College Finances
52
Mott Community College Special Committee of The Whole May 18, 2011 College Finances
description
Mott Community College Special Committee of The Whole May 18, 2011. College Finances. STRATEGIC PLAN. _____________________________________________________________________. 7-0. Budget/Finance - PowerPoint PPT Presentation
Transcript of College Finances
Mott Community College
Special Committee of The Whole
May 18, 2011
College Finances
2
STRATEGIC PLAN• 7-0. Budget/Finance
• 7-1. Focus on controllable revenues and costs to sustain our current reputation and facilities and provide funding for strategic priorities
• 7-2. Establish short and long-term budget and finance priorities that provide a balanced approach to the needs of a learning organization with the flexibility to realign resources
• 7-3. Implement a comprehensive strategy to address the long-term deficit which enables us to continue to provide affordable high quality education
• A balanced approach
_____________________________________________________________________
PRIOR YEAR BUDGET IMPACT
3
Prior year Impact in Dollars
Series1$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$2,585,000
$1,400,000
$871,353
$552,155
$464,851
Lost Property Taxes Debt ContributionHealth Insurance Increase MPSERS IncreaseLost State Aid 4
$5,873,359
Tuition Keeps Up with Lost Funding/Increase in Non-controllable costs for prior year
Series1$80.00
$85.00
$90.00
$95.00
$100.00
$105.00
$110.00
$115.00
$120.00
$125.00
$130.00
$88.34
$17.35
$9.40
$5.85
$3.71
Current Tuition Lost Property Taxes Debt Contribution
Health Insurance Increase MPSERS Increase Lost State Aid 5
$39.42
$127.76
Prior Year Budget Balancing Steps
6
Prior Year Budget Cuts• Decreased Hiring (Open Position Pool) $ 325,000• Cut funding to Reserves $ 620,000• Less Spending on Maintenance
and Replacement (72 fund) $1,250,000• Cut Contingency $ 250,000
Total current year cuts $2,445,000Set-aside cuts from last year $1,400,000Total budgetary expenditure cuts $3,845,000
7
Prior Year Budget Cuts (continued)
Total Budgetary Expenditure Cuts (from previous slide) $3,845,000
Current Year Shortfall ($5,900,000)
Shortfall Remaining ($2,055,000)
65% of current year shortfall is made up through budget cuts.
8
FUNDING SOURCES(2011-2012)
State Aid
Property Taxes-Operating
-Debt
Tuition9
Trends in Funding Sources & Enrollment
1999
-200
020
00-2
001
2001
-200
220
02-2
003
2003
-200
420
04-2
005
2005
-200
620
06-2
007
2007
-200
820
08-2
009
2009
-201
020
10-2
011
$3,500,000
$8,500,000
$13,500,000
$18,500,000
$23,500,000
$28,500,000
$33,500,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
State Aid Property Taxes Headcount
Fund
ing
10
2011-12 FUNDING PROJECTIONS with a 15% Decrease in State Aid
1999
-200
020
00-2
001
2001
-200
220
02-2
003
2003
-200
420
04-2
005
2005
-200
620
06-2
007
2007
-200
820
08-2
009
2009
-201
020
10-2
011
2011
-201
2
$3,500,000
$8,500,000
$13,500,000
$18,500,000
$23,500,000
$28,500,000
$33,500,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
State Aid Property Taxes Headcount
Fund
ing
11
THEN and NOWTuition32%
Taxes
26%
State Aid36%
Other6%
1999-2000 Tu-ition
48%
Taxes28%State Aid
20%
Other
4%
2010-2011
12
State Aid Funding $15,344,107 State Aid
Funding $15,121,880
THEN and NOWProjected 2011-2012 with -
15%State aidTuition32%
Taxes
26%
State Aid36%
Other6%
1999-2000 Tu-ition
50%
Taxes27%
State Aid18%
Other
4%
2011-2012
13
State Aid Funding $15,344,107 State Aid
