University budget process begins for 2019-20

St. Vincent’s Circle
St. Vincent’s Circle under a canopy of fall foliage, Wednesday, Oct. 31, 2018. (DePaul University/Jeff Carrion)

Faculty, staff, student and administration representatives of the Strategic Resource Allocation Committee, or SRAC, have begun meeting to prepare a budget recommendation for DePaul’s 2019-20 fiscal year.

The nine-member committee will prepare a recommendation for a university-wide budget that will be proposed to the university president, finance committee of the board of trustees and the full board for approval.

Jeff Bethke, executive vice president and chair of SRAC, answered questions for Newsline about the budget process and some early expectations for 2019-20.

How does the Strategic Resource Allocation Committee work?

The university’s three executive areas—Offices of the President, Provost and Executive Vice President—work over the summer to set the budgets of specific departments or units. When SRAC meets in November, its members consider how to balance key university costs in the next fiscal year with expected revenue. They hear presentations from Human Resources, Enrollment Management and Marketing areas as well as representatives from the three executive areas on topics such as compensation and benefits, tuition pricing, enrollments, proposed expenses and funding for strategic initiatives.

Based on that information, the committee then prepares a university-wide budget for recommendation to the president for approval. This budget addresses items such as merit compensation increases, benefits adjustments, such as the recent increases to the university’s 403(b) match, funding for capital maintenance and strategic initiatives, support for financial aid, and other broad expense categories.

While SRAC’s main work occurs in the fall, its members also meet periodically year round for briefings on the university’s financial position and to share budget process ideas.

Who serves on SRAC?

SRAC’s nine members are drawn from the leadership of DePaul's faculty, staff, students and administration. In addition to myself, the other voting members of SRAC for 2018-19 are:
  • Erin Berkowitz, Staff Council president
  • Salma Ghanem, acting provost
  • Nahal Hashemian, Student Government Association president
  • David Miller, dean, College of Computing and Digital Media
  • Scott Paeth, Faculty Council president
  • Sherri Sidler, vice president for finance and controller
  • Michaela Winchatz, Faculty Council representative
  • Paul Zionts, dean, College of Education
Last year, SRAC made recommendations that involved difficult cost-saving measures, strategic reorganizations and job reductions in some areas.

What’s been the budget impact of those actions so far?

Significant steps in cost management across DePaul in the last two years have placed the university in a better financial position than in the past. For just the second time since 2009, last year DePaul’s revenues grew faster than our expenses. The university is achieving what SRAC intended, which is to move DePaul beyond the focus on cost management toward a position where we are  thriving, academically and financially, and poised to realize the vision of the new strategic plan. That said, we all recognize that last year’s budget reductions, which included the elimination of 62 staff positions, were extremely difficult for each individual who was adversely impacted and were challenging for all of us.  

SRAC’s recommendations last year also included a 2.7 percent merit pool (increased from 2.5 percent in recent years) and an increase of the university’s 403(b) match from 9.5 percent to 10 percent. This showed the university’s commitment, even as we were cutting positions in some areas, of trying to keep our salary and benefits packages competitive.

For students, SRAC recommended an increase in institutional financial aid of nearly 9 percent over the previous year's budget to $222 million. In keeping with past years, SRAC recommended moderate tuition pricing increases for new undergraduates, with lower increases for continuing and graduate students. Nearly every dollar that is spent at DePaul comes from a student in one way or another – tuition or fees or housing – so affordability is an overarching concern as we look to build the budget.

What’s the general outlook for 2019-20?

I am optimistic DePaul will continue to provide good value to students and invest in faculty and staff while minimizing the pain of job reductions. It is still a challenging time for higher education, particularly in a region where several institutions are competing for an increasingly smaller pool of prospective students. DePaul has done incredibly well despite those challenges. This fall, we welcomed our second-largest freshman class and enrolled a total of 22,437 students, surpassing the budgeted goal by 240 students. At the same time, the budgeted headcount target anticipated a decline. Total enrollment is 332 students less than last fall. Looking ahead, the university will still need to be mindful of how we manage expenses.

Strong academic programs are what it’s all about, so we simply must have funds to invest in new ideas and innovation. Last year, we set aside $13 million specifically for initiatives associated with the strategic plan and for exciting new programs like the Academic Growth and Innovation Fund​, which has seen a significant level of interest and participation by faculty. Those types of efforts were made possible by our careful budget management and I fully expect to continue that trend of investing in innovation and quality in the coming years.  

How will the new strategic plan, “Grounded in Mission,” be taken into consideration during budget planning?

“Grounded in Mission” provides a road map for the university and will serve as a guide in our budget planning. The priorities in the budget will reflect the priorities detailed in the strategic plan.

Timeline of the annual budget process
  • September: Individual departments and units across the university began planning budgets. At the same time, Enrollment Management and Marketing conducted the review of fall enrollment results, and then projected enrollment and financial aid for the coming year. Since DePaul’s revenues are tuition driven, these projections are critical to setting the annual budget.
  • November/December: The Strategic Resource Allocation Committee, known as SRAC, meets several times in the fall to consider the budget planning groundwork and projections. In early December, its membership votes on a budget proposal to recommend to the university president. The president may approve or modify the recommendations before making a budget proposal to the board of trustees’ finance committee.
  • December: The board’s finance committee considers the president's recommendations and may send the budget as proposed or a modified set of recommendations to the full board of trustees.
  • Spring: The full board votes on a final budget at its spring meeting. This approved budget then would take effect on July 1, 2019.