MARICOPA COMMUNITY COLLEGES

Financial Planning Update

Fall 2010

FY2007-8 to FY2010-11

A recession, but all things considered…

Maricopa has done pretty well

Annual State tax support cut $23.3 million since June 2008, but we escaped with no additional cut in FY2010-11

Property tax revenue down – no 2%, new property down

No tuition increase for two years

Maricopa is doing pretty well

No massive lay-offs

Governing Board gave money to ASRS and Flex Benefit increases so employee pay was not cut

Colleges received enrollment growth

funding to help offset the cost of serving more students

FY 2011 General Fund Increase

General Fund reflects most of the operational costs of running 10 colleges and the district office

FY 2011 increased $20.5m for a total of $655.4m

Amount In

Millions

Revenue Increases, including carryforward $ 20.5

Plus:

• Carryforward Adjustment (for one-time expenses) $ (0.6)

• Enrollment Growth Funding $

(12.6)• Other Adjustments: ( for uncollected tax levy and bad debt)

$ (0.4)

• Move Scholarships and Other Expenditures from Fund 2 to Fund 1

$ (2.5)

• ASRS, salary, health insurance, plus other mandatory adjustments

$ (8.6)

• Budget Cut Reallocation $ 5.8

Available for Allocation $ 1.6

Disability Resources - $300k Permanent Funding for Prop 301 Faculty -

$500k Operating Support for new Facilities

constructed through the Bond Program - $600k

Higher than anticipated mandatory contract costs - $200k

FY 2011 Discretionary Funding

Allocation of the $1.6 million:

Building the FY 2012 Budget

Source: JLBC Budget Status Update, June 3, 2010

State Has an Unresolved Deficit

NOTE: A “structural deficit” means that it’s built in

State Aid Very slow economic recovery No stimulus protection All paths lead to more state cuts; the

unknown is how much and when

Property Tax Estimated 50% drop in new property; $5 to $6 million less to us Levy increases capped at 2%

Tuition Rate based on Governing Board decision

FY 2012 Resources

FY 2012 Preliminary Look

Mandatory Expenses

• ASRS Rate Increase .8%

• Bond Operating New Building

• Bond Operating Technology

• Salary Adjustments in Policy

• Tuition Waivers – Staff/Dependents

• Support Prop 301 Faculty

• Student Financial Aid

New Resources and Internal

Reallocation can cover the cost of

Mandatory Expenses

estimated at $6.6 Million

STATE AID APPROPRIATION$45.3 MILLION

FY 2012 Additional Issues

Discretionary Expenses

Not in Any Particular order

Flex Benefit Increase @ 21% (maybe more)

Meet & Confer Adjustment

Strategic Initiatives (21st Century Maricopa)

Specific College Needs

Consideration of Discretionary Expenses and the possibility of additional State Aid cuts also will occur during the FY 2012 Budget Development Process

Bad News

• More budget cuts are likely

• Arizona’s economic recovery will occur slowly over an extended period of years

• We will see increasing service demands as well as demands for accountability and improved performance

Good News

• We saw this coming & have been planning for it

• We are not living in the shadow of massive layoffs, salary cuts or mandatory furlough days.

• We have momentum and are moving forward to fulfill a critical role of educating students for the 21st Century

Financial Update Summary