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Texas A&M University
Commerce
Fiscal Year 2004
Budget Kick-off Presentation
April 29, 2003
http://www7.tamu-
commerce.edu/vpba/
Agenda
Review of FY 2003 Operating Budget
– Sources of funds
– Uses of funds
Review of Funding Formulae
– Instruction and Operations
– Infrastructure Support
Review of Legislative Process
Report of Current Status of State Finances
Agenda (continued)
Fiscal Year 2004:
– Tuition/Fee Increases
– Operating budget allocations
– President’s Opportunity Fund
– Priority List of Unfunded Items
– Capital Construction Projects
– Auxiliary Operating budgets
Alicia Currin – Director of Budgets and Reporting
– Detailed Budget Preparation instructions
– Budget Preparation forms and spending history
– Budget Preparation timelines
Questions and Answers
Sources of Funds
Recurring Sources of Funds from State of Texas
Non-recurring Sources of Funds from State
Tuition and Fees
Auxiliary Funds
Earnings on investments
Service Centers
Gifts and Grants
A&M-Commerce Foundation
Capital projects
– Tuition Revenue Bonds (TRB)
– Revenue Financing System (RFS)
Recurring Sources of Funds
from THECB Formulae
Instructional and Operations Support
Infrastructure and Space Support
Teaching Experience Supplement
Texas Excellence Fund
Developmental Education Program
Performance Fund
Higher Education Fund (HEF)
Recurring Line Item
Appropriations
– Staff Group Insurance Premiums (GIP)
– Worker’s Compensation Insurance
– Unemployment Compensation Insurance
– Texas Public Education Grants
– Indirect Cost Recovery (50%)
– Organized Activities
– Bond Retirement/Debt Service
– Capital Equity & Excellence
Non-Recurring Line Item
Appropriations
Special Item Support:
Continue Northeast Texas Educational Partnership
BS Degree Program in Industrial Engineering
Institutional Enhancement
Access to higher education
Program enhancement
Student Success to complete courses and programs
A&M-Commerce
Fall 2003 Tuition and Fees
(15 hrs Undergrad Resident)
Statutory Tuition $ 690
Designated Tuition $ 645
Total Tuition $1,335
Student Service Fee $ 190
Technology Fee $ 90
Student Center Fee $ 75
Recreation Fee $ 65
Library Access Fee $ 45
Other Fees $ 12
Total Fees $ 477
Auxiliary Funds
Housing
Athletics
Food Services
Student Center
Recreation Center
Children’s Learning Center
Summer Music Camps
University Parking
Vending
Revenue Budget by Source
FY 2003
Auxiliary Enterprises
14%
Other
3%
Contracts, Grants
and Gifts State Appropriations
10% 43%
Tuition and Fees
25%
Higher Education
Fund
5%
$87.8 Million
Uses of Funds
Personnel Costs
Other Operating Costs
Institutional Scholarships and Fellowships
Auxiliary Activities and Service Centers
Moveable Equipment
Capital Construction/Renovation
Technology Infrastructure
Debt Service
Uses of Funds
50000
45000
40000
35000
30000
25000
Personnel
20000
Operating
15000
10000
5000
0
FY FY FY FY FY FY
1998 1999 2000 2001 2002 2003
Expenditure Budget by
Category - FY 2003
Benefits
13%
Scholarships and
Grants
15%
Salaries & Wages Utilities
43% 4%
Other
25%
10 YF 00 YF 99 YF 89 YF 79 YF
56372 78752 91042 90442 203 ,32 no itcurt sn I
823 073 274 705 583 hcr a e s eR
9681 7991 5561 3531 938 ,1 ec ivr e S c i lbu P
2315 1645 5454 4474 033 ,4 troppu S c i m ed acA
0254 3204 0073 2623 361 ,3 s ec ivr e S tn edut S
8127 7006 5426 7585 794 ,5 troppu S l ano itut it sn I
2607 1886 5306 8355 2325 tn a l P fO .tn i a M dn a no it ar epO
7029 6077 3447 0036 7666 sp ih s wo l l eF dn a sp ih sr a lohc S
0328 2138 25101 3069 4809 yr a i l i xuA
Auxiliary Scholarships and Fellowships Operation and Maint. Of Plant
Institutional Support Student Services Academic Support
Public Service Research Instruction
FY 02 FY 01 FY 00 FY 99 FY 98
0
10000
20000
30000
40000
50000
60000
70000
80000
Actual Expenditures by Function
Ratio of Faculty & Non-Faculty
to Student Headcount
8%
7%
6%
5%
4% Non-faculty
3% Faculty
2%
1%
0%
FY 1998 FY 1999 FY 2000 FY 2001 FY 2002
Service Centers
Printing Services
Telecommunication Services
Transportation
Copy Machines
Duplicating Services
Bulk Mail Center
Value of an FTE
Enrollment is measured by semester credit hours.
