OPERATING FUND

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1 OPERATING FUND OPERATING FUND

2 PROJECTED SOURCES AND USES - OPERATING FUND SUMMARY Fiscal Year As of CO Memo B CO Memo B Total Re-benched FTES* 21,659 21,659 Funded Re-benched Resident FTES 21,625 21,625 Non-Resident FTES Campus Budget Estimates Before Prop Campus Budget Estimates After Prop 30 Passes Difference Sources of Funds Appropriations - General Fund Baseline from Prior Year $107,426,677 $107,426,677 $0 Unallocated Reductions Retirement Adjustments ($729,040) ($729,040) $0 Adjustments Adjusted General Fund Baseline Appropriation $106,697,637 $106,697,637 $0 State Appropriation Changes Compensation and Benefits Unallocated Baseline Reduction ($100M) ($5,857,300) ($5,857,300) $0 Unallocated Baseline Reduction ($250M) ($15,499,000) $15,499,000 Health Compensation Compensation (Salary Lag Supplement) SSI Costs Subtotal ($21,356,300) ($5,857,300) $15,499,000 Specified Programs Energy Systemwide Space Reallocation State University Grants (SUG) Tuition Fee Discount $5,437,000 $1,067,200 ($4,369,800) Subtotal $5,437,000 $1,067,200 ($4,369,800) Unrestricted Marginal Cost Enrollment Increase (GF) Marginal Cost on Growth (Fee Revenue) Adjustment (offset by Fee Revenue) Financial Aid Set Aside (Marginal Cost Fee) Financial Aid Set Aside (Fee Rev) for Fee Increases ($4,204,000) $4,204,000 Revenue Interest Assessment ($137,900) ($137,900) $0 Operating Support Restoration Subtotal ($4,341,900) ($137,900) $4,204,000 Projected Appropriation $86,436,437 $101,769,637 $15,333,200 Campus Projected Revenue and Adjustments State University Fee (SUF) Income $146,256,000 $134,220,000 ($12,036,000) Allowance for Revenue Shortfall ($650,000) ($650,000) $0 Non-Resident Fees $2,800,000 $2,800,000 $0 Application Fees $1,100,000 $1,100,000 $0 Other Miscellaneous Revenue $150,000 $150,000 $0 $149,656,000 $137,620,000 ($12,036,000) $236,092,437 $239,389,637 $3,297,200 Other Revenue (WS, Financial Aid) $1,000,000 $1,000,000 $0 Total Projected Sources of Funds $237,092,437 $240,389,637 $3,297,

3 Campus Budget Estimates Before Prop Campus Budget Estimates After Prop 30 Passes Difference Uses of Funds Prior Year Baseline Allocation Division Baseline Allocations $122,093,299 $122,093,299 $0 All University Expenses 22,754,392 22,754,392 $0 Reserve $3,800,815 $3,800,815 $0 Mandatory Costs (compensation pool, benefits, restricted programs, student grants) $103,743,747 $103,743,747 $0 $252,392,253 $252,392,253 $0 Adjustments: (baseline adjustments) Compensation and Benefits 2012/13 Baseline Adjustments (Cont Costs for Salary Increases, Promotions, Reclasses, Positions, etc) $358,841 $358,841 $0 Retirement Adjustment $570,000 $570,000 $0 Health $895,000 $895,000 $0 Dental $198,000 $198,000 $0 Compensation Benefit Pool Adjustment ($3,200,000) ($3,200,000) $0 Unanticipated Expenses ($1,178,159) ($1,178,159) $0 Specified Programs State University Grants (SUG) Adjustment $5,437,000 $1,067,200 ($4,369,800) Systemwide Space Calculation Energy Costs (Allocate to AUE-Utiliites) Changes to All University Expenses (677,395) (677,395) $0 Subtotal: $4,759,605 $389,805 ($4,369,800) Unrestricted Enrollment Growth (5 $3,814/FTES-Non Res) Benefits Pool (5 $1,556/FTES-Non Res) Public Affairs & Advocacy Allocation (per President) $600,000 $600,000 $0 $600,000 $600,000 $0 Subtotal - Before WS, Restricted Programs $256,573,699 $252,203,899 ($4,369,800) Work Study, Financial Aid $1,000,000 $1,000,000 $0 Total Projected Uses of Funds $257,573,699 $253,203,899 ($4,369,800) Surplus/(Deficit) ($20,481,262) ($12,814,262) $7,667,000 Budget Balancing Plan Baseline Reductions ($11,051,168) ($11,051,168) $0 Antipicated 1-time C.O. Contributions ($481,000) $481,000 One-time Reductions ($8,949,094) ($1,763,094) $7,186,000 Projected Surplus/(Deficit): $0 $0 $0 * Includes re-benched graduate FTES and non-resident FTES Fee revenue "Before Prop 30" is based on a 9% fee increase at 12/13 projected enrollment targets as of per Ed Mills Fee revenue "After Prop 30 Passes" is based on 11/12 fee levels at 12/13 projected enrollment targets as of per Ed Mills Denotes pass through funding 110

