Law
6,159,208
5,985,264
(173,944)
13,099,703
13,452,857
353,154
Nursing
3,803,133
1,558,932
(2,244,201)
Pharmacy
5,362,312
4,298,714
(1,063,598)
$ 89,937,261
$ 68,327,562
$ (21,609,698)
Arts and Science
Dentistry
Medicine
Sub-total Academic Units:
Modeling Assumptions:
Examples assumes fee revenue shared 80-20 between provider and home unit; Revenue allocated net of 10 percent for
set asides and net of scholarships and waivers. Revenue allocated based on FY2005 educational fee rates.
Draft – October 6, 2004
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
10
Allocation of Existing State Appropriation –
Performance Incentive Based
Allocation of Existing State Appropriation –
Performance Incentive Based
Existing
State
Appropriation
(and F/A Recovery)
90% Existing State $$$
to Academic &
Support Units
90% Existing State $$$
to Academic &
Support Units
Performance
Based
Incentives
10%
Upfront
Funded
Campus Priorities
Performance
Based
Incentives
Block
Allocation
% Allocated
Based on
Performance
Based
Incentive
Block Allocation
Funding
Stabilization
Year 1
90%
Funding
Stabilization
Funding
GAP
Performance
Based
Incentive
Year 1
10% of
GAP based on
Performance
Performance Incentive Plan
Allocation of State Appropriation
Performance Incentive Plan
Allocation of State Appropriation
Block Allocation – Academic Units:
Based on preliminary modeling, in most instances, the current general revenue allocation
academic units receive exceeds the amount of educational fee revenue currently
generated by each academic unit, leaving a funding gap.
In this proposal, academic units will receive a portion, or block allocation, of the funding
gap in order to provide a stabilizing revenue base. The level of block allocation would be
revisited on a regular basis – either annually or on some other regular interval. For
example:
Block Allocation – Support Units:
ƒ
Support units will receive a block allocation equal to a predetermined percentage of its 2005 general revenue
allocation.
ƒ
The block allocation will be based on 90 percent of the
units’ current general revenue allocation. As support units
cannot generate fee revenue from student enrollment, this
percentage will remain constant each year.
ƒ
The block allocation piece of this model would be funded
by revenue received by state appropriations.
Year 1 - Academic units would receive 90 percent of the funding gap
Year 2 - Academic units would receive 80 percent of the funding gap
Year 3 - Academic units would receive 75 percent of the funding gap
The block allocation of this model would be funded by revenue received by state
appropriations.
EXAMPLE – Nursing School
State Appropriation Allocation
Gross Tuition:
Less: Allocated Unit Scholarships/Waiver
Less: 10% Set Aside
$ 2,420,000
(470,000
(195,000)
Total Net Tuition $$$
$ 1,755,000
Current Nursing
FY 2005 GRA
$3,800,000
Tuition $$ from
Model
$1,558,000
GAP from Current Year
GRA Budget
$2,241,000
90%
Block
Allocation
$2,016,900
10%
Performance
Based
$224,100
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
11
BASE BUDGET ALLOCATION MODEL
90% Block Allocation and 10% Performance Based
Draft – October 6, 2004
Unit
Budgeted
FY05 Base
GRA
Fee Income
Earned from
Model
Variance Base
to Model Fees
90% Block
Allocation
Funding
Differential
Academic Units
Arts and Science
18,681,845
19,318,359
636,514
-
-
Biological Sciences
6,427,754
2,543,469
(3,884,285)
3,495,857
(388,429)
Business & Public Admin.
5,430,233
4,089,118
(1,341,115)
1,207,004
(134,112)
Conservatory of Music
4,602,832
2,011,195
(2,591,637)
2,332,473
(259,164)
Computing and Engineering
5,280,619
3,350,373
(1,930,246)
1,737,221
(193,025)
Dentistry
14,564,998
7,543,824
(7,021,174)
6,319,057
(702,117)
Education
4,913,349
4,014,183
(899,166)
809,249
(89,917)
Graduate Studies
1,611,275
161,275
(1,450,000)
1,305,000
(145,000)
Law
6,159,208
5,985,264
(173,944)
156,550
(17,394)
Medicine
13,099,703
13,452,857
353,154
-
-
Nursing
3,803,133
1,558,932
(2,244,201)
2,019,781
(224,420)
Pharmacy
5,362,312
4,298,714
(1,063,598)
957,238
(106,360)
$ 89,937,261
$ 68,327,562
$ (21,609,698)
Sub-total Academic Units:
Examples assumes fee revenue shared 80-20 between provider and home unit;
Revenue allocated net of 10 percent for set asides and net of scholarships and waivers.
Revenue allocated based on FY2005 educational fee rates.
