Budget Update Fiscal Year 2013-­‐‑14 and 2014-­‐‑015
PASSHE 2013/2014 E&G Appropria4on -­‐ Base and Performance Funding •  FY 2013/2014 Performance Funding System Wide:
–  BU is 4th out of 14 for E&G Base Appropriation
–  BU is 6th out of 14 for Performance Funding dollars received and 7th for points aLained
University
Bloomsburg
California
Cheyney
Clarion
East Stroudsburg
Edinboro
Indiana
Kutztown
Lock Haven
Mansfield
Millersville
Shippensburg
Slippery Rock
West Chester
Total Preliminary
Combined U/G
2012
2013
Diff
9,993 10,147
8,629
8,254
989
983
6,531
6,111
6,882
6,819
7,530
7,273
15,210 14,477
9,796
9,080
5,387
5,323
3,163
3,001
8,299
8,244
7,845
7,635
8,606
8,398
14,625 15,103
113,485 110,848
154
(375)
(6)
(420)
(63)
(257)
(733)
(716)
(64)
(162)
(55)
(210)
(208)
478
(2,637)
% Change
1.5%
-­‐4.3%
-­‐0.6%
-­‐6.4%
-­‐0.9%
-­‐3.4%
-­‐4.8%
-­‐7.3%
-­‐1.2%
-­‐5.1%
-­‐0.7%
-­‐2.7%
-­‐2.4%
3.3%
-­‐2.3%
Source: Preliminary Enrollment Submission
BU is the 3rd largest of the PASSHE institutions and only one of two with a combined enrollment increase this year
•  BU enrollment increased by 177 (headcount) over last year influenced mostly by First-­‐‑time/Full-­‐‑time Freshman and Summer/
Fall Freshman
PASSHE Key Challenges •  Unlikely return of State appropriation to former levels given current economic conditions in the Commonwealth •  Stagnant enrollment demographics/statewide high school seniors trending down
•  Increased fixed costs in salaries/benefits (hospitalization, retirement, etc…)
•  Funding for facilities renewal
•  PASSHE institutions retrenching faculty, furloughing staff/
administrators, and eliminating programs
•  Unfunded liabilities for post-­‐‑retirement health benefits and pensions
Actual
FY 2012-­‐‑2 013
Current Year Request Year Budget
Budget
FY 2013-­‐‑2 014
FY 2014-­‐‑2 015
E&G Revenues
Tuition
Fees
Total Tuition and Fees
State Appropriation-­‐‑Base
State Appropriation-­‐‑Performance Funding
All Other Revenue
Use of Carryforward Fund Balance (Unrestricted Net Asset Reduction Plan)
Total Revenues
$76,578,488
14,070,237
$90,648,725
30,002,570
3,522,485
4,354,329
(1,042,102)
$127,486,007
$79,411,635
15,002,439
$94,414,074
30,148,443
2,846,116
4,218,438
4,774,111
$79,646,238
15,030,743
$94,676,981
30,148,443
2,846,116
4,218,438
1,546,045
$136,401,182
$133,436,023
$71,445,460
33,090,642
(3,985,858)
$100,550,244
29,526,047
4,558,926
4,161,548
$75,598,882
37,018,819
(4,897,852)
$107,719,849
28,699,245
3,202,270
4,057,428
$138,796,765
$143,678,792
E&G Expenditures and Transfers
Compensation Summary:
Salaries & Wages
Benefits
Estimated Salary and Benefit Savings
Subtotal, Compensation
Services & Supplies
Capital Expenditures
Transfers Total Expenditures and Transfers
Revenue/Source less Expenditures/Transfers
$66,228,244
27,830,736
0
$94,058,980
25,009,052
1,830,736
6,587,239
$127,486,007
$0
($2,395,583)
($10,242,769)
Key Revenue Considera4ons Current Year Request Year Budget
Budget
FY 2012-­‐‑2013
FY 2013-­‐‑2014
FY 2014-­‐‑2015
$76,578,488
14,070,237
$90,648,725
$79,411,635
15,002,439
$94,414,074
Actual
E&G Revenues
Tuition
Fees
Total Tuition and Fees
•  FY 2013/2014 Tuition & Fees:
$79,646,238
15,030,743
$94,676,981
–  Enrollment increase of 0.9% (annualized FTE)
–  Approved tuition increase of 3%
–  Academic Enhancement and BOG Technology Tuition fee increased 3% •  FY 2014/2015 (request year)Tuition & Fees:
–  Assumes enrollment increase of 0.3% (annualized FTE)
–  Assumes no tuition increase -­‐‑ 0.0%
–  No anticipated fee increases
Key Revenue Considera4ons Actual
Current Year Request Year Budget
FY 2012-­‐‑2013 FY 2013-­‐‑2014
Budget
FY 2014-­‐‑2015
E&G Revenues
State Appropriation-­‐‑Base
