FY16 BUDGET FORUM
FY16 BUDGET FORUM February 20, 2015
Michael Hindery Vice President for Finance and Administration February 2015
FY16 BUDGET FORUM
“It’s Always a Great Day to be a Bronco!” 1,320
Launched Illuminate
entering freshman in fall 2014
www.scu.edu/alumn i/illuminate
Have raised
$17.5M for the new law school building
Completed long-term strategic plan
Rhodes Scholar Aven Satre Meloy
17.3%
return on investments 6 faculty
recognized as 2014 Women of Influence by Silicon Valley Business Journal
Have raised
$18M
for Edward M. Dowd Art & Art History Building
50 years of women’s athletics 12 newly recruited tenure track faculty & 6 new lecturers in FY15
February 2015 Feb. 20, 2015
$50.5M of new gifts raised in FY 2014
Recycled water = 40% of total campus water consumption
Freshman to sophomore retention rate
96%
One of the highest among SCU peer institutions 22
FY16 BUDGET FORUM
Agenda Integrated Strategic Plan Facilities Plan Budget Process & Considerations FY16 Salary Pool Capital Plan Questions
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Overview
• The university's financial
fundamentals are very solid
• 3.5% merit salary pools
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Integrated Strategic Plan: Goals 1
www.scu.edu/santaclara2020 Imparting a transformational Jesuit education
2
Fashioning a more humane, just, and sustainable world
3
Fostering innovation and entrepreneurship in service of humanity
4
Advancing contemporary theological studies, education, and ministry
5
Increasing diversity, access, and affordability
6
Enhancing Santa Clara’s reputation and national visibility February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Integrated Strategic Plan: Impact A transformed Santa Clara University – STEM – Increased visibility of arts and humanities – Law School – Athletics – Increased enrollment and satisfaction Programs to meet the growing and changing
Silicon Valley and its needs
– Engagement with the Silicon Valley
An endowment of $1.3B in FY23 – $415M in distributions to the operating budget over the next nine years – $422M in additions to principal – $460M in endowment earnings (portfolio return) Assumption: 5% annual return February 2015 Feb. 20, 2015
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FY16 BUDGET CapitalFORUM Project
Timeline All projects will have: • Steering Committee • Executive Committee
$31M Edward M. Dowd Art and Art History Building $58M
$146M
School of Law
STEM 2
$103M STEM I
$132M
$20M Athletics
STEM 3
STUDENT LIFE AND SERVICES $25M
$24M Benson Center Renovation
Housing 1
$53M
Housing 2
Enrollment Increase (+600 undergraduates)
2014/15
2015/16
2016/17
2017/18
2018/19
2019/20
2020/21
2021/22
2022/23
2023/24
FISCAL YEAR February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Capital Projects: Costs and Sources $448M
Total Fundraising/Gifts
ALL PHASES
Total
$145M
University Resources
TOTAL CAPITAL COSTS: $593M
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Edward M. Dowd Art & Art History Building An innovative facility that encourages and inspires collaboration, visual literacy, scholarship, and creativity to develop uniquely creative thinkers and imaginative problem solvers.
$10M $21M
$18M
$21M
Fundraising Target
Raised To Date OPEN FALL 2016 CONSTRUCTION BEGINS MARCH 2015 February 2015 Feb. 20, 2015
$10M
University Resources
$31M TOTAL PROJECT COST 9
FY16 BUDGET FORUM
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
University Budget Council (UBC) Amy Connell
Assistant Provost
Harry Fong
Associate VP for Finance
James Hall
Faculty Representative, Management
Mike Hindery, Chair
VP for Finance & Administration
Dennis Jacobs
Provost & VP for Academic Affairs
Lisa Kloppenberg
Dean, School of Law
James Lyons
VP for University Relations
Robert Numan
President-Elect, Faculty Senate, Psychology
Michael Sexton
VP for Enrollment Management
Robin Reynolds
University Budget Director
Ed Ryan
Vice Provost
Claire Shaw
President, Staff Senate February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Budget Planning Process JULY
JUNE
All budgets are balanced and loaded into PeopleSoft
MAY
Compensation budgets finalized after salary planning is completed
MICRO:
Budget development at the unit level.
