Frequently Asked Questions
Human Resources has detailed information on furlough plans, retirement incentive plans, and voluntary reduction-in-time plans.
Now that the budget task forces have completed their work, what will be the process and timetable for developing a final plan?
A: The task forces represent only a part of the process for developing a budget plan. Final reports have been presented to the administrative council and the executive budget strategy team chaired by President Barker. They are determining which recommendations can help with the 2009-2010 budget. Many are longer-term strategies that will not yield immediate savings or revenues, but will position Clemson to be more successful in the future.
There are several other efforts concurrently under way that will contribute to the final plan. The budget team met with every budget center director, members of the AC and faculty and staff leaders to get input on administrative structure and organization issues. Clemson is joining with other colleges and universities to generate legislative support for a regulatory reform bill that could help reduce operating costs. Efforts also are under way to determine how Clemson can qualify for funding under the federal economic stimulus act. Finally, faculty and staff still have time to sign up for the PSA and Facilities retirement incentive programs, and the voluntary furlough and reduction-in-time programs. The response to those programs will help determine how much further we need to reduce personnel costs. More clarity is also needed on projected state revenues and the state budget for next year. A final plan for FY10 is not expected until later in the semester.
What was Clemson’s total budget last year? Where does the money come from?
A: For the fiscal year ending June 30, 2008, Clemson’s total expenditures were $648 million. Almost 90 percent of revenues came from four sources:
Student tuition and fees (29%)
State appropriations (26%)
Grants and contracts (18%)
Sales and Services (15%), which includes auxiliary enterprises like housing and athletics.
The balance was from federal appropriations, gifts, investment income and other sources.
A large percentage of total funding is restricted to specific programs, such as grants and contracts, earmarked fees, etc. It cannot be shifted to compensate for cuts in unrestricted funds, such as state appropriations.
The cumulative cuts of over $37 million in state funds represents more than 20% of Clemson’s total budgeted state appropriation of $165 million at the end of the last fiscal year (FY2008). After the cuts, Clemson now gets less than 20% of its total funding from state appropriations.
How does Clemson spend its money?
A: Almost all of the University’s operating expenses fall into two broad categories. For FY2008, personnel costs (compensation and benefits) accounted for 62 percent of spending, with 27 percent spent on services and supplies. The balance goes to utilities, scholarships, depreciation, interest on debt and other non-operating expenses.
By functional area, the expenditures went to:
Instruction (27%)
Research (20%)
Public Service (11%)
Auxiliary Enterprises (11%)
Plant Operation and Maintenance (8%
Academic Support (6%)
Institutional Support (5%)
Student Services (4%)
Depreciation (5%)
Other ( 3%)
With the mid-year cut in state funds, spending in the current year has shifted to personnel costs and away from categories like travel, supplies, printing, equipment, etc.
Why not use the $80 million fund balance to offset the budget cut?
A: First, there is no $80 million fund balance. Clemson’s total unrestricted fund balance at the beginning of this fiscal year was about $50 million, because departments have been utilizing funds as planned – for faculty start-up packages, equipment purchases, facilities construction, renovations and so on. “Unrestricted” is an accounting term: It does not mean the funds are uncommitted.
Second, most of the fund balance is in capital plant funds and auxiliary units. The total fund balance for the E&G and PSA operations was only $3.6 million, or less than one percent of the combined E&G and PSA budget – hardly enough to offset the state budget cuts.
Third, unrestricted fund balances have been utilized where possible. Auxiliaries were asked to contribute funds to help offset state budget cuts, and funds committed for facilities projects that have been delayed were redirected to offset lost operating funds.
Q: Will tuition and fees increase again next year?
A: Almost certainly, but Clemson understands the economic pressures on families and is working to hold the line on increases as much as possible. However, tuition and fees are an important source of revenue for academics and are directly related to Clemson’s basic state appropriation for academics. Fees for 2009-2010 cannot be set until the General Assembly passes the state budget.
