2015-16 Budget PlanningBoard of TrusteesJune 17, 2015 - 11AM

1

MSU Budget Context

Constrained Resources

Michigan enters the second half of the decade with

changes in state support for the past ten years at the

bottom of the Big Ten

2

-20%

-10%

0%

10%

20%

30%

40%

50%

60%53% 51%

38%

25%

14%12%

8%

1%0%

-9%

-16%

Big Ten State’s Appropriations ChangesFY04-FY14

Inclusive of

inflation, MSU

purchasing

power reduced

by $150M

Appropriation per student allocations less than peers

Big Ten institutions typically enroll more nonresidents, further increasing

financial disparity

3

Constrained Resources

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

Approp + Tuition Per Student ResidencyMSU lags the Big Ten average by

approximately $2,800 per student,

representing over $120M in resources

MSU lags the Big Ten average for non-

resident population by approximately 13%,

representing approximately $90M

0%

10%

20%

30%

40%

50%

60%

*Residency calculations exclude Maryland and Rutgers due to availability

In order to maintain student faculty ratios within range of the Big Ten average and support

research and graduate education, MSU has worked to constrain costs

Have accommodated additional 5,000 students over 10 years

MSU core budget change averages 1.8% over the last five years, Higher Education Price

Index averages approximately 2.0% over the same period

Grounds maintenance and custodial service most efficient in the Big Ten and provide

annual savings

Natural gas buying strategies and market opportunities yielded $1M in annual savings

Within academic units, increase in web-based SCH to approximately 10% of total SCH

generated

MSU health care cost increases below national indexes each of the last 5 years by 1-2%

4

Stewardship

5

Investing in Access

$0

$20

$40

$60

$80

$100

$120

$140

2004-05 2014-15

General fund financial aid growth of almost 300% over 10 years

Over 8,700 Pell grant recipients, approximately 75% more than

Carnegie peers

Over the last three years, average financial aid increases exceed tuition

adjustments by approximately 2%

Due to significant investment during the economic downturn, average financial aid

increases exceed tuition adjustments by approximately 5.5% over ten years

General Fund Financial AidGrowth of almost 300% over 10 years

$41M

$120M

6

0

200

400

600

800

1,000

1,200

1,400

1,600

2014

Five Year Average

# of Fam

ilies

Distribution represented in 2014 inflation adjusted dollars Families earning over $200,000 truncated for presentation

Preserving Family Income Distribution

7

Limiting Student Debt

$23,000

$24,000

$25,000

$26,000

$27,000

$28,000

$29,000

$30,000

MSU State National

$25,821

$29,583

$28,400

0%

10%

20%

30%

40%

50%

60%

70%

MSU State National

46%

63%

69%

Avg. Student DebtMSU below the State and National average

for average debt load by 12.7% and 9.1%

respectively

Proportion with DebtMSU below the State and National average

for proportion of students with debt by 27%

and 33% respectively

$0

$100,000,000

$200,000,000

$300,000,000

$400,000,000

$500,000,000

$600,000,000

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

$262,413,915

$528,000,000

8Source: Contracts and Grants

Up 52% over ten years

Growing Sponsored Programs• Over $500M in annual sponsored programs

• FRIB, a $730M facility, received $90M in Congressional approvals during

the current fiscal year

Undergraduate Education – Neighborhoods

Plant Sciences

Expansion of Engineering Disciplines

Computational Sciences

Food Production and Security

Population and Community Health

Environment Food, Water, and Energy

New Techniques for Study Across Plants, Animals and People

Facilities, Infrastructure, and Technology9

Academic Programs

Sustaining Strengths & Investing in the Future

Accommodate external constraints and issues

Internal savings derived from high performance culture

Strategic investment in academic and research priorities to serve

future generations of students and stakeholders

Partnerships with Donors, State, and Federal Research Granting

Agencies

10

Ongoing Budget Objectives

Budget Planning

11Preliminary 2015-16 budget approved by the BOT in June 2014 • Includes 2.0% general merit, 0.5% college market, plus 0.5% provost market pool **Infrastructure financing*** Includes 2.0% general merit plus 0.5% provost market pool

Budget Item 2015-16Current Proposal

2016-17Current Update

State Appropriations 1.5% 4.0%

Tuition & Fees 2.7% Lower Div2.7% Upper Div

5.0% Engineering5.0% Business

4.0%

Financial Aid 4.5% 4.5%

Graduate Assistants 2.0% 1.5%

Faculty Salaries 2.0%+0.5%+0.5%* 2.0% + 0.5%***

Utilities 2.2%** 4.0%**

Health Care 5.0% 5.0%

Academic Competitiveness

College – Salary $1.5 $0.0

Central $6.3 $6.1

Computing Issues $0.0 TBD

Total $1,263.8 $1,307.6

12

Undergraduate Tuition Increase

Reconciliation

Per Credit Credits Total Per Credit Credits Total % Change $ Change

Core Per Credit $440.00 30 $13,200.00 $452.00 30 $13,560.00 2.7%

Lower Division Fee

Total $13,200.00 $13,560.00 2.7% $360.00

Core Per Credit $490.25 30 $14,707.50 $503.50 30 $15,105.00 2.7%

Upper Division Fee

Total $14,707.50 $15,105.00 2.7% $397.50

Engineering Per Credit $490.25 30 $14,707.50 $514.75 30 $15,442.50 5.0%

Upper Division Fee $1,180.00 $1,239.00 5.0%

Total $15,887.50 $16,681.50 5.0% $794.00

Business Per Credit $490.25 30 $14,707.50 $514.75 30 $15,442.50 5.0%

Upper Division Fee $400.00 $420.00 5.0%

Total $15,107.50 $15,862.50 5.0% $755.00

FY15 FY16