The University for Kentucky uky.edu/uk4ky FY 2016-17 Operating and - PowerPoint PPT Presentation

DRAFT The University for Kentucky uky.edu/uk4ky

FY 2016-17 Operating and Capital Budget AY 2016-17 Tuition and Mandatory Fees uky.edu/uk4ky

Budget Development Principles •Maintain student access and a ff ordability •Competitive pay for faculty and sta ff •Strategically plan to prevent across-the-board cuts and maintain and enhance academic quality •Enhance diversity and inclusion uky.edu/uk4ky

University of Kentucky Consolidated Operating Budget $3.5 $3.4 $3.6 $3.0 $2.7 $2.7 $2.6 $2.5 $2.7 $2.4 $2.2 $2.1 $1.8 $0.9 $0.0 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17 in billions uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? FY 2016-17 Operating Budget $3.5 Billion uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? Undesignated General Funds – 21% Money comes from: 7% • State Appropriations • Tuition 1% • Investment Income • Service Assessments 13% Pays for: • Instruction • Public Service State Appropriations • Utilities • Administrative Support Other • Scholarships FY 2016-17 Operating Tuition Budget $3.5 Billion uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? Designated General Funds – 55% Money comes from: • UK HealthCare 11% • County Appropriations • Mandatory Fees • Course and Program Fees Pays for: • Public Service • Instruction 44% • Student Services • Academic Support UK HealthCare FY 2016-17 Operating Other Budget $3.5 Billion uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? Auxiliary Funds – 6% 6% Money comes from: • UK Athletics • Housing • Dining • Parking and Transportation • Student Center Pays for: • Auxiliary units pay for all of their expenses; receive no taxpayer or tuition support FY 2016-17 Operating Budget $3.5 Billion uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? Restricted Funds – 10% 10% Money comes from: • Research Grants and Contracts • Endowment • Gifts • Federal and State Grants and Contracts Pays for: • Research • Student Aid • Public Service FY 2016-17 Operating Budget $3.5 Billion uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? Fund Balance – 8% 8% Money comes from: • Savings from Prior Year Pays for: • Capital Projects • Faculty Start-Up Packages FY 2016-17 Operating Budget $3.5 Billion uky.edu/uk4ky

University of Kentucky Where does the money come from and how is it used? Hospital 125.1% $283 Sales/Service and 88.2% Other Income $510 Tuition and Fees 99.9% $1,549 Gifts, Grants, Contracts 38.8% and Other Income Auxiliary 56.8% $780 State Appropriations -17% $187 $267 Total Operating 70.1% Budget (35)% 0% 35% 70% 105% 140% Revenue by Fund Source, Percentage Change by FY 2016-17 (in millions) Fund Source, FY 2008-17 uky.edu/uk4ky

Annual Debt Service as a Percent of Adjusted Operating Budget, 
 FY 2007-08 to FY 2016-17 $90 4.0% 3.8% $85.3 3.7% 3.6% 3.5% $76.9 3.3% $80 $76.2 $75.8 3.5% $71.8 $71.0 2.9% $70 2.9% 3.2% 3.0% $61.6 2.7% $58.6 $60 in millions 2.3% 2.5% $50 $45.1 2.0% $36.7 $40 1.5% $30 1.0% $20 0.5% $10 $0 0.0% FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 Debt Service Debt Service as % of Opera@ng Budget uky.edu/uk4ky

Building the University’s Budget TOTAL ADDITIONAL AVAILABLE FUNDS NEEDED RESOURCES • Loss of state TUITION AND • New revenues appropriations • Increase in e ffi ciencies FEE REVENUE • Increase in institutional • Strategic reallocations student aid • Increase in faculty 
 & sta ff pay • Increase in fixed costs • Strategic investments STEP 1 STEP 2 STEP 3 uky.edu/uk4ky

STEP 1: Operating Budget Impact of the 2016 
 Session of the Kentucky General Assembly 2% mid-year reduction FY 2015-16 (pending) $5.6 million in current year ending June 30, 2016 4.5% reduction 
 $12.6 million e ff ective July 1, 2016 5% set aside in Performance Funding Account 
 $13.4 million e ff ective in FY 2017-18 uky.edu/uk4ky

Budgetary Impact of Decline in State Appropriations University of Kentucky State Appropriations, net of debt service (in millions) Public Funds, FY08 and FY17 Actual $400 Original Budget, if different $350 Performance Funding Account Tuition 335 State and Fees Funds Fiscal Year $300 310 310 306 303 34% 66% 2017 284 284 280 274 267 $250 254 $200 $150 Tuition State $100 and Fees Funds Fiscal Year 57% 43% 2008 $50 $0 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 uky.edu/uk4ky

