The UCC 2019-2020 budget was proposed and approved during the month of May.
A major concern, in terms of budget shortages, with this new budget was the “increase in revenue sources as the state allocation doesn’t keep up with the cost increases” Natalya Brown, chief financial officer, and Katie Workman, budget manager, said. “It remains a concern for all of the community colleges in Oregon.”
The state currently allocates $590 million for the community college support fund. “In the case that allocation doesn’t hold, UCC will need to look into additional budget adjustments,” Brown and Workman said.
Another source of revenue could have come from House Bill 3427, which was passed by the state of Oregon on May 1 and signed by Governor Kate Brown on May 16. This bill is expected to raise billions of dollars for early childhood and K-12 education; however, this bill excludes higher education. Community colleges and universities will receive no additional funds from this bill.
UCC’s budget is divided into 11 different funds: general fund, special revenue fund (between grants and contracts, with administratively restricted funds), financial aid fund, capital projects fund, debt service fund, insurance fund, enterprise fund, internal service fund and agency fund. Each fund is annually evaluated for the following school year and improvements are created based on the next year’s budget and any future financial needs.
Next year’s general fund, which includes activities related to the college’s basic educational objectives and operations, experienced little change compared to the adjusted 2018-2019 general fund. The 2019-2020 general fund budget of $27.9 million; however, has to meet an increase in 9.5% due to the college “budgeting [a] reserve category at 2 months operating cost as the College attempts to stabilize its financial position after rapid declines in the last several years,” according to the 2019-2020 Budget Highlights. The personnel costs have also increased 6.5% since the last biennium. The adjusted 2018-2019 general fund was about $2.5 million less than the approved 2019-2020 general fund.
The majority of the general fund goes to personnel services and fringe benefits, which are a total of 83% of the expenditures, as the chart shows.
The general fund for 2018-2019 required additional money transferred to the capital projects fund because of unexpected events. “As for the general transfer funds, there [was] a negative variance due to the need for capital construction after the snowstorm this year,” Brown and Workman said. The college asked for an additional $150,000 for the capital projects fund, used for major remodeling projects, major equipment purchases, the acquisition of land or new construction.
The 2019-2020 enterprise fund has been approved for $450,000. It includes activities that furnish goods or services to students, staff, or the public, for which charges or fees are assessed that are directly related to the cost of the good or service provided. Changes to the enterprise fund mean that catering services will no longer be available and cafeteria services will be different. “The board approved the transition of catering services to be contracted with outside vendors,” Brown and Workman said. They also stated, “The future of the cafeteria has not been determined. The college is researching and vetting options that will provide service to students and staff while being fiscally responsible.” As for resolving any issues with this fund, “The College is seeking sustainable solutions for Enterprise fund operations.”
The board meeting minutes for the budget proposal mentioned that $145,000 is to be set aside for the new Industrial Technology Center. Natalya Brown stated that no money is to be set aside for the 2019-2020 approved budget, but $100,000 was set aside during the 2017-2018 school year.
Changes to the internal service fund include an increase of $49,375 from the previous adjusted 2018-2019 budget for Public Employees Retirement System (PERS). The internal service fund includes functions that exist primarily to provide goods or services to other instructional or administrative units of the college. The funds in this category are Motor Pool, Copiers and PERS Reserve.
For more information and additional budget changes see the 2019-2020 Approved Budget.