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UW-Platteville Convocation

Robert CramerVice Chancel lor

August 2012h t t p : / / w w w. u w p l a t t . e d u / b u d g e t / p re s e n t a t i o n s . h t m l

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Financial Results 2011-12

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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

Budget Definitions

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All Funds Summary (Cash Basis)Beginning Cash $ 23,128,452Total Revenue $127,981,774 Total Expenses $126,913,276Net Income $ 1,068,498

Excluding direct student loan amountsClosing Balance $ 24,196,950

Preliminary Ending Financial Position

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Fund 102 $4,426,218(General operations, tuition revenue, base of $47 million)

Fund 123 $4,001,400 (Debt service, $4 M base)Fund 128 $4,096,650

(Dining, housing, parking, base of $25 million)Fund 131 $8,474,838

(DLC, School of Ed Cost Recovery, TSI, base of $15 million)Fund 136 $1,693,089

(Similar to 128, HTCP, camps & conferences, base of $3.7 million)

Select Fund Balances

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Carry Over Balances by College/Division

Chancellor & Diversity 15,487.00 Provost 109,389.00 Administrative Services 189,992.00 Graduate Studies & Library 40,518.00 Student Affairs 22,800.00 Advancement/Development 153,796.00 Admissions & Enrollment Services 48,262.00 LAE 40,212.00 BILSA 171,683.00 EMS 699,780.00 Budget Lapse 312,841.00

Grand Total Carryover***1,804,760.0

0 ***Excludes accounts that automatically carryover (i.e. Fund 128, 136, some 131)

New Budget Tool – Carry Overs

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Financial Metrics Expense Ratio – the annual expenses divided by annual

revenue – less than one means that all of the current year’s income was not spent

Composite Financial Index – four financial ratios, weighted and combined into one, with values between -4 and 10 that measure the overall financial health of an institution

Primary Reserve Ratio – expendable net assets divided by annual expenses – measures how long the institution could rely on reserves to meet operational costs

Financial Health Measures

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Expense Ratio is an indication of the University’s ability to cover the expenses endured by cash inflow.

(less than 1.0 is desirable)

2010-11 2011-12 (PRELIM) 0.9000

1.0000

1.1000

1.011 0.992

Expense Ratio – Spending / Revenue

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Combines 4 weighted ratios to provide a snapshot of overall financial health of the University

1) Primary Reserve Ratio: Are resources sufficient and flexible enough to support the mission?

2) Net Operating Revenue Ratio: Do operating results indicate the institution is living with available resources?

3) Return on Net Assets Ratio: Does asset performance and management support the strategic direction?

4) Viability Ratio: Are resources, including debt, managed strategically to advance the mission?

Composite Financial Index

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2007 2008 2009 2010 2011-0.5

0

0.5

1

1.5

2

2.5

3

3.5

0.970.7 0.75 0.88 0.84

0.01

-0.1

0.660

-0.08

1.81

0.38

0.92

0.470.06

0.5

0.32

0.37

0.42

0.45

CFI Trend with Benchmark

Viabililty RatioReturn on Net Assets RatioNet Operating Revenue RatioPrimary Reserve Ratio

HLC Benchmark = 3.00

CFI Trend and Components

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Computed by comparing expendable net assets, including those invested in plant, to total expenses. Results represent the fraction of a year, showing

how long the University could function without income.

2007 2008 2009 2010 20110.2

0.250.3

0.350.4

0.45

Primary Reserve Ratio HLC Benchmark

Primary Reserve Ratio

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Total Cost per Student FTE

Cost Per Student FTE

Definition: Fund 102 & 131 (less Distance Learning) divided by number of full-time equivalent students

2007-08 2008-09 2009-10 2010-11 2011-12 $6,000.00

$6,500.00

$7,000.00

$7,500.00

$8,000.00

$8,500.00 $

8,09

6.13

$7,

865.

51

$8,

170.

20

$8,

086.

92

$8,

144.

59

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2007-08 2008-09 2009-10 2010-11 2011-12 $-

$1,000.00

$2,000.00

$3,000.00

$4,000.00

$5,000.00

$6,000.00

$7,000.00

$5,5

63.4

5

$5,7

58.5

6

$5,3

09.4

1

$5,1

89.8

2

$4,2

96.9

8

Per

Res

iden

t St

uden

t Am

ount

Annual Average: $5,224

State Funds / Resident FTE

Definition: All GPR Funds Expenses / Resident FTE

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State funding of 40%

Final 2001-2002 UW-Platteville Budget $73.6 Million

2001-02 Budget

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General Purpose Tax Dollars17013631

11%

Specific Purpose Tax Dollars10913119

7%

Tuition48544731

30%Federal

4915571031%

Gifts and Grants1216604

1%

Auxiliary Enter-prises

32967056.995430221%

Extension591846

0%

StateFundingof 18%

2011-12 Budget - $160.4 million All Funds

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2012-13 Budget

Final 2012-2013 UW-Platteville Budget $172.6 Million (all funds)

