December 6th, 2018 Some of the rules and procedures discussed in - PDF document

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Department Chair and Directors Workshop December 6, 2018 Recording date of this workshop is December 6th, 2018 Some of the rules and procedures discussed in this workshop are subject to change. Please check university resources before relying exclusively on this recorded presentation. AGENDA • Understanding the University budget • Managing Your Unit Budget • Modernization 1

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Washington State Budget Washington enacts budgets on a two-year cycle  Operating Budget  Capital Budget  Transportation Budget Higher Education receives discretionary funding from the State  Funded after K-12, HHS, pension obligations, debt service By law the Governor must propose a biennial budget (balanced) before the Legislature convenes in January. University Operating & Capital Budgets 2015-17 Biennium - $2.297 Billion Total Capital 13% $296.7M $2.0B Operating 87% 2015-17 Capital Budget Total Authority: $311.7 M Projected Expenditures: $296.7 M (includes Re-appropriation Balances) Parking 1% WSU Building/Land Grant Endowment 16% Local/Private State General Obligation Bonds 53% 26% Housing & Dining S&A Fees & Athletics 4% less than1% each 2

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Use of 2015-17 Capital Budget – By Expense Type State Appropriation, Land Grant Income, and Student Building Fees Preventative Maintenance (Operating) – 7% Minor Capital Projects – 20% Major Capital Projects – 73% 2015-2017 Operating Budget Fund Sources – Estimated Total: $2.0 Billion Other Net Investment 1% Income - 6% Gifts/Endowment – 4% *Net Operating Tuition & Fees Federal Appropriations 24% 1% *State Appropriations 16% Net Restricted Student Fees 4% Auxiliary Enterprises 14% Federal Grants & Contracts 16% Ed Dept Sales & Services 2% Local State Grants & Contracts Grants & 9% Contracts 3% * Available for allocation Use of 2015-17 Biennial Budget – By Function State Appropriation and Operating Tuition Plant Operations & Maintenance 9% Institutional Support Instruction 10% 50% Student Services 5% Library 2% Primary Support 9% Public Service 6% Research 9% 3

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Use of 2015-17 Operating Budget – By Expense Type State Appropriation and Operating Tuition Operations 15% Benefits 18% Salaries and Wages 67% Budget Models • How institutions allocate resources • Two classic models  Incremental Budget  Responsibility Centered • WSU has elements of both  PBL  Tri-Cities / Vancouver Tuition  EBB WSU Budget Principles • General funding is tracked by campus • Budget allocations are provided by the Budget Office to areas/campuses • Areas/campuses determine distribution of funding to their departments 4

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y WSU Budget Principles Pooled Benefits  WSU utilizes a central benefit pool to allocate resources to cover benefit related costs for particular fund types (001-XX, 143-XX, 148-02, 148-05, 148-06)  Automatic budget allocations are made to area departmental operating accounts where actual benefit expenses are incurred each payroll expense cycle WSU Budget Principles Distributio Distribution of F of F&A A Reven Revenue 4% Office of Research 23% to F&A Revenue Generating Units 7% Libraries 38% Campus Support 28% University Support For more information: BPPM 40.25 WSU Budget Principles Distribution of Generating Units F&A 23% of F&A revenue is distributed to revenue-generating units Distributions are made in one of three ways: PULLMAN CONTRACTS URBAN CAMPUS CONTRACTS URBAN CAMPUS CONTRACTS WITH Academic Unit Affiliation WITHOUT Academic Unit Affiliation Department: 15% Academic Dean: 11.5% Dean: 8% Chancellor: 11.5% Chancellor: 23% 5

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y WSU Budget Principles Accruals (Salary Savings) Policy Central pool provides for turnover costs (sick and annual leave • payouts), and PIDs Areas retain savings from vacant faculty and graduate student • positions on WSU program 05 (libraries) and 06 (instruction) Areas retain savings from the transfer of expenditures to grants • (programs 11A-14Y) regardless of employee type Central captures savings from vacant classified, administrative • professional, and non-instructional faculty positions for the first four months. Subsequent accruals are returned to areas upon request * WSU Vancouver, WSU Tri-Cities, Extension, and Ag Research manage their own accruals. WSU Budget Principles Carry Forward Policy What happens to funds at fiscal year end? Most funds carry forward at the area level. Dean, vice president or chancellor decides if they carry forward at the department level. Operating budgets • F&A accounts • Donated funds • Some funds do not carry forward Equipment replacement allocations • Special allocations for specific purposes, • such as proviso funds QUESTIONS ? 6

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Managing Your Unit’s Budget Don Holbrook Executive Director, Office of the Provost Overview • Fund Types • Budget Statement • Planning and Managing Accounts • Helpful Hints • Sample Reports University Accounting • The source of funds determines the rules for deposits and expenditures. –State Appropriations –Self-Sustaining funds –Grant Funds –Donated Funds 7

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Fund Types 001- State Funds •Can be PBL or Non-PBL Funds •Goods and Services which are necessary for the completion of official University Duties 148 - Local Dedicated •Service Centers- University Community •Summer Session Funds •F&A accounts 570 – Other Enterprise •Course Fees & Administrative Fees •Enterprise – Service Centers – External Clients Accounts 846- Advancement & •17A Accounts •Advancement Director’s Scholarship Funds •Scholarships & Dean’s Discretionary 145 – Grants & •Restricted based on the approved/awarded grant budget Contracts State Funds - PBL • Planning Budget Level or Planning Base Line (PBL) • PBL applies mainly to your state funded accounts • Departments normally receive the same PBL allocation each year. – A Mass Salary Increase (MSI) will increase your PBL – A Budget Cut will decrease your PBL • Not all funds going into your state accounts are PBL. State funds also come in the form of temporary allocations which can be one-time allocations that may not reoccur. Preparing the Department Budget Factors essential to planning the departmental budget (not necessarily listed in priority order) are: • The budget from the prior year (PBL and or One-Time Allocations). • Enrollment trends in program areas – Enrollment Based Budget). • Adjustments in program offerings. • Requests for new line positions. • Requests for any additional office staff positions. • Program replacements or coverage for faculty on grants or sabbaticals. • Number of graduate teaching assistants (GTAs) and fixed-term or part-time faculty. 8

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Budget Statement • 3 Main Areas of Your Unit’s Budget – Object 00 - Salaries –Faculty, Staff, Grad Assistants – Objects 01,02, 03, 04, 06,16 – Operating Expenses –Wages, Goods & Services, Travel, Equipment etc. – Object 07 - Benefits* Budget Statement Layout • Expense Summary by Object • Expense Summary by Object/Subobject • Expense Detail by Object/Subobject • Revenue by Source Subsource • Revenue Detail Sample Budget Statements – Expense Summary by Object Budget + Project = Account Object Title Object Codes Object Object Codes Titles 9

12/3/2018 W A S H I N G T O N S T A T E U N I V E R S I T Y Sample Budget Statements – Expense by Object Sub-object Subobject Codes Subobject Titles Sample Budget Statement Expense Detail “U” identifies Pcard Purchase Helpful Tips • WSU’s Fiscal year runs from July 1 to June 30 • The fiscal year is identified in the year that it ends (7/1/2018 – 6/30/2019 = fiscal year 2019) • Past or current budgets may be good indicators of overall service and supply needs in the department. • Monitor your budgets and ensure that expenses don’t exceed revenues/allocations. • Keep the dean's or VP’s office aware of your department's budget position. Although they may not always be able to help, it is important to keep up an institutional awareness by constantly communicating your department's needs and cost pressures. 10