Senate Standing Committee on University Budget

Senate Standing Committee on University Budget Friday, June 17, 2016, 9am Surrey Campus, Cedar 2110 A G E N D A Start Time 1. Call to Order... Thomas Westgate 9:00 am 2. Confirmation of Agenda 9:01 3. Approval of Minutes: May 20, 2016 9:02 4. Pending Business 9:03 5. Chair's Report... Thomas Westgate 9:04 6. For Information: Board's response to Senate's Budget recommendations... Thomas Westgate 9:06 7. 2017-2018 Budget Development Process - Further Information... Jon Harding 9:07 8. Presentation: Budgeting Spreadsheet/template... Jon Harding 9:40 9. Budget Development and Management Principles and Criteria. Thomas Westgate 10:00 10. Items for Discussion 10:30 11. Adjournment 10:30 Next Meeting Friday, September 16, 2016, 9am Surrey Campus, Cedar 2110 Senate Standing Committee on University Budget Friday, June 17, 2016

MINUTES Senate Standing Committee on University Budget (SSCUB) Friday, May 20, 2016, 9am Surrey Campus, Cedar Building, Room 2110 Present: Carol Stewart, Elizabeth Worobec, Tom Westgate (Chair), Joyce MacKenzie, Tru Freeman, Daniels Caroline, Jim Murray, Ex-Officio / Non-voting Jennifer Au, Jane Fee, Jon Harding, Kathy Lylyk, Regrets: Faith Auton-Cuff, Salvador Ferreras, Alice Macpherson, Jerry Murphy, Sukey Samra, Dale Simonson, Wayne Tebb, Guests: Vivian Lee Katie Masse Recorder Lori Scanlan, University Secretariat 1. Call to Order The Chair called the meeting to order at 9:04am. 2. Confirmation of Agenda Moved by Tru Freeman; seconded by Elizabeth Worobec: THAT the agenda be confirmed. 3. Approval of Minutes of March 4, 2016 Moved by Tru Freeman; seconded by Joyce MacKenzie: THAT the minutes of March 4, 2016 be approved. Motion Carried Motion Carried 4. Pending Business No business was pending 5. Chair s Report No report. 6. DRAFT: 2017/18 Draft Budget Development Process and Key Dates Jon Harding, Vice President Finance and Administration, presented the 2017/18 Draft Budget Development Process and Key Dates. Discussion occurred regarding the KPU s past budget process and the future process which would utilize a hybrid model inclusive of performance metrics. The 2017/18 budget year would utilize a zero based budget model as a transition to the hybrid model. SSCUB May 20, 2016 Page 1

Action: Financial Services will: supply a summary document with the following: o Definitions o Criteria (eg. expected course sections and section costs, administrative and support costs, non-salary operational expenses, and potential efficiencies) schedule educational events/meetings to provide information and assistance on the proposed model(s) provide each Faculty with contact numbers in order to supply support and guidance throughout the new process create self-calculating robust spreadsheets/templates that will self-populate and post them on-line along with a step-by-step clearly documented process (deadline of June) Moved by Carol Stewart; seconded by Jim Murray: THAT SSCUB endorse the 2017/18 Draft Budget Development Process and Key Dates as presented by the Vice President Finance and Administration. 7. Update: Strategic Investment Fund Application Information regarding KPU s application to the Federal Strategic Investment Fund (SIF) was shared. It was communicated that due to the urgent timeline of the SIF application KPU s Capital Plan submission to the Ministry of Advanced Education (AVED) has been delayed with AVED s understanding. A response to KPU s SIF application may be forwarded by the end of June. 8. For Information: 2016/17 SSCUB Meeting Dates The 2016/17 SSCUB meeting dates were shared 9. Items for Discussion No items were brought forward. 10. Adjournment The meeting adjourned at 10:20am. Carried SSCUB May 20, 2016 Page 2

