Budget Context for Academic Planning

1
Budget Context for Academic Planning

• Senate Meeting
• October 22, 2009

2
Agenda

• 2008-09 Year-End Highlights (Balance Sheet)
• Budget Plan Update
• Review of Budget Plan 2009-2012
• Key Budget Risks
• 2005-06 to 2008-09 Budget Expenditure Analysis

3
1) 2008-09 Highlights Balance Sheet

• Total Assets decreased to 1,359M (Last year
  1,383M)
• Cash and Cash Equivalents decreased by 81M from
  162M to 81M.
• The University transferred 82M to a laddered
  fixed income investment to take advantage of
  better returns available for longer term
  investments. (4 return vs. lt1 return)
• (Balance Sheet provided as Appendix 1 at end of
  presentation)

4
1) 2008-09 Highlights Balance Sheet

• Capital Assets decreased to 651M net of annual
  depreciation (Last year 684M)
• York Research Tower 15M
• Nadal Centre Renovation 1.5M
• Library Acquisitions 7M
• Furniture 5M
• Computers/Telecom 3M
• Miscellaneous Other 11M
• Less Annual Depreciation (45)
• Transfer of Archives Project to Investment in
  Lease (31)
• Investments increased by 17M to 449M (Last year
  432M)
• Decline in Market Value (56M)
• New Contributions 7M
• Distributions for 2008 (9M)
• Additions to Laddered Bond Fund 82M
• Transfer of Tribute Mortgage to Accounts
  Receivable (9M)

5
2008-09 Highlights Endowment Growth (As at
April 30)
6
1) 2008-09 Highlights Balance Sheet

• Long-Term Debt decreased to 313M (Last year
  343M)
• Principal payments on outstanding mortgages and
  loans are 4M annually
• Passey Mortgage matures 26M in 2010 (Fully
  funded)
• 300M in bullet bond debentures mature in 2042
  and 2044. To date sinking fund has 31 million
  set aside
• Net Asset Deficit increased by 85M to 120M
  (Last year 35M)
• Timing difference created by Semester extension
  55M
• Ancillary Deficit Bookstore/Parking 4M
• Internally Financed Assets 1M
• Operating Budget Deficit 25M

7
2008-09 HighlightsDeficit (Net Assets Balance
As at April 30)
8
2009-2012 Budget PlanSummary
Significant reduction to enrolment revenue - 25M
over 3 years
Amounts for Awards/Chairs to offset Endowment
shortfalls
Budget Cuts 3.5 / 3.5 / 3.5
Budget Deficit over next 2 years
9
2) Undergraduate Enrolment Update
Summer/09

• Budget Assumptions (June 2009)
• Budget revenue projection assumed a 10 (300 FTE)
  decrease from last summer
• Revenue impact was a 3M reduction to previous
  plan
• Current Update (October 2009)
• Total eligible and ineligible undergraduate FTEs
  were up about 1.0
• BIUs were essentially flat

10
Undergraduate Enrolment Update- Fall 2009

• Budget Assumptions (June 2009)
• 2009 Targets were 1.6 lower than 2008 Actuals
• Budget revenue projection assumed a 15 decrease
  in first year intake, and
• Significant reductions in retention into upper
  year
• Budget revenue impact was a 9.5M reduction from
  previous plan
• Revenue impact carried forward into future years
• Current Update (October 2009)
• First year intake and upper year retention are
  looking better than expected.
• Total enrolments (heads) are running 3 above
  targets
• Total enrolments (FTEs) are running 2 above
  targets
• Revenue impact remains uncertain but should be
  positive compared to June/09 budget assumption

11
Eligible Fall/Winter Enrolments 2008 2009
Targets and Actuals to Date
Data is for undergraduate, direct entry programs
only. Does not include data for Education, Law
and Nursing
12
Ineligible Fall/Winter Enrolments 2008 2009
Targets and Actuals to Date
Data is for undergraduate, direct entry programs
only. Does not include data for Education, Law
and Nursing
13
Fall FTEs Projection About 2 Above Target
14
2) Analysis of Fall/Winter Total Enrolments

• It is early in the enrolment cycle.
• Care should be taken in interpreting total
  student (head count) results
• Students are still adding dropping
  courses/programs
• FTE/Heads and BIU/FTE rates have been falling
  over the past several years
• Effects of the Tuition Credit Option yet to be
  analyzed in these results

15
2) Update on Investment Performance to
September 31, 2009 ( Preliminary)
16
2) Key Budget Risks

• Enrolment Recovery
• Capital Market Recovery
• Endowment Distribution
• Pension Fund Performance
• Tuition Fee Increase Assumptions for 2010-11 and
  beyond
• Operating funding for new Capital Projects
• Funding Impact of Accessibility for Ontarians
  with Disabilities Act
• Implementation of Budget Plan reduction measures

17
Budget Expenditure AnalysisMethodology

• Provides a consistent comparison of expenditures
  across the University over the period 2005-06 to
  2008-09.
• Actual expenditures restated in each year to
  reflect the organizational structure in existence
  in 2008-09.
• Actual expenditures adjusted for the change in
  the budget carryforwards.

18
Budget Expenditure AnalysisExpenditure
Comparison Table
19
19