State Appropriation-­‐‑Performance Funding
30,002,570
3,522,485
30,148,443
2,846,116
30,148,443
2,846,116
•  FY 2013/2014 State Appropriation:
–  Base -­‐‑ Allocation formula results in an increase of $146K over prior year
–  Performance Funding – Performance results in allocation decrease of ($676K)
•  FY 2014/2015 (request year) State Appropriation :
–  Assumes no change in base allocation
–  Assumes no change in performance funding allocation
Key Revenue Considera4ons Actual
FY 2012-­‐‑2013
Current Year Request Year Budget
Budget
FY 2013-­‐‑2014
FY 2014-­‐‑2015
E&G Revenues
Tuition
Fees
Total Tuition and Fees
State Appropriation-­‐‑Base
State Appropriation-­‐‑Performance Funding
All Other Revenue
Use of Carryforward Fund Balance (Unrestricted Net Asset Reduction Plan)
Total Revenues
$76,578,488
14,070,237
$90,648,725
30,002,570
3,522,485
4,354,329
(1,042,102)
$127,486,007
$79,411,635
15,002,439
$94,414,074
30,148,443
2,846,116
4,218,438
4,774,111
$79,646,238
15,030,743
$94,676,981
30,148,443
2,846,116
4,218,438
1,546,045
$136,401,182
$133,436,023
•  FY 2013/2014 increase in total revenue from 2012/2013
–  Increases in tuition & fees and net reduction in state appropriation –  Spending plan for excess unrestricted net assets •  FY 2014/2015 (request year) Decrease in Revenue:
–  Unrestricted Net Asset Reduction Plan -­‐‑ spending plan reduced significantly
FY 2013/2014 E&G Revenue Sources Trends in E&G Revenue Sources Key Expense & Transfer Considera4ons Actual
FY 2012-­‐‑2013
Current Year Request Year Budget
Budget
FY 2013-­‐‑2014
FY 2014-­‐‑2015
E&G Expenditures and Transfers
Compensation Summary:
Salaries & Wages
Benefits
Estimated Salary and Benefit Savings
Subtotal, Compensation
$66,228,244
27,830,736
0
$94,058,980
$71,445,460
33,090,642
(3,985,858)
$100,550,244
$75,598,882
37,018,819
(4,897,852)
$107,719,849
•  FY 2013/2014 Salary, Wages, & Benefits:
–
–
–
–
–
Overall increase from prior year of $6.5MM
Mandatory salary and wage increases, hospitalization, and retirement increases
Increased staffing of 21 new positions costing $1.9MM
Faculty VRIP positions managed through overload
11 faculty positions frozen (no associated budget for the year)
•  FY 2014/2015 (request year) Salary, Wages, & Benefits :
–  $1.9MM in VRIP and prior year frozen positions projected to be filled
–  Mandatory salary and wage increases, hospitalization, and retirement increases (see next chart)
Key Expense & Transfer Considera4ons FY 2014-­‐‑1 5 Manadated Salary/Benefit Increases Highlights:
Salaries
APSCUF
AFSCME
Nonrepresented
SCUPA
Coaches
SPFPA
OPEIU
Compounded Impact
4.55%-­‐‑7 .10%
4.87%
3.50%
4.04%
4.16%
0.38%
3.48%
Benefits
% Increase
Hospitalization
Supplemental Heath Care (Health and Welfare)
Annuitant Hospitalization:
7.1%-­‐‑7 .6%
7.00%
AFSCME
Faculty, Nonrep, SCUPA, Coaches
Retirement:
9.50%
2.20%
SERS
PSERS
32.20%
26.60%
Key Expense & Transfer Considera4ons Current Year Request Year Budget
Budget
FY 2012-­‐‑2013
FY 2013-­‐‑2014
FY 2014-­‐‑2015
25,009,052
1,830,736
6,587,239
29,526,047
4,558,926
4,161,548
Actual
Services, Supplies & Utilities
Capital Expenditures
Transfers •
28,699,245
3,202,270
4,057,428
FY 2013/2014 Expenses and Transfers:
–  Services, Supplies & Utilities: •
•
•
•
Budget includes $2.2MM use of carry forward funds
No reductions to base operating budgets
Remaining increase aLributed to costs associated with new programs and activities and contracted cost increases
Offset by slight reduction in utilities – decrease in coal and wood contracted cost
–  Capital Expenditures: •
•
•
Includes $1.52MM use of carry forward funds
No reductions to base capital budgets
