Town Hall Meeting
June 10, 2009
2008-2009/2009-2010
Budget Update
Jeanine Hawk - Vice-President, Business & Administration
Prepared In Collaboration with Fiscal Services Staff
Town Hall Meeting
June 10, 2009
May Revise Implications for 2008-09
Unrestricted General Fund
2008-09 Property tax shortfall:
2008-09 General apportionment shortfall:
-$803,250
-$790,000
Reduction is $1,593,250
Deficit Factor Budgeted is $1,420,257
Town Hall Meeting
June 10, 2009
May Revise Implications for 2008-09
Restricted General Fund – Categoricals (-14.7%)
Basic Skills:
Cooperative Agencies Resources for Education (CARE):
Counseling, Placement and Assessment (Matriculation-Credit
Counseling, Placement and Assessment (Matriculation-Noncredit):
Disabled Students Programs and Services:
Extended Opportunities Programs and Services:
Instructional Equipment:
Part-time Faculty Compensation:
Scheduled Maintenance:
-$94,088
-$14,707
-$211,033
-$6,955
-$231,136
-$206,316
-$35,416
-$146,992
-$35,420
Reduction is $982,062
Town Hall Meeting
June 10, 2009
May Revise Implications for 2009-10
Unrestricted General Fund
2009-10 General apportionment shortfall
2009-10 Physical education cut
2009-10 Property tax shortfall
NO GROWTH
Total Reduction is $5, 213,854
Deficit Factor Budgeted at Tentative is $1,433,108
Town Hall Meeting
June 10, 2009
May Revise Implications for 2009-10
Restricted General Fund – Categorical Reduction-53% (was -58.8%)
Basic Skills:
-$333,102
Cooperative Agencies Resources for Education (CARE):
-$52,066
Counseling, Placement and Assessment (Matriculation-Credit):
-$747,126
Counseling, Placement and Assessment (Matriculation-Noncredit): -$24,624
Disabled Students Programs and Services: -$818,296
Extended Opportunities Programs and Services:
-$730,425
Instructional Equipment:
Part-time Faculty Compensation:
Scheduled Maintenance:
-$125,386
-$520,399
-$125,397
Total Reduction is $3,476,821
Town Hall Meeting
June 10, 2009
Possible Savings Towards a Balanced Budget:
1.Reduce Schedule to Funded FTES
$ 2,025,839
2.Virtual Hiring Freeze-24 Positions
826-1.7 mil
3.Reduce Contracts/Services Additional 5%
474,105
4.Maximize Categorical 08-09 Carry-Over
160,000
5.Unallocated Basic Skills
450-900,000
6.Reduce Categorical Budgets by 30%
1,500,000
7.Backfill IE and Scheduled Maintenance
350-700,000
Total Potential Savings $5.8 – 8.3 mil.
Town Hall Meeting
June 10, 2009
So What’s the Big Picture??
Ongoing:
Structural Deficit
State Reductions
Physical Education
Categoricals (53.3%)
Total Ongoing Reductions Needed
$ 3,048,787
2,100,000
3,476,821
$ 8,625,608
AND
One-Time:
State Reductions
Deficit Factor & Tax Shortfall $ 1,853,739
Categoricals (14.7%)
982,063
Total One-Time Reductions Needed
$ 2,835,802
Town Hall Meeting
June 10, 2009
EFFECT OF MAY REVISE TO PROPOSED ADOPTED BUDGET -2nd Revision
2008-2009
ACCOUNTS
TOTAL REVENUE AND TRANSFERS (LESS ONE-TIME FUNDING)
2009-2010
PROJECTED FUND
PROJECTED FUND
BALANCE w/o
BALANCE with
REDUCTIONS
REDUCTIONS
133,010,302
133,010,302
2009-2010
TENTATIVE
BUDGET
136,518,708
PROPOSED
ADOPTED
BUDGET w/o
REDUCTIONS
136,518,708
2010-2011
PROPOSED
ADOPTED
PROPOSED BUDGET
BUDGET with
with 2008-09 and
REDUCTIONS
2009-10 REDUCTIONS
136,518,708
136,518,708
(137,313,739)
(137,313,739)
(138,741,231)
(138,741,231)
(138,741,231)
(138,741,231)
(1,652,526)
1,239,395
(1,652,526)
1,239,395
(826,264)
-
(826,264)
-
(826,264)
-
(826,264)
-
(4,716,568)
(4,716,568)
(3,048,787)
(3,048,787)
(3,048,787)
(3,048,787)
1,432,267
(483,912)
1,432,267
(483,912)
-
-
-
-
(3,768,213)
(3,768,213)
(3,048,787)
(3,048,787)
(3,048,787)
(3,048,787)
(172,993)
-
(172,993)
-
-
(3,780,746)
(3,780,746)
3,326,208
(3,780,746)
3,326,208
BEGINNING BALANCE
18,797,976
18,797,976
12,829,763
11,099,708
11,664,766
6,884,424
ENDING FUND BALANCE PRIOR TO DESIGNATED RESERVES
14,856,770
10.75%
14,856,770
10.75%
9,780,976
7.01%
4,270,175
3.06%
8,161,441
5.99%
3,381,099
2.48%
(982,063)
-
(982,063)
565,058
-
(3,476,821)
PROPOSED REDUCTION - CATEGORICALS
(3,476,821)
2,199,804
(3,476,821)
2,199,804
FUND BLANCE REVISE- CATEGORICALS
(574,999)
(574,999)
-
13,299,7087
13,864,766
9,780,976
793,354
6,884,424
2,104,082
9.58%
10.03%
7.01%
0.57%
5.14%
1.57%
(200,000)
(2,000,000)
(200,000)
(2,000,000)
-
-
-
-
11,099,708
11,664,766
9,780,976
793,354
6,884,424
2,104,082
7.87%
8.31%
7.01%
0.57%
5.14%
1.57%
TOTAL EXPENDITURES AND TRANSFERS (LESS ONE TIME EXPENDITURE)
VACANT POSITIONS WITH PAYROLL RELATED BENEFITS*
VACANT SAVINGS WITH PAYROLL RELATED BENEFITS*
OPERATING SURPLUS/(DEFICIT)
