Seattle Community Colleges Board of Trustees Budget Presentation 2011-12

SEATTLE COMMUNITY COLLEGES Board of Trustees Budget Presentation Fiscal Year 2011-12 Presented Thursday, September 8, 2011 North Seattle Community College

Focus of Presentation Focus of Presentation What is Our Mission? Strategic Goals to Accomplish Mission Budget Planning Process Used Enrollment Targets/ FTE History Funding Available to Reach FTE Targets Challenges

Seattle Community College District MISSION Seattle Community Colleges will provide excellent, accessible educational opportunities to prepare our students for a challenging future

District-wide & District Office Strategic Plan -- 2010-2015 District-wide Strategic Goals Goal 1: Student Success Increase Student Learning and Achievement Goal 2: Partnerships Build Community, Business & Educational Partnerships Goal 3: Innovation Increase Innovation & Improve Organizational Effectiveness District Office Strategic Goals Goal 1: Support College Priorities and Initiatives Goal 2: Ensure Business Systems/Processes are Effective, Efficient, and Responsive Goal 3: Increase Awareness of the Significant Impact of the Seattle Community Colleges

Budget Planning Process Chancellor Reconvened District Budget Planning Committee Colleges/District Office Planned for 10% cut beginning in January Colleges/District Office used Similar Planning Processes Anticipated cuts of up to $8.2 mil for District Colleges/District also needed to account for the FY 10-11 3.8% supplemental cut

District-wide Budget Committee Recommendations Process Efficiencies Centralization Revenue Generation Examination of part-time/full-time faculty Collaboration

District-wide Budget Committee Recommendations PROCESS EFFICIENCIES Further restructuring of management positions and departments across the district and within colleges Streamlining, centralizing and/or automating enrollment processes to give students greater ability to enroll at more than one of our campuses Examine the effectiveness of the use of S&A fees and the transparency of the process for the allocation of these funds at all campuses

District-wide Budget Committee Recommendations PROCESS EFFICIENCIES (previous recommendations) More efficient use of space and buildings; continuation of the goal to increase sustainable practices Minimize the use of outside consultants and contractors Increase the use of electronic forms

District-wide Budget Committee Recommendations CENTRALIZATION (previous recommendation) Increased centralization of back office functions

District-wide Budget Committee Recommendations REVENUE GENERATING Examine the reliance on soft money (i.e., international students) while keeping mindful of the district s mission Local taxing authority, competing for levy funds

District-wide Budget Committee Recommendations REVENUE GENERATING (previous recommendations) Pursue more grants & charge indirect costs Explore differential tuition & fees, and flexibility in utilizing fees for state-support classes

District-wide Budget Committee Recommendations COLLABORATION (previous recommendation) Move to common placement testing standards

SEATTLE COMMUNITY COLLEGES Board of Trustees Budget Presentation Fiscal Year 2011-12 Now for the Numbers Alan Ward Interim Financial Officer

What Does the Budget Picture Look Like?

Budget for 2011-13 Biennium Legislature dealt with $ 5 bil revenue shortfall Couldn t raise taxes-initiative I-960 State appropriations were cut Legislature reduced CTC funding by $76.8 mil or 11.5% for FY 2011-12 $84.3 mil or 12.6% for FY 12-13 (1.1% more) CTC current State funding drops from $669mil to $585 mil in FY12-13

2009-11 Sources of State General Fund Revenue (Dollars in Billions) Category Amount 13.1 $ Pct. 46.7% Retail Sales Business & Occupations Tax $ 5.6 19.9% Property $ 3.6 12.9% Real Estate $ 0.8 2.8% Public Utility $ 0.7 2.6% Other $ $ 4.2 28.0 15.1% 100.0%

How is General Fund Money Spent? 2009-11 General Fund State Expenditures Category Amount 13.3 $ Pct. 43.7% Public Schools Human Services $ 11.0 36.0% Higher education $ 2.7 9.0% Governmental Operations $ 0.8 2.8% Natural Resources $ 0.4 1.2% Debt Service/Other $ $ 2.2 30.4 7.3% 100.0%

Average Annual FTE Staff for 2009-11 Higher Education 45,062 Human Services 35,586 Transportation 11,441 Government Operations 9,931 Natural Resources 6,147 Other 820 108,987

2011-13 Higher Education Operating Budget State Funds and (Base) Tuition Revenue as a Percent of Institutional Budget

Major Budget Components by Percent Change in General Fund Appropriations 2007-09 through 2011-13

University of Washington State and Tuition Funding per Full Time Equivalent Student