$ 20,339,429
$ (2,259,937)
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
12
BASE BUDGET ALLOCATION MODEL
90% Block Allocation and 10% Performance Based
Draft – October 6, 2004
Unit
Budgeted FY05
Base GRA
Fee Income
Earned from
Model
Variance Base
to Model Fees
90% Block
Allocation
Funding
Differential
Support Units:
Chancellor
1,407,088
-
(1,407,088)
1,266,379
(140,709)
323,151
-
(323,151)
290,836
(32,315)
Intercollegiate Athletics*
2,071,778
-
(2,071,778)
1,864,600
(207,178)
Student Affairs
7,798,857
-
(7,798,857)
7,018,971
(779,886)
Advancement
3,207,499
-
(3,207,499)
2,886,749
(320,750)
17,913,328
-
(17,913,328)
16,121,995
(1,791,333)
4,338,347
-
(4,338,347)
3,904,512
(433,835)
Provost
5,880,766
-
(5,880,766)
5,292,689
(588,077)
Information Services
5,424,021
-
(5,424,021)
4,881,619
(542,402)
Cultural Events
1,874,748
-
(1,874,748)
1,687,273
(187,475)
Library
5,465,057
-
(5,465,057)
4,918,551
(546,506)
$ 55,704,640
-
$ (55,704,640)
$ 50,134,176
$ (5,570,464)
Scholarships**
22,003,370
-
(22,003,370)
22,003,370
-
Campuswide**
8,524,685
-
(8,524,685)
7,672,217
(852,469)
$ 30,528,055
-
$ (30,528,055)
$ 29,675,587
$ (852,469)
$ 176,169,956
$ 68,327,562
$(107,842,394)
$100,149,192
$ (8,682,869)
Institutional Effectiveness
Administration & Finance
Research
Academic Support Units:
Sub-total Support Units:
Campuswide Units:
Sub-total Campuswide:
TOTAL – ALL UNITS:
Footnotes:
* Intercollegiate Athletics subsidy is transferred from rate funds in the Campuswide department.
** Scholarships total includes $1,538,802 in funds allocated to Intercollegiate Athletics scholarships.
*** Major funding areas in campuswide include:
Utilities
Insurance
Fundamentals (Blocking and Tackling)
Net revenue sharing
4,868,574
1,355,891
1,629,105
600,000
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
13
State Appropriation Allocation Criteria
STRATEGIC FOCUS TO UMKC GOALS
Academic Focus to UMKC Goals
Student Engagement, Learning & Success
Goal 1: Attract, nurture & develop responsible community leaders
Goal 3: Essential community partner & resource
Research, Creative Activity & Scholarship
Goal 2: National leader in scholarship & creative activity
Organizational Effectiveness
Goal 4: Workplace of choice
Goal 5: Resources to fuel our vision
Support Focus to UMKC Goals
Service Quality
Goal 1:
Goal 3:
Goal 2:
Attract, nurture & develop responsible community leaders
Essential community partner & resource
National leader in scholarship & creative activity (Research, creative
activity & scholarship)
Organizational Effectiveness
Goal 4: Workplace of choice
Goal 5: Resources to fuel our vision
State Appropriation Allocation Criteria
Academic Unit Performance Criteria
Student engagement, learning & success 40%
•
Student engagement and learning
•
Student degree success *
•
•
Community partner/leadership success *
Academic teaching success
Research, creative activity & scholarship 20%
• National recognition for scholarship/creative activity *
Organizational effectiveness
•
Workplace of choice
•
Program efficiency *
40%
State Appropriation Allocation Criteria
Support Performance Criteria
Service Quality
•
50%
Success of units in developing & delivering quality
services to constituents
Research, creative activity & scholarship
Included As Part of 1st Criteria – Service Quality
Organizational effectiveness
•
Workplace of choice
•
Program efficiency
50%
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
STRATEGIC FOCUS
14
PROPOSED ALLOCATION CRITERIA/MEASURE
SCORE
STUDENT ENGAGEMENT, LEARNING AND SUCCESS (UMKC GOALS 1 & 3)
A.
Student Success
80% of Unit/College students and recent alumni say they are
satisfied with their UMKC experience (NSSE Survey)
40%
% of Goal Achieved
10%
B.
Student Degree Success -- Graduation Rates
% of Goal Achieved for Graduation Rate of Unit * 10%
C.
Community Partner/Leadership Success
First-time Placements of Graduates within nine months of graduation
% of Goal Achieved for Graduation Rate of Unit * 10%
D.
Academic Teaching Success - Unit Course Evaluations
Average Course Evaluations of Faculty
% to Goal Achieved
10%
RESEARCH, CREATIVE ACTIVITY & SCHOLARSHIP (UMKC GOALS 2)
E.
National Recognition for Scholarship/Creative Activity
% of Faculty and Students Receiving National/Regional Recognition and * 20%
Publications/Journals and Research Grants/Contracts in Field
20%
ORGANIZATIONAL EFFECTIVENESS (UMKC GOALS 4 & 5)
F.
Workplace of Choice
Overall rating of 80% of Unit/School employees say that they enjoy working at UMKC
% of Goal Achieved
40%
G.
20%
Program Efficiency
Department/Unit Operating Budget Expenditures per SCH compared to
National Median Peer Program/Schools
% of Goal Achieved Compared to Peers * 20%
TOTAL
Evaluation completed by Provost based on Unit Discipline Norms. *
100%
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
STRATEGIC FOCUS
15
PROPOSED ALLOCATION CRITERIA/MEASURE
SCORE
SERVICE QUALITY (UMKC GOALS 1, 2 & 3)
A.
Success of Units in Developing Quality Service to Constituents
Overall rating, 80% of the customers' surveyed rated the unit's delivery of
support services as "Superior"
% of Goal Achieved
50%
50%
RESEARCH, CREATIVE ACTIVITY & SCHOLARSHIP (UMKC GOAL 2)
Included As Part of Criteria A. - Service Quality
ORGANIZATIONAL EFFECTIVENESS (UMKC GOALS 4& 5)
B.
C.
