Town Hall Meeting
Development of Next Two-Year Budget
FY2010 and FY2011
December 4, 2008
Presented by:
Scott Bass, Provost
and
Don Myers, Vice President of Finance and
Treasurer
PRELIMINARY TIME TABLE
December 1, 2008
President issues call to the provost and vice presidents for
development of strategic objectives, action steps and budget
proposals.
December 2 – 19,
2008
•Provost and vice presidents develop an initial set of universitywide objectives and action steps, priced and prioritized;
•The University Budget Committee (UBC) begins construction of
enrollment and revenue models and conducts outreach, including
town meeting(s);
•The Strategic Planning Steering Committee (SPSS) requests
community comment and input on existing inventory of suggested
action steps;
•The President’s Council and SPSS review and discuss possible
action steps for the first two-year phase of plan implementation.
2
PRELIMINARY TIME TABLE (continued)
December 20, 2008
– January 5, 2009
•Provost and vice presidents refine objectives, action steps for
each goal, prioritized and priced;
•President meets with Provost and vice presidents individually to
review objectives, action steps and proposed budgets;
•Provost and vice presidents submit budget proposals,
incorporating prioritized action steps to the President.
January 5 – 23,
2009
•President reviews and approves objectives and action steps
and other elements of proposed budgets;
•President transmits proposed budgets to Budget Office and
UBC for further processing and deliberation;
•UBC continues deliberations and outreach.
3
PRELIMINARY TIME TABLE (continued)
January 24 –
•Faculty Senate issues recommendations on the two-year budget
February 11, 2009 to the Provost;
•UBC develops proposed budget and transmit to President for
review;
•President, Provost and Vice President of Finance meet to resolve
remaining revenue/expenditure gaps in the proposed budget and
to reach final decisions on objectives and action steps for the first
two-year phase of plan implementation;
•President meets with other vice presidents to communicate final
decisions on objectives, action steps and proposed budgets.
February 20 – 21,
2009
Board of Trustees approves the strategic plan objectives, action
steps and the FY2010-11 budget.
4
PRELIMINARY TIME TABLE (continued)
March, 2009
•
President communicates final versions of objectives, action
steps and budget to the campus community;
• President communicates budget allocations to the provost and
vice presidents.
April, 2009
Units develop line-item budgets for the new budget year.
May 1, 2009
New fiscal year begins.
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Campus Constituencies
•
Strategic Planning Steering Committee
•
Faculty Senate
•
Student Government
•
Graduate Leadership Council
•
Student Bar Association
•
Staff Council
Or e-mail: AUBudget@american.edu
6
How FYs 2008-9 Budget Development Guidelines Worked?
Guidelines
4.5% - 6.5%; market
driven pricing
Implementation
6% tuition and housing;
0% and 3% for MBA and graduate business;
Freeze undergraduate summer rate for two years
Marketing strategy
$1.5 million to revamp web; graduate marketing;
Create a University Communications and
Marketing unit.
Academic Programs
15 new tenured & tenured-track faculty; new
temporary faculty; adjunct faculty
Faculty and Staff Salary
and Benefits
3.7% for faculty and staff; An additional 0.5% pool
for faculty market; Health; Wellness Program
Financial Aid
29% tuition discount for undergraduate and
graduate students; athletic scholarships
7
How FYs 2008-9 Budget Development Guidelines Worked?
Guidelines
Development
Implementation
Eliminated a 5% assessment on restricted gifts.
$250K for the next phase of Capital Campaign.
International Initiatives
AU Abroad; international student recruitment
Information Technology
IT capital plan; Enterprise system development
and support; R18 Implementation; Web
Library
$400K new funding for library acquisition
New SIS Building and
SOC Renovation
Gifts and debt service for SIS;
SOC renovation in discussion
8
How FYs 2008-9 Budget Development Guidelines Worked?
Guidelines
Implementation
Enrollment Contingency
1.5% of tuition revenues as planned
Quasi-Endowment
Adjusted to 1% of revenue budget in FY08;
2% of revenue budget in FY09 as planned
Facilities Modernization,
$1.8M each in FY08;
Furnishings and
Equipment
$2.1M each in FY09
Institutional Expenditures
Utilities, contractual obligations, regulatory changes
Student Services
New Nebraska Residence Hall;
$400K to enhance the quality of student life
New Revenue
Increased endowment income to $3M in FY08 and
$3.2M in FY09; auxiliary enterprises; WAMU
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BUDGET DEVELOPMENT GUIDELINES
FISCAL YEARS 2010 and 2011
 A framework for developing the two-year FY2010-11
budget
 Initial action plans of the new Strategic Plan as the
guiding principle in formulating budget priorities
 Some initiatives require new funding, reductions or
redeployment of existing resources.
 Approved by the Board of Trustees in November, 2008
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BUDGET DEVELOPMENT GUIDELINES
FISCAL YEARS 2010 and 2011
1. A Linkage between initial action plans of the new Strategic
Plan and resources
2. Pricing: 4.5% - 6.5%. Market-driven pricing for summer
and MBA
3. Enrollment
 Market demands, selectivity, quality instruction and
student experience
 Creative marketing and financial aid strategies
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Undergraduate Tuition and Mandatory Fees
American
All 3-Tiers
Private
University
Average
Institutions
AY95-96 to AY96-97
3.7%
4.9%
5.0%
AY96-97 to AY97-98
4.6%
4.7%
5.0%
AY97-98 to AY98-99
4.7%
5.6%
5.0%
AY98-99 to AY99-00
4.8%
4.8%
4.7%
AY99-00 to AY00-01
5.0%
4.5%
5.2%
AY00-01 to AY01-02
5.1%
5.2%
5.5%
AY01-02 to AY02-03
4.3%
6.3%
5.8%
AY02-03 to AY03-04
5.9%
7.3%
6.0%
AY03-04 to AY04-05
5.9%
6.4%
6.0%
AY04-05 to AY05-06
6.5%
6.3%
5.9%
AY05-06 to AY06-07
5.9%
6.0%
5.9%
AY06-07 to AY07-08
5.9%
5.6%
6.3%
AY07-08 to AY08-09
5.9%
5.5%
5.9%
AVERAGE
5.2%
5.6%
5.5%
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BUDGET DEVELOPMENT GUIDELINES
FISCAL YEARS 2010 and 2011
4. Academic Programs
 Research functions, support for faculty research and
development
 Development of new academic program revenues
5. Competitive faculty and staff salary
6. Financial aid, library, information technology
7. Student services
8. Multi-year environmental sustainability initiatives
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BUDGET DEVELOPMENT GUIDELINES
FISCAL YEARS 2010 and 2011
9.
Capital projects and deferred maintenance – SIS, etc.
10. Strengthen financial safeguards to protect the university
11. Institutional expenditures
12. New revenue through innovations
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