Budget Update FY 14

Budget Planning FY 15 Budget Update FY 14 Marketing and 75th Anniversary May 2014 and

Principles Meets Core Values/Goals College is more important than any one individual Student as center Serve mission and goals of college, adjust goals as needed Be truthful Consider effects on community, meet partner expectations and commitments Supported by Evidence/Data Create a sense of urgency – internal and external Provides Return on Investment - Tangible/Intangible Gain efficiencies in operation Realign personnel costs to a realistic level Opportunity to realign to support future growth Supports Faculty and Staff Retain and reassign as possible, layoffs are last option Consider climate/morale, mitigate and communicate

Priority Criteria for Ranking Budget Request Items • Academic programs • scheduling, support growth (weekend, online), faculty ratio of full time and part time, SACS issues, diversity • Operations • overhead and infrastructure, Newtown Campus • Student services • recruitment, outreach, promotion, inclusion/diversity, retention and completion • Revenue generating • programs, courses, and services, new program development, new college success course • Grant responsibilities • Safety/security • Economic development/workforce and business services 2013-14 • 2008 (prioritized) • Improve student success • Positively impacts quality education • Supports operations/infrastructure • Promotes customer service • Support Community Needs • Security / Safety • Public Image • Supports accreditation

Budget Update FY14 Budget Planning FY15 • Budget Calendar • State Budget • Strategies for Expense Budgets Tuition Revenue Recurring and Non-recurring Fund Balance

FY2014 Budget Update Recurring vs Non-recurring • Recurring: Fund 01 • happens or occurs again or repeatedly; income or expense expected every year • Non-recurring: Fund 05 – Fund Balance • pertaining to an income or expense not likely to occur again; a one-time expense

FY2014 Budget Update Budget Composition Personnel 72.0% Operating 12.9% Utilities 2.2% Capital Expenses 2.9% Waivers and Scholarships 3.3% Unallocated Budget/Fund Bal 3.8% Contingency Reserve 2.9% 100% State Appropriation 14.8% Tuition & Fees 65.7% Other 19.5% 100%

FY2014 Budget Update Revenue • Tuition Revenue Shortfall(as of 4-28-14) • Fall - $943,042 -- down 5.34% • Spring - $885,462 -- down 5.56% • Headcount down 5.7%, FTE down 7.1% Headcount by delivering college down 9.2% (CPE snapshot) • Summer - $429,807 – down by 13% • Projected FY14 revenue deficit of $2,500,000 - $3,000,000

FY2014 Budget Update Revenue • Projected FY14 revenue deficit of $2,500,000 - $3,000,000 • Offsets: • Salary Savings + $1,500,000 • Bad Debt Expense Decrease + $500,000 • Over-spend of Waiver Expense - $100,000 • Operational Cuts + $520,000 • Under-spend Expense Budgets • Over-spend of Expense budget • Fund Balance

FY2014 Budget Update Budget Cuts

FY2014 Budget Update Fund Balance FY2013 Fund Balance as of July 2013 = $15,750,000 FY14 Authorized to Spend: Newtown North -$1,000,000 NR SO Recharge -$ 167,721 NR Approved 6/2013 -$ 241,593 NR Approved 9/2013 -$1,545,000 Recurring items funded NR -$1,172,000 Fall 2013 unrecognized tuition -$ 943,000 Spring 2014 unrecognized tuition -$ 886,000 Summer 2014 unrecognized tuition -$ 429,000 MNA 100 Nursing Home Revenue -$ 200,000 FY14 Underspend of Expense Budgets FY14 Overspend of Expense Budgets Estimated Fund Balance April 2014 = $9,165,686

Budget News – Governors budget • Capital Projects • $24 million state agency bonding for Advanced Manufacturing Center at Georgetown. • BuildSmart agency bonding package - $18 million for expansion of Newtown Campus, with a required local match of $6 million. This is a request by KCTCS that would fund projects at all 16 colleges. A downside is that the bonds would be repaid by an $8 per credit fee paid by students. Fall 2014 $4 per credit. • Operations • Cut in state funds to KCTCS of 2.5% of state allocation original proposal. Final cut for BCTC = $64,200 • Since February 2008, BCTC has incurred recurring state mandated budget cuts = $3,148,300

Due May 9, 2014 • New Public Funds Calculation Process - $1,304,000 • Recurring Cut - .7% of State Appropriation $64,200 • Performance Based Funding - $0 included in FY15 (so far) • Proposed tuition increase of $3 per credit hour - $650,000 • McGowan Rent - $89,239 • LFUCG MOA Cadet Cohort - $60,000 • Salary Savings $1,700,000 • Budget reductions by area • Increases in Expense Lines: • Must add or adjust expense lines as necessary • Proposed 1% salary increase • Reduction in revenues - • Reduce tuition to FY14 actual - $2,400,000 • Reduce FY15 revenue projections - $1,800,000 FY2015 Budget Planning

FY2015 Budget Update

FY2015 Budget Update College Budget Calendar • March 18 – LET Budget Planning Review • April 15 – LET Budget Decisions made • May 9 – Budget due to SO • May 28 – Budget approval by BCTC Board • June 13 – Action by KCTCS Board of Regents

Budget How can we all help? Concerns for BCTC in annual operations funding • Clear that we are underfunded in current KCTCS model at largest amount • No other college is in buildings KCTCS does not “own” - as our buildings were ceded to UK ownership • We are not adding capacity, only replacing what we will lose in leaving Cooper as no other college is leaving a current major campus • Expect loss of enrollment when we leave Cooper. We still think there are many UK students who take our classes • Georgetown project planning and operational costs coming soon • SACS accreditation concern - 5 year report due in 2015 - full-time faculty numbers continue to fall; not meeting minimum expectations • Technology – six years since student labs refresh • Constant cutting has affected services, classes, climate and morale