Q: Do budget cuts mean student scholarships will be cut?
A: Clemson will honor existing scholarship packages to students. Current scholarships will be renewed based on the terms and conditions of the original award letter signed by the university and the recipient. Scholarships for next year’s freshmen may be affected, but the university has made private support for scholarships its top fund-raising priority, and federal funds for Pell grants and tax credits for tuition may increase under the Congressional economic stimulus package.
Q: What has been the response to voluntary programs such as the voluntary furlough, reduction in time and the retirement incentive program for PSA employees?
A: The numbers change daily because faculty and staff have until June 3, 2009 to sign up for the PSA retirement incentive program, and may sign up for other voluntary programs at any time this fiscal year. As of mid-February, 2 people have signed up for the PSA Retirement and a small number have committed to the voluntary RIT and voluntary furlough.
Q: Will there be layoffs next year?
A: We expect to achieve most of the savings needed in personnel costs through attrition – by not re-filling vacant positions. The greatest reductions will be in administrative, institutional support and academic support areas, although some faculty positions will remain vacant as well.
In the event a Reduction-in-Force becomes necessary in an area, it will comply with the university’s RIF policy.
Q: Can we increase enrollment to get additional revenue from tuition and fees?
A: The President and Provost have both said they are committed to maintaining current levels in class size and student-to-faculty ratio to protect the quality of classroom teaching. There may be modest growth in majors where there is enrollment capacity and in the Bridge to Clemson transfer program. But the goal is to maintain freshman enrollment of about 2,800 this fall.
Q: Does the university subsidize Athletics, or does Athletics provide money to support other areas of the university? Can we just add a surtax to each ticket sold?
A: Like all auxiliary units, Athletics is self-supporting and does contribute funds back to the university to help cover the cost of central services through an assessment on revenues generated. This assessment is called a “general and administrative” (G&A) rate.
This year, auxiliaries were asked to increase their contribution to help balance the current year budget. Funds from athletics this year will be $2.8 million compared to $991,000 in FY07-08. The administration will determine the appropriate G&A rate for future years in light of reduced state funding.
The athletic department also designates one game per year in each sport as its “Solid Orange” game, and contributes proceeds to the university. Last year, the Solid Orange games contributed $92,979.
Q: Is Clemson working to get any funding through the federal economic stimulus program?
A: Yes. The university is working with state and federal officials, as well as higher education organizations, to identify programs and projects that may qualify for funding either through direct aid to states or increased funding for federal agencies. Opportunities may exist for facilities renovations, energy efficiency upgrades, public transportation and research. Student financial aid (funds for Pell Grants, etc.) are also a part of the package.
Q: What is the phased retirement plan mentioned in Provost Helms' Feb. 9 message?
A:This is a concept under discussion but no details have been worked out. If there are any developments in the future, they will be communicated through Inside Clemson.
Q: Instead of pre-printing stationery, can’t we develop a letterhead template that can be printed along with whatever letter you are printing? Wouldn’t that save money?
A: As part of the new brand identity work that is underway, the department of publications and promotion is evaluating the design of letterhead, business cards, etc. Under development are electronic versions that could reduce or eliminate the need for printing in some cases.
Q: I have heard other schools are going to 4-day weeks (Monday-Thursday) this summer to save money on energy (air conditioning). Has Clemson considered that?
A: Clemson has an Energy Conservation Team that is actively exploring a number of ideas, including the possibility of more aggressive scheduling of classroom buildings on days when no summer classes or other activities are planned.
In buildings that have automated HVAC control systems and are not in use 24/7, Facilities already routinely shuts down systems at night and over holiday breaks and restarts them to save energy. Some buildings have computer labs, special research facilities, book collections or other temperature-sensitive functions which make shutdown impossible. And, obviously, not all functions can be shifted to a four-day schedule. However, in a typical 60,000 square-foot campus building, Facilities has estimated that shutting down 12 extra Fridays during the summer could save $3,360 in energy costs for that facility.