TABLE OF CONTENTS

Glendale Community College

NCA Self-Study Report, January 2002

Table of Contents | NCA Visit 2002 Home Page | GCC Home Page
Financial Resources—Sources of Funding

 

The College budget is only one component of the total District budget supported by the following sources of revenue: property taxes; state appropriations; student tuition and fees; and grants and gifts from public and private sources.  The Governing Board, with the adoption of the fiscal-year budget, sets the property tax rate.

 

 

 

GCC’s 2001-02 specific sources of funding amounts follow:

 

Current Unrestricted Funds 2000-01

Revenues

Property Taxes

$26,182,058

State Appropriations

$8,414,151

Tuition, Registration, and Student Fees

$13,507,134

Private Gifts, Grants, and Contracts

$19,277

Other

$885,617

Total Revenues

$49,008,237

Source: MCCCD Comprehensive Annual Financial Report

 

 

 

 

The State Board of Directors for Community Colleges adopts the tuition and fee recommendations from the Governing Board.  The state legislature appropriates money to the State Board who allocates it to the community-college districts.  On occasion, the District may receive an earmarked allocation.  Grants and gifts reflect the income generated by the Maricopa Foundation and/or the individual colleges.

 

The District receives less than 15% of its funding from the state.  Other districts in the state receive up to 50% of their funds from state funding sources.  The Arizona State Legislature has traditionally favored the state’s universities with the bulk of higher-education dollars, leaving the community colleges to lobby intensely to maintain their presence and receive adequate funding consideration.

 

When major land acquisitions, construction, remodeling, maintenance and/or equipment are needed, the District has the option of going to the county voters for approval of general obligation bonds to raise revenue.  Setting up (and winning) a bond election entails considerable planning and public relations’ efforts by all colleges and the District Office, including all faculty and staff groups.  Bond elections provide a fine opportunity for GCC to become more visible in the community and generate the special funds needed to maintain and grow the programs to better serve the community.  The Governing Board has indicated a willingness to take a new bond initiative to the voters in Fall 2004.

 

Fund 1 (Operational dollars) represents the College’s base allocation, the amount of funds the institution received the prior year, plus any raises granted employees, additional FTSE Incentive Funds, and any other supplements granted by the Governing Board.  The College can reallocate these funds in any way it deems necessary.  The total Fund 1 budget for 2001-02 is $ 44,816,167.

 

The following table illustrates GCC’s operational expenditures for the most recent year for which data is available, fiscal year ending June 30, 2001.

 

Expenditure Analysis by Function  2000-01

Instruction

$28,047,750

Public Service

$172

Academic Support

$4,444,666

Student Services

$3,311,300

General Institutional

$1,236,810

Administration

$2,556,554

Physical Plant

$3,450,632

Total Operational

$43,047,888

Source: MCCCD Comprehensive Annual Financial Report

 

 

 

Clearly, the vast majority of the College’s expenditures are for instruction and student-oriented support services.  The following chart demonstrates the types of expenditures and shows that the majority of expenditures are related to salaries and benefits, leaving little flexibility to address other operational needs.

 

 

 

Expenditure Analysis by Object 2000-01

Personal Services

$32,829,283

Employee Benefits

$5,090,557

Contractual Services

$1,636,804

Supplies, Materials, and Parts

$931,487

Current Fixed Charges

$221,275

Communications and Utilities

$1,641,712

Travel

$168,066

Student Aid, Miscellaneous, and Transfers

$528,702

Total Operational

$43,047,888

Source: MCCCD Comprehensive Annual Financial Report

 

 

 

 

 

Since the last NCA visit, the District created the “Tuition and Fee Rebate Program” (also known as the “FTSE Incentive Program”) to provide a fixed amount of funding directly tied to enrollment growth (FTSE).  Knowing that dollars will be forth-coming, GCC can “front-end spend,” investing heavily in fall, knowing that when growth occurs, new dollars will be added to the budget prior to the close of the fiscal year.  These new funds are then permanently added to the College’s base budget for future years’ allocations.  More than any other factor, the reliability of these dollars has encouraged GCC to move in new directions, expanding offerings without jeopardizing established, successful programs.

