Mark M. Polatajko, CPA Candidate Public Forum September 22, 2011

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Wright State University’s
Budget Transformation:
The “Mission-Driven Allocation” Model
Presentation to:
Faculty Senate
May 7, 2012
Agenda
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Introduction
WSU Budget - Current State
The Changing Environment
WSU “Mission-Driven Allocation” Model
(MDA)
WSU MDA Model Design
The Path Forward
Concluding Thoughts and Discussion
WSU Budget Transformation
May 7, 2012
2
WSU Budget: Current State
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Traditional Base Budget Approach
Centrally Funded Incremental Adjustments
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Compensation Changes
Inflationary Adjustments
Technology Initiatives
Centrally Funded Allocations
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Strategic Initiatives
Capital Projects
WSU Budget Transformation
May 7, 2012
3
The Changing Environment
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WSU must transform its budget development
and management process to respond to this
dynamic environment:
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Drive student success
Expand programs and scholarship
Offset diminishing revenue streams
Catalyze entrepreneurship
Optimize expenses and drive efficiency
Respond to community needs
WSU Budget Transformation
May 7, 2012
4
WSU “Mission-Driven
Allocation” Model (MDA)
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As a result, WSU is developing the
“Mission-Driven Allocation” Budget Model
The power of the MDA Budget Model
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Enhance revenue generation and
entrepreneurship (students & scholarship)
Focus resources on strategic initiatives
Establish a defined governance structure
Promote transparency
Streamline expenses and drive efficiency
WSU Budget Transformation
May 7, 2012
5
WSU MDA Model Design
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Types of Units
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Academic Responsibility Centers
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Auxiliary Responsibility Centers
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Colleges, Lake Campus, WSRI, Matrix Department
ex. Bookstores, Food Service, Nutter Center, Athletics
Administrative and Service Units
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ex. Human Resources, Utilities, Facilities, Registrar
WSU Budget Transformation
May 7, 2012
6
WSU MDA Model Design
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Revenues – Unrestricted and Restricted
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Tuition and Fees
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State Share of Instruction
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60/40 Split Based on Tuition FTE and Research
Research Grants and Contracts
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75/25 Based on Instruction and Majors
Specific Tuition and Fees
Direct Research Revenues
Indirect Cost Recoveries
Investment Income
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4.5% of 5 Year Carryforward Average
WSU Budget Transformation
May 7, 2012
7
WSU MDA Model Design
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Expenses
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Direct
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Specific to each Responsibility Center
Controlled Individually by Units
Indirect
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Service Units (40 Individual/Consolidated Units)
Allocations Based on Different Drivers
Budget Managed by the A & S Units
WSU Budget Transformation
May 7, 2012
8
WSU MDA Model Design
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Strategic Initiatives Funding
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Sources Based on % of Selected Revenues
Uses
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Responsibility Centers Predetermined Subvention
New Initiatives (One-Time Funding)
WSU Budget Transformation
May 7, 2012
9
WSU MDA Model Design
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Governance
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Four Committees will be established to oversee
and manage the MDA Budget Model:
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Mission-Driven Allocation Executive Committee
Administrative Services Allocation Committee
Deferred Maintenance Committee
Space Management Committee
WSU Budget Transformation
May 7, 2012
10
The Path Forward
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FY 2013
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Ongoing training and communications
Parallel process – budget management under
traditional method/translation into MDA reports
Launch of governance committees
FY 14 budget development (MDA method)
FY 2014
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Full implementation (with hold harmless)
WSU Budget Transformation
May 7, 2012
11
Concluding Thoughts and
Discussion
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The WSU MDA Budget Model is:
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Aligned with WSU mission, vision, values
Designed to empower innovation and collaboration
Responsive to the University Strategic Plan
Geared for driving entrepreneurship
Agile in a dynamic environment
Stakeholder-driven and governed
Designed to deliver effectiveness, transparency,
and efficiency
WSU Budget Transformation
May 7, 2012
12
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