FY08 Budget Update

[Posted December 7, 2007]

This Web site provides an overview of the fiscal year 2008 campus budget. The financial tables have been updated to show the current year budget, prior year actuals, and a summary view of the capital plan.

State Appropriation

State base support to the Amherst campus has increased by $12.6 million in FY08 to $215.8 million. This increase will be used to fund the third year of Amherst 250 ($6.4 million) and previously negotiated collective bargaining increases ($6.2 million). It does not include additional funds anticipated to be allocated later this year for FY08 collective bargaining costs.

Over the last three years the campus has received approximately $23.2 million in incremental state funding beyond what was allocated to fund collective bargaining obligations. While this represents less than half the cuts the campus incurred during FY03 and FY04 when budget reductions totaled $48.6 million, this renewed state support has allowed the campus to limit its annual fee increases to inflation and to begin replenishing its faculty resources.

Amherst 250

The campus has devoted its share of the state appropriation the last three years to increase the number of tenure and tenure track faculty. The Amherst 250 initiative has funded 150 new positions in three years and is on track to reach its goal of 250 positions in five years.

While a portion of the Amherst 250 allocation supports capital improvements the campus is still finding it increasingly difficult to find appropriate office and research space for new faculty. Instructional approaches and research needs have changed dramatically over the last twenty years and the space which was suitable for previous incumbents is no longer adequate for today’s faculty.

Other Sources and Uses of General Funds Revenue

General Funds provide the primary source of revenue for the campus’ base budget that sustains the faculty and staff and provides the primary support for teaching and some of the support for the institution’s research enterprise. In addition to the state appropriation, General Funds revenue sources include retained tuition from out-of-state students, central student fees, indirect cost recovery on grants and contracts, and short term interest income. Total non-state general funds net revenue is anticipated to rise by $18.6 million in FY08. This additional income will support the campus in many important ways:

Financial Aid: An additional $2.6 million is budgeted to offset the impact of fee increases on financially needy students. Merit aid will increase $625,000 annually for the next four years to maintain the academic profile and to sustain recent out-of-state student growth. The Athletic scholarship budget will grow by $487,000 in FY08 to compensate for underfunding in prior years.
Utilities: The central heating plant opens this winter. Fuel costs will grow as the campus switches from coal to oil and natural gas but the new plant will also produce savings by generating most of the campus’ electricity needs. There are one-time costs which the campus will incur this year as it transitions from the old heating plant to the new but costs should stabilize by FY09.
Debt: The campus will borrow $190 million this year to fund the current capital plan ($160 million) and the next phase of capital projects ($30 million). Annual debt service payments will rise by $18 million to $58 million.
Academic Initiatives: In addition to Amherst 250 the budget includes $500,000 to bolster academic advising.
Block Grants: A total of $750,000 will be distributed to Vice Chancellors to help offset inflationary increases and to add critical positions.

Table I presents the base budget by Major Budgetary Unit (MBU) from FY05 to FY08.

Auxiliary and Restricted Revenue

Housing continues to progress on adding sprinklers to all of its residential units. Debt will be taken on this year to fund the next phase of this work. Dining Services will begin planning for the renovation of Worcester Dining Commons which is expected to begin in the next few years. Direct spending on grants and contracts is anticipated to rise by five percent in FY08 with a corresponding increase in research overhead income. Private gift revenue is anticipated to increase by eight percent in FY08 and revenue from endowment income continues to grow, although it still represents less than 1% of total revenue, putting the Amherst campus far behind other major public research institutions. Table II shows All Funds revenue from FY04 to FY08. Table III shows All Funds spending by major budgetary units and for central campus costs in FY07. Table IV shows the funded capital plan from FY08-FY12.

Tables

All tables are PDF documents.