KWANTLEN POLYTECHNIC UNIVERSITY 12666 72 ND Ave. Surrey, BC Canada V3W 2M8 MEMORANDUM TO: CC: FROM: SENATE Senate Standing Committee on University Budget (SSCUB) Hanne Madsen, Chair, Board Finance Committee DATE: May 25, 2016 SUBJECT: SSCUB s Recommendations to Senate for Transmittal to the Board of Governors KPU s Board of Governors thanks the Senate and the Senate Standing Committee on the University Budget (SSCUB) for their work in reviewing the university s draft 2015-16 budget, and for the advice they provided to the President. The Governors understand that SSCUB worked hard on the task and appreciates receiving the Committee s comments through Senate. The Governors support the more positive and collaborative process that was present this budget cycle. The Board has asked administration to continue moving forward with the work that has been completed to date as it relates to the Task Force Budget Allocation Sub-Committee (BASC) Plan. The Board supports the need for administration, in consultation with SSCUB, to review and re -evaluate the timelines and tasks established by the BASC s report and recommendations of 2014, in order to continue progressing and adapting to the evolving post -secondary landscape. With the advent of greater fiscal uncertainty in post-secondary education the movement towards a more strategic approach to budgeting is essential. It is important that the university continues to move to a more strategic budget model and to work collaboratively with the Senate. Observation: 2016/2017 Budget Development Process and Consultations Recommendation: SSCUB recommends that KPU continues to enhance the transparency, level of detail and timeliness related to the draft budget development process and consultations with stakeholder groups. Board Response: The Board asks administration to continue to enhance the level of transparency and detail, and refine the timeliness, of the budget development process. Furthermore, the Board asks for the continuation of transparent consultations with stakeholder groups and collaboration with SSCUB. Observation: New Budget Model Recommendation: SSCUB recommends that the timelines and tasks established by the Budget Allocation Subcommittee s report and recommendations of 2014 be followed, and that SSCUB receives regular progress updates. SSCUB appreciates that timelines are tight given that all operating divisions are likely to begin the preparation of their FY2017/18 by June 2016.

KWANTLEN POLYTECHNIC UNIVERSITY 12666 72 ND Ave. Surrey, BC Canada V3W 2M8 MEMORANDUM Board Response: The Board asks administration to review the timelines and tasks established by the Budget Allocation Subcommittee s report and recommendations of 2014 to ensure that timelines meet the needs of the organization and key stakeholders. Furthermore, the Board asks that administration continue to collaborate with SSCUB. Observation: Balancing the Budget Recommendation: SSCUB supports a balanced budget and the inclusion of a contingency. SSCUB recommends that work continue on the development of KPU s Strategic Enrolment Management Plan and the SSCUB be updated on its progress. Board Response: In support of a balanced budget, the Board recognizes the need for the inclusion of a contingency and also supports this initiative. The Board asks administration to continue the development of KPU s Strategic Enrolment Management Plan and that SSCUB be updated on its progress. Observation: FY15/16 and FY16/17 Skills Gap Plan Development Process Recommendation: SSCUB recommends that regular updates of KPU s Skills Gap Plans and the ongoing development of enrolment targets and budgetary reporting implications continue to be provided to the University community. SSCUB also recommends that all new program development initiatives consider the Skills Gap Plan. Board Response: The Board asks administration to provide regular updates of KPU s Skills Gap Plan, the ongoing development of enrolment targets, and budgetary reporting implications to the University community. The Board recommends that the Skills Gap Plan be taken into consideration when developing new program initiatives. Page 2 of 2

Senate Standing Committee on University Budget Agenda Item #: 7 Meeting Date: June 17, 2016 Presenter(s): Jon Harding Agenda Item: Action Requested: 2017-2018 Budget Development Process Further Information Motion to Approve Discussion Information Education Recommended Resolution: Context & Background: Key Messages: [maximum of three] As discussed during the SSCUB meeting on May 20, 2016, Financial Services is recommending using a zero-based budget model for the fiscal 2017-18 draft budget. A zero-based budget model should allow Faculties and Business Units to consider in detail their budgetary needs this analysis can then be used as a basis for establishing useful metrics to measure Faculty/Business Unit functions/performance. 1. Financial Services has provided an informative briefing note to further explain the methodology behind transitioning into the zero based budgeting model, and how this will increase overall institutional effectiveness. 2. Financial Services has provided a memo including the working schedule of informative consultations with faculties and business units. Also included in this memo is contact information for support and guidance purposes during the budget development process. 3. Financial Services is developing a sample budget template with clearly stated instructions to assist each faculty or unit in creating their respective budget. This sample budget template will be provided at SSCUB on June 17, 2016 along with a step-by-step explanation of its purpose and use. Attachments: Submitted by: Zero Based Budgeting Briefing Note Draft Budget Development Process Timeline (as previously received) Memo including draft working schedule of informative consultations and support contact information Jon Harding, Vice President, Finance and Administration Date submitted: June 10, 2016 ~ 1 ~

