So Master We're kicking off with part
two Jim had done colors the money

part ran last year and there was so much
to talk about we decided to do part two

this time focusing a little bit on who
decides which is always a mystery so

we really appreciate that the second
one in this fall series is going to be

well what does a dean do every day and
that's October thirty first and Bart and

a lot of you are going to be leading that
conversation and then the third one this

fall is going to be October fourteenth and
that's going to be the G.T. legal office.

Legal Affairs Kathleen Causton and
Kate wash talking about

free speech how does it work out
on campus and in the context of.

Developments in the last year we thought
that was a very good suggestion from.

From you all how we source these topics
was we wrote to the people who had

attended the series last year and ask
what would you like to see this year so

if you have any suggestions on what
we should be doing in spring or

next year please get
the Such gestures to us and

we'll be happy to consider them for
inclusion so with that I'll hand over

to Jim to share his deep expertise
with us on this topic Thank you Jim.

We'll take a vote at the end of whether
we actually demystified am I talking

too loud or is this OK just hold it
right here so we're going to hold

you here coming through the speakers
Yes because it just goes to him.

All right I'm not Lisa Godfrey.

I am Captain Kirk.

I have worked here about
seventeen years now I don't quite

match Miss Bramlett Dr Brown
scuse me on the front row here.

And the places I've worked before.

This is a pretty good description when

you start talking about
the budget process demystifying.

This black hole thing how does it all
work out how did the numbers come out who

gets what well it.

It involves some analysis I hope
we like to think it does but

it also involves politics folks and that's
that's life in the in the budget game.

But we hope that the decisions that are
made make sense for our strategic plan and

that's kind of the theme of all the budget
requests that we do with Georgia Tech is

let's let's see if we can address
this strategic plan and try to.

Every dollar we spend
contributes to toward that so

what we're going to do is we're
going to talk about organizing for

budgets who are the players
in this very important game.

No more important
decisions are made over and

Carnegie or
over at the Board of Regents office then

where the money goes that's basically
putting your money where your mouth is.

We'll talk about our three principal
budgets at Georgia Tech and actually

there are a lot more than that but we're
going to talk about the three big ones and

then we'll spend some time on Capitol
budgeting and planning Lisa Godfrey was

going to take that that section she
she is our capital budget queen

however she is working with a group
that's trying to put in a new

financial system here at Georgia Tech and
she had a command performance today so

I'm going to pretend like
I'm Lisa Godfrey for a little while.

G.T. foundation budget how does
that decision process work and

then finally our operating
budget how do we come out with

the results that we've come out with so
who are the players.

Some of you who may have worked
at another university know that

a lot of universities have their own.

Guy.
Everybody's we we have a governing body

here but it happens to be over a lot of
schools how many do we have now Sandy

twenty eight schools now so
how does the board of regents

balance out what it does
among all the variety of

schools that it that it works with I think
they do a pretty darn good job of that

it's a tough job because people sometimes
try to compare us to the University of

Georgia they wouldn't want to be compared
to us and vice versa we're different.

And then the the research schools are put
in a bag we try to treat the research

schools differently well that's that
doesn't work out that well either so

they have to really personalize what they
do as as they work with the dollars.

They are appointed by the governor for a
seven year term one thousand members five

are appointed from the state at large one
from each of the state's fourteenth and

congressional districts and then the
chancellor is appointed by the Board of

Regents Now one of the things
I am not going to cover today

because just because we don't have
enough time is how the state funding

formula works so I'm going to cover that
in about two or three sentences right now.

We are fortunate in Georgia that we have

a funding formula that
is based on enrollment.

That funding formula delivers dollars to

the university system and
then the university system in turn.

Allocates those dollars out to
the different schools and I Sandy and

I have done several presentations on
this and we could do part three and

then after after we finish part three
that's everything that I know right OK so

part three could be on the state
funding formula so the the formula.

It takes into consideration what type of
credit hours you deliver as as a school

we deliver a lot of credit hours
in the areas of engineering and

science and those are graded very
highly in the in the in the funding

formula we get extra brownie points for
those also our graduate programs

those are graded higher than
undergraduate programs so

the fact that we deliver a lot of
credit hours in those areas means

that we are a great contributor to
the university systems a pot of money.

What happens each year the system.

Counts up the credit hours
from the prior year and

comes up with a a dollar figure
that that's for the entire system.

And then that dollar figures provided
to the governor's office and

the governor typically includes
in his budget funding for

the university system based on that
formula OK every year since I've been

here except one the governor recommended
that and typically the legislature goes

along with what the what
the governor recommends OK And then

the board has to take into consideration
how many credit hours we did deliver and

do we get that back not necessarily so
it's not always a one for

one kind of kind of arrangement so
I want to cover that up front and

tell you right upfront that I'm not going
to cover it because it takes a little

while and we and we probably need to spend
an hour on it to really give give it.