New fiscal year begins
AUG/ SEPT
Macro Budget Planning for next fiscal year
MICRO BUDGET PROCESS
MACRO BUDGET PROCESS
MAR
Micro budget revenue and expense allocations confirmed
MACRO:
Budget development at the aggregate level for operating revenue and expense.
OCT
New funds requests for the coming fiscal year submitted for review
OCT thru DEC
FEB
University Budget Council develops macro budget
University Board of Trustees approves budget recommendations
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
FIVE GUIDING PRICIPLES 1.
Maintaining the lowest possible cost of education by controlling tuition and room and board rate increases and funding financial aid
2.
Increasing SCU’s ability to recruit and retain talented faculty and staff
3.
Making investments which support the strategic plan
4. Investing in information technology
to enhance the learning environment and maintain SCU’s position in the Silicon Valley
5. Responsibly steward costs and expenses
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Undergraduate Financial Aid
$
The sources of financial aid funding are: • Endowment • spendable gifts • the tuition discount
We are budgeted to spend $84.8M in FY16 on student financial aid
The average award in FY15 from all sources
is $25,280
Santa Clara currently meets
74%
of students’ financial need
February 2015 Feb. 20, 2015
4,088
undergraduate students are receiving financial aid in FY15
14
FY16 BUDGET FORUM
Endowment Market Value and Performance The endowment funds faculty, financial aid, academic programs and athletics $1,000,000
17.3%
$900,000
12.5% 17.7%
$800,000
14.2%
$598,657
$500,000 $400,000 $300,000 $200,000
$509,149
-21.4%
$697,881
16.5%
-1.4%
13.9%
12.9%
$700,000 $600,000
20.1%
-1.8%
$676,072
$716,821 $688,118 $603,618
$528,892
$449,543
$ notes market value % notes annual investment performance
$875,090 $760,218
We are budgeted to spend $33.2M in endowment payout in FY16
$100,000 $FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014
February 2015 Feb. 20, 2015
15
FY16 BUDGET FORUM
Revenue Sources Sources of revenue aren’t changing – we are tuition dependent 250.00
FY13 Actual FY14 Actual
200.00
FY15 Projected FY16 Budget
150.00 100.00 50.00 0.00
UG Tuition
FY13 Actual
208.30
Graduate Tuition 74.00
Student Fees
Auxiliaries
Gifts
Other
TOTAL
6.20
Endowment Income 26.30
34.40
19.10
14.10
FY14 Actual
225.60
77.40
5.70
27.70
39.50
13.20
20.50
382.40
FY15 Projected
233.30
81.20
6.20
29.10
33.70
17.40
16.20
409.60 417.10
FY16 Budget
237.20
76.00
5.80
33.20
35.50
20.50
15.90
424.10
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Budget Considerations FACULTY AND STAFF MERIT POOL
UNDERGRADUATE TUITION RATE
A 1% change in the salary merit pool costs ~$1.4M
A 1% change In the
undergraduate tuition rate increases revenue
by ~$2M
GRADUATE TUITION RATE
A 1% change in all
BENEFITS RATE
graduate program tuition rates increases revenue by ~$700K
A 1% change In
the benefits rate costs
~$1.5MK
OPERATIONS & MAINTENANCE Utilities, IT maintenance contracts and insurance have contracted increases ranging from 3% - 8% resulting in expense change of ~$700K
February 2015 Feb. 20, 2015
ROOM & BOARD RATE
A 1% change In the room and board rate increases revenue
by ~$250K
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FY16 BUDGET FORUM Faculty Salary Comparisons Annually, a faculty salary analysis is conducted using faculty salary information from 21 institutions American University
Fordham University
Scripps College
Babson College
George Washington
Southern Methodist
Loyola Marymount University
University of Notre Dame
Loyola University Chicago
University of Richmond
Northeastern University
University of San Diego
Claremont McKenna College
Pepperdine University
University of San Francisco
Drexel University
Pomona College
Villanova University
Bentley University Boston University Claremont Graduate
University
University
University
Sources: AAUP and CUPA-HR
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
3.5% - $2.03M
Faculty Compensation
merit pool increase
 Competitive
$800K
compensation is a priority.
