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Budget Challenges

State of the College – Helen F. Giles-Gee

January 14, 2011

Slide Presentation

Happy New Year! As is my practice, I want to bring you up to date on the most current information available about key issues that impact the College. Today will be an opportunity for me to report to you on the state of this great institution, share with you what I know regarding some of the critical opportunities and challenges before us, and work with you to assess and plot the college's course. In today's environment of economic uncertainty, these semi-annual gatherings become all the more important, and I thank you for taking time out of your schedules to participate. My address will cover six areas: Budget, Legislative Issues, Planning, New England Association of Schools and Colleges (NEASC), Total Rewards, and Enrollment Management. Enrollment management discussions about student success will consume the balance of today's meeting because of its impact on students and the budget and our need to make course corrections now with your help.

FY'12 Budget: At the University System of New Hampshire (USNH) Board of Trustees Financial Affairs Committee meeting on December 13, 2010, the trustees voted to recommend to the full board FY'12 tuition and fees. The total increase recommended is a flat dollar amount totaling $1090 for both in and out of state students. This annual funding policy review continues the board's focus on total cost of attendance. If the recommendation is approved, the total cost of attendance for next academic year for in-state students would rise to $19,620, an increase of 5.9%. The cost of attendance for out-of-state students would rise by only 4 percent to $28,300.

In addition to funding anticipated cost increases, the College's Quality and Access strategic initiatives would be continued, including increases for: financial aid, faculty, including tenure-track faculty positions, support staff additions, nursing positions, and advancement staffing.

Auxiliary Budgets and Fees: The mandatory budget and fee process did not change, though the calendar did. Auxiliary supported units needed to submit proposed budgets and fee increases early to ensure timely notification of incoming students regarding cost of attendance and financial aid. These budgets and fees need to stay within system and cabinet guidelines and are reviewed by the vice presidents of student affairs and finance and planning before submission to the student assembly. The assembly reviewed and endorsed all fees which were submitted to me for approval.

For FY'12, those recommendations include the following:

  • Mandatory Fees will increase by 1.3% or $31 over FY'11
  • Room and Board will increase by 1.7% or 140 over FY'11
  • Overall the expected increase will be 1.6% or 171 over FY'11

I note that the auxiliaries held their increases well below the 3% USNH guideline in order to allow for possible increases next year such as the proposed KSC Recreation and Civic Center. This increase was endorsed by the Student Assembly in April 2010 and then by me. The Finance Committee of the Board has recommended this fee structure to the Board for a vote in February 2011. The average mandatory fee increase over the next two years is expected to remain within the 3% guideline. I particularly want to thank the directors in auxiliaries in Student Affairs, the Vice Presidents of Student Affairs, Advancement and those in Finance and Planning and the members of the Student Assembly who worked tirelessly throughout the fall semester to develop and review auxiliary budgets and fees. I also acknowledge the Presidents' Cabinet who reviewed the budget plan and helped to articulate College priorities.

Salary adjustments for nonunion employees FY'11 have not been determined by the Board yet it is clear that the Board intends that any future salary increases may include funds not only for cost of living adjustment and equity, but also for merit. In this light, the College needs to develop a procedure for the distribution of merit pay that is fair and transparent. After discussions with the Operating and Professional Staff Councils and receiving their recommendation, I have discussed with the Cabinet the College's readiness to implement any merit program and the need to ensure sound performance evaluations given the current workload and staffing within Human Resources. Further discussions about this will occur among the Councils, the Cabinet and Human Resources. There are no recommendations about salary for nonunion employees for FY '12.

Separation Incentive Program: The Operating and PAT Staff Councils requested the development of a Separation Incentive Program (SIP). Such a SIP provides an opportunity for increased flexibility for the institution while supporting employees' transition to retirement. Kim Harkness, Director of Human Resources worked tirelessly with the University System of New Hampshire to develop a program that is fundable within current budget constraints, acceptable to the Staff Councils and the Cabinet and me. The SIP allowed for three Professional and Technical staff and three Operating staff with up to three discretionary positions, a maximum of 9 positions. The total funding pool of $500,000 established at the end of FY'10 needs to be replenished from funds recovered by the division from which the staff retires over a set period of time. An announcement of the final implementation of this program will occur within three weeks.