4 2011/12 Baseline 2012/13 OPERATING FUND BUDGET - SACRAMENTO STATE Budget Allocations Pending Approval by the President Revised as of January 24, /12 Baseline Adjustments* 2012/13 Changes 2012/13 Baseline Before Reductions 2012/13 Permanent Reductions 2012/13 New Allocations Academic Affairs 84,223, ,633 84,528,694 (7,411,629) 77,117, % Faculty promotions and reclassification funding Administration & Business Affairs 13,595,988 5,736 13,601,724 (1,359,599) 12,242, % Reclassification funding Athletics 2,589,065 4,752 2,593,817 (258,907) 2,334, % Reclassification funding Information Resources & Technology 6,635,459 6,635,459 (663,546) 5,971, % Public Affairs & Advocacy 789,758 (105,000) 600,000 1,284,758 (138,976) 1,145, % Human Resources 1,761,405 1,764 1,763,169 (158,526) 1,604, % Reclassification funding Notes Transfer position to President's Office and additional allocation President's Office 834, , , , % Transfer position from Public Affairs and Advocacy Student Affairs 8,866,269 34,656 8,900,925 (780,232) 8,120, % Faculty promotions and reclassification funding University Advancement 2,797,532 6,300 2,803,832 (279,753) 2,524, % Reclassification funding 100.0% 112,000,972 Restricted or Mandatory Costs 46.4% Center for California Studies 3,040,000 3,040,000 3,040, % All University Expenses 22,754,392 (677,395) 22,076,997 22,076, % Reduction in All University Expenses Mandatory Benefits Costs 58,150,185 (1,537,000) 56,613,185 56,613, % Reduction of benefits funding Compensation 582, , , % Tuition Fee Discounts (formerly student grants) 41,971,550 1,067,200 43,038,750 43,038, % Tuition Fee Discounts increase University Operational Emergency Reserve and Unallocated 3,800,815 3,800,815 3,800, % 100.0% 129,151,759 Total: 252,392, ,841 (547,195) 252,203,899 (11,051,168) $241,152, % Resources Available General Fund 101,769, % Fees 138,620, % Less Work Study/Financial Aid (1,000,000) -0.4% Total Resources 239,389, % Surplus/(Deficit) (1,763,094) One-time Reductions 1,282,094 Anticipated One-time CO Contributions 481,000 - * Baseline adjustments include 2011/12 continuing costs due to faculty promotions and reclassifications 111

5 Sources of Funds $240,389,637 Federal Work Study $1,000,000 1% Student Fees $137,620,000 57% General Fund State Tax Dollars $101,769,637 42% Tuition Fee Discounts, $43,038,750, 18% Uses of Funds $242,152,731 Other Uses $5,382,827 2% Benefits $56,613,185 23% Divisional Baseline Allocations $115,040,972 48% All University Expense $22,076,997 9% 112

6 Sacramento State 2012/13 Operating Fund Budget Divisional Baseline Allocations Detail $115,100,172 Human Resources $1,604,643 1% Public Affairs and Advocacy $1,145,782 1% President's Office $939,762 1% University Advancement $2,524,079 2% Student Affairs $8,120,693 7% Restricted Programs $3,040,000 3% Information Resources and Technology $5,971,913 5% Athletics $2,334,910 2% Administration and Business Affairs $12,242,125 11% Academic Affairs $77,177,065 67% 113

7 Sources of Funds Amount Percent General Fund State Tax Dollars $101,769, % Student Fees $137,620, % Federal Work Study $1,000, % Total 2012/13 Sources: $240,389, % Uses of Funds Amount Percent Divisional Baseline Allocations $115,040, % All University Expense $22,076, % Benefits $56,613, % Tuition Fee Discounts (formerly student grants) $43,038, % Mandatory Costs Other Uses $5,382, % Total 2012/13 Uses: $242,152, % Divisional Baseline Allocation Detail Amount Percent Academic Affairs $77,177, % Administration and Business Affairs $12,242, % Athletics $2,334, % Information Resources and Technology $5,971, % Public Affairs and Advocacy $1,145, % Human Resources $1,604, % President's Office $939, % Student Affairs $8,120, % University Advancement $2,524, % Restricted Programs $3,040, % Total Divisional Baselines $115,100, % Other Uses Detail Amount Percent Compensation $582, % Unallocated (Operational Reserve) $3,800, % Federal Work Study $1,000, % Total Other Uses $5,382, % The 2012/13 budget data has changed. Due to tight publishing timelines, the effects of Proposition 30's passing were not included in the 2012 Annual Report. 114

8 Sacramento State General Operating Fund Actual Expense Data 2012/2013 Data for Graph Amount % Wages 125,709, % Work Study 850, % Benefits 54,928, % Financial Aid 43,417, % Equipment 361, % Operating Expenses 32,023, % Total General Operating Fund: 257,291, % Totals do not include encumbrances or expenditure adjustments Data from Year End SAM06 Expenditures from Fund MDS01 Excludes Operating Transfers Out for Financial Aid since data is already represented under the Financial Aid category 115

9 Sacramento State General Operating Fund Actual Expenses 2012/2013 Equipment 361, % Operating Expenses 32,023, % Financial Aid 43,417, % Wages 125,709, % Benefits 54,928, % Totals do not include encumbrances or expenditure adjustments Data from Year End SAM06 Report Work Study 850, % 116

10 July 20, 2012 TO: Campus Community FROM: Alexander Gonzalez President SUBJECT: 2012/13 General Operating Fund Budget After months of careful deliberations and planning, many uncertainties remain for Sacramento State s 2012/13 General Operating Fund budget. Along with the rest of the CSU, our budget hinges on the outcome of Governor Jerry Brown s tax initiative (now called Proposition 30) on the November ballot. The result of the statewide vote will determine if the California State University system will be assessed a $250 million trigger cut and if student tuition fees will be rolled back to the 2011/12 levels. If the ballot initiative does not pass and reductions are implemented, Sacramento State s revenues will be cut dramatically. As a result, these uncertainties require us to plan carefully and once again rely on a cautious budget approach as we move into the 2012/13 fiscal year. The members of the University Budget Advisory Committee (UBAC) have worked diligently to navigate through this turbulent situation. Because of the changing landscape of the state budget process, they had to make assumptions as to what the final operating budget would be. As part of the process, they reviewed all aspects of the budget to arrive at a proposal for a balanced campus budget, including permanent divisional reductions, All University Expenses (AUE), one-time expenditure requests, and central reserves. It is important to note that since UBAC s recommendations were submitted to me at the end of last semester, the Chancellor s Office has issued additional information regarding the CSU budget reduction plan. UBAC based its recommendations on estimates for the $250 million in trigger cuts. Since then, the Chancellor s Office has provided firmer figures regarding these reduction amounts, which increased the overall campus deficit by approximately $1.1 million. And on Tuesday of this week at the meeting of the Board of Trustees, two more scenarios were presented by Chancellor s Office staff that would entail additional reductions in addition to the anticipated trigger cut of $250 million. In order to address this potentially larger deficit, adjustments to the divisional percentage reductions are warranted at this time. 117

