STUDENT FEE RATES and CONCEPTUAL BUDGET PLAN FY 2015

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1 FC 5/15/14 Action Item 1-a BT 5/16/14 IV-9 REPORT TO THE BOARD OF TRUSTEES STUDENT FEE RATES and CONCEPTUAL BUDGET PLAN FY 2015 May 2014

2 Date: May 15, 2014 To: Re: The Purdue University Board of Trustees Conceptual Plan and Report on Tuition and Fees Action Requested: Approve the Conceptual Plan This material includes a report of tuition and fees for the FY 2015 and the conceptual budget plans for FY 2015 for Purdue University West Lafayette, Calumet, IPFW and North Central campuses. Tuition and Fee On a system-wide basis for FY 2015, tuition and fee revenue represents the largest share (62%) of the proposed general fund budget at Purdue University. Tuition and fee rate increases for FY 2015 were approved at the May 2013 Board of Trustees meeting. Resident and nonresident tuition and fee rate increases of 0% were approved for the West Lafayette campus, along with the final phase-in of $10 for the Student Activity Fee. An additional adjustment of $250 per year was approved for the College of Engineering undergraduate differential fee. A 0% rate increase for Statewide Technology fees and 2% resident and nonresident tuition and fee rate increases for the Regional campuses were also approved at that time. The highlights of Big Ten comparisons for Fall 2013 undergraduate fee rates for the West Lafayette campus tuition and fees are currently ranked 9 th in the Big Ten for resident students. The corresponding ranking for nonresident students is 6 th. Student aid budgets are directly influenced by increases in tuition and fees as well as need and merit based aid programs. System-wide, the total FY 2015 student financial aid (all funds) will remain relatively flat due to West Lafayette s tuition freeze and regional campuses enrollment declines. Conceptual Plan The net operating appropriations for each campus remain flat for FY Two campuses have a compensation merit salary increase policy. West Lafayette campus and North Central campus must average 1.5%, and be applied consistently across each staff group.

3 The Calumet campus budget plan provides a 1.5% merit salary policy for clerical and service staff only. Purdue will pay close attention to the competitiveness in salary and compensation of faculty when compared to their respective peer groups or markets. In order to promote competitiveness in faculty salaries, $1.0 million is being allocated at the West Lafayette campus for faculty retention and equity. Each campus has prepared its conceptual budget proposal showing the general fund revenue changes, reductions and reallocations, and allocations to priority initiatives. Funds have been allocated on the West Lafayette campus to cover costs for the new Purdue Moves. A system-wide view showing general fund revenue increases and allocations is provided in Table-1 as follows: $ REVENUE INCREASES TOTAL ALLOCATIONS State Appropriations* Tuition & Fees Other Revenue Reductions/ Reallocations All Increases & Allocations Mandatory Costs Compensation Strategic Allocations PU-West Lafayette 0 5,205,139 1,231,836 25,753,514 32,190,489 5,349,516 7,925,048 18,915,925 PU-Calumet 0 (451,902) (200,000) 2,028,135 1,376, , ,472 1,134,724 IPFW 0 (1,802,019) (1,386,500) 3,672, ,742 (200,175) (607,396) 1,291,313 PU North Central 0 760,840 (1,000) 0 759,840 82, , ,549 TOTAL 0 3,712,058 (355,664) 31,453,910 34,810,304 5,357,356 7,663,437 21,789,511 Distribution 0.0% 10.7% -1.0% 90.3% 100.0% 15.4% 22.0% 62.6% * Excludes debt service appropriations Table-1, FY 2015 System-wide Summary of General Funds With the approval of the Board, Purdue will proceed to finalize the budget by confirming the allocations and implementing budget allocations, reductions, and reallocations. The final operating budget showing general and other funds, along with the details of allocations, will be presented for review by the Board in September Mitchell E. Daniels, Jr. President

4 Purdue University Conceptual Plan FY 2015 Purdue University West Lafayette Overall 0.0% change in Operating Appropriations from FY 2014 Reallocations ($25.8 million) 1.5% Merit Salary Policy Funding faculty promotion increments 0.0% increase in Supply and Expense budget Unavoidable Cost Increases Benefits ($0.9 million) Fuel, Utilities and Insurance $3.1 million Plant Expansion $2.2 million Student Aid 0.8% decrease in Total Student Aid from all funding sources Purdue University Calumet Overall 0.0% change in Operating Appropriations from FY % Mandatory Reduction ($2,028,135) 1.5% Merit Salary Policy for Clerical and Service staff Funding faculty promotion increments 0.0% increase in Supply and Expense budget Unavoidable Cost Increases Benefits ($72,028) Fuel, Utilities and Insurance $5,200 Repair and Rehabilitation $2,615 Student Aid 2.2% increase in Total Student Aid from all funding sources Indiana-Purdue Fort Wayne Overall 0% change in Operating Appropriations from FY 2014 Reallocation funded from Legislative Supplement ($2,000,000) 2.9% Mandatory Reduction ($1,672,261) 0.0% Merit Salary Policy Funding faculty promotion increments 0.0% increase in Supply and Expense budget