KWANTLEN POLYTECHNIC UNIVERSITY To: SSCUB From: Jon Harding, CPA, CA Vice President, Finance and Administration Date: Friday, June 10, 2015 BRIEFING NOTE Zero Based Budget Model Description: An organization s budget is designed to be a financial representation of it s expectations for the coming fiscal year. KPU currently utilizes incremental budgeting, where the budget development process begins with using the previous year s baseline as it s starting point. Zero based budgeting differs in that each budget begins with a zero baseline, and financial needs are determined based on departmental operating requirements and strategic objectives. This budgeting model should allow Faculties and Business Units to consider in detail their budgetary needs and then use this as a basis for establishing useful metrics to measure success. Through the use of zero based budgeting, each department will be given the ability to build their budget around thoughtful analysis of their specific needs and desired outputs. A great benefit to implementing this model is the ability to move away from the concept of cost control and focus more on efficiency and effectiveness as each budget item will be queried and justified in terms of projected cost and broader institutional benefit. Moving forward, implementing the zero based budget model will allow KPU to transition to a hybrid-based budget model which will include the use of performance metrics to set and achieve specific targets. A sample budget template is being developed with instructions that will assist in your budget development process. This template will be presented to SSCUB on June 17, 2016, providing an instructional overview on creating a zero based budget. Attachments: Draft Budget Development Process Timeline Memo including draft working schedule of informative consultations and support contact information

For Discussion: 2017-2018 Budget Development Process Key Dates DATE ACTIVITY NOTE June 2016 SSCUB provides advice on budget development principles and criteria for submission to Senate (based on Strategic Plan, Academic Plan and Resources Plan). SSCUB meets on Friday June 17, 2016 Reviews plan for zero based budget, criteria and requests see below for criteria. SSCUB Deans and Directors VP F&A presents draft 2015/16 Financial Statement results. The final, Board-approved results will be presented to the University community during a Summer Financial Campus Forum during the end of June. Notice sent to Faculties and Service Units notifying them of the change to the request format for their operations, i.e. need to verify their ongoing costs required for 2017/18. Templates will be provided by Financial Services. by June 30, 2016 Faculties, in collaboration with the Provost & VP Academic, will be asked to provide: 1. Expected course sections (i.e. work plan) offered in the 2017/18 fiscal year; 2. Expected cost of these sections, using their best estimate of full-time and part-time faculty costs; 3. Other admin and support costs to support the academic operations; 4. Expected cost of non-salary items for their ongoing operations; 5. Efficiencies that are being looked at for 2017/18. Page 1 of 4

Service and Administrative areas will be asked to provide: 1. Expected admin and support salary costs for 2017/18; 2. Efficiencies that are being looked at for 2017/18; 3. Expected cost of non-salary items for their ongoing operations; 4. Alignment of services with KPU s strategic plan. For new requests, the focus will be on what will enhance existing programs or services, student experience, new or enhanced opportunities for revenue and new opportunities for efficiencies/accountability. Information for the ongoing costs verification and for new budget requests for FY 2017/18 and their vision budget proposals for FY18/19 and FY 19/20 are to be submitted to the University Budget Office by October 10th, 2016 (please refer to below for staggered dates). ` June 2016 VP F&A presents final 2015-2016 Financial Statement results at four campus forums and changes to budget process as we move toward a new budget model. Campus Forums Week of June 20, 2016 TBD by Individual Faculties Faculty Councils submit their Faculty s Academic Priorities to SSCUB, SSCAPP and to the Vice President Academic. Faculty Councils September 2016 VP F&A presents preliminary 2016-2017 financial forecast at 4 campus forums, to Faculty Councils, Administrative Managers Group (Group of 50), KSA, BCGEU and KFA. Campus Forums Week of September 26, 2016 Presentations at regularly scheduled Faculty Council Meetings and Administrative Managers meetings Page 2 of 4