11 2012/13 General Operating Fund Budget July 20, 2012 Page Two So, after comprehensive analysis of UBAC s recommendations and the inclusion of the updated Chancellor s Office figures, as well as the uncertainties that lie ahead, I have finalized the University Operating Fund budget for 2012/13. It is presented below Initial Baseline Baseline Adjustment Adjusted Baseline 12/13 % of Baseline Reduction 12/13 Baseline Reductions Divisions Academic Affairs $84,223,061 $84,223, % ($7,411,629) Administration & Business Affairs $13,595,988 $13,595, % ($1,359,599) Student Affairs $8,866,269 $8,866, % ($780,232) Information Resources & Technology $6,635,459 $6,635, % ($663,546) University Advancement $2,797,532 $2,797, % ($279,753) Athletics $2,589,065 $2,589, % ($258,907) Human Resources $1,761,405 $1,761, % ($158,526) President's Office $834,762 $834, % $0 Public Affairs & Advocacy $789,758 $600,000 $1,389, % ($138,976) Totals: $122,093,299 $122,693,299 ($11,051,168) As all of us are painfully aware, Sacramento State has been forced to endure reductions every fiscal year since 2004/05. These reductions have taken their toll on every division especially the smaller units that with less size have less capacity to handle recurring cuts. However, these smaller divisions play a vital role in the University through the services they perform. Whether it is raising funds for scholarships and University programs, processing employee payroll and benefits, generating pride for the University through athletics and alumni events, or promoting and advocating for the campus, all these functions are key to our University s success. 118

12 2012/13 General Operating Fund Budget July 20, 2012 Page Three Given the updated Chancellor s Office numbers, possible trigger cuts and the limited capacity of the smaller campus units, I have determined that it is necessary to adjust the reductions proposed by UBAC. In doing this, I am taking a University-wide perspective with the goal of doing the least harm overall while maintaining the University s integrity. The plan will be to hold centrally funding that will allow the University to withstand the anticipated reductions if Proposition 30 is not successful. In the event that the results are positive however, then the funding will be allocated midyear if possible. As a specific example of this approach, the Office of Public Affairs and Advocacy has undergone organizational restructuring over the recent fiscal years and recently acquired the responsibility for University marketing. This division also has been underfunded since its initial reorganization. In an effort to reflect changing responsibilities, an allocation will be made to the division. However, the unit s percentage reduction as originally recommended by UBAC will remain in place and be tied to the newly adjusted baseline, which increases its overall reduction. Additionally, over the past several years I have approved substantial reductions to the President s Office. This is now the smallest budgetary unit on campus with the least amount of staffing it has had in almost 30 years. It is to the point where any further reductions would not allow for the operations and function it provides. Thus, no reductions or additional allocations will be made to this unit because it just cannot support it. The University s remaining baseline deficit of $9 million will be covered with central onetime reserves as a stopgap measure for the 2012/13 fiscal year. As for the All University Expenses, I am approving those recommended by UBAC to be implemented. Regarding one-time project funding, I am placing those recommended by UBAC on hold until we know if the trigger cuts will happen. To review UBAC s 2012/13 recommendations, please visit the web link provided below: Budget_Recommendations_May_2012.pdf Once the outcome of Proposition 30 is known, UBAC may need to reconvene and recommend changes to the budget. Depending on the election result, further reductions may need to take place or additional funding could be disbursed. In either event, I will carefully review the campus-wide committee s recommendations and provide a final decision. I thank you for your work and dedication during these tough economic times. I will keep you posted on the budget situation and continue to provide you with updates as developments unfold. 119

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14 May 18, 2012 To: From: Re: Alexander Gonzalez, President, California State University, Sacramento Fred D. Baldini, Chair, University Budget Advisory Committee Recommendations for the University Budget Allocations The University Budget Advisory Committee has reviewed the divisional responses to the Campus Operating Fund Budget Call for Fiscal Year 2012/13. We have met with each division head to discuss their submissions and the impact of the budget scenarios outlined in the budget call. Due to the uncertainty of the November ballot initiatives, the budget planning assumptions as provided by the Chancellor s Office and the Governor s May Revision ($250 million in system-wide reductions), were used to make our recommendations. Until new information becomes available, we must base our recommendation using these budget planning assumptions. We therefore recommend addressing the known budget reductions facing the University through reductions in All University expenses, in onetime budget requests, and baseline reductions to the divisions. We also recommend the use of onetime university central (carry forward) funds to help mitigate the baseline reductions to divisions. This is part of a multi-year plan to make strategic use of centrally held funds on a one-time basis to assist the campus through the current years of crisis. Once the Governor s May Revision was published, the resulting deficit stood at $18.9 million, which was extremely close to the highest planning scenarios presented on the budget call. UBAC worked to keep the campus deficit as low as possible. By reviewing all on-going costs and reducing when appropriate, incorporating changes to the All University Expenses, and by applying one-time centrally held carry forward funds, the committee was able to reduce the overall deficit to approximately $10.4 million. Based on the information available to us at this time, UBAC is considering this to be the best case scenario as many uncertainties still exist on the state level such as the outcome of the proposed tax measures. To address this deficit, UBAC recommends the following: A reduction to baseline funding for all divisions totaling $10,438,169 (detailed below) The use of $8,473,000 from one-time central funds to mitigate the baseline reductions for the 2012/13 fiscal year only By using one-time central funds of $8,473,000 to reduce the 2012/13 deficit and help mitigate reductions to the divisions, it s important to realize that this remaining deficit will carry forward into the 2013/14 fiscal year should the financial situation remain static in 2012/13. The University will continue to have a strategic central baseline reserve that will generate one-time carry forward funds if not used in the fiscal year. Additionally, by using the amount of one-time funds currently being recommended, it significantly reduces the amount of central reserves available for unanticipated expenses. 120