One full-time equivalent (FTE) is 30 semester
credit hours.
Base Period: Summer 2002, Fall, Spring 2003
provided funding for next two fiscal years
– Lower Division enrollments
– Upper Division enrollments
– Masters enrollments
– Doctorates enrollments
Each weighted enrollment is funded at a value
determined by the Legislature
Value of an FTE
Instruction and Operations
2002-03: $56.65 per weighted SCH
– Discipline and level
– Twenty funding categories
– Based on historical cost reporting and averages
Teacher Education (2003 weights):
– Lower division: 1.28 = $72.51 per SCH
– Upper division: 1.96 = $111.03 per SCH
– Masters: 3.23 = $182.98 per SCH
– Doctoral: 9.95 = $563.67 per SCH
Value of an FTE
Infrastructure Support
Space Projection Model – Five Factors
– Teaching Space
Standards X SCH = Predicted Assignable Space
– Laboratory Use: 25.0 weekly average hours (12.5)
– Classroom Use: 38.0 weekly average hours (23.1)
– Library Space
– Research Space
– Office Space
– Support Space
Does not include Auxiliary space
Average Rate per Square Foot is $7.36 currently
– Operations and Maintenance
– Purchased utilities
Excess space at A&M-Commerce: 129,529 sq ft
Value of an FTE
Teaching Experience
Supplement
An additional weight of 10% is added to lower-
division and upper-division semester credit hours
taught by tenured or tenure-track faculty
Intent of the legislature that the weight shall
increase, up to 50 %
Value of a Teacher Education
FTE during Base Period
New student taking 15 lower division hours during
each semester:
– Instruction and Operations $2,175
– Infrastructure and Space $ 743
– Annual Tuition and Fees $3,279
– Total $6,197
Increases for:
– Upper division
– Teaching supplement
Semester Credit Hours
(Fall, Spring & Summer)
200,000
180,000
160,000
140,000
120,000
100,000
80,000
60,000
Projected
Projected
40,000
20,000
0
FY 97 FY 98 FY 99 FY 00 FY 01 FY 02 FY 03
Semester Credit Hours 181,962 181,754 181,822 175,151 172,062 181,872 185,495
Note: FY 97-01 THECB Certified, FY 02 is Unofficial & Projected, FY 03 is Projected
Weighted Semester Credit Hours by Funding
Period
600,000
500,000
400,000
300,000
200,000
100,000
0
Weighted Semester Base Period Base Period Base Period Base Period
Credit Hours 1998-1999 2000-2001 2002-2003 2004-2005
414,524 434,167 433,799 515,163
Legislative Process
State of Texas
Appropriated Funds
A&M Chancellor Programmatic Review
Legislative Appropriation Request
Staff review by LBB and THECB
State Comptroller estimates anticipated revenues
Scheduled Session: January 14-June 2, 2003
– House/Senate Bill 1 introduced
– House Appropriations Committee
– Senate Finance Committee
– House/Senate Joint Conference Committee
– Legislature passes bill
Governor accepts/vetoes bill
State Comptroller updates revenue estimates
Fiscal year begins on September 1
Seventy-Eighth Legislative
Session
General Appropriations Act for 2004-2005
– House has approved its appropriation bill
$2.3 million reduction to formula compared to 2003
$400,000 less in non-formula appropriations
$400,000 less in special item appropriations
– Senate just approved its appropriation bill
Small ($15K) increase to formula funding
$300,000 less in non-formula appropriations
$250,000 less in special item appropriations
– Conference Committee now considering
compromise
Legislative Process
State of Texas
Appropriated Funds
A&M Chancellor Programmatic Review √
Legislative Appropriation Request √
Staff review by LBB and THECB √
State Comptroller estimates anticipated revenues √
Scheduled Session: January 14-June 2, 2003
– House/Senate Bill 1 introduced √
– House Appropriations Committee √
– Senate Finance Committee √
– House/Senate Joint Conference Committee
– Legislature passes bill
Governor accepts/vetoes bill
State Comptroller updates revenue estimates
Fiscal year begins on September 1
Fiscal Year 2004
Tuition/Fee Increases