50%
Workplace of Choice
Overall 80% of Support Unit employees say that they enjoy
working at UMKC
% of Goal Achieved
Program Efficiency
Department's Operating Expenses compared to defined national
benchmarks or indexes
% of Goal Achieved
for units/departments operating costs per Benchmark
TOTAL
25%
25%
100%
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
Allocation of Future Year New State
Appropriation Funds
Future Year
New State
Appropriation
$$
Designated
Programs
& New
Initiatives
16
UMKC Requests for New Spending Initiatives
Updated as of July 25, 2004
17
Each year, the campus will develop criteria on which new program initiatives will be evaluated and new funding
awarded. The criteria will be approved by the Executive Cabinet and distributed to units by September 1 of each
year. Based on these criteria, units are encouraged to submit requests for new funding. Requests for
designated program initiatives are due to the Campus Budget Office by October 1.
The source of the additional funding will be new state appropriations or the Chancellor’s Innovation Fund. The
funding is designed to provide the means to support new initiatives or new programs that will further the mission
of UMKC. The submission requests should include the following, as applicable:
I. Designated Programs/Special Initiatives – These are enhancements to existing programs or the
creation of new programs that extend UMKC’s ability to fulfill its mission and critical priorities.
II. Staffing enhancement requests – As the mission of the campus evolves, staffing needs change
across campus. Through this process, units are able to request new positions – faculty or staff – in
order to continue to meet their mission or unit plan. All new positions must be justified with
supporting documentation outlining workload, market demand and salary projections.
III. Technology Plan- Instructional and Non-Instructional – Major improvements to the information
infrastructure of a unit must demonstrate connectivity to the units’ mission and action plan, UMKC’s
mission and strategic priorities, and also to the campus technology plan. New spending requests in
this area should be congruent with the technology strategy of the campus; requests for this type of
new spending will be reviewed by the campus Technology Strategy Committee.
New spending request submissions should outline a three-year budget. In all spending requests, the
following should be considered and included as applicable:
1. Personnel costs (salary and benefits) of any new faculty or staff, full-time or part-time needed for
this program to operate.
2. Expense and Equipment budgets should include planned expenditures broken into the following
categories.
i. Operating Expenses – This is the portion of the budget used for office supplies, meeting
expenses, business travel, maintenance on equipment and other expense items used to
support daily activities of a unit.
1. Operating expenses due to program enhancements such as new building
openings, program expansions, or additional staff and faculty;
2. Planned business meetings, conferences or professional development;
3. Maintenance on equipment
4. Professional consulting services needed for staff development, feasibility studies
or facilitating.
5. Rental expenses – need to include any foreseeable increase in lease
agreements.
6. Maintenance, both custodial and grounds, for newly opened facilities.
7. Utilities – especially on newly opened facilities as well as current facilities with
projected cost inflation.
UMKC Requests for New Spending Initiatives
Updated as of July 25, 2004
18
ii. Equipment purchases of small equipment (unit price of less than $5,000) should also be
planned. Larger equipment items with a unit price greater than $5,000 are included in
capital equipment purchases.
1. Life cycle replacement of small office items such as fax machines, scanners,
desk top computers and copy machines.
2. Office equipment needed for new programs, new offices and new employees
should also be included in the planned budget.
3. Major Capital Equipment purchases (unit value greater than $5,000) should also be planned in
detail.
i. This would include life cycle replacement for items such as vehicles, lab equipment, and
other equipment.
ii. Purchases of equipment to outfit a new facility, classroom or program.
iii. Maintenance on current and new equipment.
New spending initiatives will be evaluated on the following draft criteria. As the University of Missouri system
goals and campus strategic priorities evolve, these criteria could change. Each year, the Executive Cabinet will
review and revise the criteria as needed, and present these to the campus by September 1. The units will have
until October 1 to submit requests for funding of new initiatives. After a review by the Chancellor and Executive
Cabinet, preliminary new funding allocations will be announced by December 1, pending the finalization of state
appropriation funding.
Criteria for Evaluation
A. Contribution to UMKC’s vision: a community of learners making the world a
better place, creating new standards in higher education.
-
Describe the new spending program or new initiative and what impact does the new
spending initiative have to the contribution of UMKC’s vision?
-
Describe the extent to which the process for accomplishing the project demonstrates
UMKC’s values. How will the project implementation process be collaborative,
accountable, etc.
B. A clear statement of intended outcomes with some ability to measure those outcomes. Show the
linkage of the intended outcomes/performance measures to one or more of UMKC Goals.
C. Illustrate the centrality of the new spending initiative to one of the four mission areas of UMKC.
How and why is the new spending proposal central to one or more of:
-
Lead in the Life and Health Sciences
-
Deepen and expand Strength in the Visual and Performing Arts;
-
Develop a Professional Workforce; Collaborate in Urban Issues and Education
-
Create a Vibrant Learning and Campus Life Experience.
UMKC Requests for New Spending Initiatives
Updated as of July 25, 2004
19
UMKC 2006 Goals and Measures Aligned with new UM System Goals - (May 11, 2004 Draft)
I. Access to Learning: Enable students to achieve their full academic potential and to cultivate their personal
development.
Strategic Goals:
1. UM should grow its overall enrollment by 10,000 students over the next five years, with diversity that
reflects that of the state of Missouri and with priority on graduate and professional students.
2. UM should be the first choice for Missouri’s top students.
3. UM should develop tuition and financial aid policies that support access and affordability for the
citizens of Missouri.
4. UM should lead the state in student retention and graduation rates.
5. UM alumnae should be recognized leaders in their respective careers.
UMKC Goal 1
We attract, nurture, and develop responsible community leaders.
„
Enrollment management and diversity-in-action project goals are achieved, which include
ranking among the top universities in graduating students of color and first generation college
students.