Legislative Issues: On December 10, the College hosted a breakfast with retiring and new state legislators. The topic was, "Why fund public higher education?" Chancellor Ed MacKay provided an overview of the University System of New Hampshire institutions and the system's budget within that context. Vice President Jay Kahn presented an overview of the efficiencies and cost savings at Keene State which make it the most efficient among its comparative peers. I spoke of the value added by Keene State College to students and the community.

One example of the college's cost-saving efforts is the convening of a print management team, led by Director Jim Draper, which has been charged with identifying a solution for decreasing the cost of printing on campus. The print management team is collaborating with our colleagues at the other USNH campuses to introduce a single system-wide printing vendor and to replace our current printing infrastructure with a streamlined, environmentally-friendly network that will cut costs and add functionality. The change to a new printing system will be a major and important shift for our campus. Jim and his team will meet individually with each campus department this spring semester to discuss the new system. I know you will give them your support.

Vice President Kahn also shared with legislators that Keene State spends the greatest percentage of its education and general budget on instruction than its peers (57%); only one peer matches that proportion. At the same time, Keene State College offers high value: new programs that aid businesses and manufacturing, core intellectual skills that are required of all students, about ½ million hours of service contributed by students that is estimated to be worth about 12 million dollars (Carson, 2010).

And the College's gains in academic quality and reputation have resulted in top national rankings in the US News and World Report and the Princeton Review. Two handouts are on your tables providing additional information on Keene State College's low cost and high value: Generating Savings and Gaining Efficiency (December 2010) and Adding Value for Students and Community (December 2010). I hope that you will review this information and inform others, especially your legislator, about why the University System of New Hampshire and especially Keene State College should continue to be funded at current levels. Chief Government Relations Officer, Misha Charles, is organizing the first workshop to assist key campus leaders with learning about the state and federal legislative process. Alumnus David Wenhold, who works on Capitol Hill in Washington, D.C., will be a key speaker.

Benefits' discussions continue to emanate from the Board of Trustees' Total Rewards Subcommittee. I am pleased to report that the Chair of the Subcommittee, Trustee John Smalls, met with the Operations and Professional and Technical staff Councils and the members of the KSC System Personnel Policy Council (SPPC) on January 4, 2011 to discuss campus issues regarding Total Rewards. The tentative timetable for this Subcommittee to do its work is as follows:

  • January 19-Towers and Watson will present findings to the Total rewards Subcommittee and Other Board members (including the presidents)
  • January 20-the System wide SPPC will receive a report from Towers and Watson
  • January 21-the Administrative Board (Chancellor, presidents and Chancellor's staff) and Chairperson Smalls will discuss the findings
  • January 24-the Total Rewards Subcommittee with review the findings and make recommendations
  • February 7-the Financial Affairs Committee will review the findings of the Subcommittee
  • February 17- the Full Board will make decisions based on the Subcommittee's recommendations.

Planning: Last year, I asked the Planning Council to begin a review of the college's strategic goals and the strategic initiative process. This is typical when a college has moved a planning process forward over a number of years. The Planning Council has already begun collecting feedback from focus groups regarding the college's goals--both long term and strategic over the coming three years. They are also considering the process of strategic initiatives for possible retention, improvement and/or change as I offered in my charge to them.

During this review period, each vice president will accept operational initiatives which are crucial to the functioning of the College. The Cabinet is continuing to review and fund, where possible, multi-year strategic initiatives which are in the pipeline while no new ones are being accepted. I expect the process of review to occur throughout this academic year and that the Planning Council will provide status reports, drafts and recommendations to the campus before the cabinet makes a recommendation to me.

New England Association of Schools and Colleges (NEASC): Before the holiday break, I returned a draft report to the Chair of our NEASC team, President Mary Grant, after it had been checked for factual accuracy as is part of the process. The final report was received on Tuesday, January 11, 1011 and has been posted on the NEASC website.

Tentatively, I am scheduled to discuss the NEASC visiting team's report with the Commission in April of 2011 with co-chairs Andrews and Netzhammer. The Provost has already led the Cabinet in an exercise that attributed leadership roles for actions to address the projections emanating from the self study. This progress report will be very helpful in moving the College forward as well as with responding to the Commission. Sometime after April, possibly extending through June, the Commission will issue its decision about the College's reaccreditation.

