PRESIDENT’S BUDGET ADVISORY COMMITTEE
September 19th, 2019
MEMBERS PRESENT:
Lisa Vollendorf Provost, Executive Vice President of Academic Affairs; Chair
Joyce Lopes Vice President of Administration and Finance; Vice-Chair
Gregory Sawyer Vice President for Student Affairs
Gordon McDougall Interim Vice President of University Advancement
Hollis Robbins Dean, School of Arts and Humanities
Laura Watt Chair of the Faculty; GEP Department
Melinda Milligan Vice-Chair of the Faculty; Sociology Department
Laura Lupei Senior Director for University Budget and Planning, A&F
Elisabeth Kettmann Staff Representative, Biology Department
Daniel Yoeono President, Associated Students
STAFF PRESENT:
Elias Lopez AVP for Academic Resources, Academic Affairs
Hayley Avery Budget Manager, Administration and Finance
GUESTS PRESENT:
Kara Rabbitt ACE Fellow, William Paterson University
Anna Reynolds-Smith Director, Administrative and Financial Planning, Student Affairs
Katie Robinson Budget Director, Administration and Finance
MEMBERS ABSENT:
Erma Jean Sims CFA Representative; Literacy Studies & Elementary Ed.
Arden Childers Vice President of Finance, Associated Students
Jerlena Griffin-Desta Chief of Staff and AVP for Strategic Initiatives and Diversity
Sean Place Chair of APARC; Biology Department
AGENDA
- CALL TO ORDER AND WELCOME
- APPROVAL OF THE AGENDA AND MINUTES: August 29th, 2019
- ANNOUNCEMENTS FOR THE GOOD OF THE ORDER
- 18/19 YEAR-END BALANCES & BUDGET CALL
- ALL FUNDS BUDGET: Housing and Transportation & Parking Services
I. CALL TO ORDER AND WELCOME
Provost and Executive Vice President of Academic Affairs, Lisa Vollendorf, welcomed the committee and began the meeting at 8:30 am.
II. APPROVAL OF THE AGENDA AND MINUTES
Vollendorf introduced the agenda and asked if there were any additions. Hearing none, Vollendorf requested a motion to approve the minutes of the August 29th meeting. Minutes were approved unanimously.
III. ANNOUNCEMENTS FOR THE GOOD OF THE ORDER
Laura Watt asked if there was a report that showed how many faculty are leaving the University and how many are being hired each year that could be provided to the group. Vollendorf replied that the Provost’s Office is putting together a report that shows those figures, and as far as a trend, it will portray that the campus is hiring faculty slightly above replacement rate because the University is not currently in a growth phase.
IV. 18/19 YEAR-END BALANCES AND BUDGET CALL
(Please see the September 19th agenda packet for related documents)
Laura Lupei presented to the committee the 18/19 year-end balances and the outcomes of the 18/19 budget call. The year-end balances report is available online in the OpenBook portal. The graph shows the starting base budget and revised budget for each division, as well as expenses for the year. The year-end balance amount is the sum of the revised budget less expenses. No division ended the year in deficit and all rolled balances into the 19/20 year.
The 18/19 budget call was the first of the now annual process for the campus. As an introduction to discussing the budget call, Lupei first reviewed the key points of the strategic budgeting process. Strategic budgeting is about being proactive in budget planning versus being reactive. The implementation of strategic budgeting will ensure the University’s resources are being used efficiently and effectively and the budget is aligned with strategic priorities. As the campus has been working on implementing strategic budgeting there has been significant progress in the implementation, and the budget call process is a key part of that progress. The Budget Call is the primary method for units to evaluate and make changes to their budget in order to link their resources with the strategic plan. Common themes from the 18/19 budget call included reallocating operating expense budget into more specific categories such as travel, equipment, and professional development; creating student employment opportunities through reallocation of temp help dollars; and aligning existing resource allocations to new strategic goals. For the 19/20 Budget Call, the process will be moved into the Questica budgeting software. The self-support units on campus will simultaneously be creating 5-year financial plans that will better integrate them into the campus planning process.
V. ALL FUNDS BUDGET: HOUSING AND TRANSPORTATION & PARKING SERVICES
(Please see the September 19th agenda packet for related documents)
To begin reviewing all funds budgeting Lupei will present a series of introductions to the various funds that make up the University Budget. For this first presentation, Lupei and Katie Robinson from the University Budget & Planning Office reviewed the Residential Education and Campus Housing (REACH) program and Transportations and Parking Services (TAPS) program funds.
As an introduction to these new programs and funds, Lupei reviewed some key definitions and policies that will aid in understanding the role of these units on campus. The definitions reviewed were for auxiliary organizations and self-support programs. Auxiliary organizations are non-profit organizations and separate legal entities; auxiliaries at Sonoma State include Associated Students, SSU Foundation, and Sonoma State Enterprises (SSE). Self-support programs are defined as those not receiving state general fund appropriations. Instead, fees are collected to pay the full cost of a program; both REACH and TAPS are self-support programs. The policies Lupei reviewed were the California Education Code, California Code- Title 5, CSU Student Fee Policy (EO1102), EO1000 (Cost Recovery), and EO994. Both the REACH and TAPS fees are classified as Category V fees on campus. Category V fees are fees charged by self-support operations on campus. All revenues collected must be used to support and develop new activities within the self-support fund; these types of fees are not governed by the Student Fee Advisory Committee. As self-support programs, REACH and TAPS abide by EO994 which dictates guidelines for reserve goals as well as Debt Service Coverage Ratio (DSCR), which is used to measure debt capacity. The University, in conjunction with EO994, also established additional reserve guidelines that programs should also include three to four months working capital as well as one-year debt obligation in their reserve goals.
Robinson presented the historical and current budget information for both of the programs beginning with REACH. REACH’s budget for 19/20 is about $38M. The main source of revenue for the programs is fee revenue collected from the students living on campus. Another source of revenue for REACH are the various lease and rental agreements between REACH and other units on campus. REACH financially supports a variety of projects on campus because of the program's capacity to take on debt, and as a result has some rental and lease agreements that provide revenue each year. Expenses for REACH include compensation, operating expense, debt service, cost recovery, lease/rental agreements, routine maintenance and non-routine maintenance, and transfers to reserves. Robinson then reviewed the REACH reserve levels, which currently is 40% funded at $25M. REACH has consistently made progress in contributing funding to its reserves with a decline in 18/19 because of the allocation to the workforce housing project. The DSCR for REACH for the 19/20 year is set at a minimum of 1.10 and the REACH programs currently have a DSCR of 1.46, which is over the minimum.
The TAPS budget for 19/20 is about $3M. The main source of revenue for TAPS is parking pass fees as well as parking violation fines. Expenses for the TAPS program are similar to Housing with ongoing compensation and operating expenses in addition to debt service, cost recovery, lease/rental agreements, routine and non-routine maintenance, and transfers to reserves. The TAPS program has currently funded 68% of their reserve goal at $2.7M with a decline in the reserve levels in 18/19 due to an allocation from the reserve to fund the repaving of parking lot E. The 19/20 DSCR minimum for TAPS is also 1.10 and TAPS currently has a DSCR of 1.54.
Vollendorf adjourned the meeting at 10:00 am.
Minutes prepared by Hayley Avery.