Ethan Erickson, Assistant Vice President for Budget Planning

Transcription

1 Memorandum TO: FROM: President Provost Vice Presidents Deans and CEOs Ethan Erickson, Assistant Vice President for Budget Planning DATE: May 30, 2017 RE: FY 2018 Annual Budget Preparation Enclosed are the FY 2018 annual budget base allocations for your area(s) and the preparation guidelines. The Board of Regents is scheduled to approve the tuition proposal June 14 upon which these allocations are based. If the Board of Regents revises the tuition proposal or the Govornor or Legislature enacts additional changes to the University s state appropriations, revisions to the FY 2018 budget allocations are possible. If any changes occur, revised base budget allocations will be released as soon as possible. Please complete the redistribution of your FY 2018 annual base budget from this information. An Overview of FY 2018 Budget Issues The 2017 Legislative session is ongoing and FY 2018 state budget allocations have not been finalized. Tuition rate increases of 3.0% for Main Campus, Olathe and Polytechnic effective fall of 2017 are proposed to the Board of Regents. A tuition rate increase is not planned for the College of Veterinary Medicine. The estimated revenue for main campus from these increases is approximately $5.2 million. These revenues will be utilized to fund base budget increases including faculty promotions, professorial performance awards, targeted faculty salary enhancements, undermarket salary adjustments, a 1% Cost of Living Adjustment (COLA), increased utility operation costs as well as other ongoing commitments of the university. At this time, the Senate budget currently allocates a 2% salary increase for state employees. In the event the Legislature provides state funding for a 2% salary increase, the university will determine how the additional 1% salary increase will be distributed (i.e. Merit or COLA) and allocations will be adjusted accordingly. Due to our enrollment and student credit hour declines this year compared to last year, the university will issue across-the-board 2.52% budget reductions to Main Campus and Research and Extension units in order to balance the university s budget for next fiscal year. 1

2 Unclassified Salaries Merit/COLA A 1% cost of living salary increase is allocated for unclassified staff and faculty, effective at the beginning of the FY 2018 contract period. Main Campus and Research and Extension general use funding will be allocated for employees budgeted on those funding sources. Units are expected to cover the salary and fringe cost for all employees funded on non-allocated or restricted use funding. Faculty Promotions - The appropriate amount for faculty promotions has been added to the FY 2018 allocation for Main Campus and Research and Extension positions. Salary increases for faculty promotions are 15% of the average salary of all university faculty members. The FY 2018 promotion amounts for both Associate Professor to Full Professor and Assistant Professor to Associate Professor are $11,940. Faculty promotion increases are to be effective at the beginning of the contract period. Professorial Performance Awards - The professorial performance awards will continue in FY 2018 at an amount of $6,370. Targeted Faculty Salary Enhancements - Targeted Faculty Salary Enhancement funding of $525,000 plus fringe benefits will be provided for Main Campus and Research and Extension for 175 awards at $3,000 each. These enhancements are to aid in faculty retention, compression, inversion and to reward high performance for faculty at the ranks of full professor, associate and assistants. Each targeted enhancement award will be for $3,000 and more than one award may be allocated to a faculty member. However, awards may not be split amongst tenured faculty. TFSE will not apply to ranked faculty serving as deans, associate deans or assistant deans. The awards are allocated to each college based on the FTE number of filled professor, associate professor and assistant professor positions. Each college will be allowed to designate up to 10% of their TFSE awards to be used for regular, nontenure-track faculty positions (instructor, professor of practice, etc.) on regular appointments. If a college chooses this option, a $3,000 award may be subdivided into no more than three $1,000 blocks to use for multiple regular, non-tenure-track faculty. Colleges which receive 10 or more TFSE awards may use up to 10% of their allotted awards for this purpose. Colleges which receive fewer than 10 awards may use one award for non-tenure-track faculty. Units may not use any portion of an award granted to non-tenuretrack faculty to also subsidize a regular tenure-track faculty member. The expectation is as follows: If granting to a single non-tenure-track faculty = $3,000 If granting to two non-tenure-track faculty = $1,500 (each) If granting to three non-tenure-track faculty = $1,000 (each) Provost Mason previously requested for colleges to submit electronically the list of faculty recommended to receive the enhancement awards along with a brief narrative of justification no later than Tuesday, May 30. K-Sate Polytechnic and the Veterinary Medical Center will fund their targeted enhancements from their own budgets. Total Rewards Under Market Equity Salary Enhancements Those employees determined by Human Capital Services to be below market equity will be provided salary increases to bring them up to 2