Remaining increase aLributed ISIS hardware costs and anticipated increases in equipment purchases through academic enhancement fund
–  Transfers: •
•
•
•
Includes $104K of carry forward funds
$1.23MM for debt service
$1.56MM for planned transfers to plant (capital infrastructure/annual renewal commitment, maintenance of plant contingency reserve, etc…)
$1.0MM to fund capital project priorities
Key Expense & Transfer Considera4ons Current Year Request Year Budget
Budget
FY 2012-­‐‑2013
FY 2013-­‐‑2014
FY 2014-­‐‑2015
25,009,052
1,830,736
6,587,239
29,526,047
4,558,926
4,161,548
Actual
Services, Supplies & Utilities
Capital Expenditures
Transfers 28,699,245
3,202,270
4,057,428
•  FY 2014/2015 Expenses and Transfers:
–  Services, Supplies & Utilities: •
•
•
Budget includes $723K use of carry forward funds
No reductions to base operating budgets
Overall cost projected to remain consistent with 13/14 except for modest increase in utilities and lease obligation increase
–  Capital Expenditures: •
•
•
Includes $376K use of carry forward funds
No reductions to base capital budgets
Overall cost projected to remain consistent with 13/14 except for anticipated cost reduction related to ISIS hardware
–  Transfers: •
Overall cost projected to remain consistent with 13/14
FY 2013-­‐2014 E&G Expenditures Summary Current Year and Request Year Budgets Current Year Actual
FY 2012-­‐‑2 013
Request Year Budget
Budget
FY 2013-­‐‑2 014
FY 2014-­‐‑2 015
E&G Revenues
Tuition
Fees
Total Tuition and Fees
State Appropriation-­‐‑Base
State Appropriation-­‐‑Performance Funding
All Other Revenue
Use of Carryforward Fund Balance (Unrestricted Net Asset Reduction Plan)
Total Revenues
$76,578,488
14,070,237
$90,648,725
30,002,570
3,522,485
4,354,329
(1,042,102)
$127,486,007
$79,411,635
15,002,439
$94,414,074
30,148,443
2,846,116
4,218,438
4,774,111
$79,646,238
15,030,743
$94,676,981
30,148,443
2,846,116
4,218,438
1,546,045
$136,401,182
$133,436,023
$71,445,460
33,090,642
(3,985,858)
$100,550,244
29,526,047
4,558,926
4,161,548
$75,598,882
37,018,819
(4,897,852)
$107,719,849
28,699,245
3,202,270
4,057,428
$138,796,765
$143,678,792
E&G Expenditures and Transfers
Compensation Summary:
Salaries & Wages
Benefits
Estimated Salary and Benefit Savings
Subtotal, Compensation
Services & Supplies
Capital Expenditures
Transfers Total Expenditures and Transfers
Revenue/Source less Expenditures/Transfers
Challenges Ahead $66,228,244
27,830,736
0
$94,058,980
25,009,052
1,830,736
6,587,239
$127,486,007
$0
($2,395,583)
($10,242,769)
Bloomsburg Financial Challenges Impact 2015 Strategic Issue #2: Achieving Excellence While Ensuring Financial Sustainability •  FY 2013/2014 Budget Shortfall ($2.4MM):
–  PASSHE’s system wide shortfall for this year is over $50MM which can only be corrected going forward through changes to cost structure at the university level
–  Bloomsburg was able to cover the $2.4MM funding gap with it’s unrestricted net assets (savings) this year – temporary solution not sustainable
•  FY 2014/2015 (request year) Budget Shortfall ($10.2MM):
–  Assumes no increase in appropriation and tuition
–  No significant increase in enrollment
–  Significant increases in salary increases, healthcare cost and retirement
Bloomsburg Financial Challenges FY 2014/2015 Deficit Analysis
FY 2013/2014 Identified Funding Challenge ($4,272,718)
Developing plans to address this immediately though evaluation of programs and service to reduce our cost structure and/or increase net revenue
FY 2014/2015 Revenue Requirement with Current Cost Structure
Total FY 2014/2015 Request Year Challenge
($5,970,051)
($10,242,769)
Impact of Tuition Increases-­‐‑Additional Revenue:
3%
4%
5%
6%
