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.
- 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
$ 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.
- What is the projected situation for FY 04?
We assume the question refers to projecting the
non-resident enrollment for Fall 2004. At this
- 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
- 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.
- 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.
- 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
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.
- 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.
- 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.
- 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
- 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
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 student
academic experiences with the differential tuition funds. Reducing instructional
budgets for this activity would not accomplish this goal.
03-05 Biennial Budget Reconciliation
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
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
April 2003, R. L.
Year 1 Year 2 And
(FY 04) Beyond
Tuition $ 297,500 $ 387,500
Pool 95,400 95, 400
Match 120,140 120,140
Portion of Incremental
Interntl. Stu. Tuition 100,000
Vending Revenue 41,900 31,900
Salary Savings 40,000 40,000
Sources $ 297,500 $ 387,500
Total All Sources $ 595,000 $ 775,000