ONE-TIME FUNDING/(EXPENDITURES):
PRIOR YEAR APPORTIONMENT ADJ - PROPERTY TAX BACKFILL
ONE-TIME OFF SCHEDULE/RETRO PAY WITH RELATED BENEFITS
OPERATING SURPLUS/(DEFICIT) WITH ONE-TIME ITEMS
MAY REVISE
PROPOSED REDUCTIONS
FUND BALANCE RATIO TO TTL EXPENDITURES & TRANSFERS **
MAY REVISE - CATEGORICALS
ENDING FUND BALANCE PRIOR TO DESIGNATED RESERVES WITH MAY REVISE
FUND BALANCE RATIO TO TTL EXPENDITURES & TRANSFERS WITH MAY REVISE**
DESIGNATED RESERVES FOR:
GLOBAL EDUCATION INITIATIVE 09-10
UNFUNDED RETIREE BENEFITS
UNDESIGNATED ENDING FUND BALANCE
UNDESIGNATED ENDING FUND BALANCE RATIO
Town Hall Meeting
June 10, 2009
Fund Balance Actuals and Projected
$14,000,000
$12,000,000
7.87%
8.31%
$10,000,000
$8,000,000
5.00%
5.14%
$6,000,000
$4,000,000
1.57%
.57%
$2,000,000
$0
2008-2009 May
Revise w /o
Reductions
2008-2009 May
Revise w ith
Reductions
2009-2010 w /o
Reductions
2009-2010 w ith
Reductions
2010-2011 w ith
Reductions
2010-2011 at
Target 5% FB Ratio
Town Hall Meeting
June 10, 2009
Budget Objectives Adopted by the BOT – April, 2007

Protect the College’s ongoing operation by maintaining a fund balance of 5% or
more going forward from 2006/07.
 Going forward from the 2007/08 budget establish benchmarks that
budget decisions for the College.
will help guide
 Develop a budget plan that brings available ongoing revenues and expenditures
into balance effective with the adoption budget for
2009/10.
Proposed New Objective:
 Protect the College’s ongoing operation, including categorical programs, by
maintaining a fund balance of 5% or more thru
2010/11.
Town Hall Meeting
June 10, 2009
Budget Principles Adopted by the BOT – April, 2007
Maintain course offerings that are responsive to current student needs but are also fiscally sound
based on established measurements such as: WSCH/FTEF.
Establish and maintain an acceptable cost effective level of learning resources and student support
services based on comparative performance data as determined by the College.
Maintain employment for permanent personnel and avoid layoffs.
To the degree that they are the basis for revenue projections ensure that enrollment growth estimates
are realistic and can be achieved within the fiscal limitations of the College.
Where possible and practicable, use staff attrition and/or existing vacancies as one means of reaching
budget targets.
Expedite changes that may produce lower costs over time such as energy saving retrofits, alternative
energy sources, reduction or consolidation of facility usage, etc.
Continue to seek external sources of funding, such as grants, to support the College’s core missions,
but avoid those with matching, management, or reporting requirements that demand significant college
resources.
Town Hall Meeting
June 10, 2009
Budget Principles Adopted by the BOT – April, 2007 – continued
Establish priorities for Unrestricted General Fund support of activities or programs outside of the core
mission of the College.
Develop a budget process that manages the growth of expenditures based on: analysis of program
need (rather than historical allocations); realistic expectations of revenues; updated market
information; and performance measurements.
In light of the current financial circumstance review ongoing and future planning initiatives in terms of
their long term advantages to the College in meeting public demand for services, improving student
success outcomes, or to provide new revenues. Modify, defer, or abandon as appropriate those for
which the costs outweigh their potential for furthering the College’s core missions and goals.
Make effective use of the College’s established planning structures and processes to recommend
specific actions to reach the stated objectives, following the principles listed above. The College
President shall clarify how these recommendations will be evaluated and the timelines necessary to
arrive at a set of final recommendations for any particular budget cycle.
Programs will not be eliminated or reduced without careful review.
Benchmarks will be used as a guide to inform the decision-making process.
Town Hall Meeting
June 10, 2009
Next Steps:
1.
2.
3.
4.
Principles and Process
 Department/Program Dialogue
 budgetideas@smc.edu
 Budget Committee & DPAC Recommend Ways to Reach Target
 BOT Workshop June 23
 Begin to Implement Solutions – July 1
Continue to Advocate with Legislators
Provide Quality Teaching, Learning and Program Services to over 21,000
FTES
Wait for the Final Budget – BOT Adopt August/September