The do you know a right explanation but

talking about how are the decisions
made by the legislature

makes its decisions on on this vast
state budget and it includes a.

Those decisions that that
formula that delivers funds

to the university system and
when the governor says

to all the other state agencies don't be
asking him for any new money next year.

He doesn't say that to the university
system because there's an acknowledgment

that as we increase in Rollman which
we've continued to do year in and

year out we're going to need some new
faculty and we're going to need some more

support to be able to support those
students and to keep our quality where

where it needs to be OK So
that's the border Board of Regents and

then within our group we have
something called the E.L.T..

Executive leadership team and you might
hear me come back to that that those

initials and these are our four main
decision makers in that in that game.

I think you you know their names I'm not
going to go through that with you but

I've also got the deans vice presidents
and other division heads in this list of

policymakers deans and

other division heads have a lot of
authority here at Georgia Tech and

I work a lot of a number of different
organizations and one other university and

I've never really worked in a place where
the head of the major divisions has

has as much authority as as our as our
leaders do here at Georgia Tech so

that's not to say that they make
decisions on the overall budget but

they have great input and
how that overall budget is established and

then once they get their allocations
they have a lot of discretion.

For example they're able to move
money between their departments or

schools within that budget and they can
move money from personal services to

non-personal services lot of organizations
don't don't even permit that So

let's say you have a vacancy and that
money could then be used for equipment or

travel or something else we
permit that of Georgia to.

A lot of decision making then out
in the field on the flipside is

everybody's expected to stay within his or
her budget and that's that's the catch

and Dr Peterson made that very
very clear when he set foot here

that he expects all I don't care how good
a recent research or your I don't care how

good a teacher you are you've got to
be able to stay within your budget so

I want to put our office in context
I know you can't read this and

I actually have one hand out that for
one of the one of the charts that I have.

This is the area called the senior
vice president for administration and

finance and
we have Jennifer Hubert here who is

is pretending like she she is that senior
vice president notes you know she she is

the key staffer in that area and
our boss left some months ago and so

that is a now a vacancy so
we are here the budget office and

we consider our partner office
this group down here with

Robert Ford which is called
the Institute finance support team and

we work very closely together
on on budget development and

working with the units on campus so
this is our group.

We think we do more than just number
crunch what we hope that we do

we are in the business of obviously
budget prep and execution.

We provide tools to the campus
the the budget package that's used

to prepare budgets on a person by person
basis is delivered by our office and

as we move ahead with our new
financial system work day is what

it's called we'll we'll see how this
fits into to the new to the new process.

For example we had a meeting yesterday
with a number of folks including folks

from college of Sciences in the College
of Engineering to talk about how we can

better.

How we can better enter merit pay
decisions into the budget process had some

really good ideas about that because
that's a you'll see in a little while but

that's that's an area that is
a problem because of the time frame

that the Board of Regents gives us on
that and I don't have a watch anymore so

I'm going to have to keep
going over to my to my phone.

Capital planning and budgeting
Lisa Godfrey who is not here is heavily

involved in that process every dollar
that's spent on a major capital project or

a minor capital project goes through
our office for budgeting and

Mr Swan our boss he signs off
on every dollar that's spent

on this campus in
the Capital Area data analysis.

Decision support for the folks over at
Carnegie we hope we do a good job of that

we support to student committees there's
a mandatory fee committee that puts

sense recommendations to the president on
what mandatory feel level should be and

there is also a text the committee's
many of you are familiar with that and

our office and Robert for his office
staff that committee long range financial

forecasting we're trying to get better at
this where we don't just look at one year

out that we're looking out into five or
ten years this becomes really critical

when you're looking at future capital
projects when you're trying to finance

a projects where we're going to be in
ten years can we afford to move ahead

in the direction we think we want to
move and then support to campus units.

We hope we're doing a good job of that so
our org chart link is here and

I'll provide this this
presentation you guys so

you all can send it out
to whoever's here to the.

Great.

OK types of budgets capital
budget capital investments

library next West Village Atlanta.

Atlanta Dr steam line replacement
we keep tearing up this campus and

putting in these new steam eyes there's a.

One of the steam lines is
sitting in Steve Swanson office.

It looks like Swiss cheese so we have

lost a lot of steam through the years
this is a this is a a maintenance project

that's going to save us a lot of money in
the long run although disrupt our lives.

