Because of the changing environment for higher education, many other unversities have undertaken similar budget redesigns. Examples include Iowa State University, Kent State University, Miami University, Ohio University, and the University of Cincinnati.
NKU's new budget model initiative began to take shape as a result of feedback collected during President Mearns' Fall 2012 listening tour, which solicited input from the entire NKU community.
In 2013, 2,900 NKU faculty, staff, and students engaged via open forums, working groups, and surveys in developing the current strategic plan.
During the strategic planning process, the major points made regarding the budget process included:
For each college and auxiliary unit:
Revenues (Direct and Allocated)
<Direct Expenses>
<Allocated Central Costs>
__________________________
Surplus/Deficit
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The Central Revenues Pool is funded by applying a "participation rate" to each unit's revenues.
Direct Revenues
Allocated Revenues
Direct Expenses
Allocated Expenses
Tuition is the largest source of NKU's revenue. Gross tuition is offset with direct and allocated aid and waivers once it has been distributed across colleges.
As shown in the diagram below, NKU's new budget model allocates the majority of tuition using a 70/30 allocation split:
This 70/30 incentive split provides fiscal support to protect and promote transdisciplinarity across colleges.
NKU's revenues from state appropriation are allocated to incentivize three major areas:
Because the budget model allocates revenues directly to colleges, the university's infrastructure is left unfunded. To support these units, the model pools and allocates administrative and support units' net costs using selected allocation variables, as shown in the table below.
Note that functional organization depicted for model development does not represent that an institutional reorganization will occur or is required. Also, costs allocated to revenue-generating units will represent the net of each administrative service unit’s revenues and expenses.
Model Pool | Allocation Variable |
---|---|
Academic Services |
Credit hours instructed |
Administrative Units |
Direct expenses |
Facilities Management |
Square footage (excluding classroom space) |
Information Technology (IT) |
Total headcount: student/staff/faculty |
Intercollegiate Athletics |
Allocated undergraduate tuition |
Sponsored Activities |
Sponsored revenues, excluding indirect costs (IDC) |
Libraries |
Student headcount: college of major |
Student Services |
Student headcount: college of major |
University Advancement |
Direct expenses |
Central Revenues Pool (CRP) Definition:
Centrally retained and/or created revenues through a participation rate to address unit subsidies, university priorities and revenue growth strategies
Purpose of CRP:
CRP Principles: