GOVERNING BOARD STUDY SESSION FISCAL YEAR 2018-2019 BUDGET DISCUSSION FEBRUARY 5, 2018 PRESENTED BY: DR. DAVID BEA
BOARD APPROVED STRATEGIC PRIORITIES • 2017-2021 College Strategic Plan • Educational Master Plan • Facilities Master Plan • Diversity, Equity, and Inclusion Plan • Strategic Enrollment Management Plan
FY19 BUDGET DEVELOPMENT CALENDAR Activity December 2017 Governing Board Study Session to discuss the budget outlook and acquire Board direction on potential scenarios and/or key parameters February 5, 2018 Governing Board Study Session to review the budget model and scenarios based on Board feedback at the December Study Session February 7, 2018 Governing Board Meeting to review and approve course fees for 2018-2019 Academic Year March 7, 2018 Governing Board Meeting to review and potentially approve: Employee Benefits; Tuition and Fees; Capital Budget Project List; Salaries and Wages; Budget Priorities; and Proposed Primary Tax Rate and Levy April 11, 2018 Governing Board Meeting to review the proposed Fiscal Year 2018-2019 budget and approve the Publication of Proposed Budget and, if required, Truth in Taxation Notification May 9, 2018 Public Hearing and Special Board Meeting to set tax levies and rates and adopt the Fiscal Year 2018-2019 budget
STUDY SESSION AGENDA • Board Direction on FY19 Budget: • Salaries & Wages • Tuition • Property Taxes • Revenue Enhancements • Expenditure Reductions
FY18 BUDGET SCENARIOS Scenario A: Delay Impacts for Scenario B: Rejuvenate the Scenario C: Revolutionize the Now with Larger Tuition College College Increases Reduce current operations by • Reduce current operations by • Small to no reductions for 17- about $10 mil per year in each of • $5 mil per year in each of next 3 18 and 18-19. Plan for $15 mil next 3 years years reduction in 19-20 Identify programs for elimination • Identify programs for elimination • Continue to reduce via attrition and begin phasing out • and begin phasing out Mitigate cost increases and Eliminate at least one location • • Reduce infrastructure/staffing Expenditure Limitation impacts • Significantly reduce • with larger tuition increases infrastructure/staffing Implement most of the first 5 • No funding to implement • years of the EMP/FMP Large and immediate investment in • EMP/FMP or other strategic EMP/FMP Rely on GO Bonds for some changes until 19-20 • EMP/FMP projects Ensure future financial stability and • Large reduction pending due to • ability to grow Expenditure Limitation
FY18 GENERAL AND ACADEMIC FUND POSITIONS (AS OF NOVEMBER 13, 2017) Position Type Closed Vacant Filled Grand T otal Administrators 6.0 42.0 48.0 Faculty 45.0 298.0 343.0 Staff Positions • Staff 39.4 103.7 744.5 887.6 Campus Total 11.0 53.5 331.9 396.4 On target to reduce 100 • vacant FTE by start of District 28.4 50.2 412.6 491.2 FY19 Chancellor 3.6 7.0 10.6 External Relations 7.8 31.0 38.8 Reduction of $6.0M in • Finance/IT 8.0 9.0 120.0 137.0 salaries Facilities/Police 15.4 15.7 168.0 199.1 HR 2.0 7.0 13.0 22.0 Academic/Student Affairs 3.0 7.0 73.6 83.6 Grand T otal 39.4 154.7 1,084.5 1,278.6
PROJECTION: ACTUAL FTSE VS. EXPENDITURE LIMITATION FTSE 30,000 25,000 20,000 15,000 10,000 5,000 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Audited FTSE CTE Weight EL FTSE
EXPENDITURE LIMITATION PROJECTIONS 130,000 120,000 110,000 Expenditure Limit (in $1,000s) 100,000 90,000 $10 mil $24 mil 80,000 We are Here 70,000 60,000 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Fiscal Year Expenditure Limit Actual Expenses Typical Increases No Tuition Increases FY18 Plan
SUMMARY OF BUDGET CRITERIA • Ensure success of the College’s Mission and Strategic Plan • Meet all regulatory and compliance requirements • Evaluate all programs and services for modification or elimination • Optimally assign human resources and physical assets across the District • Encourage Return on Investment (ROI), process efficiency, and income-generating initiatives
BUDGET CRITERIA IN ACTION Budget Criterion Examples Ensure success of the College’s Mission and Strategic Plan Center of Excellence Community Summits • • Scheduling Software – System Purchase & Implementation • Catalog & Curriculum Management System Meet all regulatory and compliance requirements Academic Leadership Training • Crisis Management Training • Evaluate all programs and services for modification or • Program Viability elimination • Program Review Service Review • Reorganization Plans • Optimally assign human resources and physical assets across • Summer Scheduling the District • Space Leasing Reorganization Plans • Passport Services • Encourage Return on Investment (ROI), process efficiency, and • CampusLogic – Financial Aid Verification income-generating initiatives • Enterprise Systems Concur •