„
80% of students and recent alumni say they are satisfied with their UMKC experience on
selected NSSE items, the "Campus Aliveness Index," "Alumni Career Satisfaction and
Citizen-Leader Inventory," or other approved satisfaction inventories.
„
85% of businesses/organizations who employ/engage UMKC alumni say UMKC graduates
are citizen-leaders, as reported on the "Employer Follow-up of Career Performance and
Citizen-Leader Survey".
II. Academic Achievement and Quality: Achieve a nationally competitive position in research, scholarship, and
academic programs in selected areas consistent with each campus mission.
Strategic Goals:
1. UM should invest in selected programs that will raise its national standing.
2. UM should hire and retain an additional 10 National Academy faculty over the next three years.
3. UM should achieve doctoral-research extensive status for UMKC, UMSL and UMR and support
enhancement of UMC’s status as an AAU institution.
4. UM should become a national leader in life science research.
5. UM should enhance its interdisciplinary research and instructional programs.
UMKC Goal 2
We are a national leader in scholarship and creative activity.
Sponsored program awards reach $60 million per year, of which $40 million are Federalfund awards.
„
„
Ten academic programs are ranked by national standards in the top ten.
„
Five academic support programs are ranked by national standards in the top ten.
UMKC Requests for New Spending Initiatives
Updated as of July 25, 2004
20
UMKC 2006 Goals and Measures Aligned with new UM System Goals - (May 11, 2004 Draft)
III. Community-University Engagement: Set new standards of quality for community-university engagement that
will constitute a national model of service and outreach to the state, the nation, and the world
Strategic Goals:
1. UM should coordinate academic year calendars across the campuses to permit electronic course
delivery.
2. UM should collaborate and partner within and without the System.
3. UM should increase public support for the state’s public research university.
4. UM should continue to operate and maintain a system network of providers to improve the delivery of
quality, cost effective health care services to the citizens and residents of the State of Missouri and
enhance the availability of and access to health care services.
5. UM should promote innovation and economic development through private-public partnerships that
identify critical workforce needs, promote technology transfer and commercialization, address the
research and development needs of Missouri industry, and enhance the entrepreneurship capacity of
the state.
UMKC Goal 3
We are an essential community partner and resource.
„
90% of community leadership says UMKC is one of the top 5 community assets.
„
50% of UMKC faculty, students and staff, respectively, engage in public scholarship, communitybased or service learning, or community service
IV. Valuing People and Creating a High-Performing Organization: Within a high-performing organization,
develop an eminent faculty and highly talented staff who are engaged, productive, diverse, and committed to
achieving the University’s vision.
Strategic Goals:
1. UM should strengthen accountability for outcomes through its performance leadership process.
2. UM should improve the compensation of faculty, and the benefits for graduate and professional
students.
3. UM should create additional opportunities to support faculty and staff in their respective
responsibilities.
4. UM should recruit and hire senior faculty within its recognized peer group or beyond.
5. UM should recruit and hire junior faculty primarily from AAU institutions.
6. UM should competitively compensate and offer development opportunities to maintain a highly
competent staff.
UMKC Goal 4
We are a workplace of choice.
„
80% of employees say they enjoy working at UMKC, as indicated by a rating of 4 or higher on
a scale of 1 to 5 on the workplace survey.
„
50% of our applicants cite our vision and values as one of their primary reasons for applying.
„
The goals of the diversity-in-action project are achieved.
UMKC Requests for New Spending Initiatives
Updated as of July 25, 2004
21
UMKC 2006 Goals and Measures Aligned with new UM System Goals - (May 11, 2004 Draft)
V. Improving Core Processes: Develop and maintain effective and efficient academic and administrative
processes that support the University’s vision and create value for constituents
Strategic Goals:
1. UM should promote and achieve greater academic and administrative efficiencies throughout the
university system.
2. UM should build the highest quality information technology infrastructure that will meet the
instructional and research requirements of faculty and students.
VI. Developing and Managing Resources: Establish and maintain the financial and physical resource base
required to support the University’s vision and sustain organizational improvement
Strategic Goals:
1. UM should permit different tuition levels among the campuses to allow for market variance, program
differences and resource requirements.
2. UM should improve the physical plant and infrastructure throughout the entire system.
3. UM should secure $300 million in external research funding annually.
4. UM should expand its private fund-raising campaigns with a goal of reaching the $1.0 billion mark
over the next five years.
5. UM should improve the financial performance of its hospitals and clinics.
UMKC Goal 5
We have the resources to fuel our vision.
„
Our composite financial health index is 7.5 on a 10-point scale.
„
Our revenue growth and diversification goals for financial freedom are achieved.
„
Our resources are allocated to priorities such that our core programs/services have their resource
needs fully met and $2 million are available annually for innovation.
