M E M O R A N D U M June 30, 2011 To: Members of the Board of Trustees From: Nancy L. Zimpher, Chancellor Subject: Approval of 2011-12 State Operated and Statutory College Core Instructional Budget Allocations Action Requested By the adoption of this resolution, the Board will approve the following: * Distribution of State support totaling $961.6M to the State-operated and statutory campuses, and estimated revenue of $1.2B for the State-operated campuses. * The impact of the methodology utilized for allocating reduction of $164M, composed of o Enacted Budget reduction of $150M o $14M to mitigate the impact of reduction in State subsidy for the three University hospitals. The following principles and rationale ultimately informed the chosen allocation methodology referred to as the “blended scenario.” * Broad campus participation in the selection of the “blended scenario.” * Reductions allocated based on the average of: (a) redistribution scenario in proportion to total State support and (b) redistribution scenario in proportion to total Financial Plan. * Redistribution of $5M to Other Research/Doctoral institutions (Upstate, Environmental Science and Forestry, Optometry, Downstate) to correct the impact on such institutions of the methodology * Five percent year-to-year reductions for System Administration and University-wide Programs * University-wide Programs are presented at the 2010-11 funding levels; a plan to distribute the year to year change of $5,989,200 is currently under discussion. The final distribution will be shared with the Board in September. * Student aid related University-wide Programs held harmless * Reduction applied before any incremental tuition to allow for reinvestment of tuition dollars. Resolution I recommend that the Board of Trustees adopt the following resolution: Whereas in accordance with Education Law §355(4), the Board of Trustees has authority to allocate annual appropriations among the State-operated and statutory colleges and programs of the University; and Whereas pursuant to Education Law §355(19) the University is required to provide the Chairs of the Senate Finance Committee and Assembly Ways and Means Committee, the State taxpayer support allocations and overall budget allocations for each State-operated campus and University-wide Program, as well as the formula and/or methodology used to make such allocations of State taxpayer support; and Whereas the 2011-12 Enacted State Operations Budget provides for total core instructional support for the State University of $2,295,607,300, consisting of $961,623,300 in direct State taxpayer support, $110,723,000 of other State University revenue distributed in proportion to State support, and $1,223,261,000 in estimated State University income from tuition and other revenue; and Whereas the 2011-12 Enacted State Operations Budget included a reduction of $150 million; and Whereas the impact of the loss of State support to the University hospitals requires a permanent distribution of $14 million from the campuses to the academic health centers; and Whereas Board of Trustees has authorized an increase in tuition rates for all resident and non-resident undergraduate, graduate, and first professional degree students, effective with the Fall 2011 semester; now, therefore, be it Resolved that the proposed core instructional budget allocations by campus and program set forth below be, and hereby are, approved for the State University of New York for the 2011-12 University fiscal year beginning July 1, 2011, in a total amount of $2,295,607,300: DOCTORAL DEGREE GRANTING INSTITUTIONS Albany $154,994,000 Binghamton 136,725,300 Buffalo University 343,150,200 Stony Brook 292,960,200 Downstate Medical 86,100,800 Environmental Science & Forestry 33,419,600 Optometry 18,803,000 Upstate Medical 65,555,200 COMPREHENSIVE COLLEGES Brockport 59,005,200 Buffalo State 79,587,100 Cortland 50,271,800 Empire State 51,453,400 Fredonia 40,635,200 Geneseo 40,742,200 New Paltz 57,475,000 Old Westbury 27,760,200 Oneonta 44,686,200 Oswego 56,468,400 Plattsburgh 48,221,100 Potsdam 37,606,100 Purchase 41,353,700 TECHNOLOGY COLLEGES Alfred 25,866,300 Canton 18,526,600 Cobleskill 20,768,900 Delhi 18,897,200 Farmingdale 41,166,500 Maritime 18,602,300 Morrisville 25,184,900 SUNYIT 18,344,600 STATUTORY COLLEGES Ceramics 8,088,100 Cornell 121,231,700 SYSTEM ADMINISTRATION 13,804,300 UNIVERSITY-WIDE GOVERNANCE Student Assembly 56,700 FACULTY SUPPORT Faculty Diversity Program 421,400 ECONOMIC DEVELOPMENT Development Centers for Business & Industry 110,800 Small Business Development 1,934,500 Strategic Partnership for Industrial Resurgence 1,862,200 RESEARCH College of Nanoscale Science and Engineering 1,928,600 Cord Blood Bank 205,600 Earthquake Center 1,642,900 Empire Innovation 9,856,900 GRI NonDoctoral 172,200 SUNY Leadership Institute 246,600 Just for the Kids 233,400 Library Conservation & Preservation 331,400 Office of Global Affairs 1,194,900 Research Institute on Addictions 2,798,500 Rockefeller Institute 1,618,400 Sea Grant 437,800 Stony Brook/Brookhaven/Cold Springs Collaboration 205,400 TwoYear College Development 37,000 STATE NEEDS/PUBLIC SERVICE High Needs Programs 3,211,600 High Needs Nursing Program 1,780,300 Sportsman Institute at Cortland 631,300 SUNY Urban Teacher Education Center 292,800 TECHNOLOGY Academic Equipment Replacement 4,631,600 Computer Center 3,510,700 Education Technology 4,195,400 Information Security Initiative 191,100 Library Automation 1,078,200 New York Network 666,600 Student Computing Access 3,182,100 Telecommunications Network 837,000 STUDENT SUPPORT/FINANCIAL AID Child Care Centers 1,554,500 Community College Transfer Program 222,500 Empire State Scholarships 621,900 Maritime Appointments 