Money Matters Presentations Arts & Sciences 2 Institutional - - PowerPoint PPT Presentation

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Money Matters Presentations

January 24, 2020

Arts & Sciences

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State Appropriations Tuition (minus Financial Aid) Room and Board Grants Gifts/Endowment Distributions

• Misc. (e.g. Royalties, Leases)

Institutional Revenues

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Tuition (minus Financial Aid) Factors Influencing Budget Planning

Recruitment

• New freshmen & transfers
• Resident/Non-resident/International
• Grad/UG; Athens, Regionals, Dublin, eLearning
• Financial Aid Strategy

Retention & Completion Rates

• % of students returning
• Time to degree

Tuition Rates

• Tuition caps
• OHIO Guarantee: cohort increases; Tuition cap + CPI
• Peer/Competitive benchmarks

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Athens UG Multi-Year Enrollment

Factors Impacting Enrollments: Incoming Students, Time to Degree, CCP

17,965 18,209 17,925 17,325 16,278

15,735 15,414 15,349 15,681 16,127

14,500 15,500 16,500 17,500 18,500

FY16 FY17 FY18 FY19 FY20 Proj FY21 Proj FY22 Proj FY23 Proj FY24 Proj FY25 Proj Athens Headcount - Actual Athens Headcount - Spring 2019 Proj Athens Headcount - Fall 2019 Proj

FY16-FY19: 3.6% Decline FY20-FY23: 5.7% Decline

FY19-20: 6.0% Decline

FY16-23 Change

• 14.6%

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FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Academic Reserves $104.1 $114.6 $119.6 Spring 2019 Proj $110.5 $80.3 $62.7 $50.5 $48.8 $56.9 $75.5 Fall 2019 Proj $84.6 $60.1 $37.5 $17.3 $0.4 $(9.8) $(35.0) $- $35.0 $70.0 $105.0 $140.0

• $129.4M Updated

Academic Operating Reserve: Impact of SEEC Update

Fall Budget Scenario Planning (will change with planning assumption changes)

Fall Budget Planning Priorities:

• Measure progress on strategies to balance
• Align reserve use to committed levels

Fall Submission Status:

• Revenue strategies not projected to reach goals (not

incorporated in graph below)

*Impact of Central Fall Planning Assumptions, only

*

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FY20 Operating: Budget vs Forecast

In millions

568.7 567.6

116.7 116.0 73.5 66.4

758.9 750.0

Budget Forecast

Revenues

Academic Auxiliary Central & Reserves Revenues 594.8 590.1 105.5 104.2 57.1 49.1

757.4 743.3

Budget Forecast

Expenses

Academic Auxiliary Central & Reserves Total Expenses

Revenue Variances:

• Central & Reserves: SSI & UG Tuition
• Academic: UG OHIO Online & Grad Prof/OHIO Online

Expense Variances:

• Central & Reserves: Compensation & Supplies/Services
• Academic: Compensation & Supplies/Services

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FY20 Operating Reserves: Budget vs Forecast

In millions

Net Transfer/(Draw) on Reserves FY20 Budget FY20 Forecast January Forecast vs. Budget: Significant Variances Athens Colleges & Schools (29.8) (27.0) State Line Items: $3.7M more - Restricted Net Tuition: $6.8M less – Grad/On-line/Fellowship offset Compensation: $6.4M less Expenses: $2.5M more RHE 0.5 (0.2) Net Tuition: $1.0M less Compensation: $1.5M less Expenses: $1.0M more Auxiliaries (3.6) (2.5) Room & Board: $1.1M less Compensation: $0.6M less Supplies & Services: $0.8M more Admin Operations & Central Institutional Reserves (WC/HC/Fundraising Adj $5M) 6.8 14.8 Internal/External Sales: $1.0M more Compensation Expenses: $2.9M less Supplies & Services (Net of Transfers): $2.5M less Reserves, Inst/Prov/SOR 0.0 1.5 SOR (SSI): $3.9M more SOR (Net UG Tuition): $6.8M less SOR Investment Transfers: $4.4M less (evolving) Total (26.2) (13.5)

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OU Budgeted Enrollments

Athens Undergraduate

Graduate (Excluding HCOM): Traditional, OHIO Online & Outreach

OHIO Online: Undergraduate Regional Campuses Comparison: June BOT Approved Budget vs FY21 Fall Budget

FY16 FY17 FY18 FY19 Proj FY20 Proj FY21 Proj FY22 Proj FY23 Proj FY24 Proj FY25 Proj UG OHIO Online FTEs - Actual UG OHIO Online FTEs - Projected UG OHIO Online FTEs - New Programs