Enrollment Management/Undergraduate: Fulltime fall 2010 undergraduate enrollment totaled 4868, an increase of eight students over fall 2009. When we look deeper at these figures, we note that the number of first-time, first year students' applications increased from 4997 in 2009 to 6674 in 2010 in part due to a transition to the Common Application process. Regardless, for fall 2010, this is an extraordinary number of applications for the Admissions office to process and subsequently for the financial team to review. The number of admitted students increased slightly from 1188 in 2009 to 1205 in 2010. The yield rates were 34% and 26% respectively. The College agreed to aim for a first-year, first-time enrollment of 1250. This enrollment number did not happen. Goals of increasing transfer enrollment to balance first-year, first time enrollment were insufficient as these numbers slipped from 236 in fall 2009 to 218 in fall 2010 (Keene State College Factbook 2010-2011 [PDF]) .

Last fall, I and the Cabinet charged the Enrollment Management Committee to reconsider indicators affecting enrollment and to project enrollment for 2011. Given current indicators, they were unable to project a sustainable enrollment. I charged the Committee to determine how to increase enrollment to the desired targets with an understanding that academic standards will be upheld. After much work, the Enrollment Management Committee provided background research that led to certain recommendations:

  • The Admissions Office requires additional part-time staff support to handle the significant increase in applications. The Vice President of Student Affairs submitted this request to the Cabinet which recommended it to me and I approved. Admissions has increased part time staff to assist with the applications
  • Financial aid funding requires adjustments to provide more aid for higher qualified students who have many options on where they may attend. And so I have moved on the recommendation of the Cabinet to address these urgent needs.
  • The Chancellor has provided funds for consultant study which will enable the College to determine optimal pricing and strategies for financial aid. I have approved this study.
  • The Financial Aid Office has been working to accelerate sample financial aid packaging so as to encourage applicants to make earlier enrollment decisions.
  • Residential Life has determined a new procedure for housing to better accommodate first and second year students including transfers.

I have asked the Enrollment Management Committee, co-chaired by Assistant Vice President Anne Miller and Vice President Andy Robinson, to provide you with an overview of crucial information regarding enrollment and a charge that asked them to focus on retention or student success. Vice President Robinson is representing the College with John Ratliff, Director of Athletics at a national NCAA conference. I ask you to stay and contribute to not only the conversation but also the development of strategies that enhance the success of students that will be crucial to our students' and the College's futures.

In closing, thank you for your many contributions to the College that have raised its esteem with stakeholders and colleagues across the country.


Keene State has set up this page to share information about the financial challenges facing the College and to ask for ideas and input from the whole campus community. More resources, documents, and interactive features will be posted as the situation develops, so please check back.

  1. Offer Your Ideas: KSC Budget and Resource Council seeks cost containment suggestions and comments
  2. President Giles-Gee's report to the campus, November 25, 2008 (pdf)
  3. How the College Manages Its Money:
    • Finance and Planning
    • KSC Planning Council
    • Operating Budget
  4. Resources on the Economy and Its Impact on Higher Education

Links

+ Budget Challenges

+ Information Timeline

+ External Resources

+ Budget Suggestion Box

Generating Savings and Gaining Efficiency (PDF)

Adding Value for Students and the State (PDF)

Updates

6/22/2011
In-state Tutition

6/10/2011
State Budget

4/14/2011
FY 2012 -2013 State Appropriations

1/14/2011
State of the College – Helen F. Giles-Gee

6/30/10
FY 11 Budget Update from President Giles-Gee

5/03/10
Budget Update from President Giles-Gee

4/23/10
Message to Students Regarding Course Registration

1/28/10
NH Supreme Court Ruling on Medical Malpractice Fund Surplus

10/30/09
Open Budget Forum, October 30, 2009

9/24/09
Budget Update from President Giles-Gee

6/3/09
Budget Update from President Giles-Gee

5/1/09
Budget Update from President Giles-Gee

3/25/09
Budget Update from President Giles-Gee

3/4/09
Budget Update from President Giles-Gee

2/17/09
USNH House Finance Committee FY2010-11 Operating Budget Hearing

1/30/09
President Giles-Gee Speaks to Campus about Current Budget Challenges Video

1/30/09
Campus Budget Overview

1/12/09
President Giles-Gee Calls Campus Budget Discussion


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