Statutory Tuition - $2 per semester credit
Designated Tuition - $5 per semester credit
Recreational Sports Fee - $45 per semester
Student Center Fee - $50 per semester
Course Fees - $85,000 to departments
Budget Reduction Strategies
Fiscal Year 2004
Minimize impact to students
Reorganize for efficiencies/effectiveness
– Eliminate programs
– Reduce programs
– Redesign programs
Consider reductions in level, quality of support
services
Operate with available resources…no use of
reserves…a balanced budget
Budget Reduction Allocations
Fiscal Year 2004
Academic Affairs - $736,851 2.82%
– A separate fund of $600,000 established for new faculty
– Additional funds provided for campuswide Microsoft licenses
– Summer School budgeted at $2 million
Business Affairs - $528,748 7.05%
Student Affairs - $318,548 7.05%
Marketing/Advancement - $350,000 24.3%
President’s Office - $65,853 7.05%
Total operating budget reduction: $2 million
Responsibility–Centered
Budgeting
Decentralized decision making
– Delegated authority with tiered approvals
– Personal accountability
– Empowerment
Oversight, not gatekeeping!
Management Reports and Training
– Information Access
– Use of Business Planning and Cost-Benefit Analysis required
Use of Technology
Each University Division and Vice President establishes
their own budget review process and decisionmaking style
President’s Opportunity Fund
Provides initial funding for new programs
Two-step process:
– Simple Concept Paper to responsible Vice
President
– If supported by VP, Detailed Plan submitted:
Program costing more than $25,000
Impact increased enrollments
Examples:
– Math/Science Education
– Theater collaborative with A&M-Texarkana
– Mach III Challenge Grant Matching
Priority List of Unfunded Items
New requests not funded by Opportunity Fund
Any significant needs which cannot be accommodated
within the base budget will be presented to the President
and Vice Presidents for consideration for new funding.
It is expected that the highest priority needs will be funded
in the base budget already.
Each request for additional funding will be considered and
funded to the extent funds are available. Those which
cannot be funded immediately will be placed in priority
order for later consideration
Outlook for the Future
Dilemma
– Decisions made over past several years to promote enrollment
growth and provide quality programs to students
– To stimulate that growth, strategic investments were made with
funds reallocated from other competing needs
– Were it not for the unanticipated State deficit, A&M-Commerce
would be receiving an increase of approximately $4.6 million in
fiscal year 2004!
– Instead, Governor directed 7% reduction in fiscal year 2003
Fiscal year 2004-2005
– Anticipated funding still more than in fiscal year 2002
– Hope for a quick economic rebound and a “restoration session”
– Continue controls on hiring, traveling, purchases
– Seek to provide merit increases once funding is restored
Successful Capital Campaign
Capital Construction Projects
Morris Recreation Center – May 2003
External Signage (Phase I) – July 2003
Temple Building Renovations – November 2003
Science and Technology Building – Summer 2005
Renovation of Student Center – starts mid-2004
Life Safety Improvements – March 2004
Renovation of Mayo Hall – pending
Renovation of Housing
– Fling and Petty Halls: 2004
– Whitley Hall: 2005
– Hart and Stone Halls: 2006
What is the highest and best
use of our limited resources?
John_harper@tamu-
commerce.edu
Suggested Readings
Financing Higher Education
– http://www.thecb.state.tx.us/reports/pdf/0513.pdf
Cost Benefit Analysis of Closing the Gap
– http://www.thecb.state.tx.us/reports/pdf/0511.pdf
Efficiencies at Institutions of Higher Education
– Http://www.thecb.state.tx.us/reports/pdf/0507.pdf
The Rising Price of Higher Education
– http://www.highereducation.org/reports/affordability_supplement/a
ffordability_1.shtml