Week of October 10 th, 2016 Deadline for submission of zero based budget template, and new proposals. Service & Administrative Areas Week of October 17 th, 2016 Deadline for submission of zero based budget template, and new proposals. Faculties October 21, 2016 October 28, 2016 Budget Presentations Service & Administrative Areas Budget Presentations Faculties Faculties and Service areas present their budget proposals to the President, Vice-Presidents, Executive Director Financial Services & SSCUB (presentations are open to the KPU community) October 2016 Budget Proposals posted on SharePoint. Financial Services November 2016 Based on the budget presentations, SSCUB provides advice to the President on Senate s priorities for budget development. SSCUB November 2016 Draft budget developed based on Strategic Plan, Academic Plan, Resources Plan and Senate s approved principles and criteria for 2017-2018 budget development. President, VP Finance & Administration, Provost, Executive Director Financial Services December 2016 and January 2017 Meet with Deans and Directors to discuss 2016-2017 preliminary results and 2017-2018 draft budget. Dates to be determined. VP F&A, Provost, ED Financial Services Page 3 of 4

January 2017 Draft University Budget presented to SSCUB for their review in mid-january 2017 (date of meeting to be determined). VP F&A, Provost, ED Financial Services. Draft Budget Consultations at 4 campus forums, to Faculty Councils, to the Administrative Managers Group (Group of 50), KSA, BCGEU and KFA. Campus Forums Week of January 25, 2017 Presentations at regularly scheduled Faculty Council Meetings, KFA and Administrative Managers meetings. VP F&A, Provost, ED Financial Services. SSCUB and SCAPP review/consult on the draft 2017-2018 through the January/February meetings. January/February meetings Consultations with APP February 2017 SSCUB provides advice and recommendations on the Draft University Budget for consideration by Senate. SSCUB Senate reviews Draft University Budget and develops advice to the Board of Governors. Senate March 7, 2017 (tentative) Board Finance Committee reviews proposed 2017-2018 Budget and makes recommendation to the Board of Governors. Board Finance Committee March 29, 2017 (tentative) Board of Governors reviews proposed 2017-2018 Budget. Board of Governors May 2017 VP F&A presents capital budget and planned projects to SSCUB. SSCUB Page 4 of 4

MAILING ADDRESS 12666 72 Ave, Surrey, BC Canada V3W 2M8 TO: SSCUB FROM: Financial Services DATE: Friday, June 10, 2016 Draft Working Schedule Faculty and Business Unit Information Sessions Faculty Meeting Date/Time Presenters Science and Horticulture Council Meeting Health Council Meeting June 21, 2016 at 1:00 pm Kathy Lylyk / Vivian Lee June 24, 2016 at 9:30 am Kathy Lylyk / Vivian Lee Science and Horticulture Chairs Meeting June 29, 2016 at 10:30 am Kathy Lylyk / Vivian Lee Financial Services Support Contact Information: If you have any questions, please do not hesitate to contact Budget Accounting via Budget.Acctng@kpu.ca or at the locals listed below: Yasemin Yorgancioglu, Accounting Analyst 2444 Debb Moffatt, Accounting Analyst 3272 Vivian Lee, Director, Budget, Planning and Payroll 2021 Kathy Lylyk, Executive Director, Finance 2970 T 604.599.2100 kpu.ca

Senate Standing Committee on University Budget Agenda Item # 9 Meeting Date: June 17, 2016 Presenter(s): Thomas Westgate Agenda Item: Action Requested: Recommended Resolution: Context & Background: Budget Development and Management Principles and Criteria Motion to Approve Discussion Information Education THAT the Senate Standing Committee on University Budget endorse the Budget Development and Management Principles and Criteria and recommended them to Senate. On June 22, 2015, Senate endorsed the following set of budget development and management principles and criteria as presented by the Senate Standing Committee on University Budget (SSCUB). Priorities should be guided by our legislated mandate, the academic plan, Vision 2018, and the resources plan. The budget process will be open and informed. SSCUB has the following recommendations: 1. Consult regularly or as required with the University community regarding ongoing changes with the financial situation over the course of the year. 2. Encourage consultation and collaboration between academic and service areas during budget development. 3. Consider services already provided to our communities, and existing or potential partnerships with community services. 4. Balance growth, relevance, and sustainability with resource implications when launching new programs and reviewing existing programs. 5. Focus on the whole experience for current and future students in setting budget priorities. The budget development and management principles and criteria are not listed in order of priority. All five priorities are considered equal. Key Messages: [maximum of three] Consultations: Submitted by: 1. In accordance with its mandate, SSCUB assists the President and Vice Presidents in the development of budgetary policies, guidelines, processes and models. Reviewed and endorsed by Senate at its June 22, 2015 meeting. Thomas Westgate Date submitted: June 14, 2016 ~ 1 ~