Funding $12,853,598
Trends in Funding Sources & Enrollment, Fiscal Year Equated Students (FYES)
2001
-200
220
02-2
003
2003
-200
420
04-2
005
2005
-200
620
06-2
007
2007
-200
820
08-2
009
2009
-201
0
$3,500,000
$8,500,000
$13,500,000
$18,500,000
$23,500,000
$28,500,000
$33,500,000
$4,000
$4,500
$5,000
$5,500
$6,000
$6,500
State Aid Property Taxes Revenue per FYES
Fund
ing
14
State and Local Funding Does Not Keep Up With Enrollment
15
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012 (proj)
20,000
22,000
24,000
26,000
28,000
30,000
32,000
34,00031,981
21,225
Actual Unduplicated Headcount Adjusted Unduplicated Headcount
Projected Property Tax Funding FYE 2010 through FYE 2016
$12
$14
$16
$18
$20
$22
$24
2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016
$23.5
$20.9
$19.5$18.5
$18.8 $19.4 $20.0
Mill
ions
16
$2.6 Million Decrease or $8.27 per contact hour
$1.5 Million Decrease or $4.95 per contact hour
$972 Thousand Decrease or $3.33 per contact hour
Percentage of Property Tax and State Aid of Total Funding
17
63%60%
62% 60%59% 58% 57% 56% 56%
54%51%
47%
40%
50%
60%
70%06
/30/
00
06/3
0/01
06/3
0/02
06/3
0/03
06/3
0/04
06/3
0/05
06/3
0/06
06/3
0/07
06/3
0/08
06/3
0/09
06/3
0/10
06/3
0/11
Percentage of Property Tax and State Aid of Total Funding projected for 2011-2012 with -15% State aid
18
63%60%
62% 60%59% 58% 57% 56% 56%
54%51%
47%45%
40%
50%
60%
70%06
/30/
00
06/3
0/01
06/3
0/02
06/3
0/03
06/3
0/04
06/3
0/05
06/3
0/06
06/3
0/07
06/3
0/08
06/3
0/09
06/3
0/10
06/3
0/11
06/3
0/12
What’s Happening with Property Taxes?(Operating)
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
15,000,000
17,000,000
19,000,000
21,000,000
23,000,000
25,000,000
27,000,000
29,000,000
31,000,000
33,000,000
35,000,000 Historical Average Increase 7 Year Forecast
19
Total lost operating property tax funding over 7 year period is $60.2 million. The average per year is $8.6 million.
$32.2M
$20.0M
What If Tuition Covered State Aid Losses?
$61.15 $62.85 $69.00 $70.55 $75.80 $79.50 $82.05 $84.70 $86.52 $93.51$61.34
$72.50
$99.61 $99.88$115.46
$120.92$128.65
$129.65
140.32
$143.70
$55.00
$75.00
$95.00
$115.00
$135.00
$155.00
Actual Hypothetical
20
Add in Property tax loss = $218.08
What’s Happening with Property Taxes?(Bonds)
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
6,000,000
6,500,000
7,000,000
7,500,000
8,000,000
8,500,000
9,000,000
9,500,000
10,000,000
10,500,000
11,000,000 Historical Average Increase 7 Year Forecast
21
Total lost bond tax funding over 7 year period is $15.8 million. The average per year is $2.3 million.
$10.4M
$7.0M
Bonded Debt Payments vs Tax Collections at .69 Mills
22
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014$6,000,000
$6,500,000
$7,000,000
$7,500,000
$8,000,000
$8,500,000
$9,000,000
7,835,136 7,735,245
8,279,381 8,052,269
7,571,294 7,492,450
6,596,937
Debt Payments Actual/Projected Revenue
Bond Funds1. County and City Taxable Values will decline by 7% for
2011-20122. The Financial Impact (Shortfall) to the Bond Funds will be
$ 850,000 in 11/12.3. We are legally required to levy a millage rate that will be
sufficient to collect enough dollars to make the current year required payments
-OR- Have enough funds available from other sources to cover any shortfall from a lower millage rate.
4. Commitment made to voters in 2004 to keep millage at .69 through 2011. (GF contribution $1.4 million last year) 23
What Have We Done Regarding Controlling/Cutting Costs?
