Spring Management Report Meeting

Transcription

1 Spring Management Report Meeting March UAF Spring 2010 Management Report 1

2 The Financial Year at UAF in Context FY10 Year-End Expectation UAF has operated throughout FY10 with very limited central resources. In conformance with our adopted budget principles (attachment A), we have operated under the premise that resources are best managed at the core business unit level. Implementing this principle has resulted in maximum distribution of all available resources to schools, colleges and institutes. This coupled with the unintended consequences of implementation the tuition distribution model has resulted in fewer resources available centrally than is prudent (significantly below the established 2% threshold). Although we will close out FY10 with solvency, we are instituting plans to pullback sufficient base and one time funding as we enter FY11 to meet prior-year commitments, central needs, and pending strategic initiatives. To accomplish this and minimize impact on individual units, we have temporarily suspended our maximum carry forward guideline. Units are encouraged to reserve as much as prudent into FY11 in order to minimize the impact of the pending pullback. In fact, after an alarming November management report, we have seen an appropriate increase in projected reserves since announcing this initiative. We believe the units are strategically using existing funds in anticipation of future need. Additionally, we continue to push for improved management report accuracy, thus staying in regular contact with the Deans, Directors, and fiscal officers who are aware of and actively managing their fiscal position. Recharge Center Review and Auxiliary Operations The recharge center review continues. Our focus on the facilities recharge has resulted in a careful review of shop rates and cost structures. That work continues and we expect to see positive change in the coming fiscal year. In conjunction with this year s rate setting process, we have challenged all centers to carefully consider their operations in light of SW accounting requirements and UAF guidelines. We will be working with those we consider marginal in the coming months. We are also responding to a request from Chancellor Rogers to review those auxiliary and recharge centers managed under Administrative Services and Student Services. Specifically, we have been charged to review business operations in the two units to ensure we are fully leveraging resources to create the optimum student experience at UAF. A key topic is to consider grouping like operations together to maximize management resources and to fully leverage available financial resources. Institutional Tuition Scholarships (waivers) We continue to implement the UAF budget management principles. We are currently working on the distribution of budget associated with institutional tuition scholarships (tuition waivers and instructional assistantships) to appropriate units. Currently the budget supporting this activity is held centrally but the authority to make awards is distributed. We believe this change properly aligns the authority to grant scholarships with the responsibility to fund those commitments. Planning Forward amid Known Fiscal Gap Another area of focus this spring is to begin addressing a significant looming fiscal gap at UAF. If no structural changes are made, we estimate that by FY13 unrestricted revenue will fall short of requirements by close to $14 million. In addition, there are key strategic investments that must be UAF Spring 2010 Management Report 2

3 made to position UAF for the future. Of course this gap will not materialize because each year we will make necessary adjustments, however the impact of filling it is in fact real, and it must be managed with a two or three-year time horizon, to support decisions that are more holistic and strategic. The gap is largely composed of insufficient general fund revenue increases and the inability to meet necessary non-general fund revenue expectations. Managing the fiscal gap was a key focus area at UAF s recent Executive Leadership retreat. Attachment E is a presentation on the subject, which was delivered at that event. Although there is much we can do, significant operational and programmatic change will be required to accommodate the gap and still fund the strategic development of the institution. This is and will continue to be a critical focus for UAF in the coming months and years. UAF Spring 2010 Management Report 3

