Transcript Budget Update October 6, 2011 FY 2012 Presented at Town Hall Meeting 10/22/10 SCSU's STATE APPROPRIATION State Appropriation Fringe Benefits Paid by State Total FY 2011 FY 2012

Budget Update
October 6, 2011
FY 2012
Presented at Town Hall Meeting 10/22/10
SCSU's STATE APPROPRIATION
State Appropriation
Fringe Benefits Paid by State
Total
FY 2011
FY 2012 *
$ 44,820,178
$ 50,449,092
25,948,632
29,022,648
$ 70,768,810
$ 79,471,740
* FY 2012 request reflects the following:
* Impact of 27th Payroll
* FY2012 Bargaining unit (BU) increases
* FY 2011 BU increases not previously covered by the State
* Annualization impact of FY11 new hires
* Fringe Benefits on all of the above
FY 2012
STATE APPROPRIATION
Original
Requested
State Appropriation
$
Fringe Benefits Paid by State
Total
50,449,092
Change
$
29,022,648
$
79,471,740
(6,869,586)
Governor's
March 2011
Recommendation
$
(3,196,467)
$
(10,066,053)
43,579,506
25,826,181
$
69,405,687
FY 2012
Steps taken when the FY2012 Spending Plan was developed:
•Reduced full-time positions from 1,023 to 998
•Continued to achieve operational savings from our ongoing cost
containment program
•No funding set aside for strategic initiatives
•Tuition and fees were increased by 2.5 percent
FY2012
Despite these actions, the university was still left with a significant budget
deficit due to an extra payroll and the growth of non-general fund
expenses. The following actions were taken to close the gap for FY2012:
•The University received board approval to use almost $4 million of reserves to
cover the general fund portion of the 27th payroll for FY 2012
•As part of the FY2012 budget preparation, each vice president provided budget
reduction outlines for their respective areas. To close the remaining gap,
divisional budgets were reduced by $4.7 million. This included holding
positions vacant, including temporary one-year faculty appointments, custodial
and clerical staff, and administrators
•A change in board policy that reduced university CHEFA debt obligations by
20 percent. Several refinance opportunities, along with lower interest rates,
saved $1.85 million
FY 2012
Once the concession agreement was finalized, Southern was notified on August 25, 2011 that
the State appropriation would be reduced by an additional $4,198,835. The concession
agreement reduced Southern salary and fringe expense by $2,880,227, leaving a budget gap of
$1,318,608. To close the gap, management positions will be held vacant until March 1, 2012 or
longer. Additional reductions were required in non-divisional OE.
STATE APPROPRIATION
State Appropriation
Governor's
March 2011
Recommendation
8/25/11 Change (*)
Sub-Total Based on
8/25/11 Change
$
$
$
Fringe Benefits Paid by
State
Total
43,579,506
(3,306,602)
25,826,181
$
69,405,687
( 892,233)
$
( 4,198,835)
24,933,948
$
(*) Note: The 8/25/11 reduction to the Gen’l Fund & FB paid-by-State appropriation is offset by the
following expense savings (resulting from employee concessions):
Elimination of BU increases
Reduction in Longevity
Related Fringe Benefit Reduction
$1,831,808
208,999
839,420
$2,880,227
40,272,904
65,206,852
FY 2012
On September 7, 2011, The University received a third notification that the State appropriation
would be further reduced by $1,257,490. To close this gap, it will require holding 16
administrative positions vacant until January 1, 2012 and 1 position for the entire year.
Additional reductions were also required in non-divisional OE.
STATE APPROPRIATION
Sub-Total Based
on 8/25/11 Change
State Appropriation
$
Fringe Benefits Paid by
State
Total
40,272,904
9/7/11 Change
$
24,933,948
$
65,206,852
( 815,556)
Sub-Total Based
on 9/7/11 Change
$
( 441,934)
$
( 1,257,490)
39,457,348
24,492,014
$
63,949,362
FY 2012
FY2012 State Appropriation
Total Amount of Reductions
$
Less: Concessions
Net Reduction
15,522,378
(2,880,227)
$
12,642,151
*
•NOTE: Net Reduction is 15.9% of the Original FY 2012 Spending Plan State Appropriation
12,642,151 / 79,471,740 = 15.9%
FY2012
Total State Appropriation Reduction:
FY2009
$ (3,266,263)
FY2010
697,040
FY2011
(318,871)
FY2012 (Net) *
Total State Appropriation
Reductions
Total Fund Balance Reduction:
TOTAL REDUCTION:
(12,642,151)
$
(15,530,245)
(4,398,959)
$ (19,929,204)
* Note: FY2012 reduction is net of savings from concessions
$15,522,378 - 2,880,227 = $12,642,151
FY 2012
100.00%
80.00%
39.03%
41.02%
41.49%
45.87%
49.26%
50.70%
51.64%
51.57%
51.31%
54.60%
54.96%
55.73%
45.40%
45.04%
44.27%
FY2009
FY2010
FY2011
60.10%
60.00%
40.00%
60.97%
58.98%
58.51%
54.13%
50.74%
49.30%
48.36%
48.43%
48.69%
20.00%
39.90%
0.00%
FY2000
FY2001
FY2002
FY2003
FY2004
% of Tuition & Fees to E&G
FY2005
FY2006
FY2007
FY2008
% of State Approp to E&G
NOTE: This Trend is Nationwide
FY2012
FY 2012
The FY2012 Spending Plan was built on an
assumption of a 2% enrollment increase.