24
Past Expenditure Reductions1) Energy Conservation Project
- Utility costs averaged 8.2% in 2003, Now they are 2.4%• Savings $520K
2) Hold on vacant positions• Average savings of $800K per year
3) Change in timing of custodial shift• Savings of approximately $170K per year
4) Eliminating and restructuring food service• Was losing approximately $100K per year• Now generating $48K per year in revenues
25
Past Expenditure Reductions5) Utility Reduction Analyst Project
• Resulted in $720K savings between 2004-2010 on Telecommunications/IT, Water, and Waste
6) Employee Contract Bargaining• Employees agreed to pay freezes with incremental
increases over 9 years at 1.35%• Industry average is 2.8%
– Savings of $460K per year
7) Course Section Efficiency• Maximizing section seat count before adding new
sections
8) Discretionary budget cuts• Average savings of $400K per year
26
Past Expenditure Reductions9) Reduction of ORP (optional retirement plan) costs
• Average annual savings of $400K
10) Combining Deans position• Fine Arts and Social Science combined saving $168K per
year
12) Outsourcing custodial and grounds work at sites• Savings of approx. $350K per year
13) Changes to health insurance coverage and plans • Savings $500K
14) New print shop lease• Savings of $200,000 per year
27
A Comparisonto
7 Other MichiganPeer Community Colleges
Based on 2009 –2010 ACS Data
19%
16%
23%
22%
19%
15%
12%
13%
33%
30%
14%
37%
30% 35
%
50% 54
%
44% 50
%
61%
37%
47%
46%
32%
31%
4% 4% 3% 3% 4% 3%
6%
2%
0%
10%
20%
30%
40%
50%
60%
70%
Delta Grand Rapids
Henry Ford Kalamazoo Valley
Mott Schoolcraft Washtenaw Wayne County
Comparison of State of Michigan Peer Group Revenue Percentages
Based on 2009 - 2010 ACS Data
State Aid Property Tax Tuition & Fees All Other
MCC is 3rd Lowest in Millage Rate, and has the Largest Property Tax Decline
1.79 1.80 1.99 2.04 2.41 2.48 3.00 3.41
-3.76
-8.64
-10.98
-1.64
-3.14 -8.64 -8.64
-5.33
-12.00
-10.00
-8.00
-6.00
-4.00
-2.00
0.00
2.00
4.00
6.00Gr
and
Rapi
ds
Scho
olcr
aft
Mott
Delta
Kala
maz
oo V
alle
y
Way
ne C
ount
y
Henr
y Fo
rd
Was
hten
aw
Prior Year Comparison of Millage Rates/Property Tax Declines with
State Grouping
31
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
Current Year Comparison of State Aid
MCC is 3rd Lowest in Property Tax Revenue
010,000,00020,000,00030,000,00040,000,00050,000,00060,000,00070,000,00080,000,000
Current Year Comparison of State of Michigan Peer Group Property Tax
Revenue
MCC is 4th lowest in Total Revenue
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
Current Year Comparison of State Peer Group Total Revenue
Tuition & Fees: Local ComparisonCollege Yearly Tuition & Fees
Mott CC 3,329 Saginaw Valley University 7,308 Eastern Michigan University 8,377Oakland University 9,285 Baker College - Flint 9,840 Ferris State University 9,930 University of Michigan - Flint 10,097 Central Michigan University 10,380 Michigan State University 11,722Davenport University 11,814University of Michigan - Ann Arbor 13,461 ITT Technical of Flint 25,064Kettering University 29,116
Cost as based on in district/state rates from the College’s web sites
MCC’s annual cost is approximately 46% of that of the next most affordable college/university in our
area.34
Tuition & Fees: Community College
ComparisonCollege Yearly Tuition & Fees
Mott CC (In-District) $3,229Wayne County CC $3,310Oakland CC $3,457Macomb CC $3,760Schoolcraft CC $3,910Delta CC $3,977Washtenaw CC $4,140Lansing CC $4,300Henry Ford CC $4,402St. Clair CC $5,663