4 1. FY10 Carryforward Analysis UAF s January management report projects a carryforward of $4.9M in F1. This represents 2.3% of projected F1 revenue. Based on initial carryforward projections, UAF has suspended the maximum carryforward guidelines as stated in the carryforward principles. This will allow departments to strategically use existing funds in anticipation of FY11 needs. It is anticipated that this action will move the anticipated year end F1 carryforward into the $5M to $7M range. Total carry forward projection including recharge and leasing (F7, FE, FL) is $13.2M. In FY09, the newly adopted carryforward policy coupled with the development of shovel ready projects enabled UAF to manage down the carryforward balance going into FY10. UAF will continue to active manage our carryforward to ensure that UAF ends FY10 within projected levels. As in prior years the bulk of FY10 carryforward will be returned back to the contributing units. The units with deficits from FY10 will be required to submit a repayment plan that includes identifying contributing factors and the steps they will take to remediate those factors in future years. In accordance with our budget principles, Central management will hold sufficient resources to ensure achievement of institutional goals and to support performance based budgeting requirements. Distributions from central carryforward will be approved via the Chancellor s Cabinet. The funding priorities are identified during the budget development process and in response to new strategic investment opportunities such as; facilities and space needs (including energy efficiencies), climate, energy engineering and biomedical priorities. 2. FY10 Budget Building Process and Status No FY09 carryforward was used to balance the FY10 budget. However, funding of known commitments would have drawn central resources $2.6M below what was initially available. As noted in our response to question 3 below, a pullback of funding from our units and additional tuition and ICR revenue enabled us to meet these commitments as required throughout the year. 3. Management of Contingencies The initial budget contained a $1.3M in central contingency reserve, which is less than the 2% required. An additional $2M was pulled back centrally in August (see attachment B) to ensure that adequate funding was available to cover centrally allocated costs and strategic investments. A separate $1.4M pool for PBB reallocations was funded at continuation time. Increases in Tuition and ICR revenue over the prior fiscal year helped offset central investments in institutional tuition waivers, assistantships and other strategic needs including $522K for the utilities not covered by the trigger funding. Decisions on use of additional contingency funds which may become available are driven by ongoing commitments, prioritization and one-time funding requests. With the exception of managing to the targeted carry forward range of $5M to UAF Spring 2010 Management Report 4

5 $7M, we do not anticipate significant additional contingency funding will be available for the balance of the fiscal year. 4. FY10 Initiative and Initiative Pool, TVEP Status We are projecting to fully expend all initiative pool and TVEP funds. We will continue to monitor. 5. Debt Strategies and Plans The only new debt related issue we anticipate for FY11 is $106K associated with the High Bay Test Module (Energy Technology Facility phase 1A). Debt for the Life Science Classroom and Lab Facility will not kick in until FY12. Please see attachment C for details. 6. Grants and Contracts Accounts Receivable Analysis Historically, total revenue from restricted grants and contracts has been greater during the first and second quarters, than during the third and fourth quarters. The size of the first two quarters is attributed primarily to increased expenditures during the summer research field season and an increase in funding tied to the start of the federal fiscal year on October 1. The average Accounts Receivable balance during the 2 nd quarter of fiscal year 2010 has seen a significant decrease. The balance of the receivables is 11% less than the 2 nd quarter of FY08 and 17% less than FY09. The reduction is largely due to the Office of Grants and Contracts Administration (OGCA) ongoing collection and monitoring policy which was instituted the last two quarter of fiscal year The average restricted revenue in relation to restricted receivables is projected to decrease by 4% from fiscal year 2008 and 14% from fiscal year The majority of outstanding Accounts Receivable in the past was due to large amounts of uncollected revenue from private entities. The entities included other universities, native corporations, non-profits and corporations. Because of the UAF ongoing collection policy OGCA believes the outstanding balance will have a steady decrease. OGCA is anticipating an increase of restricted revenues this year due to the additional American Recovery and Reinvestment Act (ARRA) funding. The increase is anticipated to climb steadily over the next two years as the grants are expensed. Because the accounts receivable generated from the ARRA funding is paid by electronic means the ratio of outstanding receivables to revenue is also anticipated to decrease for the next two years. See attachment D for details. UAF Spring 2010 Management Report 5

6 ATTACHMENT A UAF Spring 2010 Management Report 6

7 Attachment A Budget Principles Coordination 1. Direction A clear set of short and long term objectives will be developed. 2. Community The assignment of responsibilities and authority and the allocation of resources will explicitly reflect the relationship of the parts to the whole. The model will incorporate mechanisms which recognize and incent partnerships and cooperative activities between units. 3. Mission Focus Central management will hold sufficient resources to ensure achievement of institutional goals and to support performance based budgeting requirements. Motivation 4. Value and Reward Growth and Quality Improvement The system will incent and reward efficiency, effectiveness and growth with particular emphasis in areas which specifically meet institutional mission and goals. It will incorporate straightforward and easily understood mechanisms designed to automatically recognize and reward effective performance. 5. Stability To maximize motivation of desired behavior and ensure operational stability and predictability, the assignment of responsibility, authority and the rules for budget distribution will be known, remain constant and be enforced. Decision Making 6. Decentralization To optimize decision making and efficiency of operations the system will allow for the distribution of authority and responsibility to the maximum extent possible and reasonable. The closer the point of an operating decision is to the point of implementation, the better that decision is likely to be. Decentralization will be done with a clear sense of purpose and with the intent to avoid duplication of function. UAF Spring 2010 Management Report 7

