1. Mike Brandy Central Services 3/31/04
Budget Update for
Mike Brandy
Central Services
3/31/04

2. Major Assumptions REVENUE Enrollment Growth
Resident student enrollment will be the same next year in spite of potential fee increases
Non resident student enrollment will drop by 5%
Growth
We will not anticipate any growth due to downward pressures of fee increases for resident and possible bachelor degree holders

3. Revenue Assumptions (continued)
State Cost of Living Adjustment (COLA)
Governor’s Office has now included fully funding COLA for (we are assuming the COLA to be 1.84%, may be adjusted to 2.3%, but funding would have to be found) (1.84% = $2.1 million)
Equalization: We have included $2.6 million in equalization to come in as unrestricted funding
State wide faculty groups testified that their recommendation is to direct all this funding to new full time faculty positions(3/22/04)
Continued speculation at state on whether this will survive the legislative review process in tact

4. Deficit factors
We have not assumed a deficit factor for ( could be a loss of as much as $2.3 million) or any potential deficit factor for 04-05

5. PFE
We have assumed that PFE will be funded in at the same level as

6. Net Increase to Revenues
With all of these factors, and other more minor factors, the revenue for is currently forecast to increase about $5 million more compared to the budget,
or, $3.9 million compared to the estimated actual revenue

7. Expenses All funded positions in 03-04 have been budgeted in 04-05
There are no across the board salary increases budgeted
All step and column increases are funded
Benefits have been projected to increase 15%
All utilities, property and liability insurance program, new retiree benefits, etc have been budgeted
REDUCTIONS FROM NEGOTIATIONS OR COLLEGE/CENTRAL SERVICE REDUCTIONS ARE NOT YET IN THESE EXPENSE FORECASTS

8. Current Estimate of Operating Deficit
Revenue = $148.5 million
Expense = $ million
Deficit = $ million

9. Solutions to Deficit Ending Balance from 6/30/04 above 5% reserves
Modifications to benefit programs pending results of negotiations
Proposed reductions to Colleges and Central Services budgets estimated to be in the range of $ 3 million
Possible one time solutions from the negotiating tables (pending results of negotiations)
Possible other one time solutions (pending results of negotiations)

10. Timing
Many items in negotiations are close to being finalized in the next few weeks
The state will release the “May Revise” in mid May which will test our various assumptions on revenue
The legislature has now started the hearings and debate on the revenue, we will monitor and change our assumptions if certain proposals at the state look more certain
The Legislature will agree on budget and send to Governor (hopefully by end of June, but could be as late as July or August)
Meantime, we will close our books at end of July and have a true ending balance number by early August

11.
Remember,
We are using some one time funds to balance our budget, we will not have the use of those funds to balance the budget
We are anticipating increases in benefits in in the 15% range again, so we will have to resolve that issue again next year