17,965 18,209 17,925 17,325 16,278 15,735 15,414 15,349 15,681 16,127 16,492 FY16 FY17 FY18 FY19 FY20 Proj FY21 Proj FY22 Proj FY23 Proj FY24 Proj FY25 Proj FY26 Proj Athens Headcount - Actual Athens Headcount - Fall Proj Athens Headcount - June Proj 12,696 12,144 11,513 10,927 10,207 9,697 9,406 9,406 9,406 9,406 9,406 FY16 FY17 FY18 FY19 FY20 Proj FY21 Proj FY22 Proj FY23 Proj FY24 Proj FY25 Proj FY26 Proj

FY16 FY17 FY18 FY19 FY20 Proj FY21 Proj FY22 Proj FY23 Proj FY24 Proj FY25 Proj FY26 Proj UG eLearning FTEs - Actual UG eLearning FTEs - Fall Proj UG eLearning FTEs - Spring Proj

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$143.9 $143.6 $138.8 $127.1 $126.8 $125.6 $127.2 $133.1 $143.1 $151.4 $39.7 $35.8 $33.9 $31.1 $29.3 $30.5 $33.1 $37.4 $43.6 $46.2

$30.8 $29.9 $29.4 $27.6 $25.5 $25.7 $26.4 $27.2 $25.9 $25.8

$27.5 $26.3 $26.0 $23.8 $22.4 $21.2 $20.1 $19.0 $18.0 $17.1

$245.2 $239.0 $231.5 $213.3 $207.1 $207.5 $213.2 $224.9 $238.4 $249.3

FY17 FY18 FY19 FY20 Forecast FY21 Forecast FY22 Forecast FY23 Forecast FY24 Forecast FY25 Forecast FY26 Forecast

Athens Resident Net Athens Non-Resident Net Regional UG Net Tuition UG OHIO Online Net Tuition UG Net Tuition

Projected: OHIO Total Undergraduate Net Tuition

FY21-26 Forecasted Growth UG Net Tuition: 20%

(in millions)

• 24%

1% 58% 19%

Forecasted Growth: FY21-26

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Enrollment Trends

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State Appropriations Factors Influencing Budget Planning

State Support of Instruction (SSI)

• Funding to subsidize the cost of education
• Legislature determines statewide subsidy pool
• Individual university share determined via formula-

based allocation (SSI Model)

• Performance-based – Course & Degree Completions
• Medical, Doctoral components
• SSI Model has been volatile

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$140.0 $143.8 $147.4 $149.3 $153.6 $150.2 $144.6 $139.3 $136.6 $135.2 $135.5 15.4 17.1 19.4 21.2 21.3 21.7 22.4 22.6 22.5 22.4 22.1 FY17 Actuals FY18 Actuals FY19 Actuals FY20 Budget FY20 Forecast FY21 Forecast FY22 Forecast FY23 Forecast FY24 Forecast FY25 Forecast FY26 Forecast

OU SSI - UG & Grad HCOM

Enrollment Impact of SSI

FY20-21 Increases: One-Time-Only Revenue from SSI Appropriation (in Millions)

Additional 1% Appropriation from State of Ohio in FY20 & FY21 not previously budgeted

Growth: Peak UG enrollments, HCOM, & accelerated graduation Decline: UG Enrollments (Athens, Regionals, & OHIO Online)

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FY17 FY18 FY19 FY20 Budget FY20 Forecast FY21 Proj FY22 Proj FY23 Proj FY24 Proj Total Headcount (Fall) 18,197 17,936 17,323 17,120 16,278 15,735 15,414 15,349 15,681 Financial Aid $54.7 $53.8 $56.5 $57.1 $57.7 $62.0 $64.0 $65.9 $67.8 Net Tuition $186.1 $181.6 $173.2 $169.5 $159.1 $156.3 $157.7 $163.7 $175.7 Discount Rate 22.7% 22.9% 24.6% 25.2% 26.6% 28.4% 28.9% 28.7% 27.8% Non-Guarantee Growth* 0.0% 0.0% 0.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% Guarantee Growth* 1.7% 1.3% 1.3% 3.5% 3.5% 4.1% 3.5% 3.5% 3.5% $186.1 $181.6 $173.2 $169.5 $159.1 $156.3 $157.7 $163.7 $175.7 $54.7 $53.8 $56.5 $57.1 $57.7 $62.0 $64.0 $65.9 $67.8 $- $50.0 $100.0 $150.0 $200.0 $250.0

in millions

Athens UG Net Tuition: SEEC Investments

Investments in Financial Aid and Impact on Net Tuition

Multi-Year Decline

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Institutional Revenues Challenges/Constraints