5 Unavoidable Cost Increases Benefits ($769,396) Fuel, Utilities and Insurance $69,879 Repair and Rehabilitation ($62,524) Student Aid 0.6% increase in Total Student Aid from all funding sources Purdue North Central Overall 0.0% change in Operating Appropriations from FY % Mandatory Reduction 1.5% Merit Salary Policy Funding faculty promotion increments 0.0% increase in Supply and Expense budget Unavoidable Cost Increases Benefits ($145,201) Fuel, Utilities and Insurance 65,022 Repair and Rehabilitation $10,891 Student Aid 2.2% increase in Total Student Aid from all funding sources

6 Part I Purdue University Tuition and Mandatory Fees West Lafayette Campus COMPARISON OF TUITION AND FEES BIG TEN PUBLIC UNIVERSITIES ACADEMIC YEAR Undergraduate University Tuition & Fees Resident Rank by Cost 1-Year Tuition & Fees Nonresident Rank by Cost 1-Year R a n Penn State University $16, % $29, % University of Illinois 15, % 29, % University of Minnesota 13, % 19, % University of Michigan* 13, % 40, % Michigan State University* 12, % 33, % University of Wisconsin-Madison 10, % 26, % Indiana University 10, % 32, % Ohio State University 10, % 25, % Purdue University 9, % + $92 28, % + $92 University of Iowa 8, % 26, % University of Nebraska-Lincoln 7, % 21, % Mean (excluding Purdue) $11, % $28, % Purdue index to mean *MSU's and University of Michigan's negative 1-year change in fees is a result of new instructions to report lower division fees, instead of a blended rate. Note: All fee rates reported are applicable to entering freshmen students. Page 1 of 3

7 Part I Purdue University Tuition and Mandatory Fees Regional Campus Peer Comparisons Purdue University Calumet University Resident Tuition & Fees Rank by Cost University Nonresident Tuition & Fees Rank by Cost William Paterson of NJ $11,920 1 University of Tennessee-Chattanooga $24,088 1 Kean University (NJ) 10,918 2 University of Michigan-Dearborn 23,124 2 University of Michigan-Dearborn 10,614 3 Southern Illinois-Edwardsville 20,610 3 Southern Illinois-Edwardsville 9,666 4 William Paterson of NJ 19,460 4 University of Wisconsin-Platteville 7,718 5 Kennesaw State (GA) 19,390 5 University of Tennessee-Chattanooga 7,674 6 University of North Carolina-Wilmington 18,479 6 Purdue - Calumet 7,098 7 Kean University (NJ) 17,142 7 University of Southern Indiana 6,898 8 Purdue - Calumet 16,035 8 Kennesaw State (GA) 6,808 9 University of Wisconsin-Platteville 15,753 9 University of North Carolina-Wilmington 6, University of Southern Indiana 15, University of Central Oklahoma 5, University of Central Oklahoma 13, Mean (excluding PUC) 8,400 Mean (excluding PUC) 18,715 PUC index to mean 0.85 PUC index to mean 0.86 Indiana-Purdue Fort Wayne University Resident Tuition & Fees Rank by Cost University Nonresident Tuition & Fees Rank by Cost Eastern Michigan University $9,364 1 Eastern Michigan University $24,909 1 Northern Kentucky University 8,376 2 University of Nebraska-Omaha 19,343 2 University of South Alabama 8,310 3 Eastern Washington University 19,342 3 Youngstown State University 7,898 4 Boise State University 18,892 4 IPFW 7,793 5 University of Alaska-Anchorage 18,782 5 Eastern Washington University 7,372 6 IPFW 18,717 6 University of Nebraska-Omaha 7,303 7 Southeastern Louisiana University 17,770 7 Boise State University 6,292 8 University of South Alabama 16,620 8 CUNY-College of Staten Island 6,158 9 Northern Kentucky University 16,464 9 University of Alaska-Anchorage 5, CUNY-College of Staten Island 15, Southeastern Louisiana University 5, Youngstown State University 13, University of Central Oklahoma 5, University of Central Oklahoma 13, Mean (excluding IPFW) 7,098 Mean (excluding IPFW) 17,755 IPFW index to mean 1.10 IPFW index to mean 1.05 Purdue North Central University Resident Tuition & Fees Rank by Cost University Nonresident Tuition & Fees Rank by Cost University of South Carolina - Upstate $10,198 1 University of South Carolina - Upstate $20,226 1 University of South Carolina - Aiken 9,308 2 University of South Carolina - Aiken 18,340 2 Lewis-Clark State College 7,744 3 Lewis-Clark State College 18,056 3 Purdue - North Central 7,185 4 Indiana University - Kokomo 17,763 4 Shawnee State University 7,176 5 Indiana University Northwest 17,658 5 Purdue University Calumet 7,098 6 Indiana University South Bend 17,657 6 Indiana University South Bend 6,695 7 Purdue - North Central 17,105 7 Indiana University - Kokomo 6,660 8 Purdue University Calumet 16,035 8 Indiana University Northwest 6,618 9 Clayton State University 14,915 9 University of Arkansas at Pine Bluff 5, Shawnee State University 12, Clayton State University 5, University of Arkansas at Pine Bluff 11, Mean (excluding PNC) 7,240 Mean (excluding PNC) 16,436 PNC index to mean 0.99 PNC index to mean 1.04 Page 2 of 3