STEP 1: Identify Financial Needs Financial Needs, Undesignated FY 2016-17 General Funds (in millions) Decrease in State Appropriations $12.6 Increase in Institutional Student Aid $12.6 Increase in Faculty/Sta ff Pay (2% Merit) $7.6 Increase in Fixed Costs $7.8 Strategic Investments $7.9 Total Additional Funds Needed $48.5 uky.edu/uk4ky

STEP 2: Available Resources Available Resources, FY 2016-17 Undesignated General Funds (in millions) New Tuition Revenues Residency mix change in pipeline, new masters and targeted program $10.8 growth, increase freshman class size, increase retention, etc. This growth is not a ff ected by any rate increase Increased E ffi ciencies $6.9 E-payables, operating cash returns, campus sponsorships and other revenues, and energy conservation program Strategic Reallocation $6.0 Academic Excellence, Agriculture, Medicine, Facilities Management, and Adjust Unit to Self-Operating Total Available Resources $23.7 uky.edu/uk4ky

STEP 3: Tuition and Fee Revenue Rate Increase Funding Needs Less Available FY 2016-17 Resources, Undesignated General Funds (in millions) $48.5 Funding Needs Less Available Resources (23.7) $24.8 Funding Gap Additional Revenues from $24.8 Tuition Rate Increase uky.edu/uk4ky

Flagship Universities in Surrounding States Fall 2015 Tuition and Fee Rates - Resident Undergraduate $7,813 Illinois $7,234 Virginia $6,218 Tennessee $5,511 Missouri $5,468 UK $5,194 Indiana $5,019 Ohio $4,998 Maryland $3,816 West Virginia $2,000 $4,000 $6,000 $ 8,000 Source: www.Collegedata.com uky.edu/uk4ky

Flagship Universities in Surrounding States Fall 2015 Tuition and Fee Rates - Non-resident Undergraduate $21,541 Virginia $16,871 Indiana $15,572 Maryland $15,393 Illinois $15,313 Tennessee $13,683 Ohio $13,024 Missouri $12,134 UK $10,716 West Virginia 0 $4,000 $8,000 $12,000 $16,000 $20,000 $ 24,000 Source: www.Collegedata.com uky.edu/uk4ky

Kentucky Council on Postsecondary Education Tuition and Mandatory Fee Parameters •5% ceiling on resident undergraduate tuition and mandatory fee increases for academic year 2016-17 for research universities. 
 •Revised policy regarding non-resident students: Average net tuition and fee revenue generated per non-resident student should equal or exceed 100% of direct instructional and student services costs per student. 
 •Resident and non-resident graduate and professional tuition and mandatory fees are to be market competitive. uky.edu/uk4ky

Recommended Tuition and Mandatory Fees Per Semester FALL FALL % CHANGE 2016 2015 Undergraduate–Lower Division Resident $5,390 $5,660 5.0% Nonresident $12,052 $13,078 8.5% Undergraduate–Upper Division Resident $5,546 $5,823 5.0% Nonresident $12,216 $13,256 8.5% Graduate $5,826 $6,118 5.0% Resident Nonresident $13,077 $14,190 8.5% uky.edu/uk4ky

UK Undergraduate Resident Students Receiving Grants or Scholarships Average Net Tuition and Mandatory Fees, Per Student* Tuition and Mandatory Fees Per Semester $6,000 $1,801 UG 4-YEAR FALL ANNUAL out-of- $5,000 RESIDENT AVERAGE $1,437 SEMESTER % CHANGE pocket RATE* % CHANGE out-of- $4,000 pocket 2007 $3,548 9.0% 11.8% $3,000 2008 $3,868 9.0% 10.6% 2009 $4,062 5.0% 8.8% $2,000 2010 $4,305 6.0% 7.3% $1,000 2011 $4,564 6.0% 6.5% 2012 $4,838 6.0% 5.8% $0 FALL 2007 FALL 2015 2013 $4,983 3.0% 5.3% 2014 $5,232 5.0% 5.0% Tuition & Fees Sticker Price Total Aid 2015 $5,390 3.0% 4.3% 2016 $5,660 5.0% 4.0% *Resident, full-time undergraduate students; excludes loans. *Freshmen and Sophomores $140 38,000 $125 * $117 * $120 36,000 $104 $89 $100 34,000 TOTAL $75 UK FUNDED $80 32,000 $67 STUDENT $57 STUDENT $52 $51 $51 $60 $49 30,000 ENROLLMENT FINANCIAL AID $40 28,000 (IN MILLIONS) $20 26,000 24,000 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 *Budgeted uky.edu/uk4ky