08/25/2004

 

 

TO:                  Bruce Riley

 

FROM:            Ron Lostetter

 

RE:                   Answers to Budget/Budget Related Questions

 

 

Below and attached are answers to the questions the Faculty Senate requested of Chancellor Hastad on May 10, 2004 regarding “Budget Reduction and Related Issues.” We would be happy to provide further details on any item discussed in this response. Thank you for your continued interest and involvement in UW-L budget matters.

 

  1. Where are the resources associated with the UW-L reductions not returned to the state (35% cushion, salary savings and fringe benefit savings)? When and how will it be restored?

 

For the first question, please refer to “Attachment A”. The campus implemented a budget reduction for the 03-05 biennium which, with the “fringe benefit” effect, had $ 1,096,141 for items beyond the state- imposed budget reduction of

               $ 1,692,900. The majority of the $ 1,096,141 was allocated by moving $ 800,000 to cover the tuition shortfall from reduced non-resident tuition. The remaining amount was used to cover FY 04 and FY 05 ACT 33 Veto Reductions. Once the ACT 33 reduction was phased in, the campus used the remaining $ 195,804 for funding ad hoc instructors to fill needed sections in FY 04. The result is that at the end of FY 05, we will be $ 3,752 short of needed funds to meet these reductions.

 

Related to the second set of questions, the funds would be “replenished” as we restore our non-resident enrollments to our original targets. This will occur over the next several fiscal years as our new “investments” in student mix produce results. The funds will be allocated to the top priorities of the campus as recommended by the Joint Planning and Budget Committee, governance groups and as approved by the Chancellor.

 

  1. What is the projected situation for FY 04?

 

We assume the question refers to projecting the non-resident enrollment for Fall 2004. At this  time, the projections are that non-resident enrollments for Fall 2004 will be about the same as Fall 2003.

 

 

 

 

  1. Is there a credible plan for meeting EM 21 non-resident targets by 2006?

 

We assume the question is referring to the non-resident targets for Fall 2006. The campus has hired the consulting firm Noel-Levitz to work with the campus in developing recruitment plans (short- term and long- term) to meet campus enrollment mix goals. One of these goals is to meet the campus non-resident targets. The campus recruitment plans will have specific steps that the campus must accomplish in order to meet this and other recruitment goals. Working with Noel-Levitz is the “Task Force for Attaining Enrollment Targets/Mix” comprised of the Provost, Vice Chancellor for Administration and Finance, the Assistant to the Chancellor for Diversity, and the Assistant Chancellor for Advancement. This Task Force is currently working with the offices of Admissions, Financial Aids, and Registration and Records to move forward with recruitment efforts geared to move the campus along the slope needed to meet the Fall 2006 numbers. By about December 2004, the Assistant Vice Chancellor for Enrollment Management should be on board to assume this task. The Task Force will work directly with the person hired in this new position as the campus progresses in its student mix recruitment efforts.

 

  1. Is there a plan to develop additional financial resources that can be used to recruit the required number of non-resident students?

 

As the recruitment plans in # 3 above are developed, financial needs will be identified. The resources to meet the needs will come from several sources. For example, the Student Academic Initiatives identify resources to pay stipends to international students as a way to help meet their costs of attending UW-L. This will amount to $ 45,000 with an additional $ 45,000 match from UW-L. The Board of Regents has approved the “Return to Wisconsin Program” that reduces non-resident tuition 25% for non-residents who had a parent or legal guardian graduate from UW-L. The Foundation is awarding “Chancellor’s Scholarships” for non-residents who meet certain criteria. Additionally, the campus may re-allocate non-instructional funds to further meet recruitment expenses as long as there is a positive pay-off for doing so.

 

  1. Is there a plan to coordinate the various student recruitment targets across UW-L Offices?

 

Yes, this will be part of the recruitment plans mentioned in # 3 above.

 

  1. Is there a plan to predict and compensate for fluctuating student FTE?

 

The campus has many student FTE targets.  There is an overall FTE target which is now set for the next three fall sessions. That target # is 8075 pending no major budget issues or other surprises. The campus has taken a position to build its budget tuition model using “liberal” estimates to have the base budget from UW System be as large as possible. The idea is that it would be easier to “give money back” than to “ask for it.”. The campus also has a $ 400,000 “clearing account” to help absorb tuition shortfalls. Funds from this pool that are not expended by about March in any given year are used to fund one-time academic needs in academic units such as capital items or carried-over for use in academics such as funding ad hoc instructors to meet section needs. Certainly the new Assistant Vice Chancellor working with the Enrollment Management advisory group, the campus Institutional Researcher, and the Chancellors Staff will play a large role in helping “smooth” campus FTE enrollment figures.