15 Page 2 All University Expenses In response to the budget call, divisions submitted All University Expense (AUE) requests for the upcoming year. UBAC then requested divisions to revisit their request to determine if any of the AUE could be suspended or reduced for the upcoming year. Some divisions came back with reduced requests. In 11/12, some loans were paid off which eliminated large on-going AUE expenses. This along with the reduced divisional requests significantly lowered our overall commitments. UBAC also received some new AUE requests and recommends that one be granted. Even with the increases associated with uncontrollable rising costs, in the end, the overall AUE cost decreased by $677,395. UBAC is always mindful of the following criteria when reviewing requests: AUEs are generally costs allocated to a division that has little control over the expenditure. For example, energy expenses are incurred by ABA; however, the usage of energy is not controlled by ABA. AUEs should also be ongoing and thus require baseline funding. AUEs are restricted to a specific type of expense that has university wide implications and are outside the normal scope of operation for any one division, program center, or department. Permanently staffed positions should not be included as an AUE expense because those costs are controllable by the division. There were some specific AUE recommendations where the committee focused their efforts as highlighted below: Employee Assistance Program Since this request includes permanent salaries (last bullet in section above), this cannot be an AUE. A decision outside of UBAC will need to be made on this program. Costs from the program are being cut from one division and then asked to be move to another division that doesn t have the funds to absorb it. Is this a campus priority? If so, how will the funding be handled? College Scheduler-Student Registration Software The committee recommends that this request of $17,500 be placed on hold. Further discussions will need to take place by the divisions involved. A collaborative one-time request of $123K for the Degree Planning Software Implementation is providing similar functionality as this upgrade. These two software costs seem to be providing the same functionality so funding both costs would be redundant. Thus, a decision needs to be made as to 1) how much funding is actually needed, 2) where the funding should be placed and 3) who should manage it. Further collaboration between the divisions need to take place prior to a recommendation being made. Enrollment Management Technology Request of $50,000 is being recommended as a new AUE. Decisions made on pending All University Expenses (first two bullets above) may increase the reductions to divisions because any additional AUE expenses will directly affect the campus overall deficit which will trickle down to the divisions as a reduction. 121

16 Page 3 Baseline Cuts to the Divisions Given that the Governor s May Revise will impose a $250 million CSU system-wide reduction in the event the tax initiatives do not pass in November, it will create a $18.9 million gap at Sacramento State after factoring in an increase in revenues from a 9% Student Tuition Fee increase (effective Fall 2012), including one-time Chancellor s Office contributions, and paring down the expenditures (e.g. AUE). This deficit amount falls right in line with the largest scenario divisions were presented with in the Annual Budget Call. They were asked to provide the budget implications for a 10% and 15% reduction scenario. Due to the Governor s May Revise ($250 million in CSU trigger cuts) the 15% scenario represents the most accurate one for the university as a whole. It is important to acknowledge that with the $250 million in trigger cuts, the university has to sustain about a 15.6% overall baseline reduction. If the university s central one-time funds were not used to offset the reductions, the standard reductions across divisions would be 15.6%. In order to reduce the baseline reductions to the divisions, UBAC recommends that the university use one-time central funds to reduce the impact to the divisions. By applying $8,473,000 in one-time central university central reserves funds, the effective divisional reduction was reduced to $10,438,169. This was important because the divisions are extremely lean and have had to make baseline reductions over the past six years. UBAC also integrated the current conditions of each division, the division plans for dealing with the proposed reductions, their understanding of the overall campus budget, and the campus strategic plan. UBAC recommends the following baseline reductions to divisions with the understanding that the divisions will use their one-time carry forward funds (as applicable) to mitigate these reductions. 12/13 UBAC % Cut- Baseline 12/13 UBAC's Baseline Reductions Initial Divisions Baseline Academic Affairs $84,223, % ($6,737,845) Administration & Business Affairs $13,595, % ($1,359,599) Student Affairs $8,866, % ($709,302) Information Resources & Technology $6,635, % ($663,546) University Advancement $2,797, % ($335,704) Athletics $2,589, % ($310,688) Human Resources $1,761, % ($176,141) President's Office $834, % ($83,476) Public Affairs & Advocacy $789, % ($78,976) Totals: $122,093,299 ($10,455,275) Through careful review and consideration, UBAC recommends that the divisional reductions be based on a three tiered system of percentage reductions (8%, 10%, and 12%). It was determined that those divisions that were directly tied to enrollment targets should receive the lowest reductions. 122

