Budgeting and Funding Information
Requesting Funds. Requests for funds should be made in the following manner:
Recurring Expenses come from the regular College budget. Requests for recurring expenses should be submitted to the Vice President for Finance and Business Affairs by the appropriate Vice President or Dean as part of the annual budget request process early in the Fall.
Capital Expenditures and One-Time Obligations of the College come from the Renovation and Replacement budget. Such requests should be sent to the appropriate Vice President or Dean by January 10. The Vice President or Dean, in turn, sends requests to the Vice President for Finance and Business Affairs as part of the regular process for renovation and replacement requests.
One-Time, Non-Capital Funds come from the discretionary fund of the appropriate Vice President or Dean. Requests may be made at any time but for one year only. Subsequent requests must be made in the regular budget process.
Overage Funds, above a department’s budget, normally come from the Emergency Fund, although Deans/VPs should first determine if their discretionary funds can be used to cover the requested overage. Such requests should be sent immediately to the appropriate Vice President or Dean, thence to the Vice President for Finance and Business Affairs.
Requests to Solicit Funds from off-campus sources must be approved by the appropriate Vice President or Dean and sent to the Vice President for Development for consideration by the Development Committee.
- Department heads may overspend in a particular account as long as the department′s total budget is not overspent.
- If a department overspends its budget, the Vice President for Finance and Business Affairs in consultation with the appropriate VP, Dean or Department Head will consult to determine if unforeseen circumstances require future adjustments to the departmental budget or if an allocation from the emergency fund is appropriate.
- After May 1st each year, equipment purchases over $400 must be approved by the Vice President for Finance and Business Affairs.
- There are three ways for Deans/VPs to allow a department in their division to overspend the department’s original budget: The Vice President or Dean must either, pay the overage amount from the Dean/VP′s discretionary fund, transfer funds from another department in their division to the department requesting the overage (so the requesting department will not exceed its budgeted amount), or request that funds from the Emergency Fund be transferred to the department requesting the overage, so the department’s budget will not be exceeded.
- Budget amounts may be transferred between departments only with the appropriate Dean/VP′s approval. Funds may not be transferred between fund balances and budgeted income and expense accounts.
- Each department and division head is evaluated on the quality of budget management.
- The Vice President for Finance and Business Affairs will contact promptly the department heads of those departments whose expenses exceed their year-to-date budget, and whose incomes are below their year-to-date budget. Together they will devise ways to avoid budget problems before the end of the fiscal year.
- Telephone equipment charges will be assessed in November of each year and will equal the amount provided for budgeting in the original budget process. Telephone equipment charges are charged to the appropriate department.
The Capital Budget establishes a College-wide priority list for funding capital and one-time needs. Funding for these items can come from gifts designated specifically for an item on the list, undesignated capital gifts (with the written approval of the President), and renovation and replacements funds. If a designated grant is received (e.g. Biology scientific equipment) the Biology scientific equipment on the capital priority list shall be funded first before any Biology equipment not on the priority list is funded. The Capital Budget also focuses the efforts by the Advancement Office on items of highest priority. By following this policy the College is able to focus limited resources on its highest needs. Capital Budget funds not spent within two years will be reallocated by the President to other capital needs.
Allocation of Information Technology Resources
The College recognizes that information technology plays an important role in teaching effectiveness and administrative efficiencies. With the exception of regular computer and printer replacements, which are budgeted on a three-year cycle, the allocation of resources for information technology will be given equal consideration with all other requests during the annual Renovation and Replacement (R&R) budget process. Recommendations for funding will come from department chairs to their respective Deans (i.e., the Dean of the Faculty, the Vice President for Development, or the Vice President for Finance and Business Affairs). Each Vice President or Dean will then consult with the Vice President for Information Services, who will submit an overall list of information technology priorities to the Vice President for Finance and Business Affairs, who will compile a master list of all R & R requests. The master list will then be forwarded to the President’s Staff for final review prior to being submitted to the President.
Auxiliary Services Budgets
These budgets are in a unique category in that it is likely that increases in income generated in excess of budgeted income may also cause increases in expenses. The College does not want unnecessarily to limit these auxiliary services to their original budget amounts provided sufficient additional off-setting income can be generated. At the same time, budget control must be maintained to assure a College-wide balanced budget. To accomplish this task the named auxiliary services should use the following procedure:
- Auxiliary service department heads will project their best estimates on expense and income for the budget process.
- These figures will be reviewed, and refined if necessary, by the Vice President for Finance and Business Affairs before the amounts are approved in the College’s income and expense budgets.
- During the budget year, if an auxiliary service department wishes to exceed its expense budget in order to exceed its income budget by the same amount or more, the department head must request authority from the Vice President for Finance and Business Affairs to exceed the expense budget. Otherwise no department may use income-above-budgeted-income for its own use.
- If an auxiliary service is expected to exceed its expense budget without compensating income increases, then the department head must follow the same procedure as all other departments: request emergency funds.
Funds restricted by a donor cannot be transferred between funds.
If the Board of Trustees has restricted certain funds, the Board of Trustees must approve a transfer of the restricted funds to other funds.
The Vice President for Finance and Business Affairs must approve the transfer of restricted funds to other funds if neither the donor nor the Board of Trustees has restricted the funds.
Budget transfers from the salary budget to the non-salary budget and vice versa are prohibited unless approved in writing by the Vice President for Finance and Business Affairs.
Hard Money versus Soft Money
A distinction must be made between recurring or “hard” revenues such as tuition and endowment income, and nonrecurring or “soft” revenues such as those received from grants, contracts or specially designated gifts. If the College relies on soft money to fund a program, it should be understood by all that this funding strategy is relatively risky.
If soft money is cut off, there may be those who will pressure the College to replace this soft money with hard money. If this is done, it would have the effect of limiting other salaries, benefits, and programs.
To avoid these unplanned and potentially harmful effects, the College must take a disciplined approach to the acceptance and use of soft money for programs that it hopes will be ongoing.
Therefore, before soft money can be used for continuing programs, the appropriate VP/Dean must see that such programs comply with the following:
- A written description of the program and a statement that it complies with these policies must be signed by a) the person who will direct the program, b) the Comptroller, and c) the appropriate Vice President or Dean.
- No program should be undertaken, and no obligation should be made by the College before the funds are actually received.
- Programs at the College financed by hard money should not be dependent upon a program financed by soft money.
- All programs financed on soft money should be submitted for review each year by the Vice President for Finance and Business Affairs.
In the event that soft money is cut off and cannot be replaced by soft money from other sources, and if continuity of the program is highly desired by the program director and the appropriate Vice President or Dean; the procedure to decide whether the College will begin funding with hard money is as follows:
- A budget request should be made by September to the Vice President for Finance and Business Affairs.
- In order to continue the program for up to one year (the maximum time needed to be considered for inclusion in the annual budget for the following year), a request can be made to the appropriate Vice President or Dean in February for inclusion in the year-end Renovation and Replacement allocation. Such a request can be made and approved for one year only. That is, one-time money from Renovation and Replacement can be used only one year for a program. After that year either it should be a) discontinued, b) continued by inclusion in the College operating budget, c) continued on new outside soft money, or d) continued by being endowed.