Level of State Subsidy Tuition Caps Financial Aid / Discount Rate Declining high school graduates in Ohio Out-of-state, International student enrollments Regional Enrollments

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• Developing new online and hybrid graduate programs, as

well as online completion degrees and workforce development credentials

• Examining academic efficiencies, such as developing more

equitable faculty workload across colleges and redeploying faculty teaching resources across OneOHIO

• Reforming GenEd, emphasizing the need to streamline

curriculum and meet modern students' learning needs

• Reimaging the academic enterprise to pivot in response to

needs of students, employers, and the community

Academic Strategies

Integrating the Academic Strategies into the Strategic Framework

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Academic Strategies: Framework

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Strategic Framework Priorities

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$1.6 $1.5 $2.7 $1.8 $2.1 $3.3 $- $1.0 $2.0 $3.0 $4.0 FY20 Budget FY21 Forecast FY22 Forecast FY23 Forecast FY24 Forecast FY25 Forecast

Arts & Sciences Business Communication Education Engineering Fine Arts Health Sciences OHIO Online

Academic: Revenue Strategies

Incremental FY20 Budget Planning Strategies, by College

UG & Graduate Revenue Goals: Cumulative FY20 Budget FY21 Forecast FY22 Forecast FY23 Forecast FY24 Forecast FY25 Forecast Athens Colleges 1.6 $ 3.0 $ 5.8 $ 7.1 $ 7.6 $ 8.0 $ OHIO Online: New Pearson Programs

• 0.5

2.1 5.1 Regional Campuses

• 0.3

0.3 0.3 0.8 Annual Revenue Strategy 1.6 $ 3.0 $ 6.1 $ 7.9 $ 10.1 $ 13.9 $

Fall Submission Status:

• Revenue strategies not

projected to reach goals (not incorporated in graph below)

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$2.4 $2.6 $2.7 $2.5 $0.1 $0.1 $- $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 FY20 Budget FY21 Forecast FY22 Forecast FY23 Forecast FY24 Forecast FY25 Forecast

Arts & Sciences Business Communication Education Engineering Fine Arts Health Sciences

Academic: Efficiency Strategies

Academic Efficiencies: Cumulative FY20 Budget FY21 Forecast FY22 Forecast FY23 Forecast FY24 Forecast FY25 Forecast Athens Colleges 2.4 $ 5.1 $ 7.8 $ 10.2 $ 10.4 $ 10.5 $ HCOM - Base 1.0 1.0 1.0 1.0 1.0 1.0 Regional Campuses 2.7 2.7 3.1 3.1 3.1 3.1 Annual Academic Efficiencies 6.1 $ 8.7 $ 11.9 $ 14.3 $ 14.5 $ 14.6 $

Incremental FY20 Budget Planning Strategies, by College

Graphs below do not incorporate additional efficiency strategies required to offset revenue strategies not achieved

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Auxiliary Strategies: Above Revenue Decline from Enrollment

• Enrollment Declines:
• $5M lower Room & Board revenue since FY17
• Required reductions in expenses
• Increased Scholarship Support: Housing and Culinary: Over $6M
• Additional support from Housing for Counseling & Psychological Services ($1M annually)

$2.0 $1.5 $2.9

$- $1.0 $2.0 $3.0 $4.0 FY18 FY19 FY20 Forecast in Millions

Culinary Housing

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Athens Colleges: Headcount Staffing*

November 1 Census Data

FY16-FY19 Change: FY16-FY19 Change:

FY16 FY17 FY18 FY19 Classified 162 165 160 146 Administrator 425 440 429 434 607 626 599 588

• 100

200 300 400 500 600 700

Athens Colleges Staff Headcount

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

• 2.0%
• 3.1%

FY16 FY17 FY18 FY19 Early Retired Faculty 69 58 50 40 Group IV Faculty 64 46 35 38 Group II Faculty 262 276 301 295 Group I Faculty 675 713 702 676 1,070 1,093 1,088 1,049

• 200

400 600 800 1,000 1,200

Athens' Colleges Faculty Headcount

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HCOM: Headcount Staffing*

FY16 FY17 FY18 FY19 Post Doc 8 8 6 9 Classified 73 68 58 61 Administrator 173 174 178 175

• 50

100 150 200 250 300

Staff Headcount

254 250 242 245

FY16-FY19 Change: FY16-FY19 Change:

