Overview of the University Budget Structure

2009

Overview of the University Budget Structure

2009

UTSA Operating Budget Fund SourcesUTSA Operating Budget Fund Sources State Funds:

State Appropriations: Formula Funding, Special Items, Benefits

THECB Transfers: TX Pub Ed Grant (TPEG), Work-study

Statutory Tuition, Certain Lab Fees

Designated Funds: Designated Tuition, Mandatory, Course &

Incidental Fees Indirect Cost Recovery: Facilities & Admin Overhead

Auxiliary Funds (29-accts) Restricted Funds: Gifts (30-accts)

Sponsored Programs - Grants/Contracts (26-accts)

Federal Financial Aid (26-accts)

Designated Funds

19-accounts

E&G Budget = 14-AcctsState Funds + $33M of Designated Funds (Tuition, Fees & F&A)Xfrd to fund E&G Bdgt

UTSA FY 2009 Operating Budget All Revenue Sources - $421,560,213

UTSA FY 2009 Operating Budget All Revenue Sources - $421,560,213

State Appropriations

$115 M (27.3%)

Designated Funds:Designated Tuition,

Misc. Fees including

F&A/Indirect Cost

Recovery

$154.6M (36.7%)

Statutory Tuition & Fees $39.9M

(8.5%)

THECB-Tx Grant Pgm, CWS & TARP/TATP

$7.3M (1.7%)

Auxiliary Enterprise:Athletics Fee, University

Ctr Fee, Parking,

Housing, Food Service,

UTSA Card, Child Dvlpmt

$38.2M (9.1%)

Restricted: Gifts $7.2M (1.7%)

Restricted: Financial Aid $31.3M / Grants & Contracts $32M

Total = $63.3M (15%)

State Legislative Budget CycleState Legislative Budget Cycle

Legislature convenes every 2 years for 140 days during an odd numbered calendar year

beginning January 2nd

2007 = 80th Legislative Session for FY08 and 09 Budgets2009 = 81st Legislative Session for FY10 and 11 Budgets

State budget is allocated for 2 years at a time HE appropriations are generally flat in the 2nd year

Fiscal Year begins September 1 Numerical reference is by the trailing year:

2008-2009 = FY09 2009-2010 = FY10

Legislature convenes every 2 years for 140 days during an odd numbered calendar year

beginning January 2nd

2007 = 80th Legislative Session for FY08 and 09 Budgets2009 = 81st Legislative Session for FY10 and 11 Budgets

State budget is allocated for 2 years at a time HE appropriations are generally flat in the 2nd year

Fiscal Year begins September 1 Numerical reference is by the trailing year:

2008-2009 = FY09 2009-2010 = FY10

Legislative Appropriations Request (LAR)

Legislative Appropriations Request (LAR)

Each agency details funding sought from the state budget - tied to goals, objectives & strategies

Each UT campus prepares their own LAR Format dictated (ABEST system input) Instructions in early April of even calendar years Due to UT System ~ May 15, 2008

Basis for Joint Budget Hearing in Fall 2008 before session begins UTSA’s Hearing was held September 8, 2008

Each agency details funding sought from the state budget - tied to goals, objectives & strategies

Each UT campus prepares their own LAR Format dictated (ABEST system input) Instructions in early April of even calendar years Due to UT System ~ May 15, 2008

Basis for Joint Budget Hearing in Fall 2008 before session begins UTSA’s Hearing was held September 8, 2008

General Appropriations Act (GAA)General Appropriations Act (GAA)

General Appropriations Act details each agency’s biennial budget allocation State revenues only - does not include designated funds

Academic institutions Direct appropriations via funding formula are lump sum Strategies are for information only Non-formula appropriations are ‘restricted’:

– Special Items & Higher Education Group Insurance

Revenue sources referred to as ‘method of finance’ General Revenue (“sum certain” appropriations) General Revenue-Dedicated (estimated –Stat Tuition/Lab Fees)

– collected by UTSA – considered a funding source for the formula

General Appropriations Act details each agency’s biennial budget allocation State revenues only - does not include designated funds