G.T. foundation budgets the second
category two budgets year one

is we have a the president's Institute
support budget which is a budget

furnished by the foundation and the
president has a lot of flexibility on how

that money can be used a lot of it
is used for support of students.

Scholarships and fellowships and
then every unit on campus

has pretty much every unit on
campus has foundation accounts and

those funds are donated for
specific purposes and

we'll talk a little bit about that our
operating budget for ongoing operations

includes our colleges interdisciplinary
research units student support facilities

administrative support and our two units
that get earmarked money from the state

one is G T R R Georgia Tech Research
Institute in our Applied Research Group

the second one is R E I squared
enterprise innovation institute this

won't be on the test because that's kind
of hard to remember our public service and

economic development arm so we will go
through each one of these categories.

Capital budgets Let's start there
this is one that is kind of a.

A challenging one to understand.

It's a very controversial area because
there's a lot of competition for

space on campus I need space for
classrooms I need space for

this new research initiative that
we're moving toward and then Mr Swan

saying we've got to keep up the campus or
we've got some major problems we've got to

keep up our our infrastructure or if it
crumbles and falls apart we're going to be

in major problems we see that with cities
and counties and states these days and

we hope we're not in that position
people come to this campus and

they take these tours they say my gosh I
had no idea that Georgia Tech was a park

so keeping up our park helping
attract these students and

I'm not talking about just beautification
stuff I'm talking about making sure

that that our that our buildings and
our infrastructure are taken

care of properly So starting off we
have plant fund projects repairs and

renovations that we don't cover through
the operating budget now we do.

You know like painting and
replacing doors and locks and

so forth and so on those are done
on everyday basis that's not

what I'm talking about here I'm talking
about projects that are of a more major.

Scope then we have

the sources of of revenue we get
a pot of money from the state.

For fixing up our infrastructure
it's not enough to do a lot but

it sure helps out and we have to spend
that by the end of the fiscal year so

we have to carefully design those
projects that will fit in the year

we have a endowments in

the generic categories called
the president's discretionary endowment

the largest one being that levy paid Evans
you've heard of an administration building

we have over here next door called the
levy paid Evans I forget her other names.

But that is a major source
of funding that is provided.

With no strings attached pretty much and
that those funds are your mark for

capital projects the departments
contribute funds toward projects

I'm going to give you an example in just
a little while we recover indirect cost

from from grants and contracts
those funds help fund our capital

projects because without our
labs we don't do any research.

Gifts through the Georgia Tech foundation
is another source for plant fund projects.

And here are some examples here I'm
already mention the steam lined street

walkway eighty eight building
upgrades this is a huge issue and

I'll mention another issue that
we're addressing right now and

that's our ability to lock down buildings.

As we think back what happened
to Virginia Tech we think

of what happened yesterday two days ago.

This ability to be able
to flip a switch and

lock down all of our buildings at one time
that's that's going to be an expensive

effort that we're involved in right
now for the safety of of all of us.

So any auxiliary enterprises and we're
again we covered this in the other class

but basically this is our business like
operations housing food service and so

forth they have to generate
their own revenue to to pay for

their facilities so if you see
a dorm being renovated that money

is not coming from tuition it's
coming from the folks who.

Who basically occupy the dorm rooms.

Then we have major capital
projects the big stuff.

New construction and major renovations.

This is our best source and

we compete with all the other
institutions in the state and

then the university system competes with
all the other state agencies trying to

get a piece of that pie what
happens is the state sells bonds

those bonds generate revenue
that is then plowed into various

projects across the state we don't have
to pay any of the debt service on that so

this is this is free money to us but if
there is huge competition we have to get

to the top of the list for the Board of
Regents first and then the chancellor and

the Board of Regents presents
to the governor a list and

then the governor comes up with his own
list so this is for large projects and

smaller projects that are funded funded
through the state bonds then we have

a financing company I don't know if you
most most people here ever heard of this

organization called by
Georgia Tech fine facilities.

This is a nonprofit corporation that
we call an affiliate affiliates

are organizations that are that are
basically part of Georgia Tech sort of but

they have their own governing bodies and
they contribute to our mission.

And here at Georgia Tech so G.T.
facilities Inc as a nonprofit

is able to borrow money on a tax exempt
basis in other words if I'm investing

I'll put up with a lower interest rate
because I don't have to pay taxes on

that interest that I pay and
I say I could be a bank I could be and

surance company whatever the whoever
the investor might be so the I'd encourage

you to go to that link to see the amazing
projects that have been done on campus

tech Square for example no state dollars
went into that construction of Texas

where we would not have tech square if we
did not have mechanisms to be able to to

borrow and Jennifer is very aware
of this Georgia Tech was in or

all the schools were
encouraged years ago to get

creative about how they have handled the
financing on their buildings and now some

schools have gotten a little too creative
and now they have kind of clamp down and

what it what it's cause for us is a lot of
extra work and a lot of extra paperwork.

