Approved by the: Faculty Senate - April 3, 2008
Administration - May 13, 2008*
Board of Regents - no action required

* The University appreciates the thoughtful analysis of the internal budget model implementation and recommendations for improvement. Consequently, the University is referring the resolution to the Senior Vice Presidents and the Vice President and Chief Financial Officer for consideration and ongoing discussion with the Budget Model Advisory Committee and Senate Finance and Planning Committee.

Resolution on the Budget Model

MOTION:

The Faculty Senate recommends to the President that:

1. The Vice President for Research should be an integral part of the process by which decisions are made to allocate resources to all aspects of the University mission.

2. There be changes to the way that cost-pool rates are set and reviewed. Specifically, (a) establish college revenue budgets before setting cost-pool unit expense budgets and link them, so that if college revenues decline, cost-pool charges also decline, (b) establish performance metrics and quality standards for all cost-pool funded units and establish a corresponding mechanism to protect colleges if cost-pool units perform below standards, and (c) require all cost pools to report on the input received from the colleges.

3. A system of incentives be established for cost management and colleges guaranteed that they will retain for a period of time the savings they generate. Mechanisms should be in place to insure that colleges and administrative units can retain their savings and that these will not be offset by allocations from state funds.

4. A faculty committee be created to formulate basic rules that simplify interdisciplinary research. (Interdisciplinary research and centers that cross college boundaries are not directly addressed in the new budget model.)

COMMENT:

The Senate Committee on Finance and Planning (SCFP) and the Senate Research Committee last year appointed a joint ad hoc subcommittee to examine and make recommendations about the University's new budget model. The subcommittee submitted a report last fall; this recommendation to the Faculty Senate represents a distillation of some of the recommendations made by subcommittee members on SCFP in addition to the report. These are the recommendations that SCFP believes most important at this time. There are other recommendations that the Committee will bring to the Faculty Senate at a later date.

The report of the ad hoc subcommittee can be found at: http://www1.umn.edu/usenate/scfp/budgetreport.html


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