We wanted to “grow” our way out of the
effect of our budget reductions.
FY 2012
FALL 2011
HEADCOUNT
GOAL vs THIRD WEEK ACTUAL
Goal
Full Time Undergraduate
Continuing
New Freshmen
New Transfers
Actual
Third Week
Variance
Favorable /
(Unfavorable)
5,375
1,350
950
7,675
5,270
1,319
935
7,524
(105)
(31)
(15)
(151)
1,010
938
(72)
8,685
8,462
(223)
Part Time Undergraduate
1,308
1,172
(136)
Part Time Graduate
2,210
1,899
(311)
3,518
3,071
(447)
12,203
11,533
(670)
Full Time Graduate
Sub Total Full Time
Sub Total Part Time
Grand Total
FY 2012
What was the financial impact of not achieving the FY2012 enrollment goals for the Fall?
FT Undergraduate
$
(626,848)
FT Graduate
(329,184)
PT Undergraduate
(357,245)
PT Graduate
(727,316)
Total
$
(2,040,593)
Net Operating Fund impact (less financial aid 15%, Debt Services, Activity Fees) is:
$1,787,237
FY 2012
HEADCOUNT
Fall 2010 vs Fall 2011
Fall 2010
Fall 2011
Variance
Favorable /
(Unfavorable)
5,299
1,248
947
7,494
5,270
1,319
935
7,524
(29)
71
(12)
30
1,000
938
(62)
8,494
8,462
(32)
Part Time Undergraduate
1,282
1,172
(110)
Part Time Graduate
2,188
1,899
(289)
3,470
3,071
(399)
11,964
11,533
(431)
Full Time Undergraduate
Continuing
New Freshmen
New Transfers
Full Time Graduate
Sub Total Full Time
Sub Total Part Time
Grand Total
FY 2012
What was the financial impact of not achieving last Fall’s enrollment?
FT Undergraduate
$
123,720
FT Graduate
(283,464)
PT undergraduate
(334,530)
PT Graduate
(627,284)
Total
$
(1,121,558)
Net Operating Fund impact (less financial aid 15%, Debt Services, Activity Fees) is:
$1,084,439
All-University Student Headcount & FTE & by Year (Fall)
Includes Full-Time, Part-Time, Undergraduate & Graduate Students
Source: Semi-Annual Statistical Report
HEADCOUNT
Fall
Full Time
Part Time
Total Headcount
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
6,791
7,059
7,161
7,291
7,609
7,780
7,996
8,024
8,111
8,346
8,494
8,462
5,336
5,195
5,058
4,852
4,568
4,378
4,330
3,906
3,658
3,469
3,470
3,071
12,127
12,254
12,219
12,143
12,177
12,158
12,326
11,930
11,769
11,815
11,964
11,533
1.00%
-0.30%
-0.60%
0.30%
-0.20%
1.40%
-3.20%
-1.30%
0.40%
1.30%
-3.60%
% change
FTE
Fall
Full Time
Part Time
Total FTE
%change
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
6,402
6,620
6,770
6,908
7,203
7,377
7,779
7,667
7,773
8,020
8,164
8,161
1,933
1,914
1,902
1,851
1,734
1,681
1,652
1,512
1,400
1,324
1,363
1,208
8,335
8,534
8,672
8,759
8,937
9,058
9,431
9,179
9,173
9,344
9,527
9,369
2.40%
1.60%
1.00%
2.00%
1.40%
4.10%
-2.70%
-0.10%
1.90%
2.00%
-1.70%
FY2012
Current Forecast
• Possible additional 5% reduction
$63,949,362 x 5% =
$ 3,197,468
• Historically Spring enrollment/revenue is less than Fall
There will be significant revenue shortfalls for:
 Intersession
 Spring
 Spring break
 Summer A
FY2012
Current Strategies
•Meeting to develop strategies to increase enrollment:
USPaRC
University Budget & Planning
Enrollment Management Council
•Continue to hold positions vacant/hiring freeze
•Reduce departmental budgets (OE, Student Labor & UA)
FY2012
In conclusion:
The current path that Southern is following –
 Diminishing state appropriations
 Shrinking student enrollments
will not sustain Southern as the University we know today