Academic institutions Direct appropriations via funding formula are lump sum Strategies are for information only Non-formula appropriations are ‘restricted’:

– Special Items & Higher Education Group Insurance

Revenue sources referred to as ‘method of finance’ General Revenue (“sum certain” appropriations) General Revenue-Dedicated (estimated –Stat Tuition/Lab Fees)

– collected by UTSA – considered a funding source for the formula

General Appropriations Act (GAA)General Appropriations Act (GAA)

GAA specifies how state funds are allocated, not how they must be spent. Institutions are not bound to spend appropriations

within a specified strategy (E&G Space Support) Exceptions

Special Items Higher Education Group Insurance TRB Debt service Research Development funds must be used per Ed Code §62.091

General Revenue can not be used to fund Construction Auxiliary purposes – e.g. Athletics, Parking, etc.

GAA specifies how state funds are allocated, not how they must be spent. Institutions are not bound to spend appropriations

within a specified strategy (E&G Space Support) Exceptions

Special Items Higher Education Group Insurance TRB Debt service Research Development funds must be used per Ed Code §62.091

General Revenue can not be used to fund Construction Auxiliary purposes – e.g. Athletics, Parking, etc.

State Funding Variance by UT CampusState Funding Variance by UT Campus

State Appropriations

FY 2001 2002 2003 2004 2005 2006Arlington 5,400$ 5,700$ 4,900$ 4,600$ 4,600$ 4,900$ Austin 6,200 6,300 5,900 6,000 6,200 6,500

Brownsville (2) 2,700 2,900 3,200 2,900 3,100 3,000

Dallas 6,100 6,100 5,700 5,700 5,500 6,100 El Paso 5,600 5,400 5,200 4,800 4,800 5,200 Pan American 4,700 4,700 4,500 4,200 4,000 4,400 Permian Basin 9,100 8,300 7,400 6,500 6,200 6,300 San Antonio 4,800 4,900 4,400 3,900 3,800 4,400 Tyler 7,900 9,000 7,600 6,900 6,000 6,500

Per Full-Time Equivalent Student (1), Real DollarsUT Academic Institutions

(1) Full-Time Equiv alent students = 30 undergraduate semester credit hours (SCH) or 24 master's or

professional SCHs or 18 doctoral SCHs.

(2) Brow nsv ille operating rev enues from local community college tax district are not included.

State Appropriation % of Total Revenue Declined After Tuition Deregulation

State Appropriation % of Total Revenue Declined After Tuition Deregulation

$-

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

$300,000,000

$350,000,000

$400,000,000

$450,000,000

FY 02 41%

FY 03 40%

FY 04 33%

FY 05 27%

FY 06 30%

FY 07 27%

FY 08 28%

State Appropriations

Total Revenues

Formula Funding in TexasFormula Funding in Texas

Tool used by the Legislature since 1950’s to allocate most of the funds for public universities. Over time, the formula became more and more complex Simplified in 1997, engineered by Senator Ratliff The result of a ‘negotiation’ among institutions & the Legislature re: how available

dollars should be allocated

Not intended as restricted budget line item Universities may allocate to a college or department more or less than the amount

‘earned’ through the formula.

Intended to be fair & equitable, provide incentives, stable & predictable

Tool used by the Legislature since 1950’s to allocate most of the funds for public universities. Over time, the formula became more and more complex Simplified in 1997, engineered by Senator Ratliff The result of a ‘negotiation’ among institutions & the Legislature re: how available

dollars should be allocated

Not intended as restricted budget line item Universities may allocate to a college or department more or less than the amount

‘earned’ through the formula.

Intended to be fair & equitable, provide incentives, stable & predictable

Source: THECB Presentation: Introduction to the Texas Public University Funding Formula (November 2001) http://www.thecb.state.tx.us/AdvisoryCommittees/HEP/FormulaBriefingHindmanNov27.ppt

Formula Funding in TexasFormula Funding in Texas

Intended to fund Educational & General budget items 62% of all state appropriations for general academic institutions are

allocated via 2 funding formulas and 2 supplements.