You have you have a school that builds
these dormitories without proper

without properly looking at
what the customer base is there

OK that's besides them we know we have
gifts when we're always going for naming.

Naming opportunities.

I'm going for
bike racks myself I ride a bicycle

I'm trying to get a bike rack named after
me I'm going to donate some money from

the gym Kirkman Morial No
not more no no no no more.

And no no I'm not ready to die all right
here Mark student fees campus rec center

C.R.C. that debt service is
funded through student fees and

we've got a new one coming up we're going
to be renovating the student center and

very major project we have a young
lady back here from Capital Planning.

Who's going to come up and tell us
No I'm not going to make you do that.

But that will be partly financed
through student fees and

then we have sponsored
project recoveries and

our major capital projects current
projects what's what's in the works and

I've got some cool pictures but
we don't have time for him today.

And again auxilary enterprises they have
to cover their own so what have we got.

We've got a library next.

Everybody I think it's heard about
that steam lines the West Village

if you haven't been over there it's
a pretty amazing project coda which is

is known as tech square face to how many
story building is that twenty three.

Yes and I hear that when they were

doing the blasting it was it was
noticeable in the College of Business.

New campus safety facility

the Living Building at Georgia Tech
eco Commons Vandeleur renovation

what I'll add to that slide is a link
to the Capitol planning website you

can look up all these projects there we've
got some amazing projects going on now

what I'm going to do is go through
a quick process for approval.

We submit a five year capital plan to
the Board of Regents if we have a minute

I've I actually brought the latest
plan where we can take a peek at it.

I'm sorry I'm going to check my time.

Eleven thirty OK.

All the major and
minor projects in the works

high level break out of
the potential funding sources so

when we submit this plan we've got to
tell the board how we plan on paying for

these these different projects last
submission was one point four billion

dollars Now this it's not really
a wish list it's a priority list.

These priorities change all the time
why do they change they change

according to the research coming down
the pike they change according to

what we what infrastructure needs pop up
and frankly sometimes they change due to

politics because this this is
an area that needs to be addressed

campus safety facility that's
always a critical area for

Georgia Tech now that I don't call that
politics I call that a must pay item

they're in a pretty lousy facility right
now actually I think there are several

facilities we've got to have a central
area for our public safety areas.

B.O.R. approval is required for all
projects exceeding one million dollars So

so that that one million cut off is really
important and we get and the folks in

capital planning of got to consider that
do we really need to do this whole project

do we need to do we need to go with a
project that maybe is a little more modest

so internal process we get our donor
funds in where they're available and

that's that's an effort on
pretty much every facility for

example the the student center renovation
which will be called the Community Center

that's a that's a very ripe
area I would think for

a naming opportunity I think I think that
that's something that they'll be pushing

there are already pushing really
hard research needs being elevated

maybe a grants already been received
executive leadership prioritization

consideration do we need instructional
space research campus infrastructure so

the demystifying part of
this is this is a difficult

area to balance one area over
over another so you have.

A provost who has certain priorities
you have a executive vice president for

research Steve Cross who has other
areas and then Steve Swan who is going

to continue to remind everybody we've
got to take care of our core campus so

all those fit in and I and
I might make just one comment

about the approach that Georgia Tech
is taken and I love it.

And this comes from Steve Swann our
boss his approach is let's not throw

away our central core campus
let's let's retain our campus and

fix it up and repurpose buildings
where we need to do that so

we have all these wonderful buildings like
the one that we occupy next door here and

I believe Georgia Tech years
ago got a got an award for

that I'm in a building where
two of the guys in my.

Office took chemistry
labs in my building and

Lyman hall building and
the one that was connected to it which is.

Emerson.

It would have been cheaper probably for

Georgia Tech just to throw away those
buildings tearing down and rebuild and

I know I've seen that in my home in my
town in the city of Marietta that threw

away their their county courthouse
years ago and regretted it for

years because once you've torn down
they're all they're all gone so we can

bring up any number of examples of amazing
renovations here on this campus OK so.

If a project exceeds a million this is
this is a lengthy process that we have to

go through the project concept proposal
is submitted to the Board of Regents and

there's something called an integrated
review committee takes two or

three months.

And then finally the project in the budget
officially authorized by the B.O.R..

Georgia Tech then may initiate a project
within the approved budget and

then the B.O.R. has to get involved
with approving professional construction

manager along with the budget so
there's there's a lot of approval that

needs to go on through our governing body
and lot of education that has to occur.