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
Revenue Allocation Model
Next Steps For Year 1- Just Do It
October/November/
December - 2004
January/February - 2005
ƒ Finalize revenue allocation
model for FY 2006 budget
planning
ƒ Campus discussions on
proposed model attributes
ƒ Budget Advisory Committee
continues revenue allocation
discussions
ƒ Review of modeling
assumptions with
Schools/Units
ƒ Communicate plan to campus
ƒ Release of New Revenue
Allocations for FY 2006 Budget
March to May - 2005
ƒ Designation of proposed new
initiatives and designated
priorities
ƒ Develop future year (FY 2007)
performance criteria measures
and reporting systems
ƒ Develop Year 1 (FY 2006)
allocation criteria for Block
Allocation Process
Future Year Calendar
Highlights of Major Changes/Improvements
August
ƒ SCH Modeling and certification
October
ƒ Requests for Designated Spending Priorities and New
Funding Initiatives
ƒ Performance measures/criteria finalized
December
ƒ Communication/Approval of Designated Funding
Priorities
ƒ Preliminary Release of Funds
• Tuition Fee Allocation
• Block Grant Allocation & and Incentive Funding
22
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
23
UMKC PROPOSED Annual Budget Planning Cycle
Milestone Date
SUMMER
Department Task/Activity:
Aug. 1
Sept. 1
FALL
WINTER
College/School Student Credit Hour Allocations Certified
(Allocations based on prior year SCH/FTE/Major student data)
Updated Criteria and Submission Requirements
distributed for Designated Programs Initiatives
Oct. 1
Department/Unit Submission of Budget Requests for Designated Program Initiatives
Oct. 1
Round I – Chancellor Innovation Fund Awards Due
Oct. 15
State Appropriation Allocation Criteria Measures Validated
Nov. 15
Student Activity/Housing Fees/ Professional Tuition Fee
and Graduate Fee Cluster Revenue Due
Dec. 1
New: Chancellor/Executive Cabinet approves New Spending Requests for Next FY
Dec. 1
PRELIMINARY Department/Unit “Block Allocations” State Appropriations Awards made
PENDING State Appropriation Funding Levels & PROPOSED Tuition Fee Levels
Dec. 1
Colleges/Schools/Departments Revenue Forecasts for
Non-Operating Funds (Auxiliary & Service Operations and Restricted/Gift Funds)
Jan. 5
Revenue and Expense Planning Assumptions Presented for Cabinet Discussion
Revenue Assumptions for Tuition Revenues
Revenue Assumptions for Student Activity/Housing Fees
Expense Assumptions for Personnel/Benefits
Revenue and Expense Forecasts for Operating Fund based on Preliminary Estimates
Jan. 15
February
SPRING
Draft
Mar. 1
Mar. 15
Late March
Preliminary Release of General Fund Allocations
Tuition Fees based on New Revenue Model
“Block Allocation” State Appropriations (Up to x% of GRA Differential)
Incentive Plan Criteria Allocation (Gap Funding)
Campus Budget Forums/Town Hall Meetings
Preliminary Multi-Year Forecasts and Highlights of Revenue Allocation Model
Designated Initiatives for Future Year Budget
Round II – Chancellor Innovation Fund Awards Due
Final Release of General Fund Allocations
Board Approves Tuition Revenues
Mid-April
All Department Budgets Completed/Finalized in System
Late May
Board Finalizes/Approves State Appropriation Allocations to Campuses
UMKC Budget Advisory Committee
January 2003
24
Preface:
The primary accountability for the financial integrity of the University of Missouri Kansas City
campus resides in the Office of the Chancellor. The Chancellor, as the Chief Executive Officer
of the campus, has final administrative responsibility for financial planning, revenue
development, and allocation of resources to the various academic and administrative entities
of the campus.
Purpose of the Budget Advisory Committee:
The Budget Advisory Committee is an advisory committee that advises the Chancellor on
matters related to budget planning and policy. The Budget Advisory Committee also has
responsibility to assist the Chancellor in ensuring that the budget planning process and
resource allocation decisions occur in an environment that encourages open honest
communication, promotes opportunities for input from the campus stakeholders, and provides
clear concise and easily understood information regarding the University’s budget.
The Budget Advisory Committee’s role and responsibilities shall not supersede or replace the
day-to-day financial management of the University, which has been delegated by the
Chancellor to the Office of the Vice Chancellor for Administration and Finance. The specific
charges to the Committee are to:
1. Review and advise on a proposed resource allocation plan for both academic and support
unit that clearly support UMKC’s mission and strategic goals.
2. Review and advise on a proposed framework for the annual reporting on performance
measurement system for both academic and support units to ensure accountability in the
performances of the units in achieving UMKC’s strategic plan.
3. Review and advise on a proposed framework and structure for submission of new resource
and/or program funding requests. All new funding initiatives and program priorities need to
include a realistic proposed budget and established priorities that are aligned to UMKC’s
strategic goals.
4. Advise the Chancellor on the annual revenue allocation process to ensure that revenues
are aligned to support campus vision and values, and that the budget process aligns
financial resources to the UMKC’s mission and strategic goals.
5. Ensure that relevant budget information and background materials are made available to
campus constituents with responsibility for advising on planning and budgeting issues.
6. Review of annual revenue estimates and spending assumptions and advise the Chancellor
on their appropriateness.
7. Review interim financial and program performance report of the University including review
of annual operating budget, financial statements and performance measures in meeting
UMKC stated goals and objectives.
8. Other budgetary reviews or financial analyses as designated by the Chancellor.
UMKC Budget Advisory Committee
January 2003
25
Prerequisites for Membership Appointment:
Members of the Budget Advisory Committee will have a demonstrated understanding and
knowledge of the University of Missouri System and UMKC campus budget processes and
financial planning methods. Staff training and development will be emphasized to ensure the
Committee members develop the understanding and knowledge of the budget process and
financial planning methods.
It is key that Advisory Members are committed to the University and its strategic goals.
Rotation of committee appointments will be based on the discretion of the Chancellor and also
based on the willingness of the representatives to serve and exert the time and commitment to
provide meaningful input and represent the interests of the UMKC stakeholders and
community.
