Officers of Administration Annual Meeting October 10th, 2013.

Officers of Administration Annual Meeting

October 10th, 2013

Agenda

• Financial Update• Governance Transition• Other Key Initiatives• Questions

2

Financial Update

• Overview – UO Budget Structure• Financial Update – End of FY13• Projected Revenue Streams – FY14

and beyond• Key Issues Going Forward

3

School & College Budgets

UO Budget Structure

4

E&G Funds Other Funds

Central AdminBudgets

Insitutional Expenses(Debt, assessments,

utilities, leases)

• Tuition revenue• State Appropriation• F&A Return• Overhead revenue• Fee revenue, interest earnings

• Grants and Contracts revenue• Auxiliary Revenue• Service Center Revenue• Designated Operations Revenue• Restricted gifts

Grants & Contracts

Plant Funds

Auxiliary, Service Centers, and Designated

Ops Funds

Restricted Gifts

Financial ResourcesFY2013 Revenue Streams

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State Appropriation $46.4 million

Decreased levels of State Appropriation

Loss of more

than $30 million

of annual support per year

FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 $-

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

$80.0

$90.0

University ResourcesFY2013 Revenue Streams

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State Appropriation $46.4 million

Resident Tuition $119.1 million

Non-resident Tuition $241.8 million

8

FY2004 - Revenue Breakdown

Nonresident Tuition as % of Total Three sourcesResident Tuition as % of Total Three sourcesState Appropriation as % of Total Three sources

FY2013 - Revenue Breakdown

Nonresident Tuition as % of Total Three sourcesResident Tuition as % of Total Three sourcesState Appropriation as % of Total Three sources

Increasing Dependence Upon Non-Resident Tuition

School & College Budgets

UO Budget Structure

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E&G Funds Other Funds

Central AdminBudgets

Institutional Expenses(Debt, assessments,

utilities, leases)

• Tuition revenue• State Appropriation• F&A Return• Overhead revenue• Fee revenue, interest earnings

• Grants and Contracts revenue• Auxiliary Revenue• Service Center Revenue• Designated Operations Revenue• Restricted gifts

Grants & Contracts

Plant Funds

Auxiliary, Service Centers, and Designated

Ops Funds

Restricted Gifts

End of FY09 (4.6%) End of FY10 (11.1%) End of FY11 (14.7%) End of FY12 (15.6%) Projected End of FY13 (14.7%)

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

E&G Fund Balance(millions)

E&G Carry Forward Balances

0.48% 3.89%

46.17%

20.28%

9.68%

14.90%

3.51% 0.32% 0.76%

E&G Carry Forward into FY09

President's Office

Senior VP & Provost

Schools & Colleges

VP - Academic Affairs

VP - Finance & Admin

VP - Research & Graduate School

VP - Student Affairs

VP University Development

VP - University Relations

2%

5%

63.96%

18%

5%4%

1% 0% 2%

Projected E&G Carry Forward into FY14

School & College Budgets

UO Budget Structure

12

E&G Funds Other Funds

Central AdminBudgets

Institutional Expenses(Debt, assessments,

utilities, leases)

• Tuition revenue• State Appropriation• F&A Return• Overhead revenue• Fee revenue, interest earnings

• Grants and Contracts revenue• Auxiliary Revenue• Service Center Revenue• Designated Operations Revenue• Restricted gifts

Grants & Contracts

Plant Funds

Auxiliary, Service Centers, and Designated

Ops Funds

Restricted Gifts

Unrestricted Net Assets(thousands)

End of FY09 End of FY10 End of FY11 End of FY12 Estimate - End of FY13 $-

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

2.5Weeks

4.5Weeks

6.8Weeks

7.2Weeks

7.0Weeks

Operating Cost

Coverage

Agenda

• Overview – UO Budget Structure• Financial Update – End of FY13• Projected Revenue Streams – FY14

and beyond• Key Issues Going Forward

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Major Recurring Sources of Operating Funds – E&G Funds (Pre PERS Buy Out)

• Tuition revenue– Resident Undergraduate – capped at 3.5% FY14 & FY15– Non-Resident Undergraduate – market pressure

• State Appropriation – Early projection without buy-down: 1.1% increase in

FY14 and 3.0% increase in FY15 (3.0%/4.8% with buy down)

• F&A Return– Dropped $1.5 million in FY13 and likely to drop another

$1.0 million in FY14

Major Recurring Sources of Operating Funds – E&G Funds

FY2012 FY2013FY2014 -

ProjectionsFY2015 -

Projections Notes:

Net UG Tuition $ 243,200,000 $ 264,200,000 $ 269,500,000 $ 275,000,000

Assumes approximately 3% average FY15 tuition inrease, no substantive change of plan in size or mix of UG population. FY14 permanent $859K tuition buy down for state app; assumes additional $859K tuition buy down in FY15

Net G Tuition (after GTF/Law rem) $ 36,100,000 $ 34,900,000 $ 34,300,000 $ 35,200,000 Probably an overestimate in FY2015

Summer Session $ 13,700,000 $ 17,300,000 $ 18,700,000 $ 19,200,000 Possibly an underestimate in FY15

Continuing Education $ 10,200,000 $ 11,800,000 $ 12,200,000 $ 12,500,000 Also might be an underestimate in FY15

Other Tuition and Fees* $ 11,300,000 $ 12,200,000 $ 13,500,000 $ 14,100,000

* Matriculation, Special Student Tuition, 17XXXX (approx 8M), New International Fee inFY14 - ramping up over 4 years. Other assumptions same as tuition.

State Appropriation $ 50,300,000 $ 46,400,000 $ 47,800,000 $ 50,100,000

Gross State Appropriation; includes $859K FY14 tuition buy down and additional $859K FY15 tuition buy down; also includes estimate of recurring incentive funds - same as FY13 ($617K)

Overhead $ 6,800,000 $ 8,600,000 $ 8,500,000 $ 8,800,000 New rate structures ramping up over four years

F and A recovery $ 20,700,000 $ 19,200,000 $ 18,200,000 $ 17,300,000 FY14 and 15 estimates carry substantial uncertaintyTotal Operating Funds $ 392,300,000 $ 414,600,000 $ 422,700,000 $ 432,200,000

Year to year growth 5.68% 1.95% 2.25%

3.28%Annualized Growth Rate over three years.

Key Issues Going Forward

• Salary increase funding in the context of available revenue

• Human & Capital infrastructure to support campus growth

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FY2008 (Fall) FY2009 (Fall) FY2010 (Fall) FY2011 (Fall) FY 2012 (Fall) FY 2013 (Fall)18,000

19,000

20,000

21,000

22,000

23,000

24,000

25,000

20,376

21,507

22,386

23,389

24,398 24,591

UO Office of Enrollment Management, November 4, 2011

Context: Rapidly Growing Student Enrollment

CONFIDENTIAL – INTERNAL ADVISORY COMMUNICATION

Year Students Tenure Related Faculty

Student / Tenure Related Faculty Ratio

FY2008 20,376 642 31.74FY2009 21,507 646 33.29FY2010 22,386 660 33.92FY2011 23,389 683 34.24FY2012 24,398 697 35.00FY2013 24,591 715 34.39

Additional Tenure Related Faculty Hiring

CONFIDENTIAL – INTERNAL ADVISORY COMMUNICATION

Student / Tenure Related Faculty Ratio

FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 30.00

31.00

32.00

33.00

34.00

35.00

36.00

To return to FY2008 Ratio of 31.7 – Need 60 Tenure Related Faculty

To return to FY2000 Ratio of 27.9 – Need 166 Tenure Related Faculty

CONFIDENTIAL – INTERNAL ADVISORY COMMUNICATION

Classroom Infrastructure

CONFIDENTIAL – INTERNAL ADVISORY COMMUNICATION

Key Issues Going Forward

• Salary increase funding in the context of available revenue

• Human & Capital infrastructure to support campus growth

• PERS and PEBB Costs

22

Governance Board

• New University of Oregon Board of Trustees• Major functions University of Oregon will likely take over

from State Board of Higher Education– Treasury Functions (Debt & Cash Management)– Preparation of Audited Financial Statements– Payroll tax reporting– Internal Audit– Retainer contracts, P-Card Program– Risk Management (TBD)

• Ongoing discussions: Shared Services and governance structure for regional and technical institutions

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Other Key Initiatives

• New CHRO / Restructuring HR Functions• New Version of Academic Budget Model • Expanded Focus of Tuition & Fee

Advisory Board• Implementation of new faculty CBA• Development of facilities plans

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Questions?

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