1 july 20, 2007 b oard of trustees meeting focus discussion
TRANSCRIPT
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Budget and Appropriations History
◦ Fiscal Year 2006-07 Total Operating Budget
◦ Fiscal Year 2006-07 General Fund Budget
◦ Appropriation funding history
◦ Budget reduction history
Fiscal Year 2006-07 One-time funding needs
Fiscal Year 2007-08 Base Budget needs
Tuition summary
OOverviewverview
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TTotal Resources Operating Budgetotal Resources Operating BudgetTotal - $178.3 millionTotal - $178.3 million
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**This graph displays total resources net of Scholarships costs.
TTotal General Fund Resources Budgetotal General Fund Resources BudgetTotal - $96.0 millionTotal - $96.0 million
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1981 1991
20012006
To maintain financial reporting consistency with fiscal years ’81, ’91, and ’01 data, financial aid was not deducted from ’06 tuition and fee revenue.
TTotal General Fund Resourcesotal General Fund Resources
7
$44.
2
$45.
9
$47.
2
$48.
8 $51.
3
$52.
0
$50.
2
$45.
2
$45.
0
$45.
1
$45.
2
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Appropriation History(shown in 000,000’s)
State Mandates *(shown in 000,000’s)
* FY2003 appropriation after both Executive Orders and the State Supplemental
$1.3
$1.1 $1
.4
$1.8
$2.1
$2.2 $2
.5
$2.6 $3
.0
$3.5
$4.1
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
* State mandates include Michigan Public School Employee Retirement System (MPSERS), Indian tuition waiver, minimum wage, and MI-OSHA requirements.
AAppropriationppropriation
7
88
* Appropriation per FYES if NMU receives $4.2 million delayed appropriation
** Appropriation per FYES if NMU does not receive $4.2 million delayed appropriation
AAppropriation per FYESppropriation per FYES
$6
,87
6
$6
,96
6
$6
,75
1
$6
,84
4
$6
,93
1
$6
,73
9
$6
,28
1
$5
,35
5
$5
,51
7
$5
,30
7
$5
,29
0
$4
,82
0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 * 2007**
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BBudget Reduction Historyudget Reduction History General Fund budget cuts/reallocations of $13.8 million
since 2003◦ FY2003-04: $6.5 million◦ FY2004-05: $2.8 million◦ FY2005-06: $1.5 million◦ FY2006-07: $3.0 million
Organizational efficiency – consolidation of organization structure and increased productivity = lower cost◦ 5 vice presidents to 2◦ 5 academic colleges to 3
NMU faculty and staff are the most productive among the 15 public universities (student-to-staff ratio)
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FY2006-07 One-time funds
◦ Reduced payment of FY2006-07 appropriation ($807,000 or 1.7%)
◦ Delayed August 2007 payment of $4.2 million
FY2007-08 base budget
◦ Base appropriation reduction from FY2006-07 (1.7%)
◦ No further reduction in appropriation
◦ Return of $4.2 million delayed FY2006-07 appropriation payment in October 2007
GGeneral Fund Budget Assumptionseneral Fund Budget Assumptions
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FY07 Reduction: -1.7%ONE-TIME BUDGET NEEDS - FY2007 Delayed Payment: $4.2M
FY07 CASH FLOW -- APPOPRIATION REDUCTION -$5,027,000
SOURCES: Revenues in excess of budget $506,000 Delayed academic equipment upgrades, replacement of obsolute equipment, staff hirings, and building maintenance and improvements $4,521,000
Total $5,027,000
FFY2006-07 General Fund One-time NeedsY2006-07 General Fund One-time Needs
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BASE REVENUE ADJUSTMENTS FROM 2007:
Tuition and fees $217,000 Scholarships/financial aid -$95,000 Investment income $350,000 Rental income $34,000
Total Base Revenue Adjustments from 2007 $506,000 % change in budget 0.5%
BBase Revenue Adjustments for FY2006-07ase Revenue Adjustments for FY2006-07(adjusted for FY2007-08)(adjusted for FY2007-08)
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Inflationary cost increases: Compensation $2,750,000 USOEC (additional net tuition revenues) $96,000 Software maintenance/license fees (i.e., Oracle, SCT) $77,000 Athletic transportation/team travel costs $75,000 Credit/Debit card fees $68,000 Printing/postage $33,000 Faculty and staff recognition awards $25,000 Hazardous waste disposal $10,000
Total Inflationary $3,134,000 % change in total university budget 3.3%
PProjected Cost Adjustments rojected Cost Adjustments (Fiscal Year 2007-08)(Fiscal Year 2007-08)
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Budget reduction/reallocations: Departmental personnel and support costs -$870,000 Operation and maintenance (heating plant) -$300,000 Debt service/loan retirement -$122,000
Subtotal-Budget Reductions/Reallocations -$1,292,000 % change in total university budget -1.3%
BBudget Reductions/Reallocationsudget Reductions/Reallocations(Fiscal Year 2007-08)(Fiscal Year 2007-08)
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State mandates: Michigan Public School Employee Retirement System - (MPSERS) (FY07: $3,334,000) $250,000 Minimum wage (FY07: $464,000) $75,000 Indian tuition waiver (FY07: $338,000) $55,000 MIOSHA compliance (eye wash annual testing) $16,000
