|
|
Budget process moving forward as University stakeholders weigh in |
| By
Tobin J. Klinger |
|
May 12, 2008
|
|
After weeks of meetings and extensive preliminary discussions, the fiscal year 2009 budget is beginning to take shape. However, there is a great deal yet to be decided as senior leadership, deans and faculty begin to weigh in.
According to Dr. Scott Scarborough, senior vice president for finance and administration, the first draft of the proposed budget is essentially breakeven. It includes a $2.5 million reduction in administrative costs, along with $10.6 million in reallocations proposed during some 29 budget hearings, with no impact on academic programs.
“Thus far, we have had an extremely successful process,” said Scarborough, noting that the “10-5-5” exercise stimulated the conversations that were pivotal to identifying cost reductions and reallocation opportunities.
The “10-5-5” exercise asked deans, vice presidents and others to reduce their operating budgets by 10 percent, with 5 percent going into a central fund and 5 percent reinvested into strategic areas.
“These discussions have brought out some truly creative thinking, and present some real opportunities, many of which will be researched for future consideration,” Scarborough said.
There were approximately $71 million in new requests made during the budget hearing process and, according to Scarborough, “We are now beginning the decision-making phase of the budget process, which will be informed by all of the University’s stakeholders.”
Last week, the University Responsibility Group — composed of representatives from President Lloyd Jacobs’ senior leadership team, the full senior leadership team, representatives from the Faculty Senate Executive Committee, and the University’s standing Finance and Strategy Committee — reviewed the budget. The input of those groups now will go to the Strategic Planning Steering Committee for consideration, with a goal of a draft budget going to the Finance Committee of the Board of Trustees June 2, and a final budget under consideration by the full Board June 16.
The approximately $740 million budget, $267 million of which represents the UT Medical Center, and $472 million of which represents the academic enterprise, has grown slightly, thanks to an anticipated increase of $8 million in the state share of instruction dollars. However, Scarborough cautions that increased costs are surpassing projected revenue increases.
Among the increasing expenses are higher salaries and benefits in the coming year, higher interest rates the University pays for loans, and added costs for utilities and maintenance.
“When we open the newly renovated Memorial Field House, it will come with significant operational costs,” Scarborough said. “With this fantastic new facility on line, we will need to allocate nearly $2 million for utilities, maintenance and custodial support.”
Scarborough acknowledges there are significant challenges on the academic side of the budget, and he notes that the clinical enterprise remains financially sound.
“UTMC has successfully increased its operating margin and has continued to grow its clinical enterprise,” Scarborough said. “In fact, the first draft of the budget includes $8 million in hospital support for academics, mostly in the College of Medicine.”
|
|
| |
|
|
|
|
|
|
|
|
|
|