 

  1. Will the proposal for matching differential tuition adversely affect instruction?

 

The proposal for matching differential tuition (see Attachment B) identifies matching funding sources which are all non-instructional sources. Certainly these funds could be used to supplement instruction. However, the students felt, and administration agreed, that the differential tuition programs are academically related and will benefit student (and faculty) experiences at UW-L.

 

  1. Is the proposal for matching differential tuition viable in the long term?

 

Attachment B contains the funding sources for matching differential tuition. There are five sources. The administrative salary savings is a “base reallocation” from administration to the academic initiatives and is viable for the long term. The second source is vending revenue which averages about $ 100,000 per year and, as you can see, the portion allocated to funding the Academic Initiatives is actually reduced in year two by $ 10,000 to $ 31,900. The match also calls for 10 new international students to allow a match of $ 100,000. Considering the fact that $ 90,000 is being used to partially fund “in-bound” international student stipends, this is nearly a wash. The benefit, of course, is that the long-term increase will be beyond 10. The result will be funds for other strategic purposes and a greater diversity of our student body. A fourth source is work study match funds. This source is solid as long as there is federal “Campus Based Aid.”  And lastly, the “fringe benefit pool” will fund nearly $ 95,460 in match. This is a function of placing the academic initiative positions in GPR and how salary/fringe benefits are paid.

 

  1. How do other campuses provide financial incentives to non-resident students?

 

      All campuses have some “common” sources. Non-resident waivers, federal financial aid, work programs, etc. would form the basic sources. From there, outside sources would take over. These include Foundation- funded scholarships or commitments from other private sources for scholarships and/or work opportunities. What is different among campuses is the number of non-residents that they have. Over the last four years, we lost well over 100 non-residents. Many campuses in the UW System, some larger than UW-L, had less than 50 non-residents in total four years ago. We need to return to and exceed the numbers we had previously. This will further diversify our campus which is critical to our future as well as deriving economic benefits.

 

  1. Are there differences between UW-L and other system campuses in terms of the way the AFIR reports are structured?

 

      No, all system campuses use the same AFIR report form. There certainly would be differences related to specifics such as numbers/types of differential programs and/or service -based pricing programs which would impact tuition. But the same basic reporting format is used by all campuses.

 

Finally, the Faculty Senate made a second motion on April 29, 2004, related to recommending that university funds used to match differential tuition not come from instructional budgets. As outlined in Attachment B, no funds listed are from instructional budgets. It has been and is the students and our intent to enhance students academic experiences with the differential tuition funds. Reducing instructional budgets for this activity would not accomplish this goal.


 

Attachment A

UW-La Crosse

03-05 Biennial Budget Reconciliation

April 2004

R. Lostetter

 

 

Campus 03-05 Budget Reduction w/o FB                                             $  2,392,835

 

Less Actual 03-05 Budget Reduction

With FB                                                                                                 - 1,692,900

 

Difference                                                                                             $     699,935

 

Plus Campus FB Effect                                                                            +  396,206

 

Funds Available                                                                                    $  1,096,141

 

Less Amount Held For Tuition Revenue

Shortfall                                                                                                   -  800,000

 

Less Amount for FY 04 ACT 33 Veto Reduction

Related To Health Insurance Coverage For

Part Time Employees                                                                               -  100,337

 

Funds Available                                                                                    $    195,804

 

Funds Released FY 04 To Provost For Adding

Sections                                                                                                     195,804

 

Funds Available (From Above)                                                            $    195,804

 

FY 05 ACT 33 Veto Reduction Related To

Health Insurance Coverage For

Part Time Employees                                                                              -  199,556

 

Budget Shortfall FY 05                                                                         $ -     3,752

 


 

Attachment B

 

UW-La Crosse

Differential Tuition

Funding Scenario

April 2003, R. L.

 

                                                Year 1                          Year 2 And

                                                (FY 04)                        Beyond

 

 

Funding Sources:

 

Student Differential

Tuition                                 $  297,500                    $  387,500

 

Institutional Sources:

 

  Fringe Benefit

  Pool                                       95,400                         95, 400

 

  Work-Study/

   Match                                  120,140                        120,140

 

  Portion of Incremental

  Interntl. Stu. Tuition                                                    100,000

 

  Vending Revenue                     41,900                          31,900

 

  Administrative

  Salary Savings                        40,000                          40,000

 

  Sub-total Admin.

  Sources                              $ 297,500                    $  387,500

 

Total All Sources                $  595,000                     $  775,000