CALIFORNIA STATE UNIVERSITY, LONG BEACH
2005-06 RESOURCE PLANNING PROCESS
Resources and Requirements Forecast
Explanatory Notes
The 2005-06 Resources and Requirements Forecast estimates the impact of budget decisions made by the State, by the CSU System Office, and the Long Beach campus on the resource allocations for the coming year. The forecast is largely based on the Governor's January Budget and the Higher Education Compact, with minimal adjustments required as a result of the May Revision issued May 13, 2005. This forecast does not include any changes that may occur with the legislative proceedings that take place before the final budget is passed.
This year, the forecast presents separate resource details for base and non-base allocations as each are important to our overall budget strategy.
The following notes provide an explanation of the numbers shown on the forecast. Other related notes and recommendations on the budget reduction plan and selected topics can be found in the sections following this forecast.
RESOURCES
2004-05 General Fund Base Budget
Net state support and budgeted revenues and reimbursements as detailed in the 2004-05 CSULB Internal Budget Document.
Represents that portion of the University's state budget supported by tax revenues.
2004-2005 Revenues & Reimbursements
Represents that portion of the University's budget supported by resident undergraduate, teacher credential and graduate student fees.
Represents that portion of the University's budget made up of a variety of student and other fees. Examples include student health center fee, application fee, non-resident tuition, transcript fees, etc. This category is exclusive of reimbursed activities budgets that total $7,500,000, which do display in the systemwide office budget documents.
CSU Adjustments to the 2004-05 Base Budget
Change to the 2004-05 budget for the July 1, 2004 increase in the employer's contribution rate paid on behalf of CSULB employees who participate in the CalPERS retirement program.
The 2004-05 Final Budget allocations transmitted to campuses on August 3, 2004, included an interim allocation of State University Grant (SUG) dollars that was pending further review and analysis of 2003-04 campus financial aid data. Following completion of that review process, the final 2004-05 SUG allocation awarded to Long Beach was reduced by $45,700.
The 2004-05 general fund budget allocation removed $531,100 in one-time funds for academic preparation and outreach.
The net 2005-06 increase in the campus's general fund allocation based on revised CSU allocations provided to the President towards the end of April 2005.
In 2005-06, CSULB expects a total of $85,000,000 in State University Fee (SUF) revenue. This is an increase of $8,700,000 over 2004-05. The increase has two components:
- Enrollment growth of 655 new full-time equivalent students (FTES), generating approximately $2.0 million, or 23% of the total expected SUF revenue increase; and
- Rate increases effective Fall 2005, estimated to net $6.7 million, or 77%
of the total SUF revenue increase:
- undergraduate rates will increase by 8%;
- credential students increase by 8%; and
- post-baccalaureate and graduate students will increase by 10%.
This revenue projection is contingent on achieving an enrollment for Academic Year 2005-06 of 27,551 FTES (which includes 1,575 FTES for summer, 2005).
CSULB anticipates a higher amount of SUF per FTES during the summer than during the regular academic year: $3,906 per FTES versus $3,030 per FTES due to the per unit fee structure and more students taking one or two courses with fewer fee waivers.
REQUIREMENTS
2004-05 Internal Budget
The base budgets for the operating divisions and university-wide programs as detailed in the 2004-05 Internal Budget document.
Base budgets for the operating divisions.
General, necessary, or unavoidable costs that are for the benefit of the entire campus rather than a particular operating division.
2004-05 CHANGES IN CAMPUS EXPENDITURE REQUIREMENTS
Represents base budget adjustments for various divisions and university-wide allocations.
Financial Aid
Base budget adjustment associated with the financial aid set aside of 25% of state university fees from the increase revenue associated with changes in fee rates and enrollment target. The SUG allocation to CSULB is approximately 90% of the final amount expected pending analysis of overall systemwide changes in enrollment and each campus' proportional share of need.
Mandatory Costs
Base budget adjustment associated with the rate increase in campus contributions to the CalPERS employees' retirement program, which became effective during 2004-05. Those rates went from 14.843% to 17.022%, or a 2.179% increase for all employees (University Police that moved from 28.325% to 31.841%, or 3.516%.) The amount is established by the Chancellor's Office, and the funds for this pass-through allocation are provided by the State.
Compensation allocations to campuses are based on their proportional share of total general fund salary and wage expenditures in 2003/04. The allocation will support the cost of negotiated compensation increases based on a 3.5% increase in the compensation pool for represented and non-represented employees. The actual increase in compensation and benefits for represented employees will be negotiated through systemwide collective bargaining.