8 7. Knowledge Information is needed to allow decision makers to arrive at decisions which promote UAF objectives. The system will have processes in place which generate and communicate data in an effective and timely manner. Stewardship 8. Fiscal Accountability The model will encourage units to generate carry forward amounts within established limits and will contain clear sanctions for units which deficit spend or whose projections deviate from actual in amounts greater than established variances. 9. Space Accountability Space is a limiting factor for the delivery of programs and services at UAF. The model will encourage efficient and prioritized use of available space. UAF Spring 2010 Management Report 8

9 ATTACHMENT B UAF Spring 2010 Management Report 9

10 UAF Spring 2010 Management Report 10

11 UAF Spring 2010 Management Report 11

12 Pat Pitney, Vice Chancellor (907) (907) fax Administrative Services University of Alaska Fairbanks, P.O. Box , Fairbanks, Alaska MEMORANDUM TO: FROM: Brian Rogers, Chancellor Pat Pitney, Vice Chancellor Administrative Services DATE: August 17, 2009 SUBJECT: FY10 budget status UAF is entering FY10 in a very tight fiscal position centrally. This is due to conscious decisions to empower schools and colleges to manage the majority of revenue at the unit level and because of significant budget hits to central reserves. Decisions were made to maximize the level of control schools, colleges, and institutes have to deliver service to their units. The tuition model (coupled with the existing ICR distribution model), the new carry forward principles, and full distribution of available FY10 general fund allocations to operating units, are evidence of those decisions. At the same time we chose to fund major unbudgeted items centrally rather than passing cost on to departmental budget, thus drawing reserves down to near zero. A few significant ones are listed below. Legislature s denial of the utility and athletics travel supplementals - $1.3M and $0.3M respectively UAF s portion of investment losses - $2.1M Use of general fund to units to cover 100% of FY09 salary increases when ICR and tuition were required to cover 40% Additional SW charge backs due to the investment loss - $0.6M I believe providing maximum management control at schools, colleges, and institutes is appropriate and we will work to maintain and enhance that approach, however, under the conservative revenue assumptions in the attached FY10 budget summary, UAF is approximately $2M below continuation requirements. Central reserves are at less than 1% when 2% is required. To address this shortfall, and to position us to meet existing commitments, I am recommending the creation of a non-base funding pool by collecting the equivalent of 1% of actual FY09 unrestricted receipts from all UAF units. These funds will be managed within the multiple appropriation budget constraints. UAF Spring 2010 Management Report 12

13 Page 2 Memo to Chancellor Rogers re: FY10 Budget Status Recently instituted cost saving measures for unrestricted funded positions will provide unit managers the tools required to minimize the impact of this action. Extended Christmas soft closure - $700K potential savings Managing for extended vacancies - $980K potential savings (60 additional vacant days per position recruitment) These cost saving programs coupled with tuition and ICR revenue generating capacity will minimize the operational impact on major academic and research units. Units without revenue generating capacity will be dependent on utilizing the cost saving measures only. Additionally all cabinet members have been requested to; Promote energy efficiency Examine use of university vehicles Scrutinize travel Critically examine space utilization. Alternatives, including a base reduction and a pull back of actual revenue in excess of projected, were considered. These approaches were dismissed due to the temporary nature of the shortfall and because they were considered a violation of base principles calling for preserving as much flexibility at the unit level as possible. I believe this action maintains UAF s strategic momentum, by minimizing the impact to core instructional and research units and serves as an effective short-term bridging strategy to meet existing priority commitments. It positions UAF sufficiently at this time; however, we will need to revisit our overall fiscal status in the November/December time frame. Current budget distribution status and impact of the 1% by unit are attached for reference. At that time we will have more information on the status of FY10 legislative utilities funding, know tuition and ICR revenue levels, and therefore be in a position to make decisions concerning additional cost saving measures should it be necessary. With your approval a 1% pull will be applied to each unit s budget by August 24, UAF Spring 2010 Management Report 13

