The Budget Cycle
Berkeley’s budget process is a continuous cycle of actions throughout the year that helps the campus, divisions, and departments evaluate their financial position, determine where they wish to go, and chart a path for how to get there.
Take a look at the information below to see how money circulates through our institution and how divisional budgets are developed.
How does money flow through our institution?
The flow of money through Berkeley begins with the campus’ central ledger, where tuition and fees, state appropriations, and other revenue are recorded and allocated to campus divisions on an annual basis.
In addition to this revenue, certain university-wide expenses are also recorded in the central ledger - for example, fees charged by UC’s Office of the President for programs that serve the entire UC system.
After these expenses are paid, money in the central ledger then flows out to campus. There are three major areas of the campus that receive this funding.
- Berkeley’s academic divisions receive approximately $700 million annually.
- The Office of the Vice Chancellor for Research receives approximately $60 million annually.
- Central support divisions (Student Affairs, Equity & Inclusion, Finance, Capital Strategies, and Administration), which receive approximately $500 million annually. Scholarships and Fellowships for students are distributed here and make up a large portion of this allocation.
Aside from the money they receive from the central ledger, the divisions that comprise these three groups also take in money from other sources at the local level. For instance, academic divisions supplement the funding they receive through the central ledger with additional income produced by their researchers’ contract and grant activity, through revenue-generating academic programs, and through philanthropy.
How is money allocated to each division?
The Executive Vice Chancellor and Provost lead the campus’ annual budget planning process, working with vice chancellors and deans to allocate funding from the central ledger in a way that best serves campus, division, and department priorities. While the EVCP office coordinates the process, divisions’ actual budget planning is done at the local level, giving deans and vice chancellors the flexibility and responsibility to generate revenue as well as make cuts where they deem most appropriate within their division.
Each year, the process is as follows:
November to January: Budget Process Planning
Planning for the budget process begins with an analysis conducted during the November to January time frame, during which the Office of the CFO, in collaboration with the EVCP and Chancellor, reviews anticipated central revenue and expense projections for the upcoming fiscal year and, based on those estimates, sets budget assumptions for the following year. This process draws important information from the November meeting of the UC Board of Regents and the Governor’s January budget proposal.
February to April: Budget Launch and Development
Once budget assumptions for the upcoming fiscal year have been finalized, they are communicated to divisions, and the budget process is officially launched usually by late February / early March. Campus units then have approximately two months to complete and submit their budget in April.
May to June: Divisional Budget Review and Discussions
Once divisional budgets have been finalized and submitted, the deans and vice chancellors of each division meet with the EVCP and CFO to discuss their plans and the challenges and opportunities their divisions face.
June: Budget Finalization
Campus leaders gain perspective from their review of budget submissions and from meetings with division leaders, the Chancellor, EVCP, and the CFO. The Chancellor, EVCP, and CFO then make final decisions about budget allocations for each division. During this last step, the Chancellor, EVCP, and CFO make strategic funding decisions that reflect campus priorities. Budget allocation letters outlining the decisions are distributed by the end of June.