 

For the 2000-01 year, the FTSE Incentive Program amount was reduced from the prior year $2,200 per FTSE to $1,625.  The 2001-02 FTSE Incentive amount is $1,685.  This reduction has undermined one of the most successful-ever District-sponsored growth-supporting strategies, limiting College enrollment growth to classes taught by adjunct faculty.  This does not provide sufficient additional dollars to cover other related College activities that support student learning (e.g., registration, financial aid, other student support services, and maintenance).

 

The formulas to allocate new permanent dollars to the bond remodeling efforts and new construction were created--for each square foot of remodeled space, $3.13 is added to the College base budget and  $12.50 is added for each square foot of new construction.  These dollars help ensure that the structures can open on schedule and be properly maintained.

 

As the following table shows, the cost per FTSE at GCC is among the lowest of all the colleges in the District.

 

 

Cost Per FTSE by College

College

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

Projected

2001-02

Phoenix

$3,690

$3,964

$4,384

$4,806

$5,117

$5,292

$5,791

Glendale

$3,241

$3,376

$3,723

$3,927

$4,093

$4,341

$4,769

GateWay

$4,552

$4,776

$5,101

$5,548

$5,969

$6,251

$6,972

Mesa

$3,093

$3,219

$3,398

$3,728

$3,981

$4,140

$4,735

Scottsdale

$3,943

$4,032

$4,418

$5,021

$5,341

$5,503

$6,005

Rio Salado

$2,730

$2,841

$2,990

$3,065

$3,157

$2,767

$2,967

South Mountain

$5,941

$6,507

$7,386

$7,519

$7,803

$8,179

$9,173

Chandler-Gilbert

$4,709

$5,041

$6,621

$7,773

$7,712

$7,481

$7,712

Paradise Valley

$4,112

$4,281

$4,603

$5,214

$5,557

$5,525

$5,799

Estrella Mountain

$6,623

$6,291

$6,988

$6,538

$6,546

$5,983

$6,492

Source: MCCCD Adopted Budget FY 2001-02

 

Text Box: GCC’s Forensics Team wins first place in the world’s oldest oratory speech contest. No community college has ever won this most prestigious award!

 

Fund 2 (Auxiliary dollars) comes from student fees, contracted bookstore and food services shared revenues, non-credit class fees, and from ticket sales for student sports events and performances.  The President's Fund 2 (Student Activities) Advisory Committee recommends dollars for activities that include, but are not limited to, student government, student clubs, athletics, and academic and arts activities, such as Forensics.  These recommendations do not require additional District-level approval.  The total 2001-02 Fund 2 budget is $6,062,133.

 

Fund 3 (Restricted Funds) includes monies from grants, contracts, student financial aid, and scholarships.  New in 2001 is funding from Proposition 301, a 0.6% increase in state sales tax is dedicated to education, with the community colleges’ share earmarked for workforce development.  The District Grants Accounting Office manages Fund 3 accounts and transfers are made on an expenditure-reimbursement basis.  The total 2001-02 Fund 3 budget is $1,119,119 and the total amount of financial aid is $6,318,832.

 

Fund 7 (Capital dollars) from state aid, as well as dollars from the 1994 bond, is transferred to the College each fall.  All state aid allocations are made on a formula basis to each college in the District.  The last 1994 bond allocation was transferred to the campuses in Fall 2001.  In addition to the bond money spent on construction and remodeling, 20% of the funds have been spent on technological equipment, predominantly computers.  The table below shows GCC’s funding for capital equipment, computers, and other technology.

 

 

 

GCC Capital Budgets

Type

1997-98

1998-99

1999-00

2000-01

2001-02

Projected 2002-03

State Aid

$496,997

$542,942

$672,115

$556,151

$699,045

$701,871

GO Bond/Info Technology

$522,327

$509,940

$499,521

$435,400

$452,967

0

GO Bond/ Occupational

$448,044

$456,703

$425,040

$423,619

$452,372

0

District "Life w/o Bond" Allocation

 

 

 

 

 

$640,816

Potential "Draw" from GCC's Capital Savings

0

0

0

$250,000

0

$175,000

Total

$1,467,368

$1,509,585

$1,596,676

$1,665,170

$1,604,384

$1,517,687

Source: District Budget Office, Capital Allocations

 

Unlike the permanent allocations for bond projects in the operational budget, there is no parallel funding formula to support capital needs to provide new and expanded computer labs for the many computer-intensive instructional programs in areas as varied as CAD/CAM, computerized graphic arts, English, mathematics, and other non-occupational programs.  Following the CRC’s four-year replacement cycle, approximately 20% of the computer labs are updated each year, “dominoing” the older models into areas not requiring the most up-to-date technology.  As a result, each computer serves multiple programs over a period of years, extending each unit’s service life.  Thus, the initial investment in technology provided by the bond is kept current with carefully managed upgrades.  Nonetheless, the College has had to scramble continuously to provide additional operational dollars to support this initiative.