As Georgia Tech develops its projects so

here's just a quick case study how all
of you know where Van Lear is right

that big round rotunda which
is under under construction.

That's a major renovation
it's going to be costly but

great payoff it's eleven million
dollar budget and here's the mix so

the six point four donor funds
is a pretty large chunk of that

two point six Institute funds and
then College of Engineering

has committed two million dollars toward
this project so this is kind of a neat.

Combination of sources of funds.

The College of Engineering will number
one try to raise this money if they

can't raise it they're committed to
basically paying the Institute back over

over a period of years just to give you an
idea of how long some of these things take

the April board meeting the project
concept was presented and

then it's going to take till
May of two thousand and

eighteen till the final
completion occurs so

and the institute looks ahead.

You have to.

You can't say we've got
we've got this new.

Research area and we got the grant
coming next year I guess we'd better get

going and fix up our space to do that
it's just doesn't work that way so

one of the concepts Georgia Tech applies
is in some cases a building will be.

Will have a a floor for example that's
that hasn't been built out because we know

it's going to be for research we don't we
don't know what kind of research yet so

that might be a separate project in the
future to actually build out that space to

whatever the needs might be right now

I'm moving kind of fast here and I have
not given you any time at all for any kind

of questions or comments and I needed a
drink and you all might have a question or

two so capital budgets I'm not going to
able to answer all your questions but.

Let's pause for a second and see if
you have any questions at this point.

Yes.

He's right that.

This is.

Part of the room I didn't know it would.

Take so that.

You have to go back to the board
right you want to address that one.

And introduce yourself if you would this
is one of our amazing plan architects and

a number.

Of.

The friends but.

We're really really going to
try to get that idea right

yes pretty quickly I think of
Mexico where he's from the city.

I would think if in the case by
case basis you sure you might.

Seem.

To think this through new.

York that he does believe that
there are many who are just.

So this initial budget may be very
different look at the time frame

things change guess how long it took for

Cluff to get built from from this
first step over a dozen years.

All right and the cliff had to rise to
the top of the list too it's not just that

there was this delay down the board it has
to rise on up or it's a top priority for

the Board of Regents when I first got
here the campus rec center was being

completed and there were things
that were added to the scope of

the project which meant they kept pushing
certain things out of the projects one of

the things that was pushed out was
the furnishings for the billing so

we're going to have this nice building
over there without any furnishings or

any exercise equipment so one of my
first assignments was to find the money.

So you look at all sorts
of different sources for

example the presence discretionary
A endowment sometimes has to be tapped and

try to keep a balance in there so so we
have some flexibility good question though

foundation budgets we love are for yes.

Yes you know.

You were one zero zero zero zero zero
zero zero zero zero zero zero one.

Eleven thirty eight I think I think we're
good I think we're good I can I get it I

got to I got to keep moving here and we're
going to get everybody out by twelve.

And I don't get my pay she said how
can I pay if if I buy gold or toil.

And she said if I do a really good
job I get a doubling of my pay OK So

two pieces we're going to do our best
keep moving here it's to support budget

again is a pot of money that is used for

things that we can't spend our
general fund money on now people

sometimes differentiate OK can
I spend state money on that or

can I say or got to be Foundation money
usually when they say the term state

they're talking about general fund OK So

tuition money and state money and
indirect cost recoveries and

student fees many of the student
fees they spend all the same Ok so

it's not really technically state but
it's OK to use that term I get that.

So what you've got is student support
all over half of that budget goes for

scholarships and
other support for student for

example of the president's
scholarship that this provided.

Tech promise those things are covered
out of that pot of money so

that the pot is about twenty five million
dollars It's not huge but it's critical

to you say that's not that sounds
like a lot of money to me but our

budget is obviously a pretty good sized
budget but this this is critical money.

Force so you have.

Development we our salaries for

development are paid out of
our general fund budget but

we hit foundation for
things that can't be covered through that.

This pot here is what we call
miscellaneous small needs

a lot of that is there and
that's again for things that.

Faculty development comes out of this

items that we just can't we just can't
use our general fund money for and

I'm going to skip this eye chart but
when you get this it gives you a trend

of of where our money's gone through
the years and you will see that student

support is our big growth area that's
where we try to plow the money.

I'm I'm going to skip this slide OK So
so we will we'll pick up a little time

we have a process whereby anybody
who gets foundation money or

who spends expects to get foundation money
out of this pot has to fill out a form and

that process involves a review
that begins in our office and

with Robert Ford again Institute finance
support and then recommendations

are provided to Carnegie and
they look at our priorities and

then that budget is efforts approved by
the president goes over to the foundation

and they have to approve the spending of
that twenty five Some million dollars And

again the folks in this building
are going to be pushing for

as much possible in scholarship money.