Final 2012-2013 UW-Platteville Budget$126.1 Million (excluding federal aid)

General Pur-pose Tax Dol-

lars17004951

13%

Specific Pur-pose Tax Dol-

lars11452271

9%

Tuition53804157

43%

Federal1646700

1%

Gifts and Grants

13149001%

Auxiliary En-terprises

4024233532% Extension

6161850%

State Funding of 22%

State Funding of 17%

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Total enrollment is approaching 7,700 students this year (1,650 new freshmen)

TSI enrollment approaching 1,400 students with revenues of $13.5 million (510 new students)

Registrations for online programs are now over 2,900

UW-Platteville is now a tuition-driven institution - $53 million this year (almost twice the amount provided by the state)

Enrollment and Finances

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Looking Forward

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Regulations and State / Federal Oversight Continue

Slow Economic Growth Continues Pressure on State Funding and Tuition

Disruptions From New Education ModelsDemographic ChangesLearner Expectations

Key Challenges

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Flexibility provided in 2011-13 biennial budget turns out to be modest and slow to implement

Modest recommendations from the statewide UW System Restructuring Task Force

Federal regulations will expand following Penn State and the focus on student debt and tuition

Universities create own regulatory environment internally as pressures mount

Regulatory Environment

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United States

EU-15 Japan China India Latin America

World-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

Real GDP Growth 2012 Real GDP Growth 2013-2016Real GDP Growth 2017-2025

Source: The Conference Board Global Economic Outlook 2012

Projected US and Global Economic Growth Rates

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Disruptions continue and new educational models will be tried UDACITY, Coursera, and other MOOCS (massive

open online courses) UW System Flexible Degree Program “Flipping” the Classroom

Interesting Description of the Future - http://epic2020.org/

New Educational Models

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The number of high school graduates will continue to change by region

Nontraditional students will be a larger percentage of students in higher education

Hispanic students represent the fastest growing group of high school graduates

Continuing Demographic Changes

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Projected High School Graduates by Region

2008-09

2020-21

- 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000

SouthNortheastMidwestWest

Source: The College of 2020: Students Chronicle Research Services

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Growing Number of Nontraditional Students

2009

2017

- 2,000 4,000 6,000 8,000 10,000 12,000 14,000

Over 29 years old25-29 years old18-24 years old

Source: The College of 2020: Students Chronicle Research Services

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Changing Ethnic Make-up of High School Graduates

American Indian/Alaska Native

Asian/Pacific Islander

Black non-Hispanic

Hispanic

White non-Hispanic

0% 10% 20% 30% 40% 50% 60% 70%

2021-222010-11

Source: The College of 2020: Students Chronicle Research Services

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Bring Your Own Device World (BYOD)Anytime Anywhere Access to MaterialseBooks coming to a high school near youKhan Academy has content for K-12

studentsQuick feedback via learning

management systems such as D2L

Learner Expectations

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Acknowledge the brutal reality of the situation and move forward: Strategic Planning Expanding Our Sources of

Revenue Controlling Existing Costs

Opportunities to Control Our Own Destiny

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Draft plan presented in April and MaySteering Committee is updating drafts based

on feedbackAdditional sessions in August and September

including offer to meet with every departmentCampus forums in September and OctoberFinalize plan in NovemberDetails at http://www.uwplatt.edu/planning/

Strategic Planning

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Proposing a new mission, vision and four strategic priorities

Ensure plan leads to action through a steering committee that connects planning with budgets

Initiate a review of how we need to budget so that we allocate funds based on the plan and not past practices

Strategic Planning (continued)

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DRAFT Strategic Priorities

Provide a Distinctive EducationFoster a Community of

Achievement and RespectControl Our Own DestinyEnrich the Tri-State Region

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Robert Cramer, Vice Chancellor for Administrative Services – Executive Sponsor

Donna Anderson, Academic Staff Wendy Brooke, College of BILSA Dennis Cooley, Assistant

Chancellor for University Development

Dawn Drake, Director of Distance Education

Melissa Gormley, College of LAE

Annie Kinwa-Muzinga, College of BILSA

Mittie Nimocks, Provost Kassie Popp, Student

Senate David Schuler, College of

LAE Yan Shi, College of EMS Becky Troy, Classified Staff Angela Udelhofen, Assistant

Chancellor for Admissions Joanne Wilson, Interim

Assistant Chancellor for Student Affairs

Timothy Zauche, College of EMS

Strategic Planning Steering Committee

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Targeted growth through enrollment management

Identifying new opportunities and markets

Leveraging our strengths with new partners

Expanding Our Sources of Revenue

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Huron review of information technology and classroom management

Energy efficiency auditsPartnering with the Real Estate

FoundationBusiness Process Improvements to free

up time

Controlling Existing Costs

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UW-Platteville cannot stand still

Conclusion