 

Following a long recession and slow enrollment growth in the state, operational budgets became strained during the 1990s.  While few new initiatives were possible, resourceful problem-solving by the College and a “hold-harmless” Board directive meant that few programs were cut.  However, as a result of the recent rapid growth in the West Valley, GCC enrollment growth has increased its basic operational budget for the past several years.

Achievements since 1992

·      The $386 million bond, rated AAA and passed by the voters in 1994, allocated $24 million to GCC for new buildings, remodeling, and updating technology (Humanities, Music, Faculty offices, Physical Sciences, Fine Arts, Library Media Center, Math/Sciences, Enrollment Center, GCC North [in partnership with the Deer Valley High School District #97 and ASU West], and administrative space)

·      The FTSE Incentive Program enabled the College to support enrollment growth

·      Adopted funding formulas to help maintain new and remodeled facilities without taking away from other College programs and services

·      The ability of the College to carry forward a maximum of 3% of its Fund 1 dollars to the next year has enabled GCC to begin thinking in a multi-year fashion.  Linked to the FTSE Incentive Program, this has enabled GCC to pilot new endeavors before incorporating them into formal budget allocations

·      Over the last decade, tuition has increased from $26 to $43 per credit hour, increasing the District’s resource base

 

Financial Resources—Grants Development

 

Grants provide external financial resources for the College to maximize its institutional capabilities to accomplish its mission and purposes.  The Office of the Dean of Educational Services, in collaboration with the Office of the Dean of Instruction, now coordinates grant searches and support.  Both offices help faculty and staff locate appropriate grants and provide support in developing these opportunities and submissions.

 

Information about grants comes from regular MCCCD listings, local and national publications, and the Internet.  Fiscal support for developing a grant proposal, especially the hiring of a grants writer, comes from District and/or College monies.

 

Faculty and staff at the College are encouraged to compete for appropriate grants that support the College’s mission and strategic goals to enrich teaching and learning.  For 2000-01, GCC’s grants totaled over $420,000.

 

Maricopa Foundation and Fundraising

The Maricopa Colleges’ Foundation is a 501(c)(3) non-profit organization as determined and defined by the IRS, and, as such, is designated to receive gifts to any division of the Maricopa County Community Colleges from private sources such as individuals, corporations, and other foundations.  It acts as a trustee for private donations to assure that gifts are distributed in the manner specified by the donor.  With support from the Maricopa County Community Colleges’ Development Office, the Foundation also supports formation of new academic programs and instructional innovations.  In 1999, the Foundation completed its most recent campaign “Investing in Arizona,” surpassing the goal of $12 million to reach $12.8 million.  These funds will provide even more scholarships and financial assistance for MCCCD students.

 

The Foundation’s legal responsibilities for funds include compliance with donors’ restrictions for use of the gift, timely distribution of funds to students throughout the colleges and centers, judicious investment of funds, reporting to donors on distribution of their gifts, external auditing of all financial records, sound financial management in general, and any other pertinent fiduciary responsibility.

Achievements since 1992

·      MCCCD coordinates grant activities through the Office of Grants Development.  This District-level support service has allowed a more organized approach to grants development relative to College needs and maintains an extensive database

·      The President’s Advisory Committee approved a grants development process specific to GCC

·      The Foundation has successfully raised funds to provide additional student financial assistance

 

Financial Resources—Financial Management

 

Financial Management ensures that adequate financial resources are available and used judiciously to help the College fulfill its mission.  Sound and generally accepted accounting principals are applied to achieve this purpose.  At the College, financial management entails identifying the resources needed to accomplish the mission, how those resources will be secured from the funding sources available to the College, and allocating them in an optimal manner consistent with the specific planning processes.  The College receives its budget allocations through the previously outlined District budget development process.  The Dean of Administrative Services, the chief budget officer at the College, facilitates the allocation and spending of all budgeted monies.

