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Presented to the Finance/Facilities Committee Board of Trustees May 16, 2007

FY2008-2009 Operating Budget Priorities Discussion. Presented to the Finance/Facilities Committee Board of Trustees May 16, 2007. Overview of Discussion. Outline of decision timetable Legislative outlook Internal allocation recommendations. Decision Timetable.

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Presented to the Finance/Facilities Committee Board of Trustees May 16, 2007

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  1. FY2008-2009 Operating Budget Priorities Discussion Presented to the Finance/Facilities Committee Board of Trustees May 16, 2007

  2. Overview of Discussion • Outline of decision timetable • Legislative outlook • Internal allocation recommendations

  3. Decision Timetable • Fiscal Year begins July 1, 2007 • Committee public hearings scheduled • June 6 WFP • June 12 Lake Superior College – committee scheduled to approve budget • Full Board vote scheduled June 20, 2007 • Special Board meeting may be necessary

  4. Legislative Status • Conference Committee report adopted May 8 and vetoed by the Governor May 10 • Reasons for veto include: • Failure to support several policy objectives • Overall spending levels in FY2010-2011 biennium • Higher education funding linked to larger continuing debate over available resources • New report will be adopted once overall budget deal established • Timetable is uncertain

  5. College and University Budget Planning • Early March presidents were provided guidelines for preparation of operating budget materials • Proceeding with assumption that higher education bill will provide for funding of compensation and other operating cost inflation • Tuition planning proceeding with Board’s direction last fall • College and university preliminary base budgets will not include any new funds from remaining initiatives

  6. Operating Budget Request Table 1 – Fiscal Year 2008-2009 Biennial Budget Request ($ in millions) Appropriation Tuition Reallocation Total Base appropriation $1,204 $1,204 Infrastructure Inflation $ 57 $73 $10 $ 140 Technology $ 70 $ 70 Strategic advancements Recruitment/retention of underserved and underrepresented $ 24 $10 $ 34 STEM $ 10 $ 5 $ 15 Health care education $ 3 $ 3 Biosciences Center of Excellence $ 3 $ 3 Management innovation$ 10 $ 10 Total budget request – new funds $ 177 $73 $25 $ 275 Total budget request – base plus new funds $1,381 $1,479

  7. Legislative Outlook Table 2 – Comparison of system request to May 8th approved bill ($ in millions) Appropriation Tuition Reallocation Total System request - base $1,204 $1,204 System request – initiatives $ 177 $73 $25 $ 275 Total request $1,381 $73 $25 $1,479 Conference Committee Recommendation – base $1,204 $1,204 Conference Committee Recommendation – initiatives $ 150.8 $70 $25 $ 245.8 Total legislative recommendation $1,354.8 $70 $25 $1,449.8

  8. Legislative Outlook – cont. Table 3 – FY2008-2009 Operating Budget Recommendations (May 8th bill) ($ in thousands) Request Approved Difference Base Allocation $1,204,388 $1,204,388 $ 0 Inflation $ 56,857 Technology $ 70,000 Recruit/Retain Under-represented students $ 24,000 Subtotal $ 150,857 $ 135,408 ($15,449) STEM $ 10,000 ($10,000) Biosciences $ 3,000 ($ 3,000) Health Care $ 3,000 ($ 3,000) Management Innovations $ 10,000 ($10,000) Total Request $ 176,857 $ 135,408 ($41,449) Other items in bill $ 15,346 Total New Funds $ 150,754

  9. Internal Allocation Recommendations • Guidelines for state operating appropriation • Guidelines for initiatives not supported by legislature • New allocation directions from legislature

  10. Internal Allocation Recommendations – cont. • Base allocation: Funds distributed through allocation framework. • Inflation: Funds distributed based on each college/university’s percent share of FY2007 base allocations. • Technology: A portion of funds distributed to all colleges and universities based on enrollment; remainder of funds directed toward system-wide Information Technology Enterprise investments. • Recruitment and Retention: Original proposal provided two-thirds funds distributed to all colleges and universities based on low income and first generation student counts; balance awarded through a competitive grant basis. Staff will make final recommendation when funding level is known.

  11. Open Issues • Overall state resources available • Timetable for final legislative action • Special language restrictions • Support for un-funded board initiatives • Linkage of campus budget plans to action plan progress

  12. Decision Timetable • Fiscal Year begins July 1, 2007 • Committee public hearings scheduled • June 6 WFP • June 12 Lake Superior College – committee scheduled to approve budget • Full Board vote scheduled June 20, 2007 • Special Board meeting may be necessary

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