Communication and Relationship to Existing Campus Committees and Offices:
1. The Budget Advisory Committee should meet at least quarterly.
2. Budget Advisory Committee should interact regularly with the Chancellor’s Cabinet and
Extended Cabinet, as well as the Faculty Senate, Staff Assembly and Student Government
Association to facilitate the flow of information among all campus stakeholders.
3. The Budget Advisory Committee should present recommendations to the Chancellor
based on input solicited from campus stakeholders as well as the Committee’s own
educated recommendations.
4. The UMKC Office of the Vice Chancellor for Administration and Finance will coordinate
efforts to ensure the regular and timely provision of financial information to the Budget
Advisory Committee and will provide the staff support for the Committee.
5. The Office of Institutional Research on behalf of the Chancellor’s Office will be responsible
for the coordination of the regular and timely submission of unit performance
measurements and reporting on the campus/unit progress in meeting UMKC’s five
strategic goals.
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
26
PREAMBLE
BUDGETING FOR EXCELLENCE
Budget Advisory Committee
The Budgeting for Excellence Committee was formed as a result of a common desire for the redevelopment of a
budget process that supports the vision and values of the University of Missouri – Kansas City campus. A team
of ten university stakeholders, ranging from faculty to support staff to campus administrators, served as
members of this committee from May 2001 to August 2002.
In its final report published in August 2002, the Budgeting for Excellence Model encompass the following six
attributes that describe the basic characteristics of good budgeting:
ƒ
Vision & Value Driven: The budget process clearly links funding to support the state University
vision and values
ƒ
Strategic: The budget process represents a multiyear, realistic plan identifying current and future
needs and opportunities
ƒ
Accountable: The budget process supports accountability by aligning authority and responsibility
to Units for decisions made
ƒ
Open: The budget process is understandable, allowing for input from all stakeholders, with no
hidden agendas
ƒ
Responsive: The budget process allows for change
One of the first recommendations and best practice elements of The Budgeting for Excellence Committee was
that UMKC should identify opportunities for stakeholder input. Key to this recommendation was that UMKC
should establish a Budget Advisory Committee to provide an avenue for input from faculty, staff, administration
and students. As prescribed by the University of Missouri System collective rules and regulations, the
Committee should be charged with the responsibility to advise on educational planning, appraisal of resources
needed and the allocation or reallocation of resources.
The Budget Advisory Committee was envisioned to assist the Chancellor in ensuring that the budget planning
process and resource allocation decisions occur in an environment that encourages open honest
communication, promotes opportunities for input from the campus stakeholders, and provides clear concise and
easily understood information regarding the University’s budget.
The Budgeting for Excellence Committee recommended that a campus Budget Advisory Committee be
set up to advise the Chancellor and the composition of the committee be made up of the following
constituents totaling 19 members: Six members from the University faculty; two members from the
Faculty Senate; One member of the Staff Assembly; Three Academic Deans; One representative of
the Student Government Association; and Six members representing administrative support units and
functions.
Following the framework of the Budgeting for Excellence report, including its guideline for Advisory Committee
constituents, the Chancellor has recently created the first BAC committee comprising of the following members:
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
27
CURRENT
BUDGET ADVISORY COMMITTEE (BAC) MEMBERSHIP:
----------------------------------------------------------------------------------------------------------------Assignment:
Name Member
Term
Bryan Le Beau
Betty Drees
Homer Erekson
3 years
2 years
1 year
Bob Weirich
Deep Medhi
VACANCY - Cathy Carroll
Thad Wilson
Michelle Beattie
1 year
Jeff Thomas
1 year
3 years
3 years
2 years
2 years
Jim Durig
Gary Ebersole
3 years
DEANS:
FACULTY:
FACULTY SENATE:
1 year
SUPPORT UNITS:
Eric Vestal
Pam Becker *
Ed Ellyson
Carla Wilson
Bill Phillips
Patty Cahill
3 years
3 years
2 years
2 years
1 year
1 year
Mark Johnson
1 year
STAFF ASSEMBLY:
STUDENT GOVERNMENT ASSOCIATION:
Tom Kernan
*
2 years
Original appointment of Mary Lou Hines who assigned to Pam Becker, Manager of Business/Fiscal Operations for
Provost Office
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
28
SCHOLARSHIP DISTRIBUTION
Academic Year 2003 – 2004
Directly Tied to
Academic Unit
Academic Unit
Arts and Sciences
$
Biological Sciences
3,748,852
Allocation of
Balance Unassigned
Scholarships
$
241,627
Total Allocation
$
3,990,479
410,299
22,736
433,035
Business
1,414,733
84,637
1,499,370
Conservatory of Music
1,920,565
102,216
2,022,781
Computing and Engineering
1,316,061
72,585
1,388,646
Dentistry
2,869,132
149,957
3,019,089
Education
1,059,563
68,225
1,127,788
867,826
45,449
913,275
Law
1,109,922
62,624
1,172,546
Medicine
2,844,251
154,105
2,998,356
Nursing
444,859
24.735
469,594
Pharmacy
469,420
25.274
494,694
Graduate Studies
TOTAL in Academic Units
$
18,475,483
$
1,054,170
$
19,529,653
Intercollegiate Athletics
$
1,666,700
$
-
$
1,666,700
TOTAL Scholarships
$
20,142,183
$
1,054,170
$
21,196,353
Budgeting for Excellence
Presentation to UMKC Faculty Senate on November 16, 2004
29
Academic Year 2003 - 2004
Scholarships and Waivers
Individual Scholarships with Activity Exceeding $100,000
$$ Amount
Administrative Waiver
Arkansas Dental N.R. Scholarship
Chancellor Non Resident - International
Chancellor Award Non Resident DF
Chancellor Minority Non Resident
Chancellor Non Resident Award
Chancellor Non Resident BA/DDS
Chancellor Scholarship Award
Chancellors Transfer Award
Curator Freshman Scholarship
Curators Renewal Scholarship
Exchange Partner Award
GTA Award 6 Hours
GTA Award 9 Hours
GTA Non Resident Waiver - A&S
GTA Non Resident Waiver - Pharmacy
GTA Non Resident Waiver - SCE
International CC Transfer
K.C.A.S.E.