 

The District Business Services division provides centralized support and technical assistance to the colleges in the following areas: accounting, auditing, purchasing, accounts payable, and budgeting.  This division also provides the Comprehensive Annual Financial Report (CAFR), the Maricopa Annual Budget Report (MABR), and many other financial reports.  A Memorandum of Understanding (MOU) exists between the District and the Higher Learning Commission that outlines appropriate patterns of evidence to be made available by the District for purposes of meeting certain criteria for accreditation related to financial resources/uses and other assurances.  Copies of the MOU, the CAFR, and the MABR are available in the Resource Room.  The Maricopa Administrative regulations can be found on the web at

 

http://www.dist.maricopa.edu/gvpolicy/adregs/index2.html

Achievements since 1992

·      The District implemented a new financial management program, Oracle Government Financials (OGF) in 1996 (now called CFS--College Financial System) providing real-time access to account information

·      The District developed a new Budget Development software program linked to CFS and the PeopleSoft Human Resource system

·      The IE Office has prepared new budget training programs and materials that have made the budget process more comprehensible, less onerous, and more easily linked to the College’s strategic plan

·      The FTSE Incentive Program has encouraged GCC to move in new directions, expanding offerings without putting other successful programs in jeopardy

·      The 1994 bond has had a significant impact on the College: new building space has increased by over 168,000 square feet, computer labs have been updated, and technologies have developed in various disciplines, becoming indispensable teaching/learning tools

 

Financial Resources—Accounting and Purchasing Services

Accounting Services

Once the Governing Board has adopted the District budget, the College accounts are finalized.  The District-based Accounting and Purchasing Services monitors the expenditures based on generally accepted accounting practices.  Accounting services also include property accounting and asset management.  Each college in the District ensures accurate accounting through its own fiscal officer.  The GCC Manager of College Business Services monitors budget expenditures in accordance with policies established by the District Office and within the guidelines established by the State of Arizona.  Expenditures are transacted through requisitions, purchase orders, receiving reports, and vouchers.  Bids for all major purchases for the District’s colleges are made through the District Purchasing Office.  The GCC Manager of College Business Services and the Fiscal Agent have authority to purchase goods or services using limited purchase orders up to $2,500.  Each department supervisor is responsible for his or her own budget and can verify transactions through CFS.  The District purchasing guide and policy manual are available on the web at

 

http://www.dist.maricopa.edu/purchasing

Audits

The District's Audit Department conducts routine audits of all colleges and the District Office on a cyclical basis.  The College may request the District Audit Department conduct special audits as needed.  In addition, the State Auditor General conducts annual reviews of the District's accounts, including each college’s accounts.

Achievements since 1992

·      GCC created the Procurement Department to oversee and standardize purchasing of capital expense items, furniture, software, maintenance agreements, and inventory control.  Complete information can be found on the web at 

 

http://www.gc.maricopa.edu/ppcweb/

 

·      Developed the position of Fiscal Agent to provide assistance to the Manager of College Business Services and processes over 90% of the College’s purchases

·      The online financial system allows all managers access to current budget status

 

Financial Resources—Planning

 

Financial resource planning is an ongoing process that results in the development of an annual budget linked to the strategic goals and objectives of the College and District.  The College uses an online system to solicit, collate, and archive budget requests from all departments.  GCC’s annual planning and budget development process incorporates current and past years’ data, prior year outcomes, current year activities, and plans for the next fiscal year.

 

Source: GCC IE Office

 

Training begins in April for those who prepare and manage budgets.  The online planning and budgeting system is available to departments to update their outcomes, revisit planned activities for the current year, and to plan for the next fiscal year.  Early in the process, each department is encouraged to begin formulating budget requests for staffing, capital or computing needs, facilities improvements, and other operational expenses.  Those requests that demonstrate strong planning and links between needs and strategic goals have a better chance to be included in the final budget request presented to the President.

