1. 2011-13 Biennial Budget Update Robert Cramer -Assistant Chancellor March 29, 2011

2. Presentation Outline HRS and Campus Climate Survey Reminder Background on State and UW-Platteville Proposed 2011-13 Budget – Funding Impacts and Financial Aid Impacts – UW Madison Authority – Other Budget Items – Procurement and Economic Development Next Steps

3. UW Human Resources Project Coming in April Impacts 67,000 Payroll Benefits HR Processes See http://hrs.uwsa.edu/index.html for detailshttp://hrs.uwsa.edu/index.html

4. Campus Climate Survey https://online.survey.psu.edu/uwplatt/

5. Background - Funding Sources General Purpose Revenue (GPR) – includes general funding, specific purpose funding, and earmarked funding from the state, primarily from state sales and income taxes Program Revenue (PR) – includes tuition, auxiliaries, and segregated fees, as revenues received for services or from users Federal Revenue (PR-F) – includes federal grants, financial aid, direct loans, as revenues from a federal agency Segregated Funds (SEG) – includes transportation fund and other separate state accounts, credited by law to a specific state fund Gifts and Grants – includes revenues from the Foundation, non federal grants

6. 2009-11 State Budget All Revenue Sources - $65.8 B http://www.legis.state.wi.us/lfb/LFBPublications_ButtonPages/2009-11_budget.htm

7. Ten Largest General Fund Programs in 2009-11 Program2009-11%Cumulative % Elementary and Secondary School Aids$10,296,746,20037.2% Medical Assistance$2,331,348,9008.445.6 UW System$2,236,656,8008.153.7 Correctional Operations$1,988,035,8007.260.9 Shared Revenues$1,857,718,9006.767.6 School Levy/First Dollar Tax Credits$1,697,625,2006.273.7 Appropriation Obligation Bonds$728,715,0002.676.3 Community & Juvenile Correctional Services$503,577,7001.878.1 Judicial and Legal Services$486,265,5001.879.9 State Residential Institutions$378,485,7001.481.3 Subtotal$22,505,175,70081.4% All Other Programs$5,166,475,50018.6%100% Total$27,671,651,200100.0%

8. UW-Platteville 2010-11 All Funds Budget is $148.9 Million

9. Funding Impacts - Compensation Retirement Contribution 5.8% (50% of total) Health Insurance Contribution 12.6% (up from 6%) UWS GPR Impact $22,274,900 each year UW-Platteville – TBD UW-Platteville appears to keep program revenue savings associated with increased contributions

10. Funding Impacts GPR Cuts – $250 million total, $125 million per year – UW Madison $62,500,000 per year; UWS $62,500,000 per year – $2.8 million estimated annual reduction in UW- Platteville (11% of GPR and 4.7% of UWS share) – $2.4 million reduction for UW System (25% of UW System GPR)

11. Funding Impacts Tuition – 5.5% increase annually – UWS total is $35,750,000 in 2011-12 and $71,500,000 in 2012-13 – UW-Platteville increase is between $1 million and $1.2 million each year

12. Funding Impacts Prior Year Tuition Increases – As requested, reflect prior year changes including $109,765,900 increase each year to reflect GPR reduction offset ($35,000,000), differential tuition increases ($34,208,400), enrollment ($20,557,500), and vets remissions ($20,000,000) Student Technology Fee – Increase appropriation by $1,471,400 in FY12 and $2,701,300 in FY13 as requested by the Board of Regents (BOR)

13. Funding Impacts Fuel and Utilities – Increase GPR funding by $1,303,100 in FY12 and $2,461,200 in FY13 Debt Service – Re-estimate debt service payments, reducing funding by $129.1 million in 2011-12 and increasing by $57.8 million in 2012-13 – Reductions include -$23.4 million PR in 2011-12 and -$16.4 million PR in 2012-13 – Impact on UW-Platteville PR debt service – TBD - (budget for PR debt service is $6.2 million in FY11)

14. Funding Impacts Standard Budget Adjustments – Fully fund requested adjustments for continuing position salaries and benefits, reclassifications and pay progression, leases and moves, and minor appropriation transfers FY12FY13 – GPR$61,693,800$61,693,800 – PRO$34,040,400$34,040,400 – PRS $34,200 $34,200 – SEG $50,400 $50,400

15. Bottom Line - Funding Impacts Bottom Line not yet known – Estimated $2.8 million annual GPR cut – not cumulative – Estimated $1 million to $1.2 million annual tuition increase offsets some of GPR cut Other Variables Include – Enrollment including TSI – Retention of PR savings – New Tools to Manage Cuts (WI Idea Partnership)

16. Wisconsin Idea Partnership Tools to manage UW-Platteville effectively for students, faculty, employees, and citizens Budgeting – Provide “block grants” to campuses and allow funding reallocations Tuition – Provide the Board of Regents with authority to set tuition Human Resources – Allow the Board of Regents to set pay plans and approve collective bargaining agreements

17. Wisconsin Idea Partnership Capital Planning and Construction – Provide the Board of Regents with authority over non state funded projects following Building Commission approval Financial Management – Allow the Board of Regents to oversee revenue and invest earnings Purchasing – Delegate to the Board of Regents authority over University-related purchasing