OK Now let's talk about
unit funding from gifts.

Every time you set up an account or
a project for foundation money or

gifts that have been received it
has to be designated by owner.

These are the four owners department
head individual chair who.

Older or activity this is a fairly new
process probably over the past eight or

nine years.

And then it also has to be
designated by use faculty facility

program students any use because there's
a lot of money there that is very

specific can only be used for
a certain program and

only a certain individual can spend
that money so it's not like it's all

free money so what we've done we do
a report once a year I'd be glad to

share this if anyone's really interested
it goes down to the college level.

And it shows how much
total money is available

in the foundation to that particular unit
and actually I've just got the academic

units here but we've got administrative
units also that have funds so

you can see it's almost a seventy
five million dollars However that

money that's only available to the dean or
department chair and could be used for

any purpose is a fairly small percentage
of that only a quarter of it is what we

would call flexible money so I'll I'll
just suggest to you if this is a report

you're interested in send me a note and
I'll be glad to ship this to you.

Provost office is really interested
in this because we've had he's been

questioned in the past Georgia Tech you've
got all this money why do we need to raise

any more money and the answer The partial
answer to that is that it's so

specific that it's money we have to make
sure we spend it on the right purpose and

and the control is there so
you can see the big

the big ticket here College of Engineering
has forty four million dollars and

then the college of
computing nine million in

sciences five point five million dollars
So some pretty sizable money there.

Yeah.

This is.

Indeed.

Yes.

Is the Only you know your own.

Understanding is that
he said he would go to.

The Yeah.

But there was a right.

Right.

Right.

Is there any We live in.

Front of you I mean that.

You're.

Not in this part this it's all it's all
assigned to some school or department.

And.

The.

Well are for example are in dominant
funds are not for any specific purpose

Yeah there are a lot there are a lot of
funds in the foundation that are not for

in particular use yes I I don't want to
mistake that that twenty five million that

I showed you that is a piece of the entire
foundation pot that is on designated Yes I

don't I don't want to mistake that and
say everything is got to go first certain

purpose people just give to Georgia Tech
and they don't give to Georgia text

by writing a check to Georgia Tech they
write it to the foundation because soon as

it hits our books we've got to spend
it by the end of the FISC fiscal year.

Not.

Yeah Sandy help.

Can you help.

This.

You know to now Sunday I think we can all
say that the money just came right here.

Where.

Right there stop right there so to.

Call you same purpose money is

does he buy it right down here or.

Yeah but it felt like yeah I didn't
share the nonacademic units here.

But somebody has to set
up the account yeah it's.

Right.

Right.

Here it is.

That's a great question and I'm sorry I
don't know enough about how all that works

but I'll work on that for
you I know I know where you live.

Yeah.

Yes development bring development in and
have them tell what they do and all of.

The you invited the wrong
people to the presentation.

Sure thing is that it is that person.

Yeah that's right.

And.

I don't know it's the donors who said.

Who's you know somebody gives
to the college of designer

College of Architecture and says I
just want to support this college and

I don't care what you use it for
it's it all relates to.

You know when when when
all this was set up

was a number of years ago what we really
didn't know what was flexible or not there

was a lot of work with the foundation
to actually look at the letters and and

the the the wishes of the donors What
did you want this money used for

to try to figure out
what was flexible Yes.

It's.

Where there.

Is a usable use a very cheer and
then we compare

how much was actually spent compared
to what what was actually usable and

how much this balance
changes from year to year but

anyway you guys are asking great questions
and and I think having a separate session

on with some some folks from the both
development and foundation to have them

in the same presentation would be great OK
so let's go through operating budget and

I want to hand out something that
I'm going to refer to in a minute.

And I have weight probably
too many copies here but

if we could start these from the front.

And then these from the back.

If you could if you could
move them I appreciate

art I'm going to have to go back quickly

before I get through this present this
part of the presentation as a reminder of

some information that we went through
in the last in the previous session.

So we have a fun structure here
fund structure at Georgia Tech

we have a little fun too.

And our major fund areas that
are established either by Gap or

by state law or by the Board of Regents.

Specifies resident instruction This is
our core operations research instruction

administration all that is in there so
it's not just instruction so

it sounds a little bit of a misnomer.

Next we have the earmarks we
have the research G T R A I E I

squared they have earmarked state funds
then student activities is an earmark

the students pay fees for the campus
rec center of the student center and

organizations those funds
are also earmarked.

And then we have August Hillery
enterprises these are our

business like operations.

And.

From here down.

Funds must be used for
specific purposes and to be honest.

There is consideration of these
over at Carnegie but these are not

these funds are not scrutinized as
closely as our resident instruction funds

these we would consider our flexible
funds they fund the colleges they fund.

Research on campus the fund instruction.

So a lot of the effort in
building the Georgia Tech budget

would be up in this area
called resident instruction.

This is the eye chart and I'm not going to
go through this in detail partly because

of lack of time but partly I wanted
to show you that this is a pretty

complex process where we
have across the top our of

our budget process in the middle
of the Board of Regents review and

approval and
at the bottom the state process so

what we have here is something
called an Appropriations Act And

these are the state funds that come
to the university system of Georgia.

At the same time the Board
of Regents is trying to

present a budget to the governor tried
to nurse that through the system.

And then.

Finally a recommendation to the Board
of Regions So our process up at the top

involves the president making
recommendations to the board it involves

units on campus developing their
recommendations it involves budget and

in Sandy's office the I R P coming up
with estimates going into the future.

And then president and
staff present executive staff

review those priorities for
the next fiscal year the president

proposes what he thinks are the priorities
for Georgia Tech we have a meeting

typically in February where the president
makes his pitch to the chancellor.

And then the division heads which includes
the deans vice presidents and other

division heads they come up with their
proposals to present to the executive

staff and then there are budget hearings
that occur usually in the time period of.

March each year so all this is going
on a parallel basis we're already

looking at what our options are while
the Board of Regents is doing its thing.

So then the General Assembly
finishes its budget which is called

Appropriations Act and the Chancellor
then recommends to the board.

To ition fees and
allocations to the different units that

information is then transmitted to the
president and then the process proceeds

through the final preparation phase this
is very compressed and here this May and

June period you all know that we're under
a lot of pressure to get our marriage

plans in a very short time period and
I'm going to stand up here and

make an excuse for that because
we Here's how the process goes

the April meeting which is usually the
middle of April from the Board of Regents

we get our guidelines on how
the merit raises can be done and

within a couple days the president
turns around the guidelines for

Georgia Tech so
that goes out on campus then

during the time of the next couple weeks
all the units have to submit their budgets

they are you all are required to
submit on a person by person basis

your budget with salaries in there and
that's all done like in a week and

a half and then we have to submit our
budget to the board which is a very

detailed document I won't have
time to to look at it with you but

it's it's again person by person that has
to be submitted the first week of May.

So all the all this is done within
a couple weeks after they have finished

their approval of of tuition fees and
so we don't know what our money is

until we get to this point and they're
going to give us money for pay raises and

sometimes it's generous sometimes it's
not last year we got no money for

fringe benefit increases and we found
out about that the middle of April.

And then the allocations from
the state funding formula

we don't know what that picture's going
to be again until that time period there.

We're working on ways to try to
at least give some more time to

do the pay raise piece
of this of this process.

So December presentation of
priorities to the Board of Regents

revenue estimates go in intuition and
fee recommendations December and

January the president has
a hearing with the chancellor.

February and
March we issue budget instructions.

The colleges and other units make their
submissions and I'm a talk about that

a little bit more in a minute the division
heads have budget and planning meetings

with their with their individual
executives from Carnegie mid March.

Division heads in the executives get
together and they have we have two full

days of budget hearings and a march
that legislature finishes its budget

and then mid April the approvals
occur mid to late April decisions

are made with the best information we
have available allocations to units.

Merit pay increases
entered into the system

preparation of a detailed original
budget person by person line item by

line item and then that's submitted to
the board in early May We have to pull all

that package together
in just a few days and

then the budget execution begins then and
then we always come back in October and

say how do we do on in Roman and
do we have extra money to hand out.

We had good strong and Roman However
we didn't have the nonresident

students undergraduates that
we expected this year so

I will say there's not a lot
of extra money out there.

OK so.

Let me skip that one because I think we've
gone through that let me focus here.

So budget guidelines one of the executives
decision points here first decision

point are we going to do redirection what
is redirection mean redirection means.

We're going to take money from
certain areas of campus and

those are going to be redirected or
moved to other areas of campus for

example last year there was five
million dollars that was moved

from various units to various other units
to meet the priorities of the execs

because we're in a situation where
we're not going to get any significant

tuitions increases any time soon there are
already talking about zero for next year.

And then the state funds we have a lot of
institutions across the state that are not

growing and they're having to be taken
care of because the state funding

formula they're not contributing to it so
you see the U.G.A.

and Georgia Tech some of our funds in
effect end up going to other institutions

funds that we could have we could
have done so the outlook for

new money is not tremendous and
therefore the redirection means

folks have to come up with
either a one percent or three

percent reduction how would you meet that
reduction we've done this for three years

now is that going to continue yes that
will probably continue on into the future.