 FY16 budget
addresses current market lag.
for promotion increases, market adjustments, and equity
FY16 budget increases include:
$1.8M February 2015 Feb. 20, 2015
$1.7M to increase tenure track faculty in support of enrollment increases. Total of 20 full-time equivalents added over two years.
increase over FY15 benefits budget for faculty 19
FY16 BUDGET FORUM
Staff Compensation Annually, a staff salary analysis is conducted using salary information from the following: National Survey Sources Mercer Hay Group Aon Towers Watson The Conference Board World at Work
Peer and Regional Sources Dice Technology Survey World at Work CUPA Peer Report - Stanford, USD, SMC, Pepperdine, UOP,USF, LMU, Chapman, Golden Gate - UC Schools - Select CSU Schools
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Staff Compensation
3.5% - $2.20M merit increase
 Competitive
$550K
compensation is a priority.
 FY16 budget
addresses current market lag.
for market, equity, and retention adjustments associated with organizational changes
The FY16 budget includes:
$1.9M February 2015 Feb. 20, 2015
$734K for salary adjustments resulting from a review of current positions and the compensation structure
increase over FY15 budget for staff benefits 21
FY16 BUDGET FORUM
Faculty & Staff Additions Faculty: 20 full-time equivalents over two years – 16 Tenure Track positions – 4 Renewable Term Lecturer positions Staff: – 17.5 new staff positions 7 fixed term positions funded by restricted funds
– 12 existing fixed term positions converted – the right thing to do
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Cost of Education – focus on accessibility and affordability 3.4% tuition rate increase – 2nd lowest in 30 years!
3.9% room and board rate increase
Undergraduate tuition discount rate increased to 28% Combined total cost of education of $58,725 = a blended increase of 3.5%
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
FY14 Operating Expenses A&S
Information Technology 5%
University Administration & Services 23%
Business
A&S 13%
Engineering Law
Business 9%
ECP
Engineering 4%
Centers of Distinction
Law 8%
Operations and Maintenance 5%
JST
Athletics Auxiliary Services
Financial Aid 22%
JST 1%
ECP 2%
Centers of Athletics Distinction 2% Auxiliary Services 3% 3%
February 2015 Feb. 20, 2015
Financial Aid Operations and Maintenance Information Technology University Administration & Services
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FY16 BUDGET FORUM
Expenses by Category ($ millions)
90.00
FY13 Actual
80.00
FY14 Actual
70.00
FY15 Projected FY16 Budget
60.00 50.00 40.00 30.00 20.00 10.00 0.00
Student Wages
Library Acquisitions
Financial Aid
Debt Payment
Capital Spending
TOTAL
42.00
Department Operating Expense 75.10
5.30
5.50
73.50
16.90
23.80
371.60
69.80
44.90
75.70
5.90
5.30
80.00
16.70
17.30
383.80
69.40
72.90
47.10
74.20
5.90
5.40
83.00
16.60
19.50
394.00
76.10
80.00
53.40
76.50
5.90
5.90
84.80
16.40
24.50
423.50
Faculty Salaries
Staff Salaries
Benefits
FY13 Actual
64.50
65.00
FY14 Actual
68.20
FY15 Projected FY16 Budget