14 Unrestricted Pull Back in 1,000's Division Total FY09 Unrestricted Revenue 1% Pull Back Chancellor Chancellor Office Operation $1,043.6 $10.4 Equal Opportunity and Diversity $342.8 $3.4 Governance $191.4 $1.9 Human Resources $1,635.9 $16.4 Information Technology $3,920.5 $39.2 Total Chancellor $7,134.1 $71.3 Provost College of Engineering & Mines $11,910.2 $119.1 College of Liberal Arts $14,764.8 $147.6 College of Nat Sciences&Mathematics $11,672.1 $116.7 Cooperative Extension $4,149.1 $41.5 Library $8,010.9 $80.1 Museum $3,482.9 $34.8 Provost Office Operations $5,069.2 $50.7 School of Education $3,612.8 $36.1 School of Fisheries & Ocean Science $11,201.0 $112.0 School of Management $4,891.8 $48.9 School of Nat Res & Ag Science $5,986.7 $59.9 Summer Sessions $2,195.0 $21.9 Total Provost $86,946.3 $869.5 VCAS Auxiliary & Business Services $180.9 $1.8 Environ Health&Safety and Risk Mgmt $1,342.4 $13.4 Financial Services $5,745.1 $57.5 Safety Services $2,943.4 $29.4 Facilities Services $20,938.6 $209.4 Physical Plant $477.4 $4.8 Utilities $155.1 $1.6 VCAS Office $868.6 $8.7 Total VCAS $32,651.5 $326.5 CRCD Bristol Bay $1,963.4 $19.6 Chukchi Campus $1,176.5 $11.8 Interior-Aleutians Campus $2,759.9 $27.6 Kuskokwim $3,927.6 $39.3 Northwest $2,118.9 $21.2 Rural College $9,524.1 $95.2 Tanana Valley $11,017.5 $110.2 Total CRCD $32,487.8 $324.9 VCUA Student Rec Center $647.9 $6.5 Athletics and Recreation $6,034.4 $60.3 Development Office $547.7 $5.5 KUAC $907.9 $9.1 UAF Alumni Association $202.5 $2.0 University Marketing $1,783.8 $17.8 University Relations $408.5 $4.1 VC Advancement&Community Engagement $704.3 $7.0 Total VCUA $11,237.0 $112.4 VCR Arctic Region Supercomputing Center $2,263.4 $22.6 Geophysical Institute $9,709.0 $97.1 Institute of Arctic Biology $6,373.9 $63.7 Intl Arctic Research Center $3,784.2 $37.8 Vice Chancellor for Research $7,154.5 $71.5 Total VCR $29,285.1 $292.9 VCSES Admissions $2,063.2 $20.6 Enrollment Mgmt Administration $145.2 $1.5 Financial Aid $750.2 $7.5 Freshman & Transfer Services $239.8 $2.4 Registrar $1,289.5 $12.9 Residence Life Programs $1,397.0 $14.0 Student Affairs $3,146.2 $31.5 Wood Center Programs $865.3 $8.7 Total VCSES $9,896.3 $99.0 Grand Total $209,638.0 $2,096.4 UAF Spring 2010 Management Report 14

