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Vice-President (Finance & Corporate Services)

University of New Brunswick

Presentation/Discussion withFredericton Campus Student Union

Council

March 13, 2007

2


Agenda

UNB Financial Context

2007-08 Budget Planning

Campus Priorities and Focus

Questions

3


UNB 2007-08 Budget Planning

The Context

Rapidly changing landscape – Post Secondary Review

Revenue pressures

Cost pressures

Structural financial challenges

Strategic directions, integrated planning and budgeting

4


UNB Budget Planning

Revenue Pressures

Under funded compared to peers and aspirations

Funding ability/priority of Province

Traditional market enrolment outlook

Tight tuition fee market < 5%

5


2006-07 Budgeted Operating Revenue

$156.4 million

55.79%

37.50%

6.71%

Provinical Operating Grant

Tuition Revenue

Other

6



PROVINCIAL OPERATING GRANT

% CHANGE

96-97

97-98

98-99

99-00

00-01

01-02

02-03

03-04

04-05

05-06

06-07

(4.0)

(3.0)

(2.0)

(1.0)

0.0

1.0

2.0

3.0

4.0

5.0

7


Province of New Brunswick

Projected Enrolment for Grade 12

2001-2025

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

2001- A

2002 A

2003 A

2004 A

2005 A

2006 P

2007 P

2008 P

2009 P

2010 P

2011 P

2012 P

2013 P

2014 P

2015 P

2016 P

2017 P

2018 P

2019 P

2020 P

2021 P

2022 P

2023 P

2024 P

2025 P

Province Anglophone Francophone

Source: Policy and Planning, Department of Education, Province of New Brunswick, December 2006

8


UNB

FTE Student Enrolment

7000

7500

8000

8500

9000

9500

10000

10500

11000

11500

12000

2002-03 A 2003-04A 2004-05A 2005-06 A 2006-07 A

DEC

2007-08 F 2008-09 F 2009-10 F 2010-2011

F

2011-12 F

9


Tuition Fees

Maritime Universities 2006-07

6.5144,920UPEI

3.8125,210Atlantic School of Theology

4.8154,735Université de Moncton

3.9115,500N.S. College of Art & Design

4.75135,246UNB

3.9105,500N.S. Agricultural College

5.0164,355Saint Thomas

3.995,550Mount Saint Vincent

4.06,204Group Average

3.985,580Saint Mary’s

3.975,660Université Saint-Anne

3.8565,660College of Cape Breton

3.656,030Dalhousie University

3.646,030University of King’s College

3.936,205Saint Francis Xavier

5.026,405Mount Allison

3.918,062Acadia

% Change

2005-06/

2006-07Rank

Tuition

Fees

Based on Arts ProgramSource: Association of Atlantic Universities

10


Canadian Average Tuition Fees

for Undergraduate Arts Program

3.24,3474,211Canadian Average

4.85,2465,008UNB

1.94,9604,867British Columbia

(0.2)4,8284,838Alberta

0.05,0635,063Saskatchewan

0.23,3383,333Manitoba

4.65,1604,933Ontario

0.71,9161,900Quebec

5.85,3285,037New Brunswick

6.54,9474,645Prince Edward Island

3.96,5716,323Nova Scotia

0.02,6062,606Newfoundland

% Change2006-072005-06Province

Source: Statistics Canada, The Daily, Sept 1, 2006

NOTES:

1. Tuition fees shown are for an arts program only. Some institutions charge higher fees for other undergraduate degreeprograms (UNB currently charges the same for all undergraduate programs except for Engineering and Law).

2. Tuition fees do not include (a) any additional compulsory fees for athletics, health services, student associations, orother purposes, or (b) supplementary fees paid by international students.

11


18.11%5.00%23.40%5.75%19.06%8.46%% change from previousyear

1,3263481,325307855350$ change from previous year

Faculty of Law


244508382350780310$ change from previous year

Supplemental Fee

UndergraduateInternational


Graduate Tuition Fees


238238260245320310$ change from previous year

Undergraduate Fees

06-0705-0604-0503-0402-0301-02


Tuition Fee Changes for 2006-07 and 5 Year History

12


UNB Budget Planning

Cost Pressures

Costs rising faster than revenues

Cost structure is relative fixed and inflexible

Aging infrastructure

Need for investments to be competitive

13


University Cost Inflation

2.3%

3.8%

2.25%

4.6%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%

5.00%

Ontario US

CPI (General Inflation) University Cost Inflation

Source: Council of Ontario Universities, 2006.

