Facilities Management s Budget Prioritization Plan April 19, 2017

Transcription

1 Facilities Management s Budget Prioritization Plan April 19, 2017

2 UI s New Budget Model 2

3 UI s New Budget Model The historical business and financial models at the University of Iowa have given way to a more decentralized and transparent approach where costs are allocated to appropriate costs/budget centers. 3

4 UI s New Budget Model Allocation and transparency of cost is intended to drive higher levels of accountability and efficiency and to draw focus to value and return on investment. 4

5 UI s New Budget Model Non-academic services must demonstrate alignment to UI s Mission, UI s Strategic Plan and/or UI s institutional values and those services not in alignment will be diminished or discontinued. 5

6 UI s New Budget Model UI Administration has targeted faculty salaries as the top institutional priority for increasing our academic ranking and looking to the colleges to reallocate the funding from within their existing budgets. 6

7 UI s New Budget Model By extension, administrative units have been informed that salary, wage and benefit cost increases will need to be funded from reallocation instead of new funding. 7

8 UI s New Budget Model Future new funding will be designated to support strategic initiatives that advance or align with institutional or collegiate goals and objectives. 8

9 UI s New Budget Model The cost for non-academic services and support are being reflected in collegiate budgets and all collegiate officers are encouraged to review, understand, evaluate and challenge the cost and value of those services. 9

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13 Budget Reprioritization UI Administration requested that all of the colleges and major administrative departments model a 5% reduction in their current (FY17) funding base to be carried into FY18. 13

14 FM s Response Instead of a single year reactionary proposal, we proposed an alternate three year plan that is more strategic. 14

15 FM s Budget Prioritization Plan

16 FM s O&M GEF Budget FM s non-utilities GEF Budget is $39.9 million $17.1 million for custodial services $15.9 million for maintenance & operations $ 3.3 million for landscape & grounds $ 2.1 million for Oakdale utilities $ 0.8 million for campus & space planning $ 0.7 million for sustainability & administration 16

17 FM s GEF Utilities Budget The GEF utilities budget is $43 million, or 45% of the total Utilities Enterprise budget 17

18 Funding Salary & Fringes Merit wage and benefit increases historically have been centrally funded. Future funding of salaries, wages and fringe benefits will be in the form of reallocations from existing funds. 18

19 Funding Salary & Fringes 19

20 Funding Salary & Fringes FM employs 52% of UI s GEF Merit employees Our FY18 Merit fringe increases will exceed $1.5 million Fringe increases over the next three years will exceed $2.3 million for Merit staff (equivalent to 35 positions) Our P&S fringe increases will be $75,000 in FY18 and $125,000 over three years 20

21 Funding Salary & Fringes The numbers over the next three years: $2,330,000 Merit benefit increases 125,000 P&S benefit increases 750,000 Modeled Merit wage increases 200,000 Modeled P&S salary increases $3,405,000 Representing 8.5% of our current budget 21

22 Strategic Approach Proposal Budget Prioritization Plan We are pursuing a three-year strategic plan framework that will reposition Facilities Management for the future via a series of strategies designed to offset campus structural cost increases, redesign how we conduct our work, and free up resources that can be redirected for UI core activities. 22

23 Strategic Approach Proposal Planning Principles: Support UI s core mission and strategic plan Provide budget certainty to other UI budgeting efforts Transparency and partnership with those we serve Refine and redefine what s valued by those we serve Reposition the organization for a changing future 23

24 Commitment #1 Facilities Management will offset the full burden of the 8.5% of salary, wage and benefit increases coupled with a 5% overall reduction from current funding levels. The effective reduction is 13.5%, or $5.4 million, through the combination of cost reduction and cost avoidance. 24

25 Commitment #2 The Utilities Enterprise will freeze all utilities rates at current FY17 levels through FY20. With rates locked, an incentive program for reducing energy consumption could be implemented, rewarding colleges and departments for their specific conservation efforts (both energy and space). 25

26 Planning Framework

27 We ll Build on Our Current Efforts Robust preventative maintenance program Planning and scheduling of work Fault detection, diagnostic and analytics Equipment automation and modernization Improved data collection leading to better information and greater understanding 27

28 We ll Elevate our Core Competencies Employ data analytics to identify efficiencies Manage to key performance indicators Strategically source niche services Invest in the technical skills of our organization Invest in tools, systems and technology Cross functionally deploy organizational talent 28

29 We ll Realign Customer Expectations Closer partnerships with those we serve Transparency of costs and services Cease providing non-mission aligned services Cease providing non-valued services Service level agreements clarifying expectations Restructure our operating costs funding model 29

30 Next Steps Develop organizational alignment to achieve goals 30

31 Next Steps Develop organizational alignment to achieve goals Program FM s reserves for transitions 31

32 Next Steps Develop organizational alignment to achieve goals Program FM s reserves for transitions Restore building renewal funding to pre-fy16 levels 32

33 Our Vision for the Future Leaner organization focused on core mission 33

34 Our Vision for the Future Leaner organization focused on core mission Actively engaged partner with collegiate deans 34

35 Our Vision for the Future Leaner organization focused on core mission Actively engaged partner with collegiate deans Adhering to tighter and better defined service levels, but flexible enough to customize services 35

36 Our Vision for the Future Leaner organization focused on core mission Actively engaged partner with collegiate deans Adhering to tighter and better defined service levels, but flexible enough to customize services Transparent costing of services and stewardship 36

37 Our Vision for the Future Leaner organization focused on core mission Actively engaged partner with collegiate deans Adhering to tighter and better defined service levels, but flexible enough to customize services Transparent costing of services and stewardship Best practices organization in step with change 37

38 Questions?

39 One more important note!

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41 Thank You!