An “all funds” formula General Revenue – from sales taxes, franchise tax, lottery & numerous

other source All Funds – GR + Statutory Tuition

Intended to fund Educational & General budget items 62% of all state appropriations for general academic institutions are

allocated via 2 funding formulas and 2 supplements.

An “all funds” formula General Revenue – from sales taxes, franchise tax, lottery & numerous

other source All Funds – GR + Statutory Tuition

Source: THECB Presentation: Introduction to the Texas Public University Funding Formula (November 2001) http://www.thecb.state.tx.us/AdvisoryCommittees/HEP/FormulaBriefingHindmanNov27.ppt

State Appropriations: Formula FundingState Appropriations: Formula Funding

Instructional and Operations (I/O) Formula Uses Weighted Semester Credit Hours (SCH) generated during

the ‘Base Year’

Infrastructure Support Formula Funding associated with oper & mtnc of plant Driven by sft needed to support E&G activities

Adjusted Utility Rate (66.1%)All Other Infrastructure Costs (33.9%) To support Oper & Mtnc of E&G space. 08-09 Rate per predicted square foot = $6.19

Instructional and Operations (I/O) Formula Uses Weighted Semester Credit Hours (SCH) generated during

the ‘Base Year’

Infrastructure Support Formula Funding associated with oper & mtnc of plant Driven by sft needed to support E&G activities

Adjusted Utility Rate (66.1%)All Other Infrastructure Costs (33.9%) To support Oper & Mtnc of E&G space. 08-09 Rate per predicted square foot = $6.19

82.9%*

17.1%*

*of total made available to fund the formula

Instructional and Operations (I/O) FormulaInstructional and Operations (I/O) Formula

Formula Strengths: consistent methodology - same

for all 35 academic institutions; emphasizes instruction.

Formula Weaknesses: hurts growing institutions

adjustments every 2 years; motivates creation of graduate

programs; doesn’t reward quality or student success; validity

of weighting not demonstrated. Costs by discipline are

aggregated and self reported. Actual costs are not fully

funded (rate based on funding made available by the

legislature).

Formula Strengths: consistent methodology - same

for all 35 academic institutions; emphasizes instruction.

Formula Weaknesses: hurts growing institutions

adjustments every 2 years; motivates creation of graduate

programs; doesn’t reward quality or student success; validity

of weighting not demonstrated. Costs by discipline are

aggregated and self reported. Actual costs are not fully

funded (rate based on funding made available by the

legislature).

The formula is never funded at the levels recommended by THECB to cover cost increases.

Instructional and Operations (I/O) Formula Instructional and Operations (I/O) Formula

1.1. Each institution reports cost data by discipline Each institution reports cost data by discipline and level and level

2. Each institution reports enrollment data for the 2. Each institution reports enrollment data for the base period – 12 months immediately preceding base period – 12 months immediately preceding & including the legislative session.& including the legislative session. UTSA’s reported SCH for Summer 2008, Fall 2008

and Spring 2009 will determine relative amount of formula funding for FY2010 and 2011

SCH’s are adjusted by funding caps

1.1. Each institution reports cost data by discipline Each institution reports cost data by discipline and level and level

2. Each institution reports enrollment data for the 2. Each institution reports enrollment data for the base period – 12 months immediately preceding base period – 12 months immediately preceding & including the legislative session.& including the legislative session. UTSA’s reported SCH for Summer 2008, Fall 2008

and Spring 2009 will determine relative amount of formula funding for FY2010 and 2011

SCH’s are adjusted by funding caps

Cap Adjustments to the Base SCHCap Adjustments to the Base SCH

The following SCHs are deducted from our base SCH and not funded:

Doctoral Cap –doctoral hours accumulated by a single student in excess of 99 hours.

Undergraduate Hour Cap – SCH earned by a resident undergraduate student that exceeds by at least 45 hours the number of SCH required for completion of the student’s degree program.

Developmental Education Cap – developmental hours accumulated by a single student in excess of 18 SCH.