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM Operating
Budget
TOTAL FY 2015 BUDGET
($ millions)
TOTAL FY 2016 BUDGET
Revenue Undergraduate Tuition Graduate Tuition Student Fees Endowment Income Auxiliaries Gifts Other Total Operating Revenue
220.5 74.9 6.0 29.1 33.7 18.8 15.8 398.8
237.2 76.0 5.8 33.2 35.5 20.5 15.9 424.2
Expense Faculty Salaries Staff Salaries Total Salaries & Wages
71.4 74.9 146.3
76.1 80.0 156.1
Benefits Total Salaries & Benefits
49.7 196.0
53.4 209.5
Operating Expenses Student Wages Library Acquisitions Financial Aid Debt Payment Capital Spending Contingency Total Expenditures Total Results
70.8 5.4 5.6 79.4 16.6 19.0 4.3 397.1 1.7
76.5 5.9 5.9 84.8 16.4 24.5 423.5 0.7
0.5 1.2 (0.0)
0.7 (0.0)
Reinvested Funds Operating Fund Balance Capital Fund Balance NET TOTAL Results
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Capital Budget
Facilities & Auxiliaries
Information Services
New Construction
• Funding for standard renewal & improvement
• $5.5M 1st yr of network funding • $7.6M renewal & improvement
• Funding for planning phase of several new construction projects
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
Information Services: 10-Year Capital Budget Plan FY16 Request*
FY17 Projected Request
FY18 Projected Request
FY19 Projected Request
FY20 Projected Request
FY21 Projected Request
FY22 Projected Request
FY23 Projected Request
FY24 Projected Request
FY25 Projected Request
TOTAL
Information Security
0.1
0.2
0.1
0.0
0.2
0.1
0.0
0.2
0.1
0.0
1.0
IT
4.1
1.1
2.5
4.4
2.2
3.2
0.8
2.3
0.4
3.4
24.4
Media Services
4.4
2.1
1.3
1.3
2.3
2.4
3.5
1.4
2.2
2.6
23.5
Networking**
5.5
5.5
2.1
1.31.3
2.3
2.4
3.5
1.4
2.2
2.6
23.5
$ 7.4
$ 7.6
$ 7.1
$ 6.0
$ 5.8
$ 7.8
Total IS CapEx Request
$ 14.1
$ 8.9
$ 3.9
$ 5.
$ 74.4
($ millions) * Includes deferred capital **Assumes spreading Networking costs over two fiscal years.
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
FY16 Capital Budget SOURCE OF FUNDS ($ millions) Capital Renewal General University Facilities Auxiliaries Technology Subtotal Renewal Capital Improvements General University Facilities Auxiliaries Subtotal Improvements Real Estate General University Facilities Subtotal Real Estate
Capital Budget
Operating Budget
Fund Balances
Debt
Funding Total
Gifts
5.7 2.6 13.1 21.4
3.0 2.6 5.2 10.8
2.7 7.9 10.6
-
-
5.7 2.8 13.1 21.4
7.0 6.7 13.7
7.0 6.7 13.7
-
-
-
7.0 6.7 13.7
2.5 2.5
-
2.5 2.5
-
-
2.5 2.5
37.6
24.5
13.1
-
-
37.6
New Construction Master Plan Franklin Street Mall Co Generation Plant Law School STEM I Benson Expansion - Facilities Leavey Upgrades Residence Hall A Dunne Remodel
1.5 1.5 4.5 3.0 4.0 1.0 0.9 2.0 1.5
-
1.5
4.5 2.0 -
1.5 1.8 3.0 4.0 1.0 0.9 -
1.5 1.8 4.5 3.0 4.0 1.0 0.9 2.0 1.5
TOTAL NEW CONSTRUCTION
20.2
-
1.5
6.5
12.2
20.2
Total Capital Budget – FY16
57.8
24.5
14.6
6.5
12.2
57.8
TOTAL RENEWAL AND REPLACEMENT
* New construction indicates long-term funding source
February 2015 Feb. 20, 2015
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FY16 BUDGET FORUM
THANK YOU February 2015 Feb. 20, 2015
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