Incremental
Budget Model
November 2013
An Equal Opportunity University
Overview
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2
Framework
• Model centered on 2009 – 2014 Strategic Plan:
– Goal 1: Prepare students for leading roles in an innovationdriven economy and global society
– Goal 2: Promote research and creative work to increase the
intellectual, social, and economic capital of Kentucky and the
world beyond its border
– Goal 3: Develop the human and physical resources of the
University to achieve the institution’s Top 20 goals
– Goal 4: Promote diversity and inclusion
– Goal 5: Improve the quality of life of Kentuckians through
engagement, outreach and service
Consolidated Budget
In FY 2012-13, bad debt was reclassified due to an accounting change.
*In billions
Budget Overview
Continued: Budget Overview
UK’s Major Sources of Revenue and How They
Are Used
Undesignated General
Funds
Money comes from:
• State Appropriations
• Tuition
• Investment Income
• Service Assessments
Pays for:
• Instruction
• Public Service
• Administrative Support
• Scholarships
24%
12% Other
UKHC
Designated General
Funds
Money comes from:
• UK HealthCare
• County Appropriations
• Mandatory Fees
• Course and Program Fees
Pays for:
• Public Service
• Instruction
• Student Services
• Academic Support
36%
Auxiliary Funds
Restricted Fund
Fund Balance - Nonrecurring
General Funds: Designated
UKHC
Continued: UK’s Major Sources of Revenue and
How They Are Used
Auxiliary Funds
Money comes from:
• UK Athletics
• Housing
• Dining
• Parking
Pays for:
• Self-supporting
auxiliary units
pay all their
expenses
and receive
no taxpayer
or tuition
support
6%
Restricted Funds
Money comes from:
• Research Grants and
Contracts
• Endowment Income
• Gifts
• Federal and State Student
Aid
Pays for:
• Research
• Scholarships
• Public Service
13%
8%
Fund Balance
Money comes from:
• Savings from prior years
Pays for:
• Capital Projects
• Faculty Start-Up Packages
• Pilot Programs
Breakdown of Revenue Sources
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9
Overview
•
•
•
•
•
•
Total budget
State support
Tuition and mandatory fee revenue
Sponsored project awards
Realized F & A income
Endowment and investment income
Current Funds Revenue Budget
State Support
*In millions; Includes ARRA funds of $21.1 million in 2009-10 and $17.3 million in 2010-11
Tuition and Mandatory Fee Revenue
Original Proposed Budget
Millions
$400
$380
$339
$350
$314
$300
$272
$243
$250
$289
$253
$211
$200
$150
$100
$50
$0
FY-2007 FY-2008 FY-2009 FY-2010 FY-2011 FY-2012 FY-2013 FY-2014
Research and Development
Expenditures
Millions
$400
$350
$352
$332
$360
$373
$361
$329
$287
$300
$250
$200
$155
$150
$154
$172
$179
$144
$160
$164
$100
$50
$0
FY-2007
FY-2008
FY-2009
FY-2010
Federal
Source: NSF R&D Expenditure Survey
FY-2011
Total
FY-2012 FY-2013*
Estimate
Realized F & A Income
FY2007
$43.8 million
FY2008
$44.1 million
FY2009
$44.7 million
FY2010
$50.8 million
FY2011
$53.1 million
FY2012
$51.8 million
FY2013
$47.9 million
FY2014*
$41.5 million
Source: Audited Financial Statements
*Estimated
*Estimated
Millions
Endowment and Investment Income
Original Proposed Budget
$40
$35
$31.0
$33.3
$33.9
$30
$30.1
$30.2
$25
$24.5
$21.5
$17.7
$20
$15
$10
$5
$0
FY-2007
FY-2008
FY-2009
FY-2010
FY-2011
FY-2012
FY-2013
FY-2014
Breaking Down the Budget
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17
FY2013 – 14 Consolidated Budget
Organization
Major Function
10.6%
13.8%
Natural Object
1%
4.5%
3% 1%
5%
6.4%
34.7%
10.0%
36.0%
12.5%
48%
42%
36.9%
5.9%
2.6%
5.0%
0.7%
Instruction
2.7%
Public Service
Academic Support
Institutional Support
Student Financial Aid
Mandatory Transfers
Hospital Services
5.7%
0.9%
1.3% 3.9%
Research
Libraries
Student Services
Operations and Maintenance
Capital Transfers
Auxiliary Enterprises
1.0%
4.6%
President
Provost
EVPFA
Research
UK HealthCare
University Wide
Affiliated Corporations
Personnel Services
Operating Expenses
Student Financial Aid
Capital Outlay
Mandatory Transfers
Capital Transfers
Processes and Timeline for
Budget
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19
Timeline: University-Wide Budget Process
Fall
Fall/Winter
/Spring
January
Winter
/Spring
Spring
April (Even
Years Only)
June
• Budget development process begins
• University Budget Office collects revenue estimates; fixed cost increases; programmatic budget
requests
• General Assembly convenes
• President’s Cabinet reviews preliminary incremental revenues and expenses; sets priorities;
develops budget recommendation
• CPE sets tuition and mandatory fees
• General Assembly passes biennial budget
• President recommends budget to the Board of Trustees
Budget Decisions
• Concurrent with University-wide decisions
– Budget hearings and Deans’ meetings
•
•
•
•
•
Restructuring/allocation options
Salary increase and adjustment options
Program/course/administrative fees
Programmatic priorities
Program requests to President
Budget Processes and Decisions
• Implementation of University-wide decisions
– Income estimates
– Salary proposals and unit budgets
– Budget administration