Third Time Enrollment Cap – credit hours attempted by a single student for the third time.

The following SCHs are deducted from our base SCH and not funded:

Doctoral Cap –doctoral hours accumulated by a single student in excess of 99 hours.

Undergraduate Hour Cap – SCH earned by a resident undergraduate student that exceeds by at least 45 hours the number of SCH required for completion of the student’s degree program.

Developmental Education Cap – developmental hours accumulated by a single student in excess of 18 SCH.

Third Time Enrollment Cap – credit hours attempted by a single student for the third time.

Cost Study InputsCost Study InputsCost Study InputsCost Study Inputs

AFR C-2 Cost Category Discipline Level

Academic Academic

Institutional Institutional

Student Services

StudentServices

Salaries (Teaching and

Assistants)

Departmental Operating Expense

Other Departmental

Operating Expense

As ReportedSalary Weights or Semester Credit Hours

Salary Weights

Semester Credit Hours

Head Counts

Instruction and

Research

As Reported

Formula Funding Weights Reflect Formula Funding Weights Reflect Variable Costs by Discipline & LevelVariable Costs by Discipline & Level

Formula Funding Weights Reflect Formula Funding Weights Reflect Variable Costs by Discipline & LevelVariable Costs by Discipline & Level

Discipline UG L UG U Mast Doct Sp ProLiberal Arts 1.00 1.72 4.18 9.30 0.00Developmental Education 1.00 0.00 0.00 0.00 0.00Science 1.71 2.97 8.14 20.60 0.00Fine Arts 1.39 2.32 5.43 7.19 0.00Teacher Education 1.42 1.74 2.48 7.66 0.00Agriculture 1.87 2.52 7.06 9.88 0.00Engineering 2.41 3.87 7.63 15.97 0.00Home Economics 1.06 1.71 2.86 6.63 0.00Law 0.00 0.00 0.00 0.00 3.87Social Service 1.94 2.05 2.97 13.84 0.00Library Science 1.14 1.09 2.64 6.65 0.00Veterinary Medicine 0.00 0.00 0.00 0.00 16.54Vocational Training 1.66 1.97 0.00 0.00 0.00Physical Training 1.29 1.28 0.00 0.00 0.00Health Services 1.23 1.98 3.21 8.49 0.00Pharmacy 0.71 4.25 19.88 29.57 3.79Business Administration 1.12 1.73 3.43 24.29 0.00Optometry* 0.00 0.00 5.46 19.12 7.00Teacher Education-Practical 1.30 1.77 0.00 0.00 0.00Technology 1.90 2.38 4.41 3.38 0.00Nursing 1.94 2.46 4.83 10.65 0.00

Relative Weights

FY 2010-11 BienniumCost Study - FY 2006 FY 2007 FY 2008

Attempted Semester Credit Hours

Instructional and Operations (I/O) Formula Instructional and Operations (I/O) Formula

3. Per SCH funding rate for all 35 Academic Institutions is the same:

State General Rev + GR-Dedicated (Statutory tuition + lab fees) = Funding Rate

Statewide Weighted Semester Credit Hrs (WSCH) Per WSCH

Funding for Individual Institutions:(Institution’s WSCH x Funding Rate per WSCH) = All Funds Appropriated

Funding Rates FY06-07 = $55.72 FY08-09 = $59.02 (+5.9%)

FY10-11 TBD - THECB Recommended at $63.87 for Attempted SCH $72.05 for Completed,

HB1 is $60.51 (+2.5%)

3. Per SCH funding rate for all 35 Academic Institutions is the same:

State General Rev + GR-Dedicated (Statutory tuition + lab fees) = Funding Rate

Statewide Weighted Semester Credit Hrs (WSCH) Per WSCH

Funding for Individual Institutions:(Institution’s WSCH x Funding Rate per WSCH) = All Funds Appropriated

Funding Rates FY06-07 = $55.72 FY08-09 = $59.02 (+5.9%)

FY10-11 TBD - THECB Recommended at $63.87 for Attempted SCH $72.05 for Completed,

HB1 is $60.51 (+2.5%)

Teaching Experience SupplementTeaching Experience Supplement

10% additional weighting to Undergraduate SCH (both Lower and Upper Division) taught by tenure/tenure track faculty Was 5% in 98-99 and 00-01 Increased to 10% in 02-03, 04-05, 06-07 biennia

In 06-07 the GAA included this language: It was the intent of the Legislature to increase the weight

by 10% per biennium, up to 50%. (Did not increase in 08-09)

For 10-11, THECB has recommended removal of this supplement!

