Background and Context
Before digging into the process, here is some data as context.
The chart shows the share of CLA non-sponsored revenue coming from various sources (this total excludes sponsored funds, such as federal grants, that run through the university’s Sponsored Projects Administration office). Overall revenue is about $250.4 million in the current fiscal year. Roughly another $10 million comes from carry-forward funds, for a total of $260.4 million. Not shown on the chart, CLA spends $88.3 million on university cost pools such as utilities and university services. That results in budgeted collegiate spending of $172.1 million.
As the chart shows, almost 70 percent of CLA’s revenue is from tuition, with state appropriations making up the next largest group at 22 percent. Tuition revenue, which of course is directly related to enrollments, has essentially been flat for the past four fiscal years, while expenses have increased.
Teaching-Related Budget Requests
The first step of the annual budget process concern instructional expenses.
Departments made requests for Temporary Instructional Needs (or TINs) funds to cover courses that need to be taught but cannot be due to faculty being on research leave, sabbatical, and so on. This year, we moved this request earlier in the process so that departments would receive their funding allocation well in advance of the fall course registration period—TINs allocations have been made for 2015-16. TINs requests for required courses, courses essential to degree completion, and high enrollment courses receive priority for funding.
Another part of the process related to teaching concerns the TA/UI (or Teaching Assistant/Unassigned Instruction) block grant. These funds are provided to departments to dispense as they wish to hire teaching assistants, contract faculty, and instructors. The size of the grant is determined largely by recent trends in enrollment (for example, if a unit’s TA/UI funds in recent years tended to be too low or more than needed to meet instructional needs). Departments have received their block grants for the 2015-16 academic year.
Hiring and General Unit Requests
The second step in the annual cycle is consideration of unit budget requests for new non-recurring and recurring spending, or continuation of previous non-recurring spending. This year, departments were asked to submit requests for faculty hiring and other investments, providing a priority ranking for each of these. Those investments might include funds for staff support, events, hiring of student workers, and equipment, to name a few. The department provides a budget narrative and spreadsheet explaining these requests.
As part of this step in the process, we hold a unit planning/budget meeting with each department. Typically, the attendees at these meetings are the department chair and administrator, Chief Financial Officer Brent Gustafson, Chief of Staff Katie Louis, and me. This year, we did not ask departments to submit any additional written material prior to the meeting—we had in hand the budget narrative; a two-page memo supplied to me by department chairs prior to my meetings with each chair back in August and early September; planning documents from last year and any revision supplied since then.
The meetings themselves are focused on the general direction of the department; the departmental alignment with the CLA Roadmap; and a discussion of the budget requests, including their advancement of Roadmap objectives where appropriate. Other general topics might be pursued as well, including what, outside of the department, is important for departmental faculty and students to thrive; in what ways the unit contributes to the success of faculty and students from other units; how the department would plan to focus and refocus if it stayed at the same net size in faculty; and progress made in implementing agreements with CLA from last year’s planning process.
Non-faculty requests are reviewed by budget teams within CLA administration, based on the nature of the request (for example, related to undergraduate education, graduate education, outreach), and I receive recommendations from these teams. Faculty requests are reviewed by the associate deans and me. Units should learn of non-faculty requests during the latter part of May and faculty requests in June or early July.
Compensation Planning
The third and final step in the annual budget cycle concerns compensation. This year, the university’s compensation plan provides for a 2 percent increase in merit pools. For those categories of employees covered by the merit system—which now includes faculty, P&A, and civil service—units submit recommended salary adjustments as determined by their internal processes, within collegiate and university procedural guidelines.
Salary recommendations are reviewed by CLA administration and clarification questions may be posed back to units. The results from this process are completed by late May. In some years, consideration of faculty compensation also includes a special merit process and/or an equity adjustment process; this year’s cycle includes the latter, continuing the work begun last year by the Salary Equity Review Committee.
Conclusion
These three steps comprise CLA’s regular annual budgetary process. Although different years have had different details on the procedures, these steps occur annually in one form or another. Administrative units follow much of the same process as that described above, with the exceptions of instructional funding and faculty hiring.
Going forward, we will consider how pieces of the budget process might be improved for both unit and collegiate planning and decision making as well as streamlining of the time involved in the process. For example, we might want to see where we can shift our process to more of a multi-year timeframe rather than an annual cycle, which would help move toward more toward strategic thinking about budgetary investments. We also must ensure we are aligning our investments with our strategic goals and values as laid out in the CLA Roadmap.
As always, I welcome any thoughts or questions you might have at cladean@umn.edu. If you have specific suggestions about the budget process—or about any processes, procedures, or other aspects of CLA—I’d also urge you to send those to clasugg@umn.edu.
