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Faculty Senate » Annual Report 2002-2003

Budgets & Fiscal Planning Committee

 
ANNUAL REPORT 2002-2003

Budgets and Fiscal Planning Committee Report – Academic Year 2002-2003

    The Budgets and Fiscal Planning Committee engaged in four primary activities during this year. They were: (a) preparation of a solution to a homework problem assigned by Bruce Sorte to make a rough estimate of the cost of OSU 2007 (b) review and make recommendations concerning the budgets and feasibility of several category I proposals (c) represent the views of the faculty in the University Budget Committee and (d) to summarize and present, in the most transparent manner, the OSU budget for FY 2004.
    The rough cost estimate for OSU 2007 is attached to this report as an appendix. The principal findings from this exercise were: (a) the need for a capital campaign for 400 M$ to fund the estimated non-recurring costs of OSU 2007, many of which are tied to the “top tier program” in engineering (~180M$). (b) the savings in recurring costs approximately match the new costs provided personnel reduction takes place “from the top down not the bottom up”. Deans, etc. need to fired rather than clerks.
    The B&FP Committee examined the budgets and other aspects of seven category I curricular proposals. Many hours were spent on the Education double degree proposal, primarily to clarify what the proposal actually involved. In this case and in several other cases, the B&FP group served as a screening group to clarify proposals. In this regard, we recommend that new category I proposals be routed (by Academic Affairs) to the B&FP group before proceeding to curricular review so that fiscal and budgetary issues can be identified early in the process. A second concern in this area is the need for some sort of guidance to the B&FP group as to the fiscal limits of growth of the curriculum. The E&G budget for OSU increased by ~ 6% from FY03 to FY04, largely due to increases in tuition and fees. It is not clear to us whether that rate of growth is sustainable and what limits, if any, there are for new programs, degrees, etc.
    Members of the B&FP group went to University Budget Committee meetings to make sure our views were represented and to report back to the group as to what had transpired.
In late spring (May ’03) the B&FP group summarized the detailed preliminary budget for FY04 and posted the results on a web site where faculty and staff could see what was happening.

Appendix—OSU 2007
Name: Budgets and Fiscal Planning Committee
Assignment: OSU 2007 Homework Problem

    Bruce Sorte asked the B&FP Committee, as a homework assignment, to develop a crude cost estimate for the various components of OSU 2007. This paper represents our attempt to work this problem. It should be emphasized that our estimates are CRUDE, based on “back of the envelope” calculations intended to illustrate the magnitudes of various items. They should not be used in place of more accurate estimates developed by Institutional Research, etc. A further caveat is that we did not treat some items in OSU 2007 because either we did not understand what a particular proposal entailed or it did not seem appropriate to use very crude techniques to “guessestimate” a cost. Examples of this are “space charges” (where it was not clear to us what the financial implications were) and “service centers” (where better estimates are being developed). We submit this homework in hopes that it might be a rough first step in understanding the cost implications of OSU 2007.

    The bottom line of our estimates is that if all the sections of OSU 2007 were implemented (recognizing that some of them are contradictory) a non-recurring capital expenditure of about $400,000,000 would be needed (presumably to be raised by a capital campaign of the OSU Foundation.) We estimate an increase in recurring expenses of ~$29,000,000 /year with a savings of ~$30,000,000 /year leaving a net “zero sum” or a possible savings of $1,000,000/year in recurring costs.

Our estimates are given in the following tables.

Non-recurring Expenses
Action
Cost
Basis for Estimate
Top Tier Status for COE
180,000,000
OSU2007
House all freshmen in University Housing
70,000,000
=frac fresh off campus x #fresh x cost/student of new dorm space=0.4 x 3900 x $9,500,000/210 students
Establish Technology Enterprise Institute
60,000,000
OSU2007
Do deferred maintenance for UHDS
50,000,000
OSU2007
Update/fix large classrooms
20,000,000
OSU2007
Make all buildings accessible
15,000,000
OSU2007
More enhanced classrooms
5,000,000
= #classrooms x cost per classroom = 20 x $250,000
Enhance conference capability
650,000
OSU2007
Fix/replace Blackboard
500,000
BFP
Bring campus wiring up to date
1,250,000
$25,000 per building x 50 buildings
Gigabit connection to outside world
350,000
IS
Create Strategic Communications Plan
50,000
OSU2007
Remodel and relocate Office of Services for Students with Disabilities
50,000
OSU2007
Establish Web Content Management System
150,000
OSU2007
Charter two new organizations to facilitate University Communications
10,000
OSU2007
Revise course scheduling
10,000
BFP
New testing fee schedule
1000
BFP
Totals
403,021,000


In addition, there are three items (update faculty position descriptions, development of new University themes, 3 --> 4 credit re-packaging of curriculum) that could lead to an investment of substantial amounts of faculty time, which is a resource expenditure.