10% additional weighting to Undergraduate SCH (both Lower and Upper Division) taught by tenure/tenure track faculty Was 5% in 98-99 and 00-01 Increased to 10% in 02-03, 04-05, 06-07 biennia

In 06-07 the GAA included this language: It was the intent of the Legislature to increase the weight

by 10% per biennium, up to 50%. (Did not increase in 08-09)

For 10-11, THECB has recommended removal of this supplement!

Statutory TuitionStatutory Tuition Rates established by Ed Code ($50/SCH since Fall 2005 for

resident undergraduate students) Same rate for all UT institutions.

Graduate students pay 2 times undergraduate rate, referred to as Graduate Incremental Tuition.($100/SCH since Fall 2005)

Non-resident students pay rates equal to the average non-resident tuition at the 5 most populous U.S. states. Rates are determined by THECB per §54.051(d) of the Texas Ed Code (currently at $331/SCH for UG and $772/SCH for GR)

Statutory Tuition is a revenue source for the I/O formula (in an amount estimated in the General Appropriations Act.) Institution bears impact of any over or under collection of Institution bears impact of any over or under collection of

budgeted revenue – worse for campuses who lose enrollment.budgeted revenue – worse for campuses who lose enrollment.

Rates established by Ed Code ($50/SCH since Fall 2005 for resident undergraduate students) Same rate for all UT institutions.

Graduate students pay 2 times undergraduate rate, referred to as Graduate Incremental Tuition.($100/SCH since Fall 2005)

Non-resident students pay rates equal to the average non-resident tuition at the 5 most populous U.S. states. Rates are determined by THECB per §54.051(d) of the Texas Ed Code (currently at $331/SCH for UG and $772/SCH for GR)

Statutory Tuition is a revenue source for the I/O formula (in an amount estimated in the General Appropriations Act.) Institution bears impact of any over or under collection of Institution bears impact of any over or under collection of

budgeted revenue – worse for campuses who lose enrollment.budgeted revenue – worse for campuses who lose enrollment.

Designated TuitionDesignated Tuition

In 2003, the legislature ‘deregulated’ designated tuition rates to counteract declining state revenue.

Considered a local source of revenue; rates are set by by the Board of Regents (fingers crossed) & vary by institution

FY 08 = $101/SCH FY09 = $110 /SCH FY10 = $120.85 (fingers crossed) 20% of the amount collected from paid resident UG and 15% from

resident GR over $46/SCH is set aside for student financial aid. Very important revenue stream

Only discretionary source of new revenue in the 2nd year of the biennium to fund merit, mandatory cost increases, new faculty, strategic initiatives, etc.

In 2003, the legislature ‘deregulated’ designated tuition rates to counteract declining state revenue.

Considered a local source of revenue; rates are set by by the Board of Regents (fingers crossed) & vary by institution

FY 08 = $101/SCH FY09 = $110 /SCH FY10 = $120.85 (fingers crossed) 20% of the amount collected from paid resident UG and 15% from

resident GR over $46/SCH is set aside for student financial aid. Very important revenue stream

Only discretionary source of new revenue in the 2nd year of the biennium to fund merit, mandatory cost increases, new faculty, strategic initiatives, etc.

Mandatory & Incidental FeesMandatory & Incidental FeesNew fees and or changes to the fee amounts are set for twoNew fees and or changes to the fee amounts are set for twoyears upon approval by the Board of Regents. years upon approval by the Board of Regents.

Proposals are considered prior to the Fall Semester of the 2nd year of the biennium.

Fee revenue must be spent in accordance with the approved purpose (justification) and or per Texas Education Code stipulations.

Mandatory Fees (Designated & Auxiliary Funds):Mandatory Fees (Designated & Auxiliary Funds): Required to be paid by all students unless exempted by statute or waived

by the President. New fees and/or fee rate changes must be approved by the Board of

Regents (BoR)

Incidental or Course Fees (Designated Funds):Incidental or Course Fees (Designated Funds): College/course fees are included in the Total Academic Cost formula. President has authority after review of The UT System Executive VC.

New fees and or changes to the fee amounts are set for twoNew fees and or changes to the fee amounts are set for twoyears upon approval by the Board of Regents. years upon approval by the Board of Regents.

Proposals are considered prior to the Fall Semester of the 2nd year of the biennium.

Fee revenue must be spent in accordance with the approved purpose (justification) and or per Texas Education Code stipulations.

Mandatory Fees (Designated & Auxiliary Funds):Mandatory Fees (Designated & Auxiliary Funds): Required to be paid by all students unless exempted by statute or waived

by the President. New fees and/or fee rate changes must be approved by the Board of

Regents (BoR)

Incidental or Course Fees (Designated Funds):Incidental or Course Fees (Designated Funds): College/course fees are included in the Total Academic Cost formula. President has authority after review of The UT System Executive VC.

Facilities and Administrative (F&A) Indirect Cost Recovery

Facilities and Administrative (F&A) Indirect Cost Recovery

Facilities and Administrative overhead from sponsored grants and contracts provides reimbursement for institutional expenses in support of extramural activities that cannot be directly charged to a specific grant or contract.

Facilities component includes plant operation and maintenance, depreciation, library expenses.

Administrative component includes general administration

and general expenses, sponsored projects administration.

Facilities and Administrative overhead from sponsored grants and contracts provides reimbursement for institutional expenses in support of extramural activities that cannot be directly charged to a specific grant or contract.

Facilities component includes plant operation and maintenance, depreciation, library expenses.

Administrative component includes general administration

and general expenses, sponsored projects administration.

Facilities and Administrative (F&A) Indirect Cost Recovery

Facilities and Administrative (F&A) Indirect Cost Recovery

UTSA’s F&A rate is negotiated with the federal government (DHHS) On-campus rate: 44.5% On-campus rate: 44.5%

Eff. 9/1/2007 through 8/31/11Eff. 9/1/2007 through 8/31/11 Was 41.5%, gain of 3%Was 41.5%, gain of 3%

Off-campus rate: 26%Off-campus rate: 26%

Modified Total Direct Costs (MTDC) is the base to which F&A (indirect cost) rates are applied when submitting a grant or contract, per OMB Circular A-21.

UTSA’s F&A rate is negotiated with the federal government (DHHS) On-campus rate: 44.5% On-campus rate: 44.5%

Eff. 9/1/2007 through 8/31/11Eff. 9/1/2007 through 8/31/11 Was 41.5%, gain of 3%Was 41.5%, gain of 3%

Off-campus rate: 26%Off-campus rate: 26%

Modified Total Direct Costs (MTDC) is the base to which F&A (indirect cost) rates are applied when submitting a grant or contract, per OMB Circular A-21.

Auxiliary EnterprisesAuxiliary Enterprises Self-supporting activity providing goods or services to students,

faculty, staff, departments, or incidentally to the general public. Charges are directly related to, although not necessarily equal to,

the cost of the goods or services. Important aspect of campus life UTSA’s Auxiliaries include

Bookstore – outsourced management contract (Follett) Food Services - outsourced management contract (Aramark) Parking Housing University Center Recreation Center (we moved this year from designated) Athletics UTSA Card

Self-supporting activity providing goods or services to students, faculty, staff, departments, or incidentally to the general public.

Charges are directly related to, although not necessarily equal to, the cost of the goods or services.

Important aspect of campus life UTSA’s Auxiliaries include

Bookstore – outsourced management contract (Follett) Food Services - outsourced management contract (Aramark) Parking Housing University Center Recreation Center (we moved this year from designated) Athletics UTSA Card

Capital Improvement FundingCapital Improvement Funding

3 Debt Financing programs available to UTSA:

1. Tuition Revenue Bonds (TRB) approved by the Legislature to debt finance new construction. “Free money” to UTSA.

General revenue appropriation covers debt service.

Recent UTSA Buildings financed with TRBEngineering $74,250,000BSE 22,950,000Main 15,000,000Downtown, Phase III 35,000,000

3 Debt Financing programs available to UTSA:

1. Tuition Revenue Bonds (TRB) approved by the Legislature to debt finance new construction. “Free money” to UTSA.

General revenue appropriation covers debt service.

Recent UTSA Buildings financed with TRBEngineering $74,250,000BSE 22,950,000Main 15,000,000Downtown, Phase III 35,000,000

Capital Improvement FundingCapital Improvement Funding

2.2. The Permanent University Fund (PUF)The Permanent University Fund (PUF) net asset value = net asset value = $11.74B$11.74B

--PUF debt from tax-exempt bonds secured by distributions to the Available University Fund. “Free money” to UTSA.

STARS –Faculty Start-up Funds UTSA has received $6.6M over the past 3 years

LERR – Library, Equipment, Repair and Rehabilitation UTSA received $2 million for FY07; $2.237M in FY08

Recent PUF Allocations to UTSA$20.25 M for Science Lab Renovations$ 8.25 M for Engineering Building$14.50 M for 1604 & Hausman Property (future site of Athletic facilities)

Board of Regents just increased the PUF annual distribution from 4.75 to 5.0%;Board of Regents just increased the PUF annual distribution from 4.75 to 5.0%;additional proceeds of ~$30M to be used for recruitment and retention of faculty.additional proceeds of ~$30M to be used for recruitment and retention of faculty.

2.2. The Permanent University Fund (PUF)The Permanent University Fund (PUF) net asset value = net asset value = $11.74B$11.74B

--PUF debt from tax-exempt bonds secured by distributions to the Available University Fund. “Free money” to UTSA.

STARS –Faculty Start-up Funds UTSA has received $6.6M over the past 3 years

LERR – Library, Equipment, Repair and Rehabilitation UTSA received $2 million for FY07; $2.237M in FY08

Recent PUF Allocations to UTSA$20.25 M for Science Lab Renovations$ 8.25 M for Engineering Building$14.50 M for 1604 & Hausman Property (future site of Athletic facilities)

Board of Regents just increased the PUF annual distribution from 4.75 to 5.0%;Board of Regents just increased the PUF annual distribution from 4.75 to 5.0%;additional proceeds of ~$30M to be used for recruitment and retention of faculty.additional proceeds of ~$30M to be used for recruitment and retention of faculty.

Capital Improvement FundingCapital Improvement Funding

3. The Revenue Financing System (RFS) The UT System program provides low interest The UT System program provides low interest financing for capital needs:financing for capital needs:

--available to campuses that meet bond rating agencies’ standards for The UT System to preserve its AAA rating.

Construction projects or capital equipment funded by Designated funds: Policy requires a campus to meet 2 of 3 financial ratios:

Debt Service Coverage, Debt Burden and Expendable Resources to Debt

Projects funded by auxiliaries or fee revenue must demonstrate sustainable ability to service the debt.

--100% of debt service paid from UTSA revenues.

3. The Revenue Financing System (RFS) The UT System program provides low interest The UT System program provides low interest financing for capital needs:financing for capital needs:

--available to campuses that meet bond rating agencies’ standards for The UT System to preserve its AAA rating.

Construction projects or capital equipment funded by Designated funds: Policy requires a campus to meet 2 of 3 financial ratios:

Debt Service Coverage, Debt Burden and Expendable Resources to Debt

Projects funded by auxiliaries or fee revenue must demonstrate sustainable ability to service the debt.

--100% of debt service paid from UTSA revenues.