15 Vacancy Analysis Employee Category Total FY09 Exp (103010) Staff Benefits Total Total Annual Vacancy Savings Average Savings Per day Total Savings Executive $5,271,147.9 $1,718,394.2 $6,989,542.1 $489,267.9 $1,839.4 $82,770.9 APT $16,116,728.6 $7,848,846.8 $23,965,575.5 $1,677,590.3 $6,306.7 $283,802.9 Classified $18,108,744.3 $11,372,291.4 $29,481,035.7 $2,063,672.5 $7,758.2 $349,117.5 APT Temp $119,166.4 $9,414.1 $128,580.6 $9,000.6 $33.8 $1,522.7 Classified Temp $1,444,825.3 $114,141.2 $1,558,966.5 $109,127.7 $410.3 $18,461.4 Classified Temp Extended $34,107.8 $14,120.6 $48,228.5 $3,376.0 $12.7 $571.1 Total Salary and Benefits $41,094,720.4 $21,077,208.4 $62,171,928.8 $4,352,035.0 $16,361.0 $736,246.5 Benefit Rates Rate Executive 32.6% APT 48.7% Classified 62.8% APT Temp 7.9% Classified Temp 7.9% Classified Temp Extended 41.4% Factors Variable Vacancy Factor 7.0% Vacancy Period (days) 45 Total Work Days in Year 266 Percent of Days in Closure 16.92% UAF Spring 2010 Management Report 15

16 Estimated Soft Closure Savings Employee Category Total FY09 Exp (103010) Staff Benefits Total Closure Savings Executive $5,271,147.9 $1,718,394.2 $6,989,542.1 $78,829.4 APT $16,116,728.6 $7,848,846.8 $23,965,575.5 $270,288.4 Classified $18,108,744.3 $11,372,291.4 $29,481,035.7 $332,492.9 APT Temp $119,166.4 $9,414.1 $128,580.6 $1,450.2 Classified Temp $1,444,825.3 $114,141.2 $1,558,966.5 $17,582.3 Classified Temp Extended $34,107.8 $14,120.6 $48,228.5 $543.9 Total Salary and Benefits $41,094,720.4 $21,077,208.4 $62,171,928.8 $701,187.2 Estimated Utility Savings $7,500.0 Total Closure Savings $568,449.7 Benefit Rates Executive 32.6% APT 48.7% Classified 62.8% APT Temp 7.9% Classified Temp 7.9% Classified Temp Extended 41.4% Participation Factor 80.0% Total Work Days in Year 266 Total Days in Closure 3 Percent of Days in Closure 1.13% Utility Savings Per Day $2,500.0 UAF Spring 2010 Management Report 16

