Overcoming Fiscal Challenges

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Overcoming Fiscal Challenges

• October 4, 2009
• CACUBO Meeting
• Monica RimaiInterim President Senior VP for
  Administration Finance

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University of Cincinnati Profile

• Founded 1819
• Enrollment 37,000
• Type Top 25 Urban Research University
  with 353 M in Research Funding/year
• Budget 1.01 B
• Endowment 883 M
• Personnel 9,770 (without student workers)
• Athletics Big East Conference
• Campuses 5
• Uptown (main), Academic Health Center,
  Victory Parkway, Blue Ash Batavia

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Financial Context in 2003-04 Near Perfect Storm

• Enrollment slippage (33,823)
• Declining state support
• Lack of business acumen and financial planning

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Financial Context Today

• Enrollment Growth of gt9.5
• New state subsidy formula with projected 5.2M
  increase in state funds
• 8 reduction in costs overall national economic
  crisis
• New policies and processes
• Integrated Decisionmaking (See
  www.uc.edu/decisionmaking)
• First installment of 4M on reserve fund
• SP outlook changed from negative to stable

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Turnaround Strategy

• Overarching theme
• Not ad hoc institutionalize it via key
  policies
• Face into the problem
• Stop the bleeding
• Develop strategy on a going-forward basis
• Reach back and correct historic problems

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1. Face into the Problem

• Tell the truth
• Reorganized the Board of Trustees committee
  structure
• Drafted and vetted a new Integrated
  Decisionmaking process
• New decisionmaking bodies Presidents Budget
  Advisory Committee, Executive Committee

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2. Stop the Bleeding

• Restructured business/administrative divisions
  merged two divisions
• Appointed Senior VP for Administration Finance
  chief un-enabler
• Re-created Office of Internal Audit
• Temporarily increased annual endowment
  distribution from 5 to 6 from FY 2007-09
• 27 million base budget cut
• Abandon aspirational budgeting

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3. Develop Strategy on a Going-Forward Basis

• State level strategy Interuniversity Council of
  Ohio, Legislature, Ohio Board of Regents
• Operating Cash Policy
• Financial Policy Development Committee
• Performance-Based Budgeting

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4. Reach Back and Correct Historic Problems

• Structural Paydown Policy
• Debt Policy

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Lessons Learned

• Advocacy
• Personal credibility
• Transparency