1. Financial Planning & Budgeting Update Sue Wolfe Office of Budget & Financial Planning F&A Advisory Group Apr 20, 2016

2. Financial Planning & Budgeting Cycle Strategic planning identify investments needed to realize strategic goals prioritize initiatives and execution strategy (timeframe) Financial & capital planning quantify financial parameters (sources and uses of funds) identify structural (fixed) costs, like debt, cost of living/merit vs discretionary new resources Annual budget prioritize what best advances enrollment & other strategic goals, within given parameters quantify short-term action plan (next 12 months Budget execution allocate resources to functional areas report on actions Outcomes identify metrics of success quantify results (invest, subsidize, or disinvest)

3. Status of FY16 Deficit($18.3 million) Target reduction $10.3 million Revenue solutions$1.9 million Expense solutions$6.5 million University Hall$3.1 million VC spending reductions$2.9 million All other$0.5 million Over/(under)$1.9 million

4. Status of FY16 Keeping our commitments 1,2fund chartfield deficits & payroll 3reinforce timekeeping protocols 4process one-time base budget adjustments 5establish earlier deadlines 6review and update encumbrances 7work with ORSP on processing of PAs

5. Outlook for FY17 Sources of funds $442.6 million

6. Outlook for FY17 Revenue discount/expense $54.0 million

7. Outlook for FY17 Uses of funds $440.3 million

8. Outlook for FY17 Operating Margin Note: Operating margin includes selected components of revenue and expense, per UMass System Office guidance

9. Outlook for FY17 Deficit($24.1 million) Tuition increaseNew enrollment current 4.4% current + 400 needed 21.4% needed +2,176 Employment needed(233) or 10% of employees Service level reductions No shuttle($4.8) million No cleaning($4.5) million No travel($2.6) million Remaining deficit$12.2 million

10. Status of FY17 Deficit($24.1 million) Target reduction $24.1 million Revenue solutions$7.0 million Expense solutions$17.1 million Over/(under)TBD

11. FY17 Preparation Preparing for change as current revenue doesn’t support base budgets Ensuring fairness and equity across campus Implementing retained tuition Focusing on allocating resources toward mission and strategic priorities

12. FY17 Preparation Annual budget prioritize what best advances enrollment & other strategic goals, within given parameters quantify short-term action plan (next 12 months