17 Page 4 The second tier was for those divisions who had a close connection in supporting instruction, enrollment targets or providing the campus with the necessary infrastructure to support students and teaching. The third tier which received the largest reductions was determined by other conclusions as outlined below. UBAC realizes the critical need to achieve our enrollment target of 21,625 Full-time Equivalent Students (FTES) since it is tied to the campus revenue projections, which is built into the budget. Since enrollment targets are so critical, it is important to moderate the impact to the two areas that are directly involved with generating and supporting FTES which are Academic Affairs and Student Affairs. Due to their direct involvement with FTES, they received the lowest reductions of 8%. The next tier of divisions that was closely connected to supporting instruction, enrollment targets, and providing the infrastructure for the campus received a 10% reduction. This percentage also matches the lowest scenario proposed on the Annual Budget Call. The divisions included in this tier are Administration and Business Affairs (ABA), Information Resources and Technology (IRT), Human Resources, President s Office and Public Affairs and Advocacy (PAA). ABA has a huge amount of deferred maintenance costs and there is a fear of not being able to address this issues if saddled with a high reduction. This division is integral in keeping the facilities in working order hence it s important that a severe reduction doesn t hamper its ability to respond to functions of the university. IRT provides the university with software, hardware and technology services, which are essential for the campus to operate efficiently. In prior years, this division had received larger reductions because when times are tough, technology is an area that can be reduced. However, since IRT has taken larger cuts in the past, it is recommended that their cuts be in the second tier. Human Resources is also part of the campus infrastructure because this division is central for processing compensation and benefits, handling grievances, complying with new edicts and mandates, and performing tasks related to hiring and separating people. Thus, it is recommended that they also receive a 10% reduction. The President s Office has taken some of the highest cuts in the prior years and it is to the point where the operations are significantly strained. It cannot continue to endure large cuts without affecting the ability to perform essential functions of the university. Social media has emerged as the avenue of choice when it comes to communication with students and PAA has been at the forefront of this wave. PAA has made significant inroads in connecting the students with the Sac State campus which provides greater student involvement and enriches student life. Additionally, given our proximity to the Capitol, PAA is very involved with advocacy for our university. Therefore, it is recommended that PAA s cut be in the second tier. The final tier, which is also the largest tier of reductions, includes the Athletics and University Advancement areas. Since the Athletics Operating Fund budget is a smaller portion of their overall funding and the Director of Athletics indicated that the division would be able to sustain a 12% reduction in 2012/13, they were placed in this category. With University Advancement, it was noted that their fundraising goal is based on the campus State General Fund amount. As the General Fund appropriation has dropped so too has the annual goal for the university. Since fundraising goal levels have dropped, fewer resources should be needed. 123

18 Page 5 Since the university s central reserves are mitigating the effects to the divisions by applying one-time funds towards the overall deficit, it is understood that those divisions with carry forward balances will use them to offset their baseline reductions in 2012/13. One-Time Requests The outcome of the November ballots brings much uncertainty; consequently, it makes it difficult go forward with the funding of one-time projects. UBAC asked the divisions to take a secondary review of their requests and notify us which projects needed immediate attention versus those that could be delayed and to rank them in importance. Based on the revised requests, the committee recommends a few to be funded at the beginning of the fiscal year. The initial round of recommended one-time funding totaling $490,000 includes the following: University-Wide Imaging and Workflow Project (to support end-of-life issues in Student Financial Aid) = $100,000 International Recruiting = $210,000 Out-of-State Recruiting = $180,000 Given the tight budget situation, any unspent funds at the end of the fiscal year must be returned to the central reserves. There are some one-time requests that are currently on hold including the Master Plan revision, blue light emergency phones, renovation of classrooms, and Lassen Hall reconfiguration. Regarding the Master Plan revision, UBAC recommends that if the President believes that it is a priority and should be funded soon, then he would make that decision. Otherwise, in the event the tax initiatives pass in November, a subsequent review of those one-time requests may be pursued. On a separate note, there is a request for a Degree Planning Software Implementation for $123,000 which seems to be related to an All University Expenses request for College Scheduler-Student Registration Software. The committee recommends that either the divisions involved or cabinet get together to discuss which software is best suited for the needs of the university. Both appear to be related and provide similar functionality so a decision must be made outside of UBAC. In closing, should the tax initiatives pass in November, the committee available and willing to reconvene and make any secondary recommendations regarding the mix of allocations among divisions, central reserves, All University Expenses, and one-time projects. Attachments 124

19 PROJECTED SOURCES AND USES - OPERATING FUND SUMMARY Fiscal Year As of Scenario: With Trigger Cuts $250M SW Total Re-benched FTES* 22,086 At Target Funded Re-benched Resident FTES 21,625 Non-Resident FTES Campus Budget Estimates Sources of Funds Appropriations - General Fund Baseline from Prior Year $107,426,677 Unallocated Reductions Retirement Adjustments ($729,040) decr per CO Budget Memo Adjustments Adjusted General Fund Baseline Appropriation $106,697,637 State Appropriation Changes Compensation and Benefits Unallocated Baseline Reduction ($20,863,500) Health Compensation Compensation (Salary Lag Supplement) SSI Costs Specified Programs Energy Systemwide Space Reallocation State University Grants (SUG) Adjustment Unrestricted Marginal Cost Enrollment Increase (GF) Marginal Cost on Growth (Fee Revenue) Adjustment (offset by Fee Revenue) Financial Aid Set Aside (Marginal Cost Fee) Financial Aid Set Aside (Fee Rev) for Fee Increases Revenue Interest Assessment Operating Support Restoration Subtotal ($20,863,500) incr per CO Budget Memo + estimated May revise amount $5,437,000 added per CO Budget Memo Subtotal $5,437,000 Subtotal ($4,341,900) ($4,204,000) incr per CO Budget Memo ($137,900) added per CO Budget Memo Projected Appropriation $86,929,237 decr by $1.3M if excluding SUG Campus Projected Revenue and Adjustments State University Fee (SUF) Income $146,256,000 (1) Allowance for Revenue Shortfall ($650,000) Non-Resident Fees $2,800,000 Application Fees $1,100,000 Other Miscellaneous Revenue $150,000 $149,656,000 $236,585,237 Other Revenue (WS, Financial Aid) $1,000,000 Total Projected Sources of Funds $237,585,