• 3.5%

2.4%

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

FY16 FY17 FY18 FY19 Early Retired Faculty 12 14 15 14 Visiting Faculty

• 2

3 2 Instructors 56 60 59 59 Tenure Track Faculty 58 58 57 54

• 20

40 60 80 100 120 140 160

Faculty Headcount

126 134 134 129

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FY16 FY17 FY18 FY19 Early Retired Faculty 20 18 20 15 Visiting Faculty 6 6 2 3 Instructors 86 89 93 77 Tenure Track Faculty 115 113 109 101

• 50

100 150 200 250

Faculty Headcount

227 226 224 196

Regionals: Headcount Staffing*

FY16 FY17 FY18 FY19 Classified 112 105 99 86 Administrator 91 90 87 82

• 50

100 150 200 250

Staff Headcount

203 195 186 168

FY16-FY19 Change: FY16-FY19 Change:

• 13.6%
• 17.2%

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

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Non-Academic Unit: Headcount Staffing

Auxiliary Units: Athletics, Housing, Culinary, Parking &Transportation, Printing & Mail Services FY16-FY19 Change:

• 3.0%

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

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Non-Academic Units: Headcount Staffing*

Admin & Academic Support Units (excluding Operations & Maintenance)

FY16-FY19 Change:

• 5.7%

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

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Non-Academic Units: Headcount Staffing*

Operations & Maintenance

FY16-FY19 Change:

• Staffing correlates with physical plant and capital spend
• Does not include 24 positions eliminated for FY20

8.4%

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

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Non-Academic Unit: Headcount Staffing

Division of Finance & Administration (excluding Operations & Maintenance) 25 Total Positions Across VPFA & OM Impacted by Reductions through FY19

• NEW Ohio Ready Staff

self-supported headcounts (FY18 = 6 & FY19 = 5)

• Vacant & Filled Positions

Abolished

• Additional position

reductions occurred after FY19 capture date

*FY20 Faculty & Staff Data will be captured on November 1, 2019.

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Fac/Staff Headcounts – Prelim FY20

FY16 FY17 FY18 FY19 FY20 (Prelim) Post Doc 32 33 20 17 20 Classified 1227 1241 1178 1141 1107 Administrators 1640 1646 1643 1638 1653 500 1000 1500 2000 2500 3000 3500

Staff Headcount

2,899

2,841 2,796

2,780

2,920

• FY20 data is still preliminary and will be analyzed by IR prior to being finalized and published

in the coming months

• Budget reductions since FY17 have reduced faculty and staff headcounts
• Graphs exclude temporary and intermittent employees (see Budget Book, Comp. section)

2015-16 2016-17 2017-18 2018-19 2019-20 - Preliminary Group IV Faculty 70 54 40 43 37 Group II Faculty 404 439 467 445 468 Group I Faculty 848 884 868 831 828 Early Retired Faculty 101 90 85 69 60

• 200

400 600 800 1,000 1,200 1,400 1,600

Faculty Headcount

1,423 1,460 1,388 1,393 1,467

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Personnel Costs (FY19)

• Academic Benchmarking Consortium
• SAM: standard measurement of core

administrative functions

• Central functions
• Decentralized positions (e.g.

imbedded staff within colleges)

• Non-SAM:
• Faculty
• Other Staff (e.g. library, health

services, researchers)

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7% Administrative Reductions +$8.4M Base Savings Auxiliary Increased Support for Student Financial Aid +$6.0M Favorable Base Impact*

Hiring Review by President, Provost & CFO

Academic Efficiencies TBD

Institutional Spending Guidelines

FY 17-20: Budget Action Impacts

*Additional $2.0M committed by FY21

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Voluntary Separation Agreements & Custodial ERIP Functional Alignment & Service Centers Instructional Efficiency Healthcare Strategy Incremental Admin Reductions OHIO Guarantee+ Marketing and Branding New Program Development

Efficiency & Impact Levers (FY21)

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Non-Academic Units: ICA Direct Support

9.5 9.2 9.2 9.2 9.3 9.3 9.5 9.6 9.7 9.8 0.8 1.3 1.4 1.7 1.8 1.7 1.8 1.8 1.7 1.6 7.9 8.0 8.0 8.2 8.8 9.0 9.2 9.4 9.7 9.9 0.0 5.0 10.0 15.0 20.0 25.0 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26

Millions

FY17-19 Actual ICA Central Support & FY20-26 Forecast

Beginning Base Base Reduction ($) Indirect Cost Support - Variable Raise Pool + Healthcare Increment Equity Distribution ICA - Scholarships