 

The final budget requests are submitted in late September and distributed for review and prioritization to the following cross-functional budget subcommittees: Instructional, Student Services, and College-wide Services.  In addition, the College Computer Request Committee (CRC) reviews and recommends all technology requests to the College Technology Committee (CTC) and the College Facilities Committee does the same for all building and grounds requests.  In November, all subcommittees’ recommendations are then submitted to the Budget Development Committee (BDC) for final, campus-wide prioritization before presenting recommendations to the College President for final budget approval.  The entire process is detailed at

 

http://www.gc.maricopa.edu:2049/ie/PlanningBudgetingAssessing/BudgetingProcess/BudgetingProcess.html (restricted access - username gccguest)

 

The Governing Board identifies specific “Goals” (formerly called “Ends”) for special emphasis and funding to help guide individual colleges in their proposals.  For example, during the 2002-03 budgetary cycle diversity and teacher education will be stressed.  Each college attempts to link its budget requests to programs that address these goals, but are not limited to them when making supplemental requests.  Each college presents its budget requests to the District Financial Advisory Committee (FAC) in December.  FAC then makes recommendations to CEC, who then in turn forwards their recommendations to the Chancellor.  The Chancellor sends the recommendations to the Governing Board for final approval.  The Board then submits the proposed budget to the State Board of Directors for Community Colleges for review.  The State Board can make changes or deny requests, especially for tuition or fee increases.  They make their final recommendations for budget approval in June.  All tuition, fees, and state appropriations are based on this adopted budget.

Achievements since 1992

·      In recent years, the College’s planning and budgeting processes have become much more inclusive of faculty and other employee groups, involving additional subcommittees to help prioritize requests

·      The annual review of the budget process has provided more flexibility and responsiveness to the changing needs of the College

·      The online planning and budgeting software program and training materials have allowed the process to be more comprehensible, less onerous, and more easily linked to the College strategic plans

Team Analysis

Team 6 conducted an analysis of factors likely influencing areas for improvement and their relationship to the measures of success in several areas.  Regarding Sources of Funding and Planning: equitable access to funds based on linking College goals with those of the Governing Board, improved communication and training for successful financial budget decisions feedback, and a successful future bond initiative, along with maintaining the operational fund balance in the black (without debt, carrying forward no more than 2% of annual budget), and having sufficient funds to meet student academic and extra curricular needs.  The team determined that online planning and budgeting and a great number of people/groups involved in the process were strengths, but the difficulty in obtaining and training people to participate, and a lack of timely feedback on budget decisions were weaknesses.  Regarding Purchasing: providing the best vendor at the most cost-effective price, perhaps with value-added service and student satisfaction.  The team determined that the College’s Procurement Department’s cost-saving efforts and faster service were strengths, but a cumbersome online mechanism was seen as a weakness.  The implementation of a new Student Information System (planned for Spring 2002), which will streamline processes, was seen as an opportunity, but banking issues related to check fraud was identified as a threat.

 

Regarding Capital Budget: FTSE funds received reflect actual FTSE generated, increased access to funds from grants, donations, and scholarships, and a successful future bond initiative.  The team identified population growth in the West Valley, external partnerships, and the College’s involvement in the planned bond initiative as strengths, but a reduction in FTSE funding and decreasing state aid were seen as threats.  Regarding Grants: grants that support the College mission, programs and strategic plan, have faculty support, and are internally and externally visible and understandable.  That the grants processes have not been open and visible, the lack of a campus development office (human, financial and physical resources), and a lack of successful grant implementation (in-kind) were identified as weaknesses, but the shared resource of a District grants writer was deemed an opportunity.  Grant fund variety, inclusion, growth, and funds for resources, were seen as strengths.

Areas for improvement

Recommendations

Content Area Validation

GCC has developed a strong process to link planning and budgeting; it has the requisite tools to manage its budget effectively; and has identified priority areas for improvement.  Strategies have been developed that focus on process improvements, training, and for seeking new sources of funding.  Some of the funding concerns are outside of the College’s control, as it is part of a multi-college district, and the District is the legal entity.  Therefore, while the College can attempt to influence internal District resource allocation processes, it has very little influence on the broader issues of tax base, legislative allocations, and state resource allocation processes.  In 1999-00, the Dean of Educational Services, in collaboration with the Dean of Instruction and Associate Deans, was assigned the primary responsibility for coordination of grants at GCC.  Once a plan is specified, College and District resources, including monies for grant submissions, will be available.  Also, a College-wide database of the status of existing grants will continue to be updated.

 

 

 

Next: Physical Resources -- Facilities

http://www.gc.maricopa.edu/ncaselfstudy/ncaselfstudy/10C6Fnd.htm
Last revised 1/8/02. Direct feedback to l.hawbaker@gcmail.maricopa.edu. See Legal Disclaimer.