17 DRAFT University Of Alaska Fairbanks FY10 MAU Unrestricted Operating Budget Projections (in 1000's) DRAFT Base Adjustments New Base Budget Obligations (Required): ACCFT and United Academics Compensation (UAFT/UNAC - A9/F9) (60% F1) ACCFT and United Academics Market Adjustment (60% F1) Adjunct Faculty Compensation (AAUP - FT) AHETCE Compensation (L CR,CT) (60% F1) Virology M&R (funded one time) CES (Funded one time) CES/ACEP/Engineering Outreach (funded) ACEP (funded one time) Health Programs (funded) M&R (funded) Staff 4.5% Grid Adjustment (60%) Total New Base Budget Obligations (Required) Fairbanks Campus Organized Research CES Bristol Bay Chukchi Interior Aleut Kuskokwim Northwest Rural & Comm dev TVC Total ($715.2) ($165.5) ($33.6) ($8.7) ($10.0) ($12.0) ($26.5) ($11.1) ($33.1) ($69.6) ($1,085.3) ($368.9) ($26.5) ($22.5) ($8.4) ($3.5) ($2.2) ($22.8) ($5.5) ($18.3) ($38.0) ($516.4) ($50.3) ($1.8) $0.0 ($2.3) ($1.9) ($3.2) ($1.7) ($1.4) ($1.8) ($59.2) ($123.7) ($31.5) ($8.4) $0.0 $0.0 $0.0 $0.0 ($3.1) ($1.3) $0.0 $0.0 ($44.3) ($150.0) $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($150.0) $0.0 $0.0 ($350.0) $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($350.0) $0.0 $0.0 ($100.0) $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($100.0) $0.0 ($500.0) $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($500.0) ($87.4) $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($40.8) ($47.2) ($175.4) ($302.3) $0.0 $0.0 ($14.6) ($14.3) ($17.2) ($24.1) ($17.0) $0.0 ($44.5) ($434.0) ($1,248.1) ($343.7) ($41.8) ($21.3) ($8.8) ($29.6) ($36.8) ($24.7) ($86.9) ($79.4) ($1,921.2) ($2,953.7) ($1,045.9) ($547.9) ($55.3) ($38.6) ($64.2) ($114.9) ($60.9) ($180.9) ($337.9) ($5,400.2) Other Base Adjustments: SW Charge-Backs FY09 Market Adjustment (A9 and F9 Market plus Executive Raise) FY10 MAU PBB Pool Pull Back (1% of GF) FY10 MAU PBB Pool reallocation Total Other Base Adjustments ($382.7) $0.0 $0.0 ($15.9) ($8.6) ($20.2) ($17.5) ($9.2) ($96.3) ($147.2) ($697.5) ($999.7) ($321.1) ($55.1) ($13.4) ($10.6) ($2.5) ($27.8) ($10.8) ($43.2) ($44.0) ($1,528.2) ($1,062.6) ($117.8) ($37.8) ($12.3) ($9.0) ($16.2) ($28.9) ($16.6) ($48.0) ($53.2) ($1,402.3) $1,062.6 $117.8 $37.8 $12.3 $9.0 $16.2 $28.9 $16.6 $48.0 $53.2 $1,402.3 ($1,382.3) ($321.1) ($55.1) ($29.3) ($19.2) ($22.7) ($45.3) ($20.0) ($139.5) ($191.3) ($2,225.7) Total Base Obligations ($4,336.1) ($1,367.0) ($603.0) ($84.6) ($57.8) ($86.8) ($160.2) ($80.9) ($320.4) ($529.1) ($7,625.9) Revenue Adjustments FY10 Tuition Revenue - Change in Rate (+5%) FY09 Enrollment Increase and/or Enrollment Pattern Shift FY10 Compensation Increase (less executive salary reduction) Staff Benefit Reserve CES (funded one time) CES/ACEP/Engineering Outreach ACEP (funded one time) Health Programs (funded) Virology M&R (funded on time) M&R (funded) Utility Exposure (Assumes $2.687 Trigger Funding) Total Revenue Adjustments $983.2 $0.0 $0.0 $1.0 $0.6 $11.6 $28.1 $12.6 $160.9 $214.1 $1,412.0 $700.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $700.0 $2,328.4 $803.3 $121.4 $82.5 $33.5 $86.6 $133.4 $62.5 $184.4 $226.6 $4,062.6 ($478.1) ($78.0) $21.8 ($46.3) ($22.9) ($45.1) ($90.7) ($42.0) ($94.6) ($177.1) ($1,053.0) $0.0 $0.0 $350.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $350.0 $0.0 $0.0 $100.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $100.0 $0.0 $500.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $500.0 $87.4 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $40.8 $47.2 $175.4 $150.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $150.0 $302.3 $0.0 $0.0 $14.6 $14.3 $17.2 $24.1 $17.0 $0.0 $44.5 $434.0 ($1,055.5) $0.0 $0.0 ($19.6) ($8.7) ($12.5) ($99.3) ($9.7) $0.0 $0.0 ($1,205.3) $3,017.7 $1,225.3 $593.2 $32.2 $16.8 $57.8 ($4.4) $40.4 $291.5 $355.3 $5,625.7 Balance ($1,318.3) ($141.7) ($9.8) ($52.4) ($41.0) ($29.1) ($164.6) ($40.5) ($28.9) ($173.9) ($2,000.2) Potential Solutions Enrollment Increase (2%) Increased ICR ($3.2M Additional Restricted Activity) Soft Holiday Closure (3 days) Two Week Forced Vacancy Utility Savings (2% energy conservation effort) Fuel Supplemental Total Potential Solutions $417.8 $0.0 $0.0 $0.4 $0.3 $4.9 $11.9 $5.4 $68.3 $91.0 $600.0 $300.0 $300.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $600.0 $390.4 $78.7 $16.1 $5.1 $3.7 $6.8 $11.9 $6.6 $18.4 $23.3 $560.9 $512.4 $103.3 $21.1 $6.7 $4.8 $8.9 $15.6 $8.6 $24.1 $30.5 $736.2 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $1,055.5 $0.0 $0.0 $19.6 $8.7 $12.5 $99.3 $9.7 $0.0 $0.0 $1,205.3 $2,676.2 $482.0 $37.2 $31.9 $17.5 $33.0 $138.8 $30.3 $110.9 $144.8 $3, % Unrestricted Pullback $1, /23/2010 DRAFT UAF Bible 08_07_09.xlsx UAF Spring 2010 Management Report 17