18. BOR Requests Not Approved Growth Agenda Financial Aid Recruitment and Retention OSER and DOA Procurement Chargebacks Tuition Increase Grants Restoration of 2% Pay Plan UW Madison Intercollegiate Athletics Expanded Tuition Authority $12,000 Overload Cap Elimination

19. Financial Aid No additional funding for WHEG and elimination of statutory link to increase appropriations with tuition Funding is provided for Wisconsin Covenant Scholars in 2011-12 and 2012-13 HEAB administers the Wisconsin Covenant Scholars Enrollment in the Covenant Scholars will cease after September 30, 2011 Re-estimate MN – WI reciprocity funding

20. Financial Aid WI GI Bill is extended to UW-Madison Authority $6.5 GPR million is provided for the WI GI Bill Lawton Minority Retention Grants – suspend the formula that increases grants by the same percentage as tuition in 2011-13. No Increases for Lawton, Advanced Opportunity Program, Tuition Increase Grant, Study Abroad or Student Aid. Limit Tuition Increase Grant to students enrolled in 2010-11.

21. UW Madison Authority Establishes a separate authority with Board of Trustees (21 members) Provides $378 million GPR in 2011-12 and $462 million GPR in 2012-13 Authority has complete control over tuition and employee compensation but must comply with statutory requirements on benefits Classified employees part of state civil service system until June 30, 2012 Authority has control over revenue and interest earnings related to tuition, auxiliaries, and other PR

22. UW Madison Authority UW Madison – s. 16.71(4) delegation to UW Madison Trustees authority to contract for materials, supplies, equipment or services related to higher education. UW Madison – s. 16.73 (4m) allows UW Madison trustees to enter into agreements with other higher education institutions for purchasing – does not appear to include UWS

23. UW Madison Authority Capital Projects - UW Madison – delegated authority for non GPR / GFSB projects – s. 16.85 (1), 16.85 (12), 16.855 (22), 16.89 Capital Projects – Enumeration of state funded projects (GFSB or GPR) Building Commission approval of all projects over $500,000 State management of state funded projects Leases require Building Commission approval

24. UW Madison Authority Section 49 ((s. 13.48 (12) (b) 6. ) – the board may allow privately owned or operated facilities on University land without Building Commission approval Section 1087 ((s. 37.11 (11)) – the board may invest surplus moneys … that may be issued by such nonprofit sharing corporation as may be contracted with by the board for the construction or equipment of dormitories, commons, or field houses…

25. Other Items Lapses – DOA secretary authorized to lapse GPR and PFR from all employee compensation reductions, elimination of positions, across the board cuts, and elimination of the 2% wage increase. UW System is not included in this lapse. DOA Secretary authorized to lapse an unallocated $145 million GPR and PR from executive agencies. UW System is not included in this lapse.

26. Other Items ECB – removes requirement that UW System provide that the board grant part time use of equipment and space necessary for the operations of the state educational radio and television networks (section 968) (36.25 (5) Sale of Land – if the board sells any real property, the board shall credit 20.285 (1) (iz) net of public debt (section 1003) (s. 36.335)

27. Other Items Undocumented Persons – eliminate nonresident tuition and fee exemptions UW-Milwaukee – Require Board of Regents to allocate $250,000 for development of a plan to convert UW-Milwaukee to an authority. Reports – eliminate required annual reports on excess expenditures Appropriations – convert lab modifications and master’s level business programs to continuing appropriations.

28. Other Items Allow any UW campus to establish a charter school with BOR approval

29. Procurement Increase threshold for sealed bids and proposals from $25,000 to $50,000 Eliminate uniform cost-benefit analyses for contractual services Revise requirements related to prison industries Exempt equipment under $5,000 from energy standards Permit DOA to maintain a list of bidders and contractors who have been convicted of criminal convictions

30. Economic Development Require the Board of Regents to coordinate economic development with the Wisconsin Economic Development Corporation (section 950 and 960) (s. 36.09 (1) (am) and s. 36.11 (29r) (b) 1. Create an Office of Business Development in DOA with 2.0 FTE

31. Next Steps Legislative Process – Joint Committee on Finance, Senate, and Assembly Decision on UW Madison as separate authority Pursue Wisconsin Idea Partnership to manage financial challenges going forward

32. References / Useful Sites UW System Government Relations - http://www.uwsa.edu/govrel/ http://www.uwsa.edu/govrel/ Department of Administration - http://doa.wi.gov/index.asp?locid=166 http://doa.wi.gov/index.asp?locid=166 Wisconsin Legislature - http://legis.wisconsin.gov/http://legis.wisconsin.gov/ Joint Committee on Finance - http://legis.wisconsin.gov/lfb/jfc.html http://legis.wisconsin.gov/lfb/jfc.html Legislative Fiscal Bureau - http://legis.wisconsin.gov/lfb/index.html http://legis.wisconsin.gov/lfb/index.html Wheeler Report - http://www.thewheelerreport.com/http://www.thewheelerreport.com/ Wispolitics - http://www.wispolitics.com/http://www.wispolitics.com/ Poll Everywhere – www.polleverywhere.comwww.polleverywhere.com