Kansas Exchange - Non Resident
KC Urban Teac Fel Ed Fee
Med School Waiver Ed Fees
Med School Waiver Non Resident
Mo Tax
Non Resident Waiver - Doctorial Only
Non Resident - Law
Part-Time Non Resident Midwest Exchange
Part-Time Non Resident
Part-Time Non Resident Dental 1-3
Special Chancellor Non Resident
UMKC Freshman Grant
UMKC Grant
UMKC Tax Waiver
OTHER Scholarships (Less than $100,000 in Activity)
% of Total
Scholarships
1,353,230
0.54%
0.59%
6.99%
0.49%
5.58%
6.28%
4.08%
5.24%
0.93%
0.49%
1.60%
0.56%
2.39%
0.52%
0.99%
0.58%
0.72%
0.59%
0.63%
5.13%
0.72%
3.76%
0.61%
10.53%
1.16%
0.79%
1.19%
8.75%
0.75%
2.05%
1.31%
2.35%
1.91%
6.38%
$
18,475,483
87.16%
Total Scholarships - General Allocation Distribution
$
1,054,170
4.97%
Intercollegiate Athletics
$
1,666,700
7.86%
TOTAL SCHOLARSHIP ACTIVITY
$
21,196,353
Total Scholarships Directly Tied to Academic Units
115,101
124,666
1,480, 734
103,071
1,182,393
1,332,158
864,496
1,110,609
198,000
103,250
340,083
117,679
506,081
110,303
209,829
121,910
153,033
125,029
134,099
1,086,857
151,748
796,159
129,382
2,232,084
245,088
167,075
253,140
1,854,812
159,866
433,812
277,474
498,048
404,185
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
30
The Budgeting for Excellence Project evolved from the acknowledgement that historically the budgeting
process at UMKC was surrounded by secrecy, confusion, misperceptions and lack of trust and creditability.
The campus identified the need to redesign a budget process that was understandable, transparent, open,
clearly articulated and tied to unit performance.
In August 2002, the Budgeting for Excellence Committee presented recommendations to the Executive
Cabinet that revamped the budgeting process and suggested several changes to the method and delivery of
the budget. There were five major recommendations of the project committee, one of which spoke specifically
to allocation of resources:
“The UMKC budget aligns available resources to the campus department priorities,
which are based on the institutional mission, goals, vision and values.”
Based on that recommendation and with the approval of the Executive Cabinet, a Budget Advisory Committee
was formed. The committee’s charge was to further examine the budget of UMKC and design a budget
process that would meet the campus needs of accountability, openness, and performance incentives. The
Budgeting Advisory Committee (BAC) has met regularly over the past two years, focusing mostly on a revenue
allocation model. One of the first priorities for the Committee was to understand the campus’ current revenue
allocation method.
Currently, units annually receive a general revenue allocation, which basically comprises the operating base
budget for the units. This base is an historical budget which has been incrementally increased or decreased
over the years to address salary and benefit issues, new spending initiatives, and reductions or withholdings of
state funding. The general revenue allocation has three components: student fees, state appropriations and
recovery of indirect costs for grant activity. All three of these revenue sources are allocated to one “pot” of
money, which in turn, is allocated to the units. The following graphic illustrates the current model of revenue at
UMKC.
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
State $$$
Student Fee $$
Recovery F&A $$
GENERAL
REVENUE
ALLOCATION
Academic Units
Support Units
31
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
32
The current allocation model is not tied to enrollment revenue generated by a specific unit; it does not award
units for superior performance; and it doesn’t link the revenue allocation to the units’ contribution to the campus
goals.
Based on the initial charge of the budget redesign process, the Budget Advisory Committee has recommended
a new revenue allocation model that provides three basic components to address “financial freedom”:
A.
Incentives for units to meet enrollment goals
B.
Ties revenue allocation to the campus goals; and
C.
Awards units/divisions for superior performance in meeting and exceeding those goals.
Essentially, the revenue allocation model segregates the revenue previously lumped together in the general
revenue allocation pool and uses those funds to allocate resources to units based on enrollment and success
in achieving campus goals and priorities. It also sets aside revenue to fund campus priorities that cannot
directly self-generate operational revenue. These would include core library support, capital equipment
funding for instruction and research, technology improvement and reserves.
In the model, educational fee revenue, net of scholarships and waivers and net of campus set-asides, would
be allocated to the academic units. Funds from state appropriations would be used for both academic and
support units in a block allocation designed to stabilize the operating budget base for units. State
appropriations would also be allocated to close funding gaps between revenue allocated to units; these funds
would be awarded based on performance.
The indirect cost recovery would be allocated to research incentives and core institutional priorities.
The
Budget Advisory Committee has not discussed to date the recommendation from the original report for
modification to the allocation of indirect cost recovery funds.
The following graphically describes the revenue allocation model, as recommended by the Budget Advisory
Committee.
