All College Budget Forum Mission College October 11, 2013 Overview The national and state economic recession and recovery has a long-term impact Not meeting FTES targets.
Download ReportTranscript All College Budget Forum Mission College October 11, 2013 Overview The national and state economic recession and recovery has a long-term impact Not meeting FTES targets.
All College Budget Forum Mission College October 11, 2013 Overview The national and state economic recession and recovery has a long-term impact Not meeting FTES targets and efficiency targets impacts our revenue generation Both colleges and the district have balanced budgets through a combination of one-time cuts and contributions from the Land Corporation Overview Decline in student enrollment results in lowered ongoing revenue To balance the budget all entities must identify ongoing, permanent reductions MC=$1.35 Million District=$630,000 WVC= $1.5 Million Basic Aid provides glimpse of hope from future revenue growth Background Decline from Peak (-2769) MC Unduplicated Head Count 27,000 26,500 26,000 25,500 25,000 24,500 24,000 MC 23,500 23,000 22,500 22,000 21,500 23,314 25,072 26,292 25,153 25,035 23,523 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 FTES FY 13/14 Target @ 15,898 6 yr. decline of 1846 FTES MC-Total Budget 2009-2013 $45.0 $44.3 $42.9 $42.4 $43.0 $43.7 $40.0 $35.0 Total Budget Mission College (including grants) $31.0 $30.0 $29.6 $30.0 $28.5 $28.5 $25.0 Fund 100 in $M Total in $M $20.0 $15.0 $10.0 $5.0 $2009-10 2010-11 2011-12 2012-13 2013-14 FY 12/13 Budget Recap Adopted budget was balanced Prop. 30 passed – no mid-year “trigger” cuts Missed out on growth funding (177 FTES ) Create EPA account (Prop 30 $ at $100/FTES) District foregoes $50M in restoration funding WVC and MC missed their FTES targets by 250 FTES each On State “stability”, but entered Locally Funded Basic Aid Basic Aid Definition Basic aid occurs when local property tax revenue exceeds total funding that the State provides as calculated by SB 361 apportionment. Local property taxes and enrollment fees are primary source of revenues. The Bucket Analogy 2012/13 funding formula, District received $5.4M in state apportionment Local property tax/student fees exceeded $5.4 in apportionment, entered Basic Aid Revenue Impact of Basic Aid District’s Core Funding is not affected by issues at the state level State budget shortfalls Community College system shortfall Deferrals Revenue Impact of Basic Aid District continues to receive funding for: Student Categorical Funds EOPS, DSPS, Financial Aid, Student Success Lottery Mandated Costs EPA Other grants Funding dependent on # of students/FTES Greater Impact of Basic Aid Better planning More stability in revenue Less impact from the ups and downs of state funding Potential for incremental growth Slow growth dependent on Santa Clara County tax revenues Multi-Year Basic Aid Projections Multi-Year Basic Aid Analysis State Apportionment Educational Protection Account (EPA) Enrollment Fees Property Taxes Less Property Taxes Excess (Basic Aid Funding) Total Computational Revenue 1.57% COLA Actuals Estimated 2012-2013 2013-2014 1,563,910 1,589,800 8,393,139 8,292,422 70,748,792 71,290,122 (927,522) (141,508) 79,778,319 81,030,836 1.8% COLA Estimated 2014-2015 1,589,800 8,292,422 73,428,826 (1,394,060) 81,916,988 2.2% COLA Estimated 2015-2016 1,589,800 8,292,422 75,631,691 (1,794,751) 83,719,162 Assumptions: -Property tax rate increase by 3% annually (exclude one-time RDA funding from calculation) -FTES goal at 15,898 -Enrollment fees decrease by 1.2% (200/16,098) -Reduction of $.5 million in 14/15 and 15/16 due to basic allocation adjustment (less than 10,000 FTES) Fiscal Stability Planning 2013-2014 One Time Budget Reduction ($578K MC) Reductions recommended by GAP Spring 2013 Basic Aid Status Revenues from property taxes Potential Slow Growth One time funds Participatory Task Force to determine use FY 13/14 District Budget Budget development approach Balance with one-time funds for FY 13/14 Estimated shortfall – $4.5 million Available revenues $3.0 million from the Land Corporation $1.5 million District Services/Colleges $578,000 from Mission College One Time Reductions 13/14 Item # 1 2 3 4 5 Position / Description Fall 13/14 Salary Savings Reassign Time C Harrison Account Number 120-280950/280976-6840-51227-464 120-280950/280976-6840-53xxx-464 Fall 13/14 Fringe/Health Benefits C Harrison Spring 13/14 Salary Savings Reassign Time C Harrison 120-280950/280976-6840-51227-464 120-280950/280976-6840-53xxx-464 Spring 13/14 Fringe/Health Benefits C Harrison 120-280950/280976-6840-51227-464 $ 42,800 $ 14,150 $ 42,800 $ 14,150 7,500 $ 121,400 6 Reduction from Interest Income from various Funds--carryover funding from FY12/13 591-261200-7310-57300-000 $ 64,224 7 Reduction from Graphics / Printing 100-230200-6010-55300-000 $ 10,000 8 Reduction from Community Education Department's Revenue 591-260000-7310-57300-000 $ 10,000 9 10 11 Fall 13/14 Salary Saving from RT supported by Grants Total Reduction 100-200500-6600-55160-000 Reduction from Research & Planning 100-232600-1300-54110-000 Budget offset from Lottery Supplies to HM 100-221000-6700-51450-000 $ 5,000 $ 50,700 $ 4,000 12 Reduction from Health Services Fund Balance 121-255100-7310-57300-000 $ 50,000 13 Reduction from Campus Center Fund Balance 732-200600-7310-57300-000 $ 20,000 14 Reduction from Evening Administration $ 597-200600-7310-57300-000 $ 5,000 15 Reduction from Admin Services - Duplicating Center 597-220300-7310-57300-000 $ 25,000 16 Reduction from Admin Services - Facility Rental 597-220600-7310-57300-000 $ 10,000 17 Reduction from Hospitality Mangement Revenue 597-232600-7310-57300-000 $ 15,000 18 Reduction from President Office 597-271210-7310-57300-000 $ 9,900 19 Reduction from IIS Revenue 591-260100-7310-57300-000 $ 15,000 20 Reduction from FY13/14 Interest projection 591-261200-7310-57300-000 $ 35,000 21 22 Reduction from Library Revenue 330-281230-7310-57300-000 Reduction from Child Development 120-220900-7310-57300-831 Reduction from Land Corp Target after CBO meeting on July 16, 2013 $ 2,000 $ 125,776 $ 578,000 Fiscal Stability Planning Ongoing Structural Deficit Living year-to-year with One time cuts Land Corp infusions of dollars 14/15 Ongoing Permanent Budget Reduction District – approximately $3.5M MC portion – approximately $1.35M Constraints on Reductions 50% Law Full Time Obligation Number (FON) Required to be 311 based on state requirements Fine from State is significant Timing is awkward Likely will be hiring for Fiscal Year 2014-15 to meet this obligation It’s Bigger Than Us Structural and Economic Changes End of the wave of Baby Boomer children Improving Silicon Valley economy We are not alone in this, but we still have to adjust to this new environment Our only growth will come from attracting new students with new and refreshed programs and higher retention Structural Deficit Reliance on Land Corporation and One Time Cuts to balance budget each year Smaller FTES & Headcount = Loss of Revenue 12-13 Target missed by 250 FTES 83 FTES from Prop 30 Restoration not restored (based on Growth) Missing Efficiency Targets 550-555. 10 points = $400K FY 14/15 Budget Planning On-going budget reductions for FY 14/15 Estimated shortfall – $5.0 million Available revenues for 14/15 $3.5 million budget reduction $1.5 million from the Land Corporation On-going budget reductions continue beyond FY 14/15 Re Cap--How did we get here? Past 4 budgets have been balanced with one time funding—Not Sustainable Enrollment decrease=revenue decrease Combination of one-time cuts and Land Corp Stability Funding 12/13 FTES target—MC short by 250 ($1.2M) Prop 30 District short by177 FTES-MC =83 ($400K) Serving almost 3000 less students Non Peak Efficiency Target short by 20 points ($800K) Next Steps Colleges Develop Budget Reduction Plans for FY 2014/15 and beyond District develops Board policy for Basic Aid Funds Allocation Based Participatory Governance District Council Task Force recommendations Looking to the Future Financial Reductions address structural factors Greater stability due to Basic Aid Never a guarantee, but should not face cuts in the immediate future Potential stability in short term for growth Basic Aid provides opportunity for growth in revenue in future years Questions and Discussion Reference Slides for Q&A Follow This Slide Basic Aid Districts Marin Mira Costa San Mateo South Orange County San Jose-Evergreen West Valley-Mission FY 13/14 State Budget for Community Colleges Item January Proposal May Revise Final Budget Apportionment $196.9M $87.5M COLA $89.4M Growth $87.5M COLA $89.4M Growth $50M $50M Student Success On-line Education $16.9M $16.9M $16.9M Adult Education $315.7M $30M for 2 years $500M for FY 15/16 $25M for 2 years $500M for FY 15/16 Deferral buydown $179M $179.9M for FY 12/13 $64.5M for FY 13/14 $179.9M for FY 12/13 $30M for FY 13/14 90-unit cap Proposed Withdrawn Deleted Shortfall 2011/12 2012/13 2013/14 2014/15 (projected) $2.9M $6.0M $4.5M $5.0M Revenues -On-going budget reduction -One-time budget reduction $3.0M $2.9M $1.5M -Bargaining concessions $1.5M -Land Corp stability funding $1.5M -Land Corp additional funding TOTAL REVENUES $3.5M $1.5M $1.5M $2.9M $6.0M $1.56M $5.3M $4.5M Additional -Possible mid-year trigger cuts (covered by Land Corp) -Workload reduction $4.8M (6.2%) -Workload restoration -Health Benefit Cap -RDA dissolution $1.5M $0.75M (waived) --- $1.7M (waived) $5.0M Full-time Faculty Obligation Fall 2010 Fall 2011 Fall 2012 Fall 2013 Fall 2014 323.1 323.1 315.1 315.1 311 Actual (or projected) 306 305 309 306 Reported (or projected) 312 310 310 311 FT Faculty # 68.02% 68.23% 68.43% FON Obligation