Total Mandates $396,000 % change in total university budget 0.4%
SState Mandate Increases tate Mandate Increases (Fiscal Year 2007-08)(Fiscal Year 2007-08)
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Initiatives:
Instructional staffing and support: $940,000
Faculty staffing (enrollment) adjust - FY08 ($840,000)
Graduate stipends ($100,000)
Facility maintenance and equipment (Deferred maintenance $87.3M) $657,000
Long-term building maintenance ($507,000)
Capital equipment replacement ($150,000)
Administrative staffing and support: $206,000
Grant development ($160,000)
Internationalization ($40,000)
Extended library hours for students ($6,000)
Total Initiatives $1,803,000
% change in budget 1.9%
IInitiatives nitiatives (Fiscal Year 2007-08)(Fiscal Year 2007-08)
2020Source: State of Michigan HEIDI Database
$10,341
$9,660
$8,936
$7,516
$7,398
$7,350
$7,265
$7,200
$6,956
$6,956
$6,948
$6,752
$6,733
$6,638
$6,184
$5,543
UM-AA
MTU MSU UM-D AVG WSU WMU FSU EMU OU UM-F GVSU LSSU CMU**
NMU* SVSU
Annual resident undergraduate tuition and fee rates
* NMU includes portion of Freshmen Student Athletic Fee ** CMU Freshmen rate is $7,530
TTuition and Fee Ratesuition and Fee RatesFiscal Year 2006-2007Fiscal Year 2006-2007
2121Source: Presidents Council Tuition and Fees Report
9.1%
8.7%
8.5%
7.9%
6.8%
6.5%
6.4%
6.0%
6.0%
5.9%
5.9%
5.8%
5.5%
5.1%
4.9%
4.8%
OU MTU UM-D UM-F FSU AVG LSSU EMU WMU GVSU MSU WSU UM-AA
CMU SVSU NMU
Annual resident undergraduate tuition and fee rates
TTuition and Fee Percentage Increasesuition and Fee Percentage IncreasesFiscal Year 2006-2007Fiscal Year 2006-2007
2222
Annual resident undergraduate tuition and fee increases per semester(based on media reports)
TTuition and Fee Semester Increasesuition and Fee Semester IncreasesFiscal Year 2007-2008Fiscal Year 2007-2008
*For new students Fall 2007**Fall 2006 to Fall 2007 Comparison (6.7% summer to fall)
UniversityPer Semester
IncreasePer Semester
% Increase
CMU* $795 21.1%FSU** $750 20.8%OU $486 13.9%MTU $460 9.5%MSU $427 9.6%GVSU $326 9.9%LSSU $309 9.3%EMU $279 8.0%UM-AAUM-DUM-FNMUWSUSVSUWMU
To be announced - July 25
To be announced
To be announced - July 19To be announced - July 19To be announced - July 19To be announced - July 20
To be announced - July 27
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Recover appropriation reduction 1.7% (1.7% tuition = 1.7% appropriation)Recover expected appropriation increase 4.2% (3.2%CPI + 1% growth/initatives)Tuition and fee inflation 4.2% (3.2% CPI + 1% growth/initiatives)
Tuition Percentage Increase 10.1%
TTuition Guideline uition Guideline (Fiscal Year 2007-08)(Fiscal Year 2007-08)
*The 10.% assumes NMU receives the $4.2 million delayed appropriation.
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* Scenario 3: nonresident increase same dollar amount as resident
BASE BUDGET -- FY2008 Scenario 1 Scenario 2 Scenario 3*
BASE REVENUE ADJUSTMENTS From FY2007 (0.5%) $506,000 $506,000 $506,000
PROJECTED COSTS --INFLATIONARY (3.3%) -$3,134,000 -$3,134,000 -$3,134,000
BUDGET REDUCTIONS/REALLOCATIONS (1.3%) $1,292,000 $1,292,000 $1,292,000
STATE MANDATES (0.4%) -$396,000 -$396,000 -$396,000
INITIATIVES (1.9%):
Instructional staffing and support -$940,000 -$811,000 -$750,000
Facility maintenance and equipment -$657,000 -$557,000 -$465,000
Administrative staffing and support -$206,000 -$206,000 -$206,000
Total Initiatives -$1,803,000 -$1,574,000 -$1,421,000
APPROPRIATION % change -1.7% -1.7% -1.7%
Appropriation adjustment -$807,000 -$807,000 -$807,000
ENROLLMENT % change 0.00% 0.00% 0.00%
Enrollment revenue adjustment $0 $0 $0
TUITION AND FEES % rate change 9.50% 9.00% 9.25%
Tuition and fees adjustment $4,342,000 $4,113,000 $3,960,000
BUDGET BALANCE $0 $0 $0
GGeneral Fund Budget Model Summaryeneral Fund Budget Model Summary(Fiscal Year 2007-08)(Fiscal Year 2007-08)
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9.5% NR%=R % 9.0% NR%=R % 9.25% NR$=R $Scenario 1 Scenario 2 Scenario 3
FY07 -- Resident undergraduate (30 credits) $6,141.00 $6,141.00 $6,141.00FY08 -- Resident undergraduate (30 credits) $6,724.00 $6,694.00 $6,709.00 FY08 -- Annual increase $583.00 $553.00 $568.00 FY08 -- Per semester increase $292.00 $277.00 $284.00
FY07 -- Nonresident undergraduate (30 credits) $10,077.00 $10,077.00 $10,077.00FY08 -- Nonresident undergraduate (30 credits) $11,034.00 $10,984.00 $10,645.00 FY08 -- Annual increase $957.00 $907.00 $568.00 FY08 -- Per semester increase $479.00 $454.00 $284.00
AAnnual Tuition and Fee Ratesnnual Tuition and Fee Rates(Fiscal Year 2007-08)(Fiscal Year 2007-08)
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Eliminate initiatives ($1.3 million)
$2.9 million balance – staffing and programming reductions and delayed university improvements and/or mid-year tuition and fee increase
◦ $2.9 million is the equivalent of eliminating 50 positions or an additional 6.3% in tuition and fees
GGeneral Fund Budget eneral Fund Budget (if $4.2M is not received)(if $4.2M is not received)