Mandatory cost increases for health are based on a 9.7% increase in premium rates effective January 2005. Increases for dental premium rate increases are based on a 5% increase in Delta Dental monthly premium rates and a 4% increase in PMI DeltaCare premium rates effective January 2005. The CSU will allocate $1,524,000 to the Long Beach campus based on our actual percentage share of health and dental premium costs in 2003/04. Because benefit budgets were overfunded during the prior budget year planning process, we are able to reduce the allocation to meet these requirements and use those dollars for unfunded mandatory costs.
Requirements have increased to cover premiums for Worker's Compensation (+$429,594, or 13% increase), Industrial Disability Liability/ Nonindustrial Disability Insurance/ Unemployment Insurance (+$162,841, or 36% increase) and Property Insurance (+$43,162, or 10% increase), with a decrease expected in our Liability Insurance premium of -$47,812, or 10%. After analyzing future liabilities, our campus must also increase risk management reserves by approximately $235,000 to cover the anticipated increase in the number of claims under our $200,000 deductible, as well as to cover miscellaneous insurance policies and legal costs. Although the estimated budgetary need for risk management and insurance costs total $819,000, non-base resources will be used to cover the gap in base funding expected in 2005-06.
This allocation will cover the expected increase in utility costs due to rate changes and increased demand.
This mandatory cost increase is funded at a rate of $8.42 per square foot for new space or space renovations completed or coming on-line in the 2005/06 fiscal year.
Long-Term Need
Long Beach will receive $115,800 based on our proportional share of total custodial square footage. This allocation will be added to our existing deferred maintenance budget. Instructionally related space will receive the highest campus priority.
Campus Recovery Plan Allocations
The campus recovery plan encompasses two components. The first component is an allocation to support faculty for new enrollment growth. The second component is a pro-rata allocation to instruction and non-instruction budgets.
This allocation supports the faculty costs to accommodate an additional 655 full time equivalent students, funded at the rate of $2,744 per FTES (the rate currently used by the CSU system in calculating the marginal cost of instruction).
This allocation represents the funding to be distributed on a pro-rata share basis after all mandatory costs and other requirements are met, to assist the divisions' in restoring operating budgets to meet our collective institutional mission.
| Instruction | Amount |
|---|---|
| Academic Affairs | $1,213,700 |
| Non-Instruction | Amount |
|---|---|
| Academic Affairs | 431,200 |
| Administration & Finance | 441,000 |
| Athletics | 43,200 |
| Office of the President | 21,600 |
| Student Services | 145,600 |
| Univ Relations & Development | 46,700 |
| Total Non-Instruction | $1,129,300 |
The budget plan forecasts $877,600 to be available as a contingency reserve. In the event these base funds are not required to cover revisions of revenue projections and/or other changes in the final budget, the funds will be used to accelerate the campus recovery plan. This acceleration will be accomplished by increasing the pro-rata allocation.
CALIFORNIA STATE UNIVERSITY, LONG BEACH 2005-06 NON-BASE BUDGET
RESOURCES
Campus Recovery Plan - Carryover Reserves
Savings totaling $13,531,427 from both University-wide resources and division operating budgets play a key role in campus recovery planning. The university-wide contingency reserve will be used only in the event of deterioration in the final budget and/or if required to meet unplanned costs resulting from collective bargaining. Any uncommitted portion of the contingency will be reserved for future years' recovery plans.
| Area | Subtotal | Total |
|---|---|---|
| University-wide Savings | $7,841,000 | |
| Division Savings | ||
| Academic Affairs | $2,500,000 | |
| Administration & Finance | 1,079,383 | |
| Student Services | 267,510 | |
| Univ Relations & Development | 243,534 | |
| Total Division Savings | $4,090,427 | |
| Contingency Reserve | $1,600,000 | |
| Total | $13,531,427 |
REQUIREMENTS
University-wide savings of $7,841,000 will be distributed to the divisions on a pro-rata basis of the total operating budget. Division savings totaling $4,090,427 will be retained by each division responsible for generating the carryover funds. The distribution of these non-base resources is displayed in the Recommended Budgeted Plan on page 14 of this document; the expenditure plans have been disclosed in detail in the Appendix B of this document. The contingency reserve of $1,600,000 is held to cover any budget deterioration when the state budget is finalized. Any excess non-base reserves will be carried forward to assist in funding the 2006-07 recovery plan.