20 Campus Budget Estimates Uses of Funds Prior Year Baseline Allocation Division Baseline Allocations $122,093,299 All University Expenses 22,754,392 Reserve $3,800,815 Mandatory Costs (compensation pool, benefits, restricted programs, student grants) $103,743,747 $252,392,253 Adjustments: (baseline adjustments) Compensation and Benefits 2012/13 Baseline Adjustments (Cont Costs for Salary Increases, Promotions, Reclasses, Positions, etc) $362,548 Retirement Adjustment $570,000 Health $895,000 Dental $198,000 Compensation Benefit Pool Adjustment ($3,200,000) reduced to offset deficit Unanticipated Expenses ($1,174,452) Specified Programs State University Grants (SUG) Adjustment $5,437,000 added per CO Budget Memo Systemwide Space Calculation Energy Costs (Allocate to AUE-Utiliites) removed per Facilities Svcs Changes to All University Expenses (677,395) Subtotal: $4,759,605 Unrestricted Enrollment Growth (5 $3,814/FTES-Non Res) Benefits Pool (5 $1,556/FTES-Non Res) Info Resources & Technology tsf to baseline for AUE costs Admin and Business Affairs tsf to baseline for AUE costs Human Resources Allocation (per President) Administration and Business Affairs (per President) $0 Subtotal - Before WS, Restricted Programs $255,977,406 Work Study, Financial Aid $1,000,000 Total Projected Uses of Funds $256,977,406 Surplus/(Deficit) ($19,392,169) Budget Balancing Plan Baseline Reductions Antipicated 1-time C.O. Contributions ($481,000) Received memo on 5/7/12 One-time Reductions ($8,473,000) Projected Surplus/(Deficit): ($10,438,169) * Includes re-benched graduate FTES and non-resident FTES 1) Fee revenue is based on a 9% fee increase on 12/13 projected enrollment targets as of per Ed Mills Denotes pass through funding 126

21 TOTAL PROJECTED DEFICIT: ($10,438,169) Initial Baseline SCENARIO: Academic Affairs $84,223,061 With $250M in Trigger Cuts Administratioin & Business Affairs $13,595,988 FTES = 21,625 Student Affairs $8,866,269 Information Resources & Technology $6,635,459 University Advancement $2,797,532 Athletics $2,589,065 Human Resources $1,761,405 President's Office $834,762 -$10,438,169 Total Projected Deficit Public Affairs & Advocacy $789, % Deficit as % of 12/13 Ending Baseline $122,093,299 Varies UBAC Recommended Baseline Cut Varies UBAC Recommended % Reduction/Year Baseline Budget Categories Initial Baseline Total Cut based on deficit 12/13 UBAC % Cut Recommend Total Deficit Reduction Needed 12/13 UBAC's Baseline Recommend Total 12/13 Reduction Division Projected 11/12 Carry Forward Funds Academic Affairs $84,223, % -8.00% ($7,200,514) ($6,737,845) ($6,737,845) $8,720,355 Administration & Business Affairs $13,595, % % ($1,162,367) ($1,359,599) ($1,359,599) $2,119,170 Student Affairs $8,866, % -8.00% ($758,007) ($709,302) ($709,302) $1,483,531 Information Resources & Technology $6,635, % % ($567,288) ($663,546) ($663,546) $389,193 University Advancement $2,797, % % ($239,170) ($335,704) ($335,704) $4,797 Athletics $2,589, % % ($221,348) ($310,688) ($310,688) $0 Human Resources $1,761, % % ($150,588) ($176,141) ($176,141) $515,831 President's Office $834, % % ($71,367) ($83,476) ($83,476) $739,424 Public Affairs & Advocacy $789, % % ($67,519) ($78,976) ($78,976) ($139,596) Central Carry Forward $122,093,299 ($10,438,169) ($10,455,275) ($10,455,275) $13,832,705 Difference: $17,106 Add into central carry forward reserve * Center for CA Studies' reductions are made separately from the university's (per Budget Act) so they are not factored into reduction calculation percentages 127

22 2011/12 Budget Projected 2012/13 Budget Incr(Decr) Comments All University Expenses Academic Affairs Probationary Faculty Dev Grants 51,000 39,725 (11,275) 3 units of RT +$500 per college Dept. Chair Stipends 60,000 60,000 - Accreditation-Department 114, ,000 10,000 Alliance for Minority Participation (AMP) Project 800, ,000 - $800K in baseline allocated in 04/05 Disabled Students-Assembly Bill 422 Inst Materials 114, ,000 41,000 Disabled Students-Contract Interp 435, ,000 - Disabled Students-Executive Order 665 8,500 6,000 (2,500) Disabled Students-Non Classroom Accomodations 5,000 4,000 (1,000) Grad Equity Fellowship 49,500 49,500 - Calif Teacher Performance Assessment 50,000 50,000 - CSUPERB (Chancellor's Office Grant) 28,000 28,000 - Classroom Furniture - moved from ABA 50,000 25,000 (25,000) Lab Furniture - moved from ABA 75,000 37,500 (37,500) Natural Sciences & Math Alliance of Minority Participation 50,000 50,000 - IR&T Faculty workshops, payments for external evaluating, more details to follow Campus commitment to AMP program via funding Ad Astra software upgrade, Adobe, SPSS, Microsoft, Oracle related software increases. Campuswide Software & Hardware (aka Technical) 1,614,895 1,656,856 41,961 IT Infrastructure 1,581,152 1,599,164 18,012 Give DW detail to committee. Center for CA Studies Washington Fellow w/cal Institute 18,474 19, Administration and Business Affairs VISA/Mastercard Charges 30,000 40,000 10,000 External Audits 44,500 48,400 3,900 Insurance-Vehicle 22,867 22,867 - General Services Charges 25,000 20,000 (5,000) County Jail Booking Fees 15,800 15,800 - State Fire Marshall Inspection 15,000 15,000 - Space Rental 6,534,110 6,538,444 4,334 Liability Program (aka Risk Pool Management) 391, , ,395 Industrial Disability Leave/Non-Industrial Disability Insurance/Unemployment Insurance (IDL/NDI/UI) 647, ,748 66,946 Property Insurance 466, ,418 (39,213) Worker's Compensation 1,460,502 1,371,904 (88,598) Flood Control 114, ,000 14,000 Athletic Injury Medical Expense (AIME) 183, ,539 47,767 Medical Monitoring 8,000 5,000 (3,000) Child Care 85,000 85,000 - Capital Project Feasibilty Studies & Master Plan Revisions 100,000 - (100,000) 1098-T Hope/Lifetime Learning Relief Tax 2,500 1,500 (1,000) Campus Sponsored Visitor Parking 15,000 - (15,000) Rental Fee Waiver Reimbursement 160,000 80,000 (80,000) Energy Savings Project 150, ,000 - Ramona Avenue Demolition 500,000 - (500,000) Folsom Hall Tenant Improvements 600,000 - (600,000) Music License Agreements 22,000 22,000 - Based on FTES Facilities Management Major Utilities 4,651,991 4,791, ,559 Placer Hall Maint & Utilities 30,000 30,000 - Campus Renovations 100,000 50,000 (50,000) Ramona buyback was not included in AUE total for 11/12 Add Ramona property (campus=114k + Ramona=14K) Human Resources 128