18 ATTACHMENT C UAF Spring 2010 Management Report 18

19 Category / Description Debt Amount UAF Debt Payments FY09 to FY19 (All amounts in thousands) FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 Current Debt Sub-Total: Debt Service on Current Debt Issues $ 5,598 $ 5,408 $ 5,453 $ 5,441 $ 5,444 $ 5,064 $ 4,931 $ 5,042 $ 4,982 $ 4,988 $ 4,046 Projects with Anticipated Debt Funding Sub-Total: Debt Service on Anticipated Debt Issues $ - $ - $ 106 $ 965 $ 2,202 $ 2,774 $ 2,774 $ 2,774 $ 2,774 $ 2,774 $ 2,774 Debt Service on Current and Anticipated Debt Issues Total: Debt Service on All Debt Issues $ 5,598 $ 5,408 $ 5,559 $ 6,406 $ 7,646 $ 7,838 $ 7,705 $ 7,816 $ 7,756 $ 7,762 $ 6,820 Total Unrestricted Revenue (Forecast ) $ 248,861 $ 261,304 $ 288,088 $ 302,493 $ 333,498 $ 350,173 $ 386,066 $ 405,369 Internal Debt Arrangements Sub-Total: Internal Debt Arrangements Additional Items Under Consideration UAF Spring 2010 Management Report 19

20 ATTACHMENT D UAF Spring 2010 Management Report 20

21 Attachment D UAF Spring 2010 Management Report 21

22 ATTACHMENT E UAF Spring 2010 Management Report 22

23 3/23/2010 FY10 Budget Status 1 FY09 Budget $8.5M Non General Funds Required to Maintain Existing Programs! (Only $1.6M Additional NGF Earned in FY09) Compensation Increase $4.6M General Fund $3.7M Non General Fund Maintenance & Repair $506K General Fund $670K Non General Fund Other Fixed Costs $1.0M General Fund $4.1M Non General Fund Programs $2.6M General Fund $2.8M Non General Fund 2 FY10 Budget $8.2M Non General Funds Required to Maintain Existing Programs! ($7.4M projected additional in FY10) Compensation Increase $4.2M General Fund $3.3M 3M Non General Fund Maintenance & Repair $434K General Fund $657K Non General Fund Other Fixed Costs $150K General Fund $4.2M Non General Fund Programs $1.1M General Fund $2.7M Non General Fund 3 UAF Spring 2010 Management Report 23 1

24 3/23/2010 Reasonable Carry Forward Based upon Carry Forward Guidelines: Minimum of 1% or $3,574,249 Maximum of 2% to 4% or $10,296,954 Projected Carry Forward Based Upon YTD Revenue and Expense Activity Between $5M and $9M 4 F1 Carry Forward Projections as of November 2009 Unit Projected Carry Forward Chancellor $17,539 VC For Rural, Community & Native Education $326,571 Provost $758,500 Vice Chancellor for Students $83,792 VC Advancement & Community Engagement <$460,130> Vice Chancellor for Administrative Services $155,764 Central Obligations (Scholarships, debt service, utilities etc.) <$1,577,045> Vice Chancellor for Research $1,639,551 Total $944,542 5 Suspend Maximum Carry Forward Guideline For FY10 there will be no sweep of carry forward in excess of levels specified in the guidelines The accuracy guideline will remain in effect 6 UAF Spring 2010 Management Report 24 2

25 3/23/2010 Institutional Needs Institutional Shortfall $2.6M Un Budgeted Scholarships Critical Needs Fuel Non General Fund Portion Departmental Needs International Programs Development Office Arctic Policy School of Management Infrastructure One Stop Initial Capital Project Development Structural Deficit Funding KUAC Bookstore/Tech Center Athletics OIT 7 Lay of the Land How We Evolved Financially From FY05 to FY09 8 FY09 Unrestricted Expenditures by NCHEMS FY09 Actual % of Total FY05 FY09 Direction of Change Academic Support $21.2M/5.2% Research Academic Support Institutional Support Debt Service 3.7M/.9% Institutional Support $34.9M/8.6% Instruction $69.5M/17.2% Intercollegiate Ahl Athletics $5.3M/1.3% 3% Library Services $8.6M/2.1% Physical Plant 51.4M/12.7% Physical Plant Instruction Public Service $9.3M/2.3% Research $43.4M/10.7% Scholarships $3.0M/.7% Student Services $13.1M/3.2% 9 UAF Spring 2010 Management Report 25 3