Commonfund, HEPI

14


UNB Budgeted Operating Expenses

2006-07(excluding ancillaries and contributions to Capital)

56.69%

18.81%

14.50%

10.00%

Faculties & Departmental Costs Academic & Student Support

Administration & Development Maintenance & Utilities

15


Infrastructure Renewal

UNB Figures and Context

Average Age of Buildings

36

23

45

0

5

10

15

20

25

30

35

40

45

50

Fredericton Saint John Canadian Average

16


Infrastructure Renewal

UNB Figures and Context

Facilities Condition Index (FCI)

22.0

11.3

17.3

10.0

0.0

5.0

10.0

15.0

20.0

25.0

UNB Canada Atlantic Above 10Unacceptable

17


UNB Fredericton Campus

Infrastructure Renewal Expenditure Budgets$(millions)

$3.59 $3.62 $3.65 $3.71 $3.79

$6.14

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

2006-07 B 2007-08 F 2008-09 F 2009-10 F 2010-11 F 2011-12 F

Annual Spending to Improve Overall Facilities Condition over time $8.1M

$8.1

$6.3

Minimum Annual Spending to Sustain Overall Facilities Condition $6.3M

Pro-forma

January 23, 2007

18


UNB

Operating Budget Planning 2007-08

- Same overall faculty and complement size and mix

2.5%- Basic CPI

4.5%- Energy cost increases

(391)

(3.73%)

(137)

(5.51%)

(254)

(3.17%)

- Enrolment decreases (FTE)

4.5%- Basic level of tuition fee increase

(from 2.5% to 3.5%)

5.0%

- Basic salary increases

- Benefit Increases

3%

3.27%

- Provincial Funding to universities

- UNB Allocation based on formula

TotalUNBSJUNBF

Assumptions in the Initial Budget Forecast

19


UNB


Overview

($ millions)

$(6.9)$(2.9)$(4.0)- Initial forecasted budget shortfall

TOTALUNBSJUNBF

As of January 23, 2007

20



Financial Imperatives

Combination - Revenue initiatives

- Expense initiatives

- Recalibration to a new lower level

- Rebalancing cost structures

- Investments to strengthen

- Financial Environment

UNB/Partners/Stakeholders

21


UNB 2007-08 Plan and Budget Overview

- Scholarships reductions in number of- Property Development

- Stability in benefit costs

prioritization

determined by review and

attrition in priority areas- Other budget cuts increases

- Partial replacement of selectively frozen- Competitive tuition fee

- Facilities Improvements- Non-salary budgets- Incentives

- Advancement faculty and staff positions- New Advancement model

- Recruitment marketing- Mainly attrition based- College of Extended Learning

Strategic InvestmentsExpense Management and

Cost Reduction

New Revenues

22


UNB


Overview

$(6.9)$(2.9)$(4.0)- Initial forecasted budget shortfall

$(2.6)$(0.8)$(1.8)Current Forecasted Budget Shortfall

($ millions)

1.62%2.4%1.4%(% of total budget)

4.32.12.2- Impact of expense management

and cost reductions

TOTALUNBSJUNBF

As of January 23, 2007

23


UNB Operating Budget Planning

Overview of Expense Management

& Cost Reduction Program 2007-08

Fredericton Campus – Overall reduction planned $2.2 million @1.75%

Attrition reduction in faculty and staff positions – main budget tool

Non-salary budgets frozen except for scholarships, library and utilities

Flex funds designated for strategic priorities

Saint John Campus – Overall reduction planned $2.1 million @ 3.0%

# of faculty and staff positions reduced - TBD

Flex funds restricted

Infrastructure transfer reduced by $600 K

24


UNB

Options to Address Remaining

2007-08 Budget Shortfall of $2.6 million

Impact of Provincial Operating Grant• 1% = $875 K

• Additional grant requirement 3%

• Total grant increase would need to be @6%

Tuition Fee Increase• 1% = $550 K

• Additional tuition fee requirement 4.8%

• Total tuition fee increase would need to be @9.5%

Student Enrolment• 1% change in enrolment = $550 K or 105 students

• Additional # of students + 500 students, @ 5%

• Total change in # of students + 109, instead of (391)

25



Integrated Planning and Budgeting Model

Strategic Planning Academic, Research and

Operational Planning

Forecasting &

Budgeting

Performance

Measurement &

Reporting

26


STUDENTS INVOLVED INBUDGET PROCESS

Fredericton Campus Budget Management Committee Jeff Strong, Undergraduate Representative Colin Curry, Graduate Student Representative

University-wide Budget Management CommitteeJessica Stutt, Undergrad Student Rep (UNBF)Fern Paul, Graduate Student RepHans Klohn, Undergraduate Student Rep (UNBSJ)

Finance CommitteeJessica Stutt, Undergraduate Student Representative

Board of GovernorsJessica Stutt, Student Union PresidentSusan Barry, Student Representative Council, SJ

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