This month’s installment of “From the CFO” continues sharing information with the campus about the change-management efforts underway at UCF.
We will be launching a new budget model on July 1 that makes several changes to how we have handled budgets in prior years. The new model is designed to help us strengthen our operations, expand our resources and invest in excellence.
The new model brings a greater transparency to how all resources are allocated to carry out the mission of the university. Additionally, it brings with it greater accountability and responsibility for vice presidents, deans, directors, and others to spend the funds allotted to their respective colleges and units with care and purpose.
Some key points are:
1. Our current “incremental” budget model provides colleges and units the budget they had from the prior year, which might be increased or decreased due to changes in enrollment. This model assisted the university on its growth trajectory, but now we must have a more strategic focus to build budgets from the bottom up.
2. In the current budget model, funds first flow into the university from all sources, then central administration distributes those funds to colleges and units. The new model has all funds flowing into the university through the colleges, with the central administrative units providing their allocated costs for funding, and the provost sets aside funds to support colleges and fund presidential strategic priorities.
3. Education and General (E&G) revenues — including tuition, fees, and state appropriations — will be allocated in this way:
a. The college teaching a course will receive 80% of the revenues associated with the student credit hours generated.
b. The student’s home college will receive 20% of the revenues associated with the credit hours generated.
c. State appropriated funds will be distributed using the following criteria:
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- Instructional effort (42.5%)
- Student completion (42.5%)
- Research activity (15%)
4. Under the new model, all sources of funds will align with all future uses of those funds. Both the sources and uses of the funds will be completed within the appropriate colors of money for the university (i.e., E&G, Auxiliary, Contracts and Grants, and Fundraising).
5. Carryforward funds from a prior year will be highlighted to identify non-recurring expenses. These funds will follow the annual carryforward spending plan voted on by our Board of Trustees every June and tracked over the course of the next fiscal year.
Effective July 1, 2019, the rules around carryforward usage in a subsequent year changed, so it’s important that there be a clear understanding of how these funds may be used. This spring and into the summer, we plan to spend more time meeting with the campus community in small group sessions to ensure this topic is better understood.
There will also be enhanced discussions around budget development and deployment that include:
1. Budget presentations by Central Support Units
2. Budget presentations and management by colleges
3. Continued updates after each Board of Trustees meeting with Dollars & $ense webinars
4. Group meetings and events with President Cartwright and Provost Johnson
5. A new, comprehensive budget model web course that you can review at your own pace for a window into how the budget model will work. You can find the course here.
The model will take a couple of years to mature on our campus, but having it done with all the other changes presents some unique opportunities for us to continue to improve. We encourage you to visit the Budget Model Redesign Initiative. Our future is looking brighter every day as we work together to solve some of these issues.