Table I: Major Budgetary Unit (MBU) from FY05 to FY08.
Table II: All Funds revenue from FY04 to FY08
Table III: All Funds spending by major budgetary units and for central campus costs in FY07
Table IV: Funded capital plan from FY08-FY12




FY08 Budget Update Amherst 250 Plan: Step One, An Interim Report Amherst 250 Plan Financial Master Plan Budget Document Archive Home		FY08 Budget Update [Posted December 7, 2007] This Web site provides an overview of the fiscal year 2008 campus budget. The financial tables have been updated to show the current year budget, prior year actuals, and a summary view of the capital plan. State Appropriation State base support to the Amherst campus has increased by $12.6 million in FY08 to $215.8 million. This increase will be used to fund the third year of Amherst 250 ($6.4 million) and previously negotiated collective bargaining increases ($6.2 million). It does not include additional funds anticipated to be allocated later this year for FY08 collective bargaining costs. Over the last three years the campus has received approximately $23.2 million in incremental state funding beyond what was allocated to fund collective bargaining obligations. While this represents less than half the cuts the campus incurred during FY03 and FY04 when budget reductions totaled $48.6 million, this renewed state support has allowed the campus to limit its annual fee increases to inflation and to begin replenishing its faculty resources. Amherst 250 The campus has devoted its share of the state appropriation the last three years to increase the number of tenure and tenure track faculty. The Amherst 250 initiative has funded 150 new positions in three years and is on track to reach its goal of 250 positions in five years. While a portion of the Amherst 250 allocation supports capital improvements the campus is still finding it increasingly difficult to find appropriate office and research space for new faculty. Instructional approaches and research needs have changed dramatically over the last twenty years and the space which was suitable for previous incumbents is no longer adequate for today’s faculty. Other Sources and Uses of General Funds Revenue General Funds provide the primary source of revenue for the campus’ base budget that sustains the faculty and staff and provides the primary support for teaching and some of the support for the institution’s research enterprise. In addition to the state appropriation, General Funds revenue sources include retained tuition from out-of-state students, central student fees, indirect cost recovery on grants and contracts, and short term interest income. Total non-state general funds net revenue is anticipated to rise by $18.6 million in FY08. This additional income will support the campus in many important ways: Financial Aid: An additional $2.6 million is budgeted to offset the impact of fee increases on financially needy students. Merit aid will increase $625,000 annually for the next four years to maintain the academic profile and to sustain recent out-of-state student growth. The Athletic scholarship budget will grow by $487,000 in FY08 to compensate for underfunding in prior years. Utilities: The central heating plant opens this winter. Fuel costs will grow as the campus switches from coal to oil and natural gas but the new plant will also produce savings by generating most of the campus’ electricity needs. There are one-time costs which the campus will incur this year as it transitions from the old heating plant to the new but costs should stabilize by FY09. Debt: The campus will borrow $190 million this year to fund the current capital plan ($160 million) and the next phase of capital projects ($30 million). Annual debt service payments will rise by $18 million to $58 million. Academic Initiatives: In addition to Amherst 250 the budget includes $500,000 to bolster academic advising. Block Grants: A total of $750,000 will be distributed to Vice Chancellors to help offset inflationary increases and to add critical positions. Table I presents the base budget by Major Budgetary Unit (MBU) from FY05 to FY08. Auxiliary and Restricted Revenue Housing continues to progress on adding sprinklers to all of its residential units. Debt will be taken on this year to fund the next phase of this work. Dining Services will begin planning for the renovation of Worcester Dining Commons which is expected to begin in the next few years. Direct spending on grants and contracts is anticipated to rise by five percent in FY08 with a corresponding increase in research overhead income. Private gift revenue is anticipated to increase by eight percent in FY08 and revenue from endowment income continues to grow, although it still represents less than 1% of total revenue, putting the Amherst campus far behind other major public research institutions. Table II shows All Funds revenue from FY04 to FY08. Table III shows All Funds spending by major budgetary units and for central campus costs in FY07. Table IV shows the funded capital plan from FY08-FY12. Tables All tables are PDF documents. Table I: Major Budgetary Unit (MBU) from FY05 to FY08. Table II: All Funds revenue from FY04 to FY08 Table III: All Funds spending by major budgetary units and for central campus costs in FY07 Table IV: Funded capital plan from FY08-FY12


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