How We Started FY 2010-11 July 1, 2010 General Budget Cut $4,007,146 Compensation Cut $720,025 Total Cut$4,727,171 Tuition Increase -7% $4,350,083 Net Reduction for FY 10-11 $377,088

Things Were OK THEN! Revenue Targets Missed/Forecasts were lowered Sales/Business taxes generate over 50% of State revenue- revenues missed forecasts Governor implemented a 3.8% supplemental budget reduction in December This was another $2,688,021 budget cut for the District

State Budget Reduction History FY 2008-09 Reduction of $3,132,000 (reported as 4.3% by SBCTC) FY 2009-10 Reduction of $5,112,157 (reported as 6% by SBCTC) FY 2010-11 Reduction of $4,007,106 (reported as 5.5% by SBCTC) FY 2010-11 Reduction of $720,025 (compensation reduction) FY 2010-11 Supplemental Reduction of $2,688,021 (3.8%) Ordered by Governor in December 2010

Key Reductions for the District for FY2011-2012 Permanent Budget Reduction ($5,058,712) Suspend PERS/TRS Plan 1 COLA Cap State Funding for TIAA-CREF Plans @ 6% ($328,318) ($741,664) One-Time Reduction ($430,593) Temporary 3% Salary Reduction ERP Advanced Planning ($1,631,632) ($203,398) TOTAL ($8,394,317)

Key Additions for the District for FY2011-2012 Tuition increases of 12% per year for resident students and upper division applied baccalaureate tuition (but 2% of operating fee for CTC Innovation Account/ERP Enterprise Resource Planning*) One-time compensation reduction from FY2010- 2011 of $720,025 added back * a system that integrates finance, HR, academic and student service processes, data, and information across an entire organization (CTC)

History of Funding by Category Fiscal Year FY 07-08 State 72,270,561 $ Tuition 22,925,200 $ Offsets* 10,279,821 $ FY 08-09 74,770,000 $ 24,303,370 $ 10,957,821 $ FY 09-10 73,433,666 $ 26,336,958 $ 11,740,721 $ FY 10-11 70,930,387 $ 30,840,002 $ 10,836,393 $ FY 11-12 57,518,523 $ 34,914,021 $ 13,010,220 $ * Offsets International Running Start Indirect Charges

% Change 07-08 to 10-11 Annualized FTES 2007-08 2008-09 2009-10 2010-11 State FTES Allocation State FTES Earned Percent of Allocation Earned 14,606 14,369 98% 14,890 15,025 101% 14,918 15,845 106% 15,575 15,660 101% 7% 9% International Student FTES Earned Running Start FTES Earned 2,079 701 2,413 688 2,402 638 2,474 634 19% -10%

Projected Tuition Revenue FY 2011-2012 FY2010-2011 FY2011-2012 Enrollment 100% 100%* Current Tuition Allocation $30,598,643 $30,598,643 Projected Tuition Collected $32,478,159 $34,914,021** Projected Additional Tuition $1,879,516 $4,315,378** *Assumes SCCD generates similar FTES as FY2010-2011 (approx 15,600) despite having less projected funding for WRT FTES in FY2011-2012 (500-600 less) ** New Tuition Allocation Amount for FY2011-2012 assumes net 7.5% tuition revenue increase and similar FTE generation ($4.3M above FY11 allocation; approx $2.5M more than what was collected in FY11)

Budget/FTE Target for FY11-12 Total FY 11-12 Operating Budget $105,442,764 for District State funding $57,518,523 Tuition Funding $34,914,021 Offsets $13,010,220 What are offsets? International Revenue $8,715,606 Indirect Charges $1,955,018 Running Start $1,664,000 ABE $675,636

FTE Targets for FY2011-2012 Total To Distribute 15,056 15,056 FY2011-12 General FTES Worker Retraining - Base (101) Worker Retraining - Growth & Variable (123) Worker Retraining - Growth & Variable (AV1) Applied BAS Central FTE Applied BAS South FTES Hospital Employee Education Training Targeted 0809 ABE FTES Targeted 0809 I Best FTES Targeted 0809 Hi-Demand Transfer FTES Targeted 0809 Early Ed, Math & Sci FTES Aerospace Apprenticeships TOTAL TARGET TOTAL TARGET 13,780 647 273 146 40 42 - 44 23 39 16 6

Other Budget Concerns for 11-13 Biennium Revenue Continues to Fall Short of Forecasts Possibility of Another Supplemental Cut Will Enrollments Remain Strong? Groundhog Day in Washington D.C.

Seattle Community Colleges FY2011-2012 End of Presentation Questions & Discussion?

DW Budget Presentation FY 2011-2012 Special thanks to North Seattle Community College for hosting this presentation.

Approval of Budgets by Board See Handouts