Campus Revenue Generation and Incentive Program
Outline of Revenue Generation Incentive Program For New or Expanded Academic Initiatives
1. The purpose of this program is to recognize the equivalent value of cost reductions and revenue enhancements during a time of very serious budget constraints.
2. Initiatives included in this program require Presidential approval.
3. Proposals will be judged for their academic merit and financial benefits. The respective academic leader (Provost, Dean of Medicine or Interim Executive Dean for Health Sciences) determines the former and Finance/Budget will decide on the latter. Approval from both entities is necessary before submission for Presidential consideration.
4. In order to pass the financial viability test, revenue must be easily measured and clearly new to the institution. Income shifted from other existing programs does not qualify.
5. A portion of new revenue will accrue to affected non-academic units at the same proportion as in the opening 2008-09 state budget allocations. This distribution will have no impact on budget cuts in that the new revenue is intended to off-set new costs.
6. The sponsoring academic unit will receive dollar for dollar credit for the remaining portion of new revenue, minus normal fringe benefit charges as applicable, as satisfaction of budget reductions distributed to that area.
7. Programs will be initially considered for the 2009-10 fiscal year. Revenue will be distributed when success of the initiative is verified and only to the degree that base campus revenue targets are met or exceeded.
Credit Distribution Plan:
Use State Purpose allocation totals from the Operating Budget (Gray Book) by organization (major administrative area) to determine the proportionate sums to be distributed to those areas incurring costs as a result of the initiative and credit the balance of revenue to the sponsoring academic unit.
Issues requiring consideration for each specific initiative:
1. If a proposed program requires significant infrastructure or capital investment, such costs need to be carefully examined and quantified as part of the review and approval process. Modifications to the revenue distribution formula may result.
2. Initiatives may generate revenue to the extent that budget cuts in the academic unit in question are fully met or exceeded. In such cases, modifications to the revenue distribution formula may result.
3. All parties agree with the stipulation in guideline #7 above. However, there are many factors affecting campus revenue generation and collection; many are within management’s control and some are not. In order to assure new program revenues and costs are not negatively impacting base university revenue totals, an annual review of each initiative will be required. Such review will be a cooperative effort by representatives of the three academic leaders, Finance and Budget personnel.