239,600 Office of Diversity, Equity, and Inclusion 457,900 Native American Program 213,200 Student Loans 3,075,000 Student Support Services 539,000 SUSTA 1,570,700 Tuition Reimbursement 34,697,600 Graduate Diversity Fellowships 6,039,300 PROGRAMS FOR THE DISADVANTAGED Educational Opportunity Centers 48,198,600 Educational Opportunity Programs 19,345,300 TRANSITIONAL FUNDING 3,742,900 UNIVERSITY-WIDE PROGRAM TO BE ASSIGNED (5,989,200) SHARE OF THE HOSPITAL REDUCTION 14,000,000 UNDISTRIBUTED APPROPRIATION 20,119,300 TOTAL UNIVERSITY $2,295,607,300 and, be it further Resolved that upon completion of revised revenue projections for 2011-12 by the campuses, and upon completion of a distribution plan for the University-wide programs, the updated campus and program allocations will be reported to the Finance and Administration Committee and transmitted to the Director of the Budget, the Chairs of the Senate Finance Committee and Assembly Ways and Means Committee, and the Office of the State Comptroller, and, be it further Resolved that the Chancellor, or designee, be, and hereby is, authorized to modify the allocations provided for herein (excepting the statutory colleges) in accordance with Resolution 86-48 adopted March 26, 1986, and to develop and transmit to the Director of the Budget and to the Chairs of the Senate Finance Committee and Assembly Ways and Means Committee a Financial Plan consistent with the allocations provided for in this resolution. Background The State budget provides for total core instructional support for the State University of $2,295,607,300, consisting of $961,623,300 in direct State taxpayer support, $110,723,000 of other State University revenue distributed in proportion to State support, and $1,223,261,000 in estimated State University income from tuition and other revenue. (see Chart A for year-to-year changes for each campus). The following principles and rationale ultimately informed the chosen methodology referred to as the “blended scenario.” * Broad campus participation in the selection of the “blended scenario.” * Reductions allocated based on the average of: (a) redistribution scenario in proportion to total State support and (b) redistribution scenario in proportion to total Financial Plan. * Redistribution of $5M to the Other Research/Doctoral institutions (Upstate, Environmental Science and Forestry, Optometry, Downstate) to correct the impact on such institutions under the methodology. * Five percent year-to-year reductions for System Administration and University-wide Programs * A plan is currently under development for the distribution of $5.8 in reductions for the University-wide programs, reflecting an overall 5% year to year decrease. * Student aid related University-wide Programs held harmless. * Reduction applied before any incremental tuition to allow for reinvestment of tuition dollars. The 2011-12 Enacted Budget includes a reduction of $150M, comprised of $131.4M in a lump sum reduction to be applied to the State-operated campuses and programs and $18.6M in reduction to the statutory colleges. In addition, the three University hospitals sustained a reduction in State subsidy of $119M. To help mitigate the impact of the cuts on hospital operations, an additional reduction in the amount of $14M has been applied to campuses which would become a permanent reduction. Therefore, the reduction applied to the State-operated campuses and programs in 2011-12 totals $145M. The campus-specific budget allocations of State tax dollar support and campus revenue, and the allocations for the University-wide Programs were developed in an incremental manner, using the final adjusted 2011-12 Adjusted Financial Plan as the starting point. (See Attachments B-D for details.) The allocations for the statutory colleges at Cornell and Alfred University are as set forth in the appropriation bill. Additional details on the development of the budget are below: * Mandatory Costs – The 2011-12 Enacted Budget included funding in the amount of $48.5M for the costs of collective bargaining increases, general inflation (OTPS), energy, and funding related to the tuition sharing enacted for 2008-09 to bring the University’s share to 40% of the 2008-09 tuition increases. * Enacted Budget State Support Operating Reduction – A reduction of $164M was applied to the base to calculate the final appropriated State support amount. * Statutory Colleges– Allocations provided as presented in the Enacted Budget, including adjustments for mandatory costs and a share of the $164M total operating budget reduction. * Campus Revenue – The revenue estimates are based on the new resident and non-resident undergraduate, graduate rates, and first professional degree program tuition rates approved by the Board. Campuses are currently revising the revenue estimates using the most recent enrollment information, and these revised revenue estimates will be used to update the total core instructional budget allocations. The updated allocations will be reported to the Finance and Administration Committee and transmitted to the Director of the Budget, the Chairs of the Senate Finance Committee and Assembly Ways and Means Committee, and the Office of the State Comptroller, as required by this resolution. The State University Board of Trustees has the authority to allocate the annual appropriations in accordance with the operating flexibility legislation of 1985. Education Law §§355(4) and 355-a authorize the University to determine the number of positions supported by available personal service funds. The Director of the Budget retains authority over the total aggregate funding (expenditure ceiling) available to the University during any fiscal year. Attachment -7- Board Resolution June 30, 2011