26 3/23/2010 Relative Size FY09 General Fund and Non General Fund Revenue General Non General Percent Unit Fund Fund Total Of Total Chancellor $4,688.1 $587.3 $5, % Provost $61,574.7 $61,635.3 $123, % CRCD $19,849.9 $23,604.0 $43, % VCR $13,063.7 $71,734.7 $84, % VCACE $7,231.1 $5,945.3 $13, % VCSES $7,435.4 $21,200.2 $28, % VCAS Operating $9,760.7 $10,416.3 $20, % Physical Plant & Utilities $21,961.2 $9,577.4 $31, % VCAS Institutional $4,160.5 $7,837.5 $11, % Total $149,725.3 $212,538.0 $362, % 10 General Fund Over Time $70,000.0 $60,000.0 $50,000.0 $40,000.0 $30,000.0 $20,000.0 $10,000.0 FY05 FY06 FY07 FY08 FY09 $ Annual Growth Rate in General Fund Revenue FY05 FY09 Annualized 16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2.00% 4.00% 12 UAF Spring 2010 Management Report 26 4

27 3/23/ % Annual Growth Rate in Non General Fund Revenue FY05 FY09 Annualized 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 5.00% 13 Where Are We Going FY11 and Beyond 14 Assumptions Annual 3% Salary Increase Annual 15% Benefit Increase Annual 5% Tuition Rate Increase / 7% in FY12 Change in Enrollment Unit Specific Indirect Cost Recovery Unit Specific 15 UAF Spring 2010 Management Report 27 5

28 3/23/2010 Meeting Priorities While Costs Continue To Increase Salaries Staff Benefits (Health Care) Utilities/Fuel SW Assessments Network Data Tapes Skillsoft Roxen Board of Regents Maintenance and Repair Requirement Risk Management Debt Service (Life Sciences, Energy) Custodial Services Contract Scholarships Other Inflationary Items Structural Deficits 16 Main Revenue Drivers Enrollment Tuition Rates Restricted Activity and Corresponding ICR General Fund Fund Raising Auxiliaries Bake Sales 17 Potential Increased Revenue Tuition Rate Increase Only $1.6M ICR on Sponsored Activity 1% $280K 5% $1.4M Enrollment ti Increase (tfy11 (at Titi Tuition Rt Rates) 1% $330K 5% $1.6M Federal Revenue 1% $880K 5% $4.5M 18 UAF Spring 2010 Management Report 28 6

29 3/23/2010 FY11 19 FY11 Budget Governor s Proposal $8M Non General Fund Required to Maintain Existing Programs! Compensation Increase $3,674 General Fund $3,550 Non General Fund Maintenance & Repair $795 General Fund $790 Non General Fund Other Fixed Costs $1,282 General Fund $ 3,655 Non General Fund Programs $950 General Fund $2,668 Non General Fund 20 FY12 21 UAF Spring 2010 Management Report 29 7

30 3/23/2010 How Do We Meet The Challenge? 22 Unrestricted Revenue Gap Based Upon FY05 to FY09 Annualized Data $360,000.0 $340,000.0 $320,000.0 $300,000.0 $280,000.0 $260,000.0 $4.2M Surplus $3.5M Gap Breakeven $8.3M Gap $13.8M Gap Projected Expense Projected Unrestricted Revenue Annualized Expense Increasing at 8.42% Annualized Revenue Increasing at 6.86% $240,000.0 $220,000.0 FY09 FY10 FY11 FY12 FY13 23 How Are We Going To Address Priorities Raise Revenue Reduce Cost Reallocate Transform Stop Doing Incentives to Encourage What Practices/Behaviors Key Strategic Investments 24 UAF Spring 2010 Management Report 30 8