3 the range minimum. Main Campus and Research and Extension general use funding will be allocated for employees budgeted on those funding sources. Units are expected to cover the cost of those employees funded on non-allocated or restricted use funds. Additional Total Rewards Salary Enhancements - In addition to the under market equity salary adjustments mentioned above, units may self-fund salary adjustments for unclassified professional staff as long as the adjustments are within the pay range for a given job title and pay grade and are justified based on compression, equity, retention with proof of offer, or assignment of additional duties within a job title and pay grade. All requests for such salary adjustments must be approved by the Provost or appropriate Vice President and be supported by appropriate documentation. This documentation may be in the form of a spreadsheet or memo and must include the employee s name, title, current and proposed pay, funding source (GU or RU) and justification based on the reasons above. Please submit electronically your requested salary adjustments to the Provost or appropriate Vice-President by June 5, Any adjustments linked to changes in duties which may lead to a change in job title or pay grade must be submitted as a reclassification to HCS after the start of the fiscal year and should not be entered into the budget. University Support Staff (USS) Salaries Salary Increase - There will be a 1% cost of living salary increase for university support staff, effective at the beginning of the contract period. Main Campus and Research and Extension general use funding will be allocated for employees budgeted on those funding sources. Units are expected to cover the cost of those employees on non-allocated or restricted use funding. The Senate currently includes a 2% salary increase in their budget. If the university receives state funding for a 2% salary increase, the university will determine how the increase will be distributed and the allocations will be revised. Longevity Bonus - The longevity bonus paid to USS who have at least 10 years of service will continue to be paid one-time annually. The amount awarded per year remains the same at $50. This sets the minimum bonus paid for 10 years of service to $500 and the maximum bonus for 25+ years of service to $1,250. All USS will be eligible for a longevity bonus once they have 10 years of service. Total Rewards Under Market Equity Salary Enhancements Those employees determined by Human Capital Service to be below market equity will be provided salary increases to bring them up to the range minimum. Main Campus and Research and Extension general use funding will be allocated for employees budgeted on those funding sources. Units are expected to cover the cost of those employees on non-allocated or restricted use funding. Additional Total Rewards Salary Enhancements In addition to the under market equity salary adjustments mentioned above, units may self-fund salary adjustments for USS staff as long as the adjustments are within the pay range for a given job title and pay grade, and are justified based on compression, equity, retention with proof of offer, or assignment of additional duties within a job title and pay grade. 3

4 All requests for such salary adjustments must be approved by the Provost or appropriate President and be supported by appropriate documentation. This documentation may be in the form of a spreadsheet or memo and must include the employee s name, title, current and proposed pay, funding source (GU or RU) and justification based on the reasons above. Please submit electronically your requested salary adjustments to the Provost or appropriate Vice-President by June 5th, Any adjustments linked to changes in duties which may lead to a change in job title or pay grade must be submitted as a reclassification to HCS after the start of the fiscal year and should not be entered into the budget. University Support Staff Change Due to the implementation of Total Rewards, where units will be allowed to determine salaries for USS employees within ranges instead of being on a pay scale, funding for USS positions will no longer be managed centrally. When a USS position goes vacant, Central will no longer sweep the salary above the minimum salary amount units will be allowed to keep the savings. However, Central will also no longer fund the increase when an employee is hired in above the minimum and will no longer cover reclassifications. Longevity bonus increases will also be the responsibility of the individual units. Each unit s USS general use funding has been reset to the FY 2017 base and will now be balanced similar to unclassified staff. Students The minimum wage continues at $7.25/hour. There is no increase to student allocations. OOE There is no increase for Other Operating Expenditures. Graduate Teaching Assistant Tuition Waiver Allocations The tuition waiver allocation has been increased by the proposed graduate resident tuition rate increase (3.0%) recommended to the Board of Regents. Colleges and other areas are expected to stay within the amount allocated for GTA tuition waivers or cover overdrafts from their funds. If a college funds any additional GTA positions, both the salary and the GTA waiver (equivalent to 9 graduate resident credit hours each semester) must be funded by the college. Employer Fringe Benefit Rates FY 2018 The final fringe benefit rates for FY 2018 have not been released by the State. The State releases the actual rates about mid-june each year before the first payroll in the new fiscal year. The Budget Office will notify you if the actual rates differ from our estimate and the final rates will be calculated before the annual budget is completed. A table showing estimates of FY 2018 Fringe Benefit Rates is available on the Budget Office website under Quick Links. Internal Reallocation Base Reductions 4

5 An internal reallocation base reduction is necessary to fund the FY 2018 base budget. A 2.52% reduction was applied to both the Main Campus and Research and Extension general use base. The targeted reduction amount is included on each unit s allocation form. Details on how the reallocation amounts were applied are included. Preparation and Timeline for the FY 2018 Annual Budget An updated Annual Budget Planning Calendar is available on the Budget Office website under Annual budget preparation. The Online Entry area to input funding or any other changes is available for data entry. The undermarket and 1% COLA will be automatically entered by HCS into the system by May 30. We request that any other unclassified and USS salary increases be entered in the system by units using the following codes: Professorial performance award (PPA), Promotion (PRO), Targeted Faculty Enhancements (TGT), Equity/Compression (EQU) Retention (RET) and other (OTH) We appreciate the effort involved to track the justifications for salary adjustments. This information is necessary for the university to comply with relevant affirmative action and EEOC laws, regulations and guidance. The Online Entry area will close to users at 5 p.m. on Tuesday, June 20, The payroll funding and unclassified salaries will be copied to PeopleSoft to begin processing pay in the new fiscal year. We will reopen the Online Proof area on Wednesday, June 21 for final balancing changes. The Online Proof area will close Friday, June 30. All materials that are to be returned to the Budget Office, such as the balancing spreadsheets, position listings with additional changes and any other information regarding how the budget allocation was realigned, should be submitted by Friday, June 30, I invite you and your staff to contact me or other Budget Office staff as questions arise regarding the FY 2018 annual budget development or the annual budget proposal process. Thank you for your patience and your assistance in completing the FY 2018 base budget. Enclosures 5