Costs based on published “out of district” rates for other Community Colleges for 30
Credit/Contact hours
35
Comparison of MI Community Colleges and Universitiesfrom 2005/06 to 2009/10
Faculty Compensation
Administrator Compensation
In-district tu
ition Rate
Enrollment
State Funding-5%
0%
5%
10%
15%
20%
25%
30%
35%
16% 16%18%
31%
6%
22%
30%32%
2% 3%
Community College % Change
University % Change
36From 3/27/11 Free Press
CURRENT YEAR BUDGET IMPACT
37
FYE 2012 Impact in Dollars
Series1$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
$3,000,000
$1,500,000
$900,000
$850,000
$750,000
$675,000$453,656
Capital Funding Restoration Lost Property TaxesHealth Insurance Increase Debt ContributionContingency Restoration MPSERS IncreaseLost State Aid
38
$8,128,658
Tuition Keeps Up with Lost Funding/Increase in Non-controllable costs for FYE 2012
Series1$80$85$90$95
$100$105$110$115$120$125$130$135$140$145$150$155$160
$98.68
$20.94
$10.47
$6.28
$5.93
$4.71$3.17
Current Tuition Capital Funding RestorationLost Property Taxes Health Insurance IncreaseDebt Contribution2 Contingency RestorationMPSERS Increase Lost State Aid
39
$56.73
$155.41
COMPARISON PRIOR YEAR/CURRENT YEAR
40
2011 2012
0
1
2
3
4
5
6
7
8
Current Reserve
Required Reserve
Reserve Requirements
41
In m
illio
ns
Still need $183K
Still need $950K Still need $36K
Adequately funded
FEDERAL FINANCIAL ASSISTANCEPELL GRANTS
42
-
5
10
15
20
25
30
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Mill
ions
Academic Year
Pell Awards
Increased Five-Fold in Ten Years
Pell Award & Cost of TuitionMott Community
CollegeIn-District
(Published 10/11)Saginaw ValleyState University
In-State
(Published 10/11)Delta CC
Out of District Rate
Pell Awarded $5,550 $5,550 $5,550
Tuition & Fees(30 contact hours)
$3,229 $7,308 $3,977
Books & Supplies $1,000 $1,000 $1,000
Difference $1,321 -$2,758 $ 573
Student Receives Remaining
Balance
Student Needs Unmet
Student Receives Remaining
Balance
Pell Distribution – 09/10
Awarded Educational Tuition & Fees
EducationalBooks & Supplies
Charges
Non-Educational
Govt. Refund
$24,787,898 $14,787,184 $2,896,345 $7,104,367
Sample of Approx. 8,000 Students
STATE INFLUENCES
46
PERCENTAGES CAN BE MISLEADING
47
Current Tuition (30 contact hours) $2,960 $6,870 $9,692
Mott Community College
Saginaw Valley State University
University of Michigan - Flint
In-District In-State In-State
PERCENTAGES CAN BE MISLEADING
48
Current Tuition (30 contact hours)
Contact Hour
ChangeTuition Change
Contact Hour
ChangeTuition Change
Contact Hour
ChangeTuition Change
5% increase $5 $148 $11 $344 $16 $485
$2,960 $6,870 $9,692
Mott Community College
Saginaw Valley State University
University of Michigan - Flint
In-District In-State In-State
PERCENTAGES CAN BE MISLEADING
49
Current Tuition (30 contact hours)
Contact Hour
ChangeTuition Change
Contact Hour
ChangeTuition Change
Contact Hour
ChangeTuition Change
5% increase $5 $148 $11 $344 $16 $4857% increase $7 $207 $16 $481 $23 $678
$2,960 $6,870 $9,692
Mott Community College
Saginaw Valley State University
University of Michigan - Flint
In-District In-State In-State
The Inequality of any Percentage Increase
50
7% Increase $1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$2,045,225
$4,674,800
$6,720,025
MCCSVSUUM-Flint
The impact of a 7% tuition increase for MCC compared with local 4 year Universities
K-12 Schools Universities Community Colleges-15
-10
-5
0
5
10
15
20
25
30
35
(8.8)
4.8
35
3.4 -
5
Enrollment
Appropriations
Enrollment vs AppropriationsFY 06 – FY11
51
In p
erce
nts
COMMENTS/QUESTIONS?
52