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
33
General Revenue Allocation Model
Student Fees and State Appropriations
Student Fee Revenues $$
(Net of Scholarships)
Existing State
Appropriation $$
New State
Appropriation $$
Designated
Priorities/
Initiatives
10% for
Campus
Priorities
90% to
Academic
Units
10% for
Campus
Priorities
Academic
Units
Block
Allocation
Support
Units
Funding Gap
(Performance
based)
Academic
Units
Support
Units
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
34
Academic Unit Model:
The following describes the allocation model used for the academic units.
1.
Academic units will receive revenue generated by their unit based on the student
Student Fees:
credit hours generated the previous academic year, less scholarships and waivers attributable to
that academic unit, and less campus set-asides. Revenue will be allocated based on current
educational fee rates. For example, for FY2006, final student credit hour data from FY2004 will be
used at the FY2005 educational fee rates.
For students taking classes in their home academic unit (i.e., major), all revenue, net of
scholarships and waivers, will be allocated to that academic unit.
For students taking classes in other academic units, the revenue will be shared between the
academic unit providing the course instruction (80 percent) and the home unit (20 percent).
Note: Educational revenue in this model does not include continuing education, dual high
school credit, EMBA, PACE and video network courses.
Units currently receiving supplemental fees such as clinical nursing fees, applied music fees, and
other supplemental fees will continue to receive that revenue. Since FY 2003, all supplemental
educational course fees (e.g., clinical nursing, computer science, conservatory, technology
infrastructure fee) are now being directly allocated to the various units.
Scholarships and waivers are allocated to academic units based on the actual operating fund
waiver and scholarship expense in the campuswide scholarship and waivers department, excluding
those awarded for Athletic scholarships. These expenses can be directly traced by purpose of
scholarship and waiver so that the expense can be allocated to the academic unit which has
awarded the financial aid and fee remission.
The educational fee revenue will be certified and distributed each year during the Summer so that
units will understand the fee allocation portion of this model for planning purposes.
2.
Block Allocation: In most cases, the current general revenue allocation academic units receive
exceeds the amount of educational fee revenue currently generated by each academic unit, leaving
a funding gap.
In this proposal, academic units will receive a portion, or block allocation, of the funding gap in order
to provide a stabilizing revenue base. The level of block allocation would be revisited on a regular
basis – either annually or on some other regular interval.
For example:
Year 1 - Academic units would receive 90 percent of the funding gap;
Year 2 - Academic units would receive 80 percent of the funding gap;
Year 3 - Academic units would receive 75 percent of the funding gap;
The block allocation of this model would be funded by revenue received by state appropriations.
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
3.
35
State Appropriations: Although the academic units will receive educational fee revenue and a
block allocation, a funding gap (based on current general revenue allocation) may still remain,
especially as the block allocation is reduced on regular intervals.
State appropriation funding will be allocated to academic units based on units’ contributions to the
campus goals and priorities. Units will be awarded state funds for their achievement and
performance in student learning and success, research and scholarship and organizational
effectiveness.
The criteria for funding awards will be based on measurable goals. As units’ performances either
increase or decline, state funding will be adjusted accordingly.
4.
Designated Program Initiatives: These are enhancements to existing programs or the
designation of new program/initiatives that extend UMKC’s ability to fulfill its mission and critical
priorities. Each year, the Executive Cabinet will develop criteria on which new program initiatives
will be evaluated and new funding awarded.
These criteria will be released to the units by September 1, and designated funding requests will be
due back in October. The new designated initiative funding awards will be announced by
December 1 for campus and unit budget planning purposes. The source of funding for designated
initiatives is new state appropriation funds or the Chancellor’s Innovation fund.
Budgeting for Excellence Revenue Allocation Model
Budget Advisory Committee Recommendations
Executive Summary
36
Support Units:
In general, support units will be allocated funding only from the state appropriations. Details of the revenue
model for the support unit are as follows.
1.
Student Fees: Support units do not generate student educational fees and will not receive any
allocation of educational fee revenue under this model. The only exception would be units that
directly receive supplemental fees such as the technology infrastructure fee (instructional
computing), transcript fees, application fees and other fees currently directly designated to that unit.
These units currently receive that revenue directly and that practice will continue under this model.
2.
Block Allocation: As in the case with the academic units, support units will receive a block
allocation equal to a pre-determined percentage of its FY2005 general revenue allocation. The
block allocation will be based on 90 percent of the units’ current general revenue allocation. As
support units cannot generate fee revenue from student enrollment, this percentage will remain
constant each year. The block allocation piece of this model would be funded by revenue received
by state appropriations.
3.
State Appropriations: Although the support units will receive a block allocation, a 10 percent
funding gap of its current revenue allocation will still need to be recovered by the unit.
State appropriation funding will be allocated to support units based on the units’ contributions to the
campus goals and priorities. Units will be awarded state funds for their achievement and
performance in service quality and organizational effectiveness. The criteria for funding awards will
be based on measurable goals. As units increase performance or decline, state funding will be
adjusted accordingly.
4.
Designated Program Initiatives: These are enhancements to existing programs or the
designation of new program/initiatives that extend UMKC’s ability to fulfill its mission and critical
priorities. Each year, the Executive Cabinet will develop criteria on which new program initiatives
will be evaluated and new funding awarded.
These criteria will be released to the units by September 1, and designated funding requests will be
due back in October. The new designated initiative funding awards will be announced by
December 1 for campus and unit budget planning purposes. The source of funding for designated
initiatives is new state appropriation funds or the Chancellor’s Innovation fund