So then the executives have to decide
what is our focus for than a coming year

what fee and differential tuition
guidelines are we going to provide and

what marriage guidelines are we can
provide that's all dependent on the B.O.R.

they tell us how to do
our marriage program.

Policy decisions definition
of must pay items

is the first thing that
the bosses have to.

Decide.

Things such as you've got to pay your
utility bill you've got to cover your

fringes those those have been substantial
the fringe benefit increases faculty and

staff attention we always have
a pot of money to keep the best and

finest the staff and faculty so

that's an item that comes to the top
of the list got to cover our leases

cybersecurity is a tremendous investment
that we have coming up external mandates

come in such as new rules
about handling grants so

many of you are familiar with those and
staffing is has had to be has

has has to be added to cover those
areas system improvements I.T.

system improvements so
then the merit pay policy and G.T.

funds are are are committed how are the
how are the bosses going to set set

the merit pay are redirection
allocations going to be made or

are we just going to have everybody do it
across the board so I think the approach

in the future is going to be not just an
across the board we're going to take money

from everybody and put it back in a pot
but it's going to be selective certain

areas are growing on campus
certain areas are not growing so

then after we've done all these other
things how much quote new workload

are we going to have available for
new faculty and other expansion items or

new programs so that's been our
challenge to meet these items and

have enough money left for that all
right so I am coming to the end here and

I know I'm not leaving a lot of free
time for questions but I'll hang around

a while looks like we've got some folks
coming in here in just a minute where

the money go two thousand and eighteen
academic and research twenty one percent

pay and fringes a third of our new
money went for our pay and fringes.

Facilities operational that's
always going to be a big cost for

Georgia Tech here pre-committed areas and
earmarked revenue and you might say.

What is this year marked revenue business
well that would be tuition differentials

that certain programs charge it might
be fees the certain programs retain for

example there are some master's
programs over in in college of

business that have program
fees that money goes back

into those programs for
investment in for the students so

again you've got some definitions of
what these categories mean down below.

All right what's a.

I T.

includes the software and
maintenance costs.

This number would shock you and I'm not
I'm not going to say it because he's got

that he's got the camera going here it's a
lot of money and it's as as a person whose

identity has been stolen I realize what
I'm going through to recover from that.

And Georgia Tech cannot afford to let
that one that particular one slip and

it's expensive we have a new
financial system coming in and

a price data management which
Sandy's area works with

learning management software
which is pretty expensive.

Pretty expensive stuff so the I.T.
area yes that's that's a big chunk.

And we don't apologize for
it and here is the game.

Where our funding came from we got forty
point eight million new money quote.

And add to that three point seven
million that was the redirection

funds that came from various units went
back into the pot and then reprogram So

forty five million dollars is
is the value of that pie OK.

Real quick what are factors out into
the future that our executives are going

to have to consider continuing
the merit pay when Dr Peterson got here

we had gone several years without
pay raises he values very highly

paying our staff paying our
faculty what is deserved so

we don't lose turnovers is
expensive to us and he has been

a great supporter of putting money in vet
investing that money into our employees

faculty growth to a company enroll in
this this is been a theme we've had for

years let's make sure that
our student faculty ratio

doesn't slip that we have enough faculty
to teach our students and not only that

that we support those faculty and
that we provide adequate start up.

If you hire a faculty member
in engineering for example

you can expect to pay some pretty big
bucks to be able to set up that lab for

that individual to to provide
the equipment to provide grad students

if you're going to get that
faculty member to come here.

H P C coda and other leases can
be a continuing challenge for

us we've got to be looking forward
in our in our construction and

our buildings to be able to make sure
we can support our efforts research

administrative support research equipment
refreshment this is been a theme for

Dr Cross to make sure we don't
let our our research equipment

get outdated and that we make more of
an effort to share that equipment among

different research areas and
just continued I T refreshment.

OK I've been talking one
hundred miles an hour and

you guys haven't had much chance to
ask questions or or to chime in and

we're close to twelve probably after
twelve a little bit so let me pause for

just a couple questions then I'm going to
hang around afterwards if you'd like to

ask me something or send me an e-mail
if you want more information.

If you're interested in the state funding
formula for example we could I could

give you more information on that that's a
that's a topic I would have liked to spend

more time on because it's really important
to Georgia Tech you have any more

questions for
me when you've been a lovely audience.

You've been awfully quiet but
I have been Gavin so

much you haven't had a chance to talk well
thank you all for coming I've enjoyed it.