23 2011/12 Budget Projected 2012/13 Budget Incr(Decr) Comments All University Expenses State Controller's Office Charges 19,000 15,000 (4,000) University Staff Assembly 14,000 14,000 - Maintain Assistive Devices for Employees 86, ,000 33,348 Legal Settlements/Services 35,000 35,000 - Legal Services Contracts 40,000 40,000 - Complaint Investigation 200, ,000 (50,000) Medical Exams 8,000 8,000 - Background Checks 8,000 8,000 - Federal and State Postings 3,800 3,800 - Employee Scholarships-CSU Training Programs 30,000 30,000 - Staff Reclass Funds 130, ,000 - Faculty Promotions 232, , ,452 Benefit Administration Fees (C.O.) 88,000 88,000 - Noontime Wellness 11,000 11,000 - Employee Assistance Program (EAP) - - New Request - Can't be an AUE because it's primarily permanent salaries. Decision needs to be made at President's or Cabinet level as to the priority to the campus & where it should be funded. President's Office Trustees' Authorizations 98,600 98,600 - General Memberships in University Orgs 100, ,000 - Student Affairs State Match for Federal Funds-Student Nursing Grants 450 1, American's Disability Act Accomodation Svcs 20,000 20,000 - Maintenance and Updates of PAVE System 7,000 8,825 1,825 Financial Aid Admin-Job Location & Developmt (JLD) 75,000 75,000 - Campus Labs (formerly Student Voice) 35,000 37,662 2,662 College Scheduler-Student Registration Software - - Full annual maintenance fee that used to be shared with AA and SA (upgraded version of maintenance). This request is providing same functionality as Degree Planning Software 1-time request. Can't fund both because would be redundant. Enrollment Mgmt Technology (Hobson) - 50,000 50,000 New Request Athletics Big Sky/NCAA Fees 31,800 31,800 - Total All University Expenses 22,754,392 22,076,997 (677,395) Mandatory Costs Benefit Costs 58,150,185 56,613,185 (1,537,000) Compensation Increases 582, ,012 - Student Grants (SUG, EOP) 41,971,550 47,408,550 5,437,000 University Operational Emergency Reserve and Unallocated 3,800,815 3,800,815 - Total Mandatory Costs 104,504, ,404,562 3,900,

