December 16, 2021 Minutes

PRESIDENT'S BUDGET ADVISORY COMMITTEE

December 16th, 2021

MEMBERS PRESENT:

STAFF PRESENT:

GUESTS PRESENT:

MEMBERS ABSENT:

AGENDA

1. Call to Order and Welcome
2. Approval of the Minutes: November 4^th, 2021
3. Board of Trustees Budget Request
4. 2022-2023 Budget Planning
5. Fall Budget and Planning Forum Review
6. Announcements for the Good of the Order

1. Call to Order and Welcome
   Provost and Vice President of Academic Affairs, Karen Moranski, welcomed the committee and began the meeting at 8:30 am.
    
2. Approval of the Minutes: November 4th, 2021
   Moranski introduced the agenda and asked if there were any additions. Hearing none, Moranski requested a motion to approve the minutes of the November 4th meeting.  Minutes were approved unanimously.
    
3. Board of Trustees Budget Request
   Laura Lupei presented the Board of Trustees (BOT) budget request. The BOT requested a total of $715.5M of increased based revenue for the CSU system for the 2022-2023 year. Of the increase, $673M would be increased General Fund and the remaining $42.5M would be increased student fee revenue from an increase in full time equivalent students.
   
   The BOT organized their request into three priority areas; the students, the people, and the future of the CSU.
   
   The student priority consists of $170M in new funding in the categories of Graduation Initiative ($75M), Basic Needs Initiative ($20M), and Bridging the Equity Divide ($75M).
   
   The people priority totals $223.3M in the categories of the Compensation Pool ($209.3M), Health Benefits ($14M), and Staff Salary Structure Study Results (TBD).
   
   The future priority totals $322.2M in the areas of Academic Facilities and Infrastructure ($135M), Strategic Enrollment Growth ($129.9M), Mandatory Costs ($40.5M) and SB169 State University Grant Requirement ($16.8M).
   
   There was also a major, one-time funding request for $1B for much needed deferred maintenance.
    
4. 2022-2023 Budget Planning
   Lupei then presented an update on 2022-2023 budget planning. She first reiterated that enrollment is down about 2100 students from the high of 9097 in FY 16-17 to a projected 6927 in 21-22.
   
   The enrollment projections used for budget planning for the 22-23 year utilized the following assumptions; prior year (Fall 2021) yield rates, utilizing prior year (Fall 2021) application rates, and then, updating yield rates with rolling year averages as rates change and improve for 2023-2024 and beyond.
   
   Currently, the reduction strategy entails taking 50% of the base deficit in base reductions over the next three years. The other 50% of the base reduction would be compiled of various one-time funding strategies. The 50% base reductions will be met by allocating amounts to the divisions to meet based on the division's share of the marginal cost functions.
   
   It is important to note that for reductions that are allocated out based on the marginal functions, new funds will be reallocated on the same methodology as enrollment growth returns along with the corresponding tuition revenue.
   
   The current projected deficit for 22-23 is $15.5M (10.93% of the current year’s budget). The 22-23 reduction plan proposal has 50% ($7.8M) of the projected deficit split between the six main marginal cost categories:

When applying the marginal cost categories to the divisions, the cut by division based on the share of the marginal cost categories is below:

The next steps for 22-23 budget planning consist of the Cabinet providing their priorities in December for the upcoming year. In February, the Annual Budget Call will go out to the campus units. During this call, the units will be tasked with submitting a budget plan that incorporates reductions, and other changes to the unit's budget will be net-zero. The reductions units plan must take into consideration the current Cabinet Institutional Priorities.

These priorities, in no particular order, are; enrollment management, academic success, recruitment and retention of faculty and staff, strong residential program, support for underserved/underrepresented student populations, and health and safety of students, faculty, and staff.

5. Fall Budget and Planning Forum Review
   ​The committee reviewed the feedback from the Fall Budget Forum. The main takeaways were:
   1. The presentations from the Provost and on the topic of strategic enrollment planning were greatly appreciated.
   2. Continuous and ongoing communication and conversation on these topics is very important.
   3. Individuals were wanted to know how they can help.
      
      It was all agreed that the hybrid format reached more people and that should continue. The committee also discussed the broader approach to communication on campus and where improvements can be made.
6. Announcements for the Good of the Order
   None.

Moranski adjourned the meeting at 10:05 am. 

Minutes prepared by Shawn Taylor.