Fall Budget Forum Projected Fiscal Year 05/06 Budget Fiscal Year 06/07

1. Fall Budget ForumProjected Fiscal Year 05/06Budget Fiscal Year 06/07 September 12, 2006

2. Purpose of the Forum • Review 05/06 Results • 06/07 Budget/SB 361

3. Agenda • Budget & Fund Balances JS • Budget Challenges JR

4. Revenue Uncertainties for Building the 05/06 Budget • Equalization continuing • Allowable Growth Allocation • Amount of COLA • Basic Skills • Deficit Factor • Achieving Enrollment Cap • Future Resident and Non-resident Fee Increase

5. Actual 04/05 & Projected 05/06State Revenue • 05/06 General Apportionment increase consists of Growth, COLA and includes Equalization and final P for E allocation from 04/05.

6. Actual 04/05 & Projected 05/06 Local Revenue

7. Actual 04/05 & Projected 05/06 Operating Expenses • Salary and benefits include increases of 5% effective January 2005 and approximately 5.42% effective January 2006, 10 additional instructors Fall 2005 and the Classification Study implementation. • Other operating expenses include $600,000 in ongoing software expense transferred from technology purchases.

8. Actual 04/05 & Projected 05/06 Interfund Transfers • Transfers In consists of Continuing Ed Fees and Theatre Revenue.

9. Actual 04/05 & Projected 05/06 General Fund Balance • 05/06 Projected General Unrestricted Fund Balance 5% Board Operating Contingency $ 3.8 million Undesignated Fund Balance $ 5.4 million Total $ 9.2 million

10. Actual 04/05 & Budget 05/06 Ending Fund Balances • The decrease in Total Fund Balances is primarily from expenditures in construction (Sports Pavilion and Major Maintenance) and equipment (Technology and Banner).

11. Salaries and Benefits • Increased from 73% to 83% as % of Revenue. • Real increase in salaries and benefits is $20.6 million from 2001 to 2006.

12. Other Expenses The expenses that contributed to the increase were Supplies, Liability Insurance, Software Licenses, Legal, Advertising and Utilities.

13. Growth in Revenue and Expenses • Margin is the amount remaining after salaries, benefits and operating expenses.

14. What was different for the 05/06 Year? • Classification Study Implementation • P for E included in Base • Equalization reduced substantially • COLA @ 4.23% • Enrollment Cap @ 2.58% • January salary and benefits increase was 5.42%

15. Conclusion • We are tied to the WHIMSICAL state budget. • If the housing market declines significantly it will throw the state into a recession.

16. Revenue Assumptions for Building the 06/07 Budget • Equalization amount – SB 361 • Amount of COLA – 5.92% • Basic Skills - $502,000 • Deficit Factor? • Achieving Enrollment Cap – 1.33%-2.03% • Future Resident and Non-resident Fee Increase? • Reduction in fee from $26/unit to $20/unit

17. Adopted & SB 361 06/07State Revenue • General Apportionment includes COLA of 5.92%, Equalization, Basic Skills, and Growth of 0.0%

18. Adopted & SB 361 06/07 Local Revenue • The Difference State Revenues is from equalization estimate and the one-time Block Grant.

19. Adopted & SB 361 06/07 Operating Expenses • Two additional security personnel were omitted from budget.

20. Adopted & SB 361 06/07 Interfund Transfers • The $50,000 is a transfer from Ed Programs expense to the conversion of the classroom and provide furniture for the student success offices and conference rooms.

21. Adopted & SB 361 06/07 General Fund Balance • The Difference is from equalization and the one-time Block Grant.

22. Projected 05/06 & SB 361 06/07 General Fund Balance • Revenues: $4.4 million equalization, 5.92% COLA, Basic Skills, and one-time allocations. • Expense: 5.92% COLA, classification study, and 5.42% salary increase. • Net Transfers Out: Parking Structure and Banner.