Presentation on theme: "Helen Benjamin Chancellor Contra Costa CC District, CA Jean Floten President Bellevue College, WA Finance and Fund Raising: The President’s Role AACC Presidents’"— Presentation transcript:
Helen Benjamin Chancellor Contra Costa CC District, CA Jean Floten President Bellevue College, WA Finance and Fund Raising: The President’s Role AACC Presidents’ Academy April 17, 2010
Resource Management 101 Unique role of the president Pitfalls in budget review Becoming “fearless with fundraising ”
Unique Role of President in Finances and Fund-raising The President is the chief steward and advocate for the college in this area. As steward, the president manages and holds in trust the property, finances, and other affairs of the institution. As advocate, the president represents the college in all matters. You provide leadership and stewardship to others who follow your lead and watch your every move. Set a superior example. College assets do not belong to the president but are entrusted to the president for safe keeping and appropriate use.
Unique Role of President in Finances and Fund-raising The president is the public face of the college. Managing funds responsibly and with integrity are key presidential responsibilities. Before the president can fund-raise, s/he must friend- raise. Public trust and confidence are basic to effective fund- raising.
Keeping the College Financially Sound Develop a budget process that Is simple and easy to understand Provides for financial stability Provides for an appropriate level of reserves consistent with board policy and direction Is an integral part of the district/college planning process and related to goals and objectives Provides means to address any current or future emphasis directed by the board of trustees Promotes efficient use of district/college resources Allows flexibility for “local” control with accountability Is planned in a multi-year cycle.
Keeping the College Financially Sound President Operate a balanced budget Develop a nose for numbers, accounting logic and estimates Keep a budget cushion Have good accountability, internal controls/monitoring Provide sound instructions to finance and budget staff Fund-raise
Setting Aside Adequate Funds in Good Times for Tough Times Rule 1: Estimate revenue conservatively Rule 2: Develop a culture of planning where all requests are considered during annual budget development Rule 3: Spend conservatively Rule 4: Manage year-end balances Rule 5: Keep an adequate reserve
Setting Aside Adequate Funds in Good Times for Tough Times Establish a culture in which a conservative approach to District/college finances is the norm. Develop values that include planning for an uncertain future. Ensure policies and procedures are in place that require a certain level of reserves. Ensure budget management procedures are in place for monitoring internal and external factors that could change budget assumptions; ensuring flexibility in the event of unanticipated changes in revenue, expenses or community needs.
Coping with Possible Layoffs and Cutbacks Honestly Courageously Openly Prudently
Coping with Possible Layoffs and Cutbacks Build relationships Explain budget situation Carefully consider situation/timing Establish planning council Consider unique opportunities Consider early retirements, furloughs Be transparent Meet with affected individuals/units/ unions before communicating plan Treat affected employees with respect and dignity Allow for appeals
Pursuing Diversified Funding Know your particular funding model Tuition and fees Grants, contracts Online education Community service and self-support programs Auxiliary services Partnerships: BHAGs Foundations.”
Questions for CFOs Has deficit spending been occurring? If so, how is it addressed? Is the college fund balance stable or consistently increasing? Are enrollments increasing, declining, or stable? Are staffing and other expenses adjusted consisted with enrollment trends? Does the college have a consistent, board approved minimum reserve ?
Questions for CFOs Are collective bargaining agreements settled within revenue sources in the last three years? Are the agreements affordable? Is the college using one-time funds to pay for ongoing expenses? Are internal controls in place to ensure financial integrity? Is position control integrated with payroll? What are the unfunded liabilities? Is there a plan to fund them?
Questions for CFOs Headlines Nobody told me… Yikes! Now what…
Headlines Audit finds college spent $1 million too soon Audit finds college spent $1 million too soon XXXXX college $1 million short XXXXX college $1 million short Bookkeeping error wasn't the first at college Bookkeeping error wasn't the first at college College Program Under Scrutiny -- Audit Questions Use Of XXXX Kitchen College Program Under Scrutiny -- Audit Questions Use Of XXXX Kitchen
General College Health Have an audit before or right after you are hired. Request audits, whistleblower complaints for last five years. Issues or problems? Facilities master plan? Severe problems; how immediate are they? Current capital projects? Risk of going over budget? Relationship with the City; impacts on building projects? Pending lawsuits?
Budget Thermometer How are you funded? What revenue can you count on? Where is risk? Contracts sustainable? Budget balanced? Reserves used? How are reserves? Overall debt? How solid is the source of funds paying it down? Self-supporting programs/services? Risk? Over-expenditures?
Three Pieces of Advice about Fund-Raising If possible, establish an interdependent foundation (501 (c) 3) with the sole purpose of raising money for the college. Hire a fund development expert to run the foundation and make that person an integral part of the college. Develop a fund development plan in which the strategic directions of the college are reflected.
Three Pieces of Advice about Fund-Raising Cultivate stages of giving Understand that we must give to get Build partnerships Know it’s about business