POTENTIAL REVENUE ENHANCEMENTS • Charge Fee for Payment • Space Leasing & Partnerships Plans • Property Taxes • Charge for Merchant • Tuition Increase Services Fees • State Aid • Parking Fees • Revenue Bonds • Increase Employee Benefits Contribution
PROPERTY TAX RATES: AZ COMMUNITY COLLEGES, FY18 (RATES PER $100 NET ASSESSED VALUATION) $3.50 $ 3.1383 $3.00 $ 2.6210 $ 2.5429 $ 2.3735 $2.50 $ 1.9828 $ 1.8067 $2.00 $ 1.3890 $ 1.4096 $ 1.3430 $1.50 $1.00 $ 0.6142 $0.50 $0.00 Graham Yuma/La Paz Pinal Cochise Yavapai Navajo Maricopa Pima Mohave Coconino Secondary Tax Rate $- $0.3632 $0.3099 $- $0.2001 $- $0.2140 $- $- $0.1326 Primary Tax Rate $3.1383 $2.2578 $2.2330 $2.3735 $1.7827 $1.8067 $1.1956 $1.3890 $1.3430 $0.4816
IN-STATE TUITION AND MANDATORY FEES PER CREDIT HOUR: AZ COMMUNITY COLLEGES, FY18 $120.00 $105.00 $110.00 $100.00 $88.00 $86.00 $85.00 $83.00 $87.00 $86.00 $90.00 $82.00 $82.00 $80.00 $72.00 $70.00 $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 Coconino Mohave Pima Maricopa Pinal Graham Yavapai Yuma/La Paz Cochise Navajo FY 2018 Fees Per Unit $0.00 $7.00 $5.50 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 FY 2018 Tuition Per Unit $105.00 $81.00 $81.50 $86.00 $86.00 $85.00 $83.00 $82.00 $82.00 $72.00
PEER COMPARISON - PER CREDIT HOUR PUBLISHED OUT -OF-STATE TUITION RATES 2016-17 (IPEDS DATA - IC2016_AY) $600.00 For 2017, PCC had the 16th lowest out-of-state tuition rate among its $500.00 Peers, AZ CCs, Aspen Winners & Peer City Colleges Tuition per Credit Hour $400.00 $300.00 $200.00 $100.00 $-
PEER COMPARISON - PER CREDIT HOUR PUBLISHED IN-STATE TUITION RATES 2016-17 (IPEDS DATA - IC2016_AY) $300.00 $250.00 For 2017, PCC had the 7th Tuition per Credit Hour lowest in-state tuition rate $200.00 among its Peers, AZ CCs, Aspen Winners & Peer City Colleges $150.00 $100.00 $50.00 $-
TOTAL PCC TUITION & FEES VS. MAX PELL AWARD (FOR IN-STATE STUDENTS TAKING 12 CREDITS IN BOTH FALL AND SPRING) $7,000 $6,000 $5,000 $4,000 Max Pell Award $3,000 $2,000 $1,000 $0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Total Tuition and Fees $1,256 $1,304 $1,352 $1,412 $1,532 $1,652 $1,724 $1,844 $1,974 $2,046 $2,118 Remaining Pell $3,475 $4,046 $4,198 $4,138 $4,018 $3,898 $3,921 $3,886 $3,801 $3,769 $3,802
TUITION • Increase of $1.00 per credit to In-state/Resident tuition rate = $450K • Guaranteed Tuition • Tuition Cap at 15 hours • Tuition Cap at 12 hours • Tuition Tiers
POTENTIAL EXPENDITURE REDUCTIONS • Positions • Sponsorships • Salaries & Wages • Professional Development Allocations • Cell Phone Stipends • Contractual Services • Contracts/Schedules • Athletics • Recess Pay • Employee Recognition/Events
LONG TERM REDUCTIONS • $2.5M from Student Services • $2.5M from Instruction • $5.0M from Operations
BUDGET COMMUNICATION PLAN 11/03/17: Budget Development calendar reviewed with the Finance and Audit Committee • 11/07/17: Discussion with the ELT regarding the FY19 budget outlook • 11/08/17: Budget Development calendar submitted to the Governing Board • 11/16/17: Discussion with Student Leadership regarding the FY19 budget outlook • 12/04/17: Governing Board Study Session, held in conjunction with the Finance and Audit Committee, • to review the FY19 budget outlook and discuss parameters for the February/March Study Session January: Numbers newsletter to PimaAll • January: Budget presentations to faculty, staff, administrators, students, and community members • Ongoing: Collaboration with the Finance and Audit Committee •
BUDGET MODEL
RESOURCES • Budget Criteria • February 2017 Expenditure Limitation presentation to the Governing Board • June 2017 Adoption of Tax Levies and Rates and Budget for FY18 • FY18 General Fund Budget Detail • November 2017 Report to the Governing Board – Proposed FY19 Budget Calendar • November 2017 Preliminary Budget Presentation to Student Leadership • December 4, 2017 FY19 Budget Outlook Presentation to the Governing Board • January 2018 Budget Forums Presentation
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