    In the estimates of recurring costs below, we have counted expenditures of faculty time where that action would lead to the need to replace the instruction or other service offered by the faculty member. We did not include costs of faculty time for the usual overloading by insensitive administrators. All financial data is from 2001 OSU Fact Book. We have assumed any new infrastructure carries a minimum cost of $100,000/year including OPE and that new deans, etc cost $200,000/year including OPE.

Savings of Recurring Costs
Action
Savings
Basis for Estimate
Eliminate low productivity units
15,000,000
~15% of ~ $100,000,000 academic budget involves low productivity programs
Reduce Administration by 10%
9,000,000
0.1 x $90,000,000
Merge colleges—Create new colleges around areas of inquiry
6,000,000
16 colleges/programs x 0.75 x $500,000/college –(assumes firing deans, etc.)
Efficiencies in curriculum management, student financial services, enrollment management
150,000
OSU2007
Surcharge on athletic tickets
50,000
$1/ticket x 50,000 tickets
Substitute non-lab courses for lab courses in BACC CORE Science Perspectives
100,000
BFP
Totals
$30,300,000


In addition, one can identify a non-recurring saving of $2,000,000 by a proposed transfer of funds from Athletics to the Academic portion of the University.

New Recurring Expenses
Action
Cost
Basis for Estimate
Allow each faculty member 0.1 FTE for non-departmental work
8,200,000
0.1 x $82,000,000
Ensure all faculty will have international experience
1,100,000
= 0.33 x average asst prof salary x #asst prof x 1/5 = 0.33 x 48300 x 358 x 0.2—a low estimate given issue of travel support
Increase Library funding to 4% of total University expenditures
1,200,000
In 1998-99, library was 3.4% of total U exp.; increasing that to 4% for 1998-99 (low estimate)
Establish Technology Enterprise Institute
100,000
OSU2007
Establish new PhD programs in CLA
1,000,000
10 programs x $100,000/ program of new hires
Increased support for research facilities
1,700,000
34 facilities x $50,000/facility
Increase financial aid in parallel with tuition increases
1,050,000
yearly tuition increase x yearly financial aid = 0.05 x $21,000,000
Make graduate students 20% of overall enrollment
5,250,000
# new grad students x cost of average GTA/GRA = 350 x $15,000
15% of students will be from minority groups
3,750,000
# new minority students x cost of “full-ride” scholarship = 250 x $15,000
Support innovative curricular development
200,000
# faculty x # hours/faculty x average faculty hourly wage= 100 x 40 x 50
Centralized Academic Success Center
100,000
BFP
Expand Office of Institutional Research to include Assessment
100,000
BFP
Establish Ugrad College to provide new courses for first two years
100,000
BFP
Establish Global Systems Science Institute
100,000
BFP
Hire VP for International Affairs/Dean of International Programs
200,000
BFP
Restore Faculty Grants and Awards for International Activities
900,000
OSU2007
Re-institute/redefine Dean of Research
200,000
BFP
Increase ugrad scholarly activity
500,000
# new projects x average $/project = 500 x $1000
Increase grad student scholarly activity
450,000
# new students x ($/grad fellowship + tuition) = 15 x $30,000
Create Training and Development Clearinghouse
100,000
BFP
More computer support
100,000
BFP
Strengthen Marketing
200,000
OSU2007
Restructure University Publications
200,000
OSU2007
Establish Web Content Management System
200,000
OSU2007
Adopt web standards
100,000
BFP
Establish Center for Teaching and Learning
100,000
BFP
Benefits package for part time faculty
700,000
# fac x $/month x mo/year x OPE = 100 x $2000 x 9 x 0.4
Increase Provost’s Fund
400,000
OSU2007
Hire VP of Diversity
200,000
BFP
Establish Coalition for Healthy Campus Community
50,000
OSU2007
Hire Alcohol/Drug Specialist
60,000
OSU2007
Enhance “study abroad” programs
50,000
OSU2007
Better communication with international alumni
50,000
new staff person
Enroll 10% of ugrad students in foreign study
115,000
#US ugrad students x 0.1 x $100 additional expense/year = 11500 x 0.1 x $100
Establish Performance Development Network
50,000
BFP
Create on-going personnel needs assessment program
50,000
BFP
Improve IT consulting desk
10,000
personnel
More IT training
50,000
personnel
Improve event publicity, web council
50,000
OSU2007
Establish Interdisciplinary Council
50,000
staff support
Professional development funds for advisors
50,000
BFP
Advisory Board for summer term
BFP
Improvements in search procedures
50,000
BFP
Formal faculty mentoring program
100,000
BFP
Revise P&T guidelines
10,000
BFP
Hold workshops on dealing with international students
10,000
BFP
Increase Honors College Enrollment
25,000
BFP
Totals
$29,335,000


This assumes any increases in normal enrollment, apart from special initiatives, are fully funded.