Base Reductions* FY18: -$484K FY20: -$193K

*Offset by Raise Pool & Healthcare

Percentage of University’s Operating Revenue: 2.5%

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Athletics integration with colleges

Coaching Education, 14 MBA/Sports Admin, 10 Athletic Training, 8 Journalism, 1

Grad Assistantships in Athletics

20 40 60 80 100 120 140 160 180

Student Athlete - Majors

34 VPFA: Budget Unit Details Link: VPFA Annual Report

Finance & Administration:

Budgeted & Approved FTEs

1 Finance: General Accounting, Grants, FAST Team, Finance Customer Care, Purchasing & Accounts Payable 2 FY20 VPFA budget included 3.0 FTE from University Planning that are transitioning to the Strategy & Innovation Office 3 OHIO Ready budgeted FTE are self supported and receive no Central support 4 Eight (8) Maintenance FTE increases are based on the transition of 4 FTE from OIT and 4 FTE that are self supported (formerly outsourced)

VPFA Unit - Budgeted FTE FY17 FY18 FY19 FY20 Design and Construction 27.2 24.1 23.2 15.0 Budget Planning & Analysis 6.0 5.0 4.2 4.0 Capital Projects Finance 9.0 7.0 6.0 5.0 Treasury 2.0 2.0 2.0 2.0 Finance1 46.0 43.0 39.0 39.0 Finance: Bursar 17.0 17.0 17.0 17.0 Human Resources 37.0 37.0 35.8 35.8 HR: Enterprise Risk Management 4.0 4.0 3.0 3.0 Logistics 14.2 14.2 14.2 14.2 OUPD 38.0 38.0 38.0 38.0 Real Estate 3.0 3.0 3.0 2.0 University Planning2 3.5 4.5 6.5 6.5 Training & Change Management 6.0 6.0 6.0 3.0 Office of the CFO 6.5 6.5 5.5 4.5 Business Service Center 7.0 9.0 9.0 10.0 OHIO Ready3 0.0 5.0 5.0 5.0 VPFA Total 226 225 217 204 Auxiliary & Other VPFA Units FY17 FY18 FY19 FY20 Transportation & Parking Services 27.0 27.7 28.0 26.5 Printing 13.9 13.8 13.8 13.8 Airport 12.9 12.6 12.8 12.6 Operations & Maintenance FY17 FY18 FY19 FY20 Facilities Management & Safety 12.0 10.0 9.0 9.0 Sustainability 2.8 2.8 2.8 2.0 Emergency + CIRT 2.0 2.0 2.0 1.3 Health & Safety 15.0 15.0 15.0 15.0 Facilities Support Services 7.0 7.0 7.0 7.0 Custodial 228.0 228.0 228.0 217.0 Utility 21.0 21.0 19.0 19.0 Grounds & Rec. 37.0 36.0 35.0 34.0 Maintenance4 98.0 102.0 105.0 111.0 Heating Plant 16.0 16.0 16.0 16.0 O&M Total 438.8 439.8 438.8 431.3

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FY16 Actuals FY17 Actuals FY18 Actuals FY19 Budget FY19 Forecast FY20 Budget Internal Principal & Interest $38.0 $47.7 $49.0 $54.1 $52.8 $68.1 Supplies, Services, & Capital Costs $198.7 $194.9 $188.7 $194.2 $185.8 $199.7 Benefits $109.9 $113.7 $113.1 $121.8 $116.3 $123.0 Salaries, Wages, & Other Payroll $346.2 $361.5 $354.6 $372.1 $358.2 $366.4

50.0% 50.4% 50.3% 50.1% 50.2% 48.4% 15.9% 15.8% 16.0% 16.4% 16.3% 16.2% 28.7% 27.1% 26.8% 26.2% 26.1% 26.4% 5.5% 6.6% 6.9% 7.3% 7.4% 9.0%

$- $100.0 $200.0 $300.0 $400.0 $500.0 $600.0 $700.0 $800.0 $692.8 $718.0 $705.3 $742.3 $713.1 $757.3

FY20 Expense Driver: Internal Debt Service

FY20 Internal Principal & Interest

• Planning Unit

Direct Loans

• Century Bond

Deferred Maintenance

• Advance principal

repayment HCOM:$12.2M

FY20 Budget Book Section 2.6

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• Changes to RCM Allocation methodologies

make year-to-year comparisons difficult

• FY17: RCM simplification; eLearning flip
• Changes to tuition/SSI allocation methodologies
• Offsets to subvention/contribution margin
• FY20: SSI allocation
• methodology changes
• offsets to subvention/contribution margin
• FY21: Transition to college spending allocations

Budget Model Changes