24 Division Priority of requests Categorize request (safety/risk, student related, infrastructure, maintenance, university-wide, technology, etc. Is this a collaborative request? If so, indicate divisions involved. AA 1 University-wide No Identify Funding Source (e.g. Operating Fund, Lottery, Trust, etc.) Operating Fund Carry Forward/ Lottery/CCE One-Time Expenditure Needs by Funding Source and Fiscal Year by Division 11/12 Projected AUE and Central CF Funds: 11,300,000 ($8.3M + $3M) Less Recommended 12/13 1-time Reduction Funding: (8,473,000) Total 12/13 Projected Funds Available: 2,827,000 Less 1-time Recommended Funds to Divisions: (490,000) Less 1-time funds to AA to support courses/ftes: 2,337,000 One-time items on hold until budget impact known: Projected Remaining Carry Forward Balance: 2,337,000 Expenditure Description (Must be $50,000 or more) Identify $ Amount in Fiscal Year Classify UBAC Expenses as Onetime Recommen (1-time) or Intermittent (Int) ds 12/ Comments To produce the necessary level of FTES and to preserve positions, funds are needed to fill the gap created by a 10% reduction, PLUS backfill behind current $4.5 mil instructional deficit for a total of $12.9 mil. Less $2.53 mil in initial planned baseline reductions Intermittent N/A $10,370,000 $10,370,000 $10,370,000 AA is not asking for this funding, it just wants to keep its carry forward funds AA 1 University-wide No Operating Fund Carry Forward/ Lottery/CCE To produce the necessary level of FTES and to preserve positions, funds are needed to fill the gap created by a 15% reduction, PLUS backfill behind current $4.5 mil instructional deficit for a total of $17.1 mil. Less $2.53 mil in initial planned baseline reductions Intermittent N/A $14,570,000 $14,570,000 $14,570,000 AA is not asking for this funding, it just wants to keep its carry forward funds AA 2 University-wide AA, IRT, SA Operatng Fund Degree Planning Software Implementation (see IRT) 1-time AA 3 University-wide AA, ABA, SA, UA, HR, IRT Operatng Fund University-Wide imaging and workflow project (see IRT) 1-time AA 4 University-wide AA, ABA, IRT Operatng Fund Continued renovation of campus classrooms (see IRT) 1-time ABA 1 Safety/Risk/Universitywide No Operating Fund Transition Plan Study to comply with the American with Disabilities Act (ADA) 1-time $150, ABA 2 University-wide No Operating Fund Sac State Master Plan Revision 1-time $300, ABA 3 Safety/University-wide No Operating Fund Additional cameras and Blue Light emergency phones for strategic placement on campus. Cost includes equipment purchase, digital storage and installation.costs for cameras at campus entrances and walkways. 1-time $100, $100, AA, ABA, SA, UA, ABA 4 University-wide HR, IRT Operatng Fund University-Wide imaging and workflow project (see IRT) 1-time ABA 5 University-wide AA, IRT, SA Operatng Fund Degree Planning Software Implementation (see IRT) 1-time ABA 6 University-wide AA, ABA, IRT Operatng Fund Continued renovation of campus classrooms (see IRT) ABA 7 University-wide No Operating Fund Campuswide Roadway & Wayfinding Project 1-time $100, $50, $50, AA, ABA, SA, UA, HR? University-wide HR, IRT Operatng Fund University-Wide imaging and workflow project (see IRT) 1-time Hold until November (outcome of tax initiatives). However, the committee understands that if the funding is needed before November, the HOLD - revisit if November tax initiatives passes HR said they were collaborating with IRT on this request IRT 1 University-Wide University-Wide imaging and workflow project. All six of the listed divisions participated in a comprehensive study of the use of work-flow automation for the most impacted academic, Yes. Academic Affairs, ABA, Student Affairs, University Advancement, Human Resources, and IRT student, and administrative business functions (i.e. impacted admissions, financial aid, advising, procurement, hiring, fund-raising). All six divisions have also engaged in an evaluation of specific technology solutions that would have the most likely return on investment. Comprehensive documentation on this imaging and work-flow will be provided to UBAC. Note that replacement of three legacy imaging systems essential for financial aid and admissions processing is required in 2012/2013, as current systems are at end-of-life. One-Time Operating Existing funding for document imaging reduces project cost by approximately $50, time 100,000 $375,000 $100K to deal with end of life issues for financial aid. Funds must be managed by both SA and IRT (joint collaboration). Will provide funding right away. Degree Planning Software Implementation: Speeding progress towards graduation by decreasing the number of excess credits accumulated by students was noted as a top priority IRT 2 University-wide, Enrollment Planning, Curriculum Planning and Advising Yes. Academic Affairs, Student Affairs, IRT in the President's spring address. The funding identified would both enhance our current limited degree audit tools and substantially enhance those rudimentary tools by adding software capability to a) allow all students to create two or four-year degree completion plans, and 2) allow curriculum planners to obtain aggregate student data to optimally schedule classes to meet student needs. Further documentation will be provided to UBAC. Similar One-Time Operating degree planning software is in use at Cal Poly Pomona and CSU Northridge. 1-time $123,000 This request in similar to funding requested for an AUE by Student Affairs for the College Scheduler-Student Registration Software. Discussion among division leaders needs to take place to discuss priority of software and which one to use. IRT 3 Classroom Yes. Academic Affairs, ABA, IRT Continued renovation of campus classrooms is a designated campus priority for use of one-time funds. "Excess carry-forward funds will be used for campus repair, replacement, growth, and refresh programs, such as instructional classroom maintenance and remodel projects, including smart classroom conversion projects." In addition, classroom improvement is a designated priority of both the campus Strategic Plan for IT and the Faculty Senate's Strategic Plan for Academic Technology. The amount requested would fund six smart classroom conversions, down from the funded by previous one-time allocations.the amount requested has been reduced by $300,000 compared to last year, in consideration of One-Time Operating current budget issues. 1-time $300,000 HOLD - wait until after November and reconsider HOLD an amount until after November SA 1 Student related SA and AA Operating Fund Lassen Hall reconfiguration 1-time $90,500 (currently set at $90,500) Need at beginning of year. Ask for a breakdown SA 2 University-wide No Operating Fund International recruiting Int or annual 210,000 $300,000 $300,000 of expenses (how it will be used) SA 3 University-wide No Operating Fund Out-of-State recruiting Int or annual 180,000 $180,000 $180,000 Need at beginning of year. Ask for a breakdown of expenses (how it will be used) SA 4 University-wide AA, SA, IRT Operating Fund University-Wide imaging and workflow project (see IRT) 1-time TOTAL: 490,000 $26,478,500 $25,570,000 $25,470,

25 December 11, 2012 To: From: Re: Alexander Gonzalez, President, California State University, Sacramento Fred D. Baldini, Chair, University Budget Advisory Committee Additional Recommendations for the University Budget Allocations In July, the 2012/13 fiscal year budget was approved and it resulted in a $20.5 million deficit that was balanced by an $11 million reduction in divisional baselines and by using one-time central funds of $9.4 million to bridge the gap. After the passage of Proposition 30 in November, a slightly different budget emerged for the university. The $250 million in system-wide trigger cuts were removed, the student fees were rolled back by 9.1% which decreased projected revenue, and the one-third financial aid set aside that was tied to the 9.1% fee increase was also reduced. These changes decreased the university s overall deficit from approximately $20.5 million to $12.8 million. However, with the implementation of $11 million in divisional baseline reductions back in July, the remaining campus deficit declined to $1.76 million. Since the current year budget is already in place and additional one-time funds became available after the Proposition 30 s passage, the committee decided to focus on the one-time projects list that was placed on hold until after November. The committee carefully reviewed each request and obtained pertinent information that was needed to make an informed recommendation. In the end, projects totaling $1,538,500 were recommended for funding (see Attachment A). Additionally, there were two recruiting projects totaling $390,000 that were also recommended (Attachment A). However, due to the timing of this recommendation, the committee was unsure if the decision to fund these projects is too late in the fiscal year to make any impact. Also, there may be changes in the recruiting plans which could render this recommendation ineffective. Thus, the committee will let the president decide on how to proceed with these recruiting projects. At this time, there are no plans by UBAC to re-evaluate the divisional baseline reductions or to address any one-time divisional funding unless asked by the president. Attachments 131