Budgeting Basics

Marcy P. Driscoll

Florida State University

Christine McCormick

University of Massachusetts-Amherst$$

Opening Exercise• What kind of budget model do you have?

– Incremental model– SCH production model– RCM model– Some combination

Find the money

Where does the money for your college come from?

• State appropriation/Tuition revenue– Direct from tuition– Allocation from central administration– Unfilled faculty positions– Unfilled staff positions– Summer programing – Graduate student tuition and fee waivers– Carryforward

• Other sources of revenue– Distance learning fees– Tech fees– Material & supply fees– Online degree programs/courses (fees & tuition)– Continuing and professional development (fees &

tuition)– Charter school contracts– Royalties from commercial ventures– Other off-book activities

• Private funding– Gifts from individuals– Corporate and foundation gifts– Bequests and planned gifts– Real estate and other gifts of real property

• Research funding– State service contracts– State flow-through federal grants– Federal grants– Foundation grants– Research overhead and residual funds– “course buyouts”

Where are the accounts held?

• Provost/central administration• Dean’s office, units in dean’s area• Departments• Sponsored research• Foundation• Other entities (e.g., Distance Learning,

Continuing Education)

Table Discussion

Do you have a centralized budget for the College/School? Or does each department and unit have its own budget? What are the advantages and disadvantages of each?

Spend the money

Who spends the money?

• Dean• Dean’s units• Department• PIs• Centers

What drives decisions about spending?

• Basic operational needs• Instructional needs and investment• Enrollment and student-credit-hour targets• Research needs and investment• College priorities (strategic plan)• Faculty recruitment and start-up• Salary equity and counteroffers• Spousal hires

What drives decisions about spending (cont’d)?

• Collective bargaining agreements• Student financial needs• Facility and technology upkeep and renewal• Expenditure guidelines and policies• Risk tolerance• Investment in other revenue generating activities• Recurring vs. non-recurring expenses

Things to keep in mind• In some places, money is money.• In others, money comes in multiple buckets

that are generally not interchangeable.• In either place, spending guidelines and

restrictions can affect how you spend what you have.

TIPS TO BUDGETING SUCCESS – LESSONS LEARNED

• Make sure you have a competent budget manager.• Understand the budget yourself. Keep asking questions

until you do understand it.• Get to know the budget people in central administration.• Talk to other deans.• Maintain a reserve (5-10%).• Make the college budget transparent.

Faculty Salary, 75%

Staff Salary, 14%

Part-time Lecturer, 2%

Graduate Assistantship Salary, 8%

Balance Available

Fiscal Year Projection: SAMPLE

89% used for Faculty and Staff Salary

Base Budget $x,xxx,xxx

Salary ExpensesFaculty and Staff Salary

$x,xxx,xxx

Part-time Lecturer Salary $xxx,xxx

Total Salary $x,xxx,xxx

Available for other expenses $xxx,xxx

Graduate Assistantship Salary(Additional GA funded by Grants and CPE programs)

$xxx,xxx

Net Available for operating $xxx,xxx

* Est. Operating Expenses $xxx,xxx

College Operating ExpensesCategory 2013 2014 2015Administrative, General Office, Student Travel & Department Discretionary

Faculty Travel

Technology and Equipment

Telephone/Ethernet

Recruit/Hire (includes moving)

Copy/Print

Postage

Total

College RevenueFund Description 2013 2014 2015

Research RTF (College-level)

Research RTF (PI)

Continuing Education

Revenue Activity

Unrestricted Gift

Undergraduate / Out-of-State

Graduate Revenue Share

Department Revenue SharingFunding Source A B C

Full-time Faculty (Fall 2015)

GOFGeneral Operating Funds

(does not include travel allocation)

RTFResearch Trust Funds

25% of College’s FY15 RFT Return

CEIContinuing Education Incentive Funds

30% of College’s FY15 Net CPE Revenue

Follow the money

Questions?

To Do:

Find the money.Spend the money.

Follow the money.