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Friday, June 12, 2015

Update on FY 2016 Compact Process

The outcome of the compact process for the College of Liberal Arts is still a work in progress at this time. I’d like to share a bit about Central’s budget decisions for CLA as well as how our overall financial picture looks.

The Central budget process is heavily influenced by state funding, and the Higher Education appropriation bill this session resulted in lower funding than the U had originally requested for holding tuition flat for both undergraduate and graduate students. As a result, the budget for FY 2016 across the University will rely on a 1.5% tuition increase for in-state undergraduates, a 7% increase for non-resident undergraduates, and a 2.5% increase for graduate and professional students.

As part of the University’s “compact” process (my post on the process is here), CLA was required to identify two separate sets of reallocation options for consideration that combined to nearly $4.0 million. In other words, CLA contributed this amount toward two pools of funds that would then be reallocated across campus. Approximately half of this amount was intended to create resources for the implementation of the Twin Cities Campus Strategic Plan, and the remainder was part of the normal annual compact process and the need to balance the U’s budget, fund compensation increases, and address critical financial issues.

Items that CLA contributed toward the normal compact process pool include lower TA/UI instructional funding in a number of units with declining enrollments as well as a reduction in our annual tuition reserve. Overall, about $1.3 million of the amount CLA put on the table was accepted for the reallocation pool. Currently accepted contributions to the Campus Strategic Plan pool include faculty attrition, lower allocations for LATIS (formerly CLA-OIT) technology grant pools, and some smaller funding items. At this point, Central accepted all items contributed by most colleges toward the Strategic Plan pool.

As you know, the flip side of the college putting dollars on the table for reallocation is that funds are possibly returned to the college for reinvestment. This year’s compact process directed such resources to the college as well as provided funds for compensation increases.

We received new investments (following up on my announcement earlier in the spring semester) for faculty diversity cluster hiring, which advances the diversity and research excellence goals in our CLA Roadmap. We received some modest targeted help for graduate student support, which also advances our research excellence efforts. And we received new investments to help us move forward our Roadmap goal of student readiness by providing substantial funds to support the development of career bundles (and the ancillary services required to make the bundles concept work) as well as expand the Freshman Research and Creative Awards program to serve more high-achieving first year students. Combined, these reflect FY 16 investments--or, more specifically, reallocations back to the college--of more than $1.5 million toward these key collegiate Roadmap priorities.

On a less cheery note, there are as of yet no allocations of new investments from the Strategic Plan pool. We do not have any specifics about this situation, other than that Central will be making investment decisions at some later date. We, of course, hope that resources will come our way from this pool, but they haven’t yet. We are not alone: all of the Twin Cities colleges are in the same boat at this time.

Last week, we distributed CLA budget allocations to academic and administrative units. The FY 2016 budget allocates additional funding for TA/UI in some units with strong growth in enrollments and plugs a fairly high number of curricular holes that emerged due to late faculty departures. Beyond that, we were able to fund a number of smaller requests from units for soft funding for a variety of purposes.

Regarding overall collegiate finances, we’ve noted before the likelihood of some improvement in our financial condition at the conclusion of the current fiscal year (2015) at the end of June. We currently expect to use this good result to reinvest in and increase faculty and P&A travel allocations; provide payouts from the Terminal Agreement Program; and support capital infrastructure improvements.