Divisional FY2017-18 budget targets

February 1, 2017

On February 1, senior campus leaders received their division’s FY2017-18 budget target via email from AVC-CFO Rosemarie Rae and EVCP Carol Christ. As discussed in recent forums, your unit can meet the target either through revenue generating programs or cost saving activities. This target is just the beginning point of our iterative budgeting process, which is a collaborative process that will require careful coordination within our limited time period. Through the course of our small group meetings together this month, we look forward to understanding the landscape more fully and discussing the implications of the target on your strategic plans. Together, we're confident our campus is prepared to prioritize UC Berkeley over our individual units and make the tough choices needed to sustain our academic excellence.

Overall agreement on the budget target methodology will likely never be possible, but as leaders of this university, your support is critical to our success. Our small group meetings to discuss the targets will be conducted with several reasoned, strategic principles in mind:

  • Incorporate a combination of metric-­based financial information (e.g., revenue growth, expense growth, profitability, etc.) and operational data (e.g., student credit hours)
  • Develop a methodology simple enough to allow for straightforward communication and ensure the rationale of the methodology is made transparent to the entire campus
  • Provide effective data and tools to confront difficult decisions (e.g., shrinking or merging academic and nonacademic units, laying off staff, etc.)
  • Consider cross-campus interdependencies with an eye toward how budget reductions in one unit might affect other units and the campus as a whole

We acknowledge budgeting with these targets will be challenging for all of us. We ultimately must meet the $57 million in-year deficit target OP has established for our campus in FY2017-18. OP has not dictated how the target will be met, but there is an expectation that we will:

  • Shift philanthropic dollars to core operations

  • Grow academic and research revenue

  • Improve teaching productivity

  • Implement financial reform that equitably distributes central resources while fairly taxing units for common goods

  • Manage organizational headcount

  • Rightsize the Athletics program to an acceptable level of institutional support

After this month’s small group meetings, campus leaders will have the clarity needed to develop budgets and formally submit strategic plans, revenue generation plans, and budgets in mid-April. The Chancellor and Provost will carefully consider our academic and administrative priorities as they make final budget decisions with the trusted counsel of the Academic Senate, Deans, and Vice Chancellors.