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FSEC discusses budget allocation process
By MARY COCHRANE
Contributing Editor
The University at Buffalo is changing the way it carries out its budget allocation process and though that transformation will take more time, positive things are already occurring as a result, Sean Sullivan, associate vice president for academic planning and budget, told the Faculty Senate executive committee yesterday.
"When you make such a dramatic flip as we have from a very distributive, formulaic, revenue-sharing approach to budgeting to one that is much more strategic, driven by objectives and a vision that is developing parallel with it, there's quite a change in the mechanics of budgeting, and there's a lot more demand for information supporting our budget discussions," Sullivan said.
"There's work that is being done to improve our financial information systems, all of which will serve to inform the university much more substantially than we were informed in the past about why we are distributing our resources the way we are and what impact we're getting for that distribution," he added. "That takes time to do and we're taking the time to get it right."
The change in budgeting approach is necessary to accommodate all of the changes that UB foresees for the future, as documented in the ongoing UB 2020 strategic planning process. Such changes could cause an increase in the total operating budget from the current $1 billion to as much as $1.5 billion, according to Sullivan, who was joined in his presentation by Provost and Executive Vice President for Academic Affairs Satish K. Tripathi and James A. (Beau) Willis, chief of staff in the Office of the President and interim executive vice president for finance and operations.
For example, as much as $100 million in faculty and staff salaries is expected to be vacated in the next five to seven years and a plan needs to be in place as to how best to manage the use of those additional funds.
As a result, Sullivan said he and others have spent more than a year "orienting" the Faculty Senate's Budget Priorities Committee to the budgeting process and preparing for the new BAP, one that views the university as a whole and that no longer includes "unit-centric financial planning and formula-driven budget methods that have limited the university's ability to invest fully in a strategic vision that moves UB to a next level of prominence."
The new resource management process employs a five-step approach that begins with creating a profile of each academic unit at UB, including specifics regarding such items as the unit's budget, revenues and staff size. The unit then plans what it hopes to accomplish with its resources over the course of the next year, the next three years, and further into the future. Each unit would then make a public campus presentation that invites dialogue on its goals. Following a finalization of its plan, the unit then enters a three-year "compact agreement" in order to reach the final step, budget implementation.
Sullivan expects all three-year compact agreements to be completed by the end of the current fiscal year.
Changes in budgeting at UB already have produced savings, including a 30 percent reduction in phone expenses, thanks to implementation of VoIP, and a 10-15 percent projected savings in administrative overhead costs resulting from transformation initiatives. Also, UB has hired 35 additional faculty and expects to see that figure rise to 100 during the 2008-09 academic year, on schedule for hiring goals projected by UB 2020.
Faculty Senate members had questions regarding budget specifics such as classroom space and capital improvements, increasing the stipends for graduate assistants and how to limit the amounts units charge each other for services provided internally.
Overall, Sullivan assured them, these questions will be examined and will be answered through the new budgeting process, which at its heart, will require the university academic units to think as often as possible in terms of "cross university" services and programs. After all, the first in a list of 10 resource management principles that Sullivan handed out at the meeting states that "all resources are university resources."