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FY 2011-FY2015 Budget Comparison And 5 Year Projection 1 Office of Finance.

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Presentation on theme: "FY 2011-FY2015 Budget Comparison And 5 Year Projection 1 Office of Finance."— Presentation transcript:

1 FY 2011-FY2015 Budget Comparison And 5 Year Projection 1 Office of Finance

2 FY 2011-FY 2015 Historical Look back 2 Fiscal Years 2011 through 2015 have been tumultuous in Higher Ed For UT that is defined by a decline in enrollment of 12%- $26M State Share of Instruction Subsidy decline of 13%- $17M Sales and Service Revenue decline of 16% (housing, meal plans, athletics)- $13M Rising healthcare/benefit costs- $3M These factors had a Total Impact of $60M in reduced Income Management has mitigated this impact and maintained a positive cash flow by Increasing tuition and fees Reducing interest expense: refinancing debt Reduction in FTE’s; salaries Reducing Capital Expenditures Non-Salary expenses

3 FY 2011-FY 2015 Budget Comparison 3 $23.5M Decline in Operating Revenue- 4.5% Decline in enrollment (offset by tuition/fee increases) State Share of Instruction/State Appropriations decline Sales and Service Revenue decline Other Revenue decline

4 FY 2011-FY 2015 Budget Comparison 4 Increase in Expenditures of $943K-.2% Salaries decreased due to 7.7% decrease in FTE’s Benefit costs increased (healthcare and tuition waivers) Reduced Non-Salary (Operating Expense) Depreciation expenditures increased

5 FY 2010-FY 2015 Budget Comparison 5

6 Items Negatively Affecting Financial condition during this time period and Managements’ response 6 *FY2013 student bookstore moved to UT Foundation

7 FY 2016 Budget Development 7 FY2016 Adjusted Budget reflects FY2015 Fall Enrollment Decline and a 3% Increase in both Undergrad Enrollment and Tuition and Fees

8 FY 2016 Budget Development 8

9 9 * Assumes fully funded depreciation *

10 5 Year Forecast-FY2016-FY2020 3% Enrollment and Related Services 10 Increase in Expenses in FY2017- FY2020 Annual Salary Increase of 2%- $4.6M annually Annual Benefit Costs Increase of 2%-$1.8M annually Inflation of 2%-Increases in Operational costs-$2.2M annually Depreciation annual Increase of $2.2M Decrease in Principal & Interest on Debt -$200k annually Total Increased Expenses $42.7M

11 5 Year Forecast-FY2016-FY2020 3% Enrollment and Related Services 11 Management Actions in FY2016-FY2020 3% Annual Increase of Tuition/Fees (undergrad)-$4.6M Average/annually 3% Annual Net Increase in Enrollment & Related Services (undergrad)-$5.4M Average/annually Reduce Capital Spend to 52% funded depreciation in 2016 to 83% in 2020 Faculty Retirement Savings-$1M Increase Auxiliary Margin- $1M Additional Management Actions $48.3M Increase in Tuition/Fees and Enrollment for 2016 are included in 2016’s Adjusted Budget of $-36M

12 5 Year Forecast-FY2016-FY2020 3% Enrollment and Related Services 12

13 5 Year Forecast-FY2016-FY2020 3% Enrollment and Related Services 13 * Gradually increasing capital spend towards fully funding depreciation

14 5 Year Forecast-FY2016-FY2020 Flat Enrollment 14 Increase in Expenses in FY2017- FY2020 Annual Salary Increase of 2%- $4.6M annually Annual Benefit Costs Increase of 2%-$1.8M annually Inflation of 2%-Increases in Operational costs-$2.2M annually Depreciation annual Increase of $2.2M Decrease in Principal & Interest on Debt -$200k annually Total Increased Expenses $42.7M

15 5 Year Forecast-FY2016-FY2020 Flat Enrollment (000’s) 15 Management Actions in FY2016-FY2020 3% Annual Increase in Tuition/Fees (undergrad)-$4.6M Avg./annually Increase Enrollment and Related Services by 3% in FY2016, Flat FY Reduce Capital Spend to 52% funded depreciation in 2016 to 83% in 2020 Faculty Retirement Savings-$1M Increase Auxiliary Margin- $1M Additional Management Actions $29M Increase in Tuition/Fees and Enrollment for 2016 are included in 2016’s Adjusted Budget of $-36M

16 5 Year Forecast-FY2016-FY2020 Flat Enrollment 16

17 5 Year Forecast-FY2016-FY2020 Flat Enrollment 17 * Gradually increasing capital spend towards fully funding depreciation

18 FY 2011-FY 2015 Budget Comparison 18 $18.5M or 6.9% increase in Operating Revenue Growth in Cancer Treatment Growth in Emergency Room visits Growth in Clinic volume (new locations) Growth in Kidney Transplants, Vascular Surgery, GI, Interventional Neurology, LVAD (Heart), Pain Services, Wound services, Rehab Services, Behavioral Health, etc.. Improved contracts with commercial payers Increased complexity of inpatients, CMI went from to CMI: a relative value assigned to a diagnosis-related group of patients in a medical care environment. The CMI value is used in determining the allocation of resources for the care and/or treat of patients.

19 FY 2011-FY 2015 Budget Comparison 19

20 FY 2011-FY 2015 Budget Comparison 20 Increase in Expenditures of $14.6M or 5.5%. Salary Expenses increased on average 2.5% annually due staffing increases (i.e., New Clinics and Cancer Treatment) and wage increases. Benefit costs increased (healthcare and tuition waivers) Increase in supply costs, kidney acquisition, pharmaceutical sales. Depreciation expenditures increased Purchased Services increased related to software and equipment maintenance.

21 FY 2010-FY 2015 Budget Comparison 21 * Does not include Capital Expenditures funded from Bond Debt *


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