7%
7.5% Needed to balance
•
$ 2,382,349
$ 3,176,466
$ 3,970,582
$ 4,764,699
$ 5,558,815
$ 5,955,879
8%
$ 6,352,931
9%
$ 7,147,048
FY 2014/2015 (request year) Budget Shortfall ($10.2MM):
–  $4.22MM of the $10.2MM is continuation of FY 14 deficit ($2.4MM), funded VRIP ($827K) and funded frozen faculty position ($1.05MM)
•
Balance of ($5.9MM) would require a 7.5% authorized tuition increase to cover – likelihood = 0%
Unrestricted Net Assets Summary As of June 30, 2013 •
•
•
•
•
•
6/30/13 - $36.16MM excess unrestricted net assets as defined by University Financial Health
Indicators per PASSHE BOG Policy 2011-01-University Financial Health
Majority, $26.08MM, resides in E&G plant fund for maintenance and repair work, multi-year
capital projects, and reserves
Spending plans for E&G excess unrestricted net asset balances obtained from President/VPs/
AVPs/Deans
FY 13/14 – Plan to expend $4.77MM plus $2.4MM to cover projected FY 13/14 shortfall;
Total = 7.17MM
FY 14/15 – Plan to expend $1.55M
Subject to change pending the results of ongoing strategic enrollment management efforts,
master plan completion, and the evaluation of financial sustainability of university programs
and services
Unrestricted Net Assets E&G Total
Unrestricted Net Assets All Uses Reserves
Cover Multi-­‐
Projected FY Year/Strategic 13/14 Planning
Seed Money Shortfall
Total
Designated for Educational & General Activities:
FY 2013 Residual Budget Carryforwards:
President
Academic Affairs
Administration
Student Affairs
University Advancement
Total FY 2013 Residual Budget Carryforwards
$ 50,000
377,641
299,892
-­‐
71,909
$ 799,442
Academic Enhancement
$ 108,473
1,185,917
229,118
432,399
64,920
$ 2,020,827
$ -­‐
335,746
-­‐
-­‐
-­‐
$ 335,746
$ -­‐
-­‐
-­‐
-­‐
-­‐
$ -­‐
$ 158,473
1,899,304
529,010
432,399
136,829
$ 3,156,015
$ 878,800 $ 2,987,267 $ -­‐
$ -­‐
$ 3,866,067
Technology Fee
$ -­‐
$ 431,415 $ -­‐
$ -­‐
$ 431,415
FY 2014 BOG Waivers Increase
Central Scheduling System
Balance FY 2014 E&G Budget
Total Strategic Planning Initiatives
$ -­‐
-­‐
-­‐
$ -­‐
$ 172,146
100,000
-­‐
$ 272,146
$ -­‐
-­‐
2,395,582
$ 2,395,582
$ 172,146
100,000
2,395,582
$ 2,667,728
PEPSI Bonus-­‐Trustee Scholarships
$ -­‐
$ 269,079 $ -­‐
$ -­‐
$ 269,079
Sustainability Initiatives
$ -­‐
$ 129,470 $ -­‐
$ -­‐
$ 129,470
Total Designated for Educational & General Activities
$ 1,678,242 $ 6,110,204 $ 335,746 $ 2,395,582 $ 10,519,774
Designated for E&G Plant Activities:
Unrestricted E&G Plant Funds
$ 1,709,281 $ 24,371,288 $ -­‐
$ -­‐
$ 26,080,569
Total Designated for E&G Plant Activities
$ 1,709,281 $ 24,371,288 $ -­‐
$ -­‐
$ 26,080,569
Grand Total
$ 3,387,523 $ 30,481,492 $ 335,746 $ 2,395,582 $ 36,600,343
$ -­‐
-­‐
-­‐
$ -­‐
Unrestricted Net Assets E&G Plant Ac4vi4es Unrestricted Net Assets Designated for E&G Plant Activities
Maintenance and Repair
$ 489,777
Capital Projects:
Replacement of Coal Boilers (Steam Plant Upgrade)
Relocate Phone Switch/Computing Backup
26 Acre Land Purchase
Early Learning Center
Off Campus Educational Delivery Site
Pedestrian Bridge
Magee Center Demolition
Electrical Distribution System
Update Master Plan
Office Renovations-­‐MCHS
Carver Hall-­‐Exterior Lighting, Sidewalk/Landscape Renovation
Nelson Fieldhouse-­‐Replace Shower Floor
Athletic Field-­‐Replace Artificial Turf (Design)
Boiler Feedwater Controls
Other
Total Capital Projects
$ 11,000,000
3,586,379
2,500,000
2,375,848
1,837,337
851,953
262,321
220,432
212,375
187,492
150,000
150,000
50,000
50,000
447,374
$ 23,881,511
Reserves:
Contingency
Project Planning
Annual Renewal Reserve
Total Reserves
1,517,914
7,300
184,067
$ 1,709,281
Total Designated for E&G Plant Activities
$ 26,080,569