Budget How can we all help? Strategies to address revenue shortfall • Have reduced staffing by about 59 positions in last 3 years • 19 vacant positions held to balance FY13 budget (4 later filled) • 18 vacant positions held to balance FY14 budget (5 later filled) • 17 vacancies held during FY14 to address budget shortfall • 8 vacancies approved to post during FY14 • 13 vacancies (retirements/resignations) projected effective 6/30/14 • Staffing & Personnel / Workload changes • Voluntary time off • No college funds for grants expenses • Consider close of programs, reductions of services • Reduce professional development funds • Changes to dual credit • Continue to tighten schedule - once a year only offering of some transfer classes • Ending weekend classes and some evening • Close buildings / campuses for summer • Making investment of nonrecurring in marketing - $350,000+ this year

Budget How can we all help? • Focus on our important work • Advocate – talk to legislators, students, friends, family • Find ways to save or generate funds • Be creative and resourceful • Revenue generating programs • Assist students to be responsible / succeed • Bad Debt Expense • R2T4 • Contract re-negotiations • Spending and hiring “hard frost”

Marketing

Marketing Objectives • Suggestions from Fac - Staff Meeting What message can we own? • Value / Affordable • Caring /Supportive / Small classes • Start here / Path to success • Quality • Transfer • Technical / Good careers • Flexible learning options • Close to home • Innovative / Specific Programs /PTK • Workforce Training • Benefits of education • Partnerships

Marketing Objectives • Raise awareness of unique, affordable, convenient programs • Define breadth and depth of programs that lead to high-wage, high-demand careers • Reinforce BCTC (vs. KCTCS) branding • Celebrate the positive impact that BCTC has on people’s lives for 75 years • Increase understanding of Lexington campus locations

Media Suggested • Everything… • Radio • Television / Cable • Out-of-Home • Digital Display • Social Media • Print • Facility Signage • 1 Large Sign per Campus • Grass roots • Guerilla • Email • On-Campus

Expected Outcomes • Increase awareness by X % • Increase enrollment by X % • Increase faculty, staff, & student engagement—measure? • Increase media coverage—measure? • Increase social media engagement by X % • Increase website hits by X % • Increase donations by X %

BCTC New Television Concepts – Yesterday and Today/Imagine – :30 It began with a handful of vocational classes and just over 300 students... 75 years later, BCTC has transformed into one of the most respected community colleges in the nation...Helping thousands of people a year get a head start on a 4-year degree... ...And helping thousands more prepare for high-wage jobs in over 40 different fields – all at a fraction of the cost of a four-year school... So whether you’re starting out – or starting over – your brighter future starts at BCTC. Imagine a place that puts higher education within reach…Where classes are small and teachers care… Imagine a college that in just two years can prepare you for a high-paying job or a jumpstart to a four-year degree. And now imagine that you leave with loads of opportunity and little debt. BCTC -- all you expect and more than you imagine.

Outdoor: Transformation

Target Audiences • Primary-Recruitment • Traditional students: high school students • Under-employed or unemployed • Key influencers: family / friends / teachers • Former students not completing programs • Students interested in online or summer school courses • Secondary-Public Awareness • Employers / Business Leaders • Community & Political Leaders • Current / Potential Donors • Thinking & talking public

Messages 1. A first-rate, affordable, convenient postsecondary education • For 95% of Central Kentuckians, a BCTC campus within a 30-minute drive. • More than 1,000 students attend the Newtown Campus in Spring 2014. • Tuition for a BCTC education is one-third to one-half of the cost of public universities and much less than that of an independent or for-profit college. • More than 5,000 nursing and allied health care students each year, prepare to meet the growth in health care jobs of 26% forecast in Kentucky through 2020.

Messages 2. High wage, high demand career programs that prepare students for their next steps • BCTC currently offers 44 programs of study, including specialized study in jockey and horse care, advanced manufacturing, integrated engineering, biotechnology, respiratory care, informatics, medical coding, and alternative energy. • A BCTC associate degree graduate will earn 24% more in annual wages than a high school graduate. • BCTC boasts a high job placement rate, 80% to 100%, for graduates.

Messages 3. The first two years of a baccalaureate degree • More than 3,600 BCTC students (from 2008-09), transferred to a four-year university within three years, representing more than 25% of the entering class. • Successful transfer students from BCTC to universities earn on average a 3.0 grade point one year later. • The BCTC Transfer Center, houses transfer advisors from six universities in the region and provides direct support to transferring students. Many are eligible for significant transfer scholarships. • BCTC is the largest transfer institution in Kentucky and transfers more students to UK, EKU, KSU, and NKU than any other college.

Messages 4. Workforce training solutions to meet the needs of regional employers and the global economy • BCTC is one of the largest providers of workforce education serving over 500 businesses and training more than 1,500 employees annually. • Serves around 18,000 credit-seeking and workforce students annually. • Awards some 3,500 associate degrees, diplomas and certificates annually. • 90% of BCTC students are successful in passing end-of-program licensure and certification exams. • 5.

Messages 5. Student support that begins wherever students are • BCTC’s Adult Education, GED, and English as a Second Language (ESL) programs serve four counties and serve some 2,000 students each year. • Almost 24% of BCTC students are diverse or multicultural students. • Largest enrollments are in the programs of liberal arts/transfer, nursing, business, and computer science and information technology.

Budget Update FY 14