8 Part I Purdue University s in Undergraduate Academic Year Student Fees Prior to Summer 2009 PRESENT For students enrolled beginning Summer 2009 through Spring 2011 Summer 2011 through Spring 2012 Summer 2012 and thereafter Prior to Summer 2011 EFFECTIVE FALL 2014 FALL 2014 For students enrolled beginning Percent Summer 2011 through Spring 2012 Summer 2012 and thereafter Prior to Summer 2011 Summer 2011 through Spring 2012 Summer 2012 and thereafter WEST LAFAYETTE General Service $ 8, $ 9, $ 9, $ 9, $ 9, $ 9, $ 9, Technology Fee Repair & Rehabilitation Fee Student Fitness and Wellness Fee Student Activity Fee Total Resident $ 9, $ 9, $ 9, $ 9, $ 10, $ 10, $ 10, % + $10 0% + $10 0% + $10 Nonresident Tuition 18, , , , , , , Total Nonresident $ 28, $ 28, $ 28, $ 28, $ 28, $ 28, $ 28, % + $10 0% + $10 0% + $10 International Student Tuition N/A N/A 1, , N/A 1, , Total International Nonresident $ 28, $ 28, $ 29, $ 30, $ 28, $ 29, $ 30, % + $10 0% + $10 0% + $10 REGIONAL CAMPUSES PUC PRESENT EFFECTIVE FALL 2014 Fall 2014 Percent IPFW PRESENT EFFECTIVE FALL 2014 Fall 2014 Percent PNC PRESENT EFFECTIVE FALL 2014 Fall 2014 Percent General Service $ 6, $ 6, Technology Fee Student Service Fee Parking Fee Repair & Rehabilitation Fee Total Resident $ 7, $ 7, % Nonresident Tuition 8, , Total Nonresident $ 16, $ 16, % General Service $ 6, $ 6, Technology Fee Student Service Fee Parking Fee Repair & Rehabilitation Fee Facility Fee Total Resident $ 7, $ 7, % Nonresident Tuition 10, , Total Nonresident $ 18, $ 19, % General Service $ 6, $ 6, Technology Fee Student Service Fee Parking Fee Repair & Rehabilitation Fee Facility Fee Total Resident $ 7, $ 7, % Nonresident Tuition 9, , Total Nonresident $ 17, $ 17, % Page 3 of 3

9 Part II Purdue University FY 2015 General Fund Summary FY 2014 and FY 2015 General Fund s by Revenue Source General Fund Revenues FY 2014 West Lafayette Proposed FY 2015 Dollar FY 2014 Purdue University Calumet Indiana-Purdue Fort Wayne Purdue North Central Proposed Proposed Proposed FY 2015 Dollar FY 2014 FY 2015 Dollar FY 2014 FY 2015 Operating Appropriation $244,792,248 $244,792,248 $0 $27,843,362 $27,843,362 $0 $39,018,966 $39,018,966 $0 $13,453,989 $13,453,989 $0 Debt Service Appropriation 21,336,918 20,821,980 (514,938) 1,474,082 1,478,484 4,402 5,310,403 5,312,223 1,820 2,024,537 2,024,537 0 Student Fees 637,224, ,429,529 5,205,139 51,962,356 51,510,454 (451,902) 62,201,662 60,399,643 (1,802,019) 16,083,077 16,843, ,840 Facilities and Admin Rec. FY 2015 General Fund : Revenue s, Reductions, Reallocations, and Expenditure Allocations Dollar 58,000,000 59,200,000 1,200, , , , ,000 21,000 65,000 60,000 (5,000) Interest Income 25,500,000 25,500, ,200,000 1,000,000 (200,000) 1,700,000 1,200,000 (500,000) 325, ,000 (6,000) Other Income 24,410,111 24,441,947 31, , , ,635,879 1,728,379 (907,500) 841, ,000 10,000 Total Revenues $1,011,263,667 $1,017,185,704 $5,922,037 $84,159,800 $83,512,300 ($647,500) $111,041,910 $107,855,211 ($3,186,699) $32,792,603 $33,552,443 $759,840 Revenue s West Lafayette PUC IPFW PNC Operating Appropriation $ 0 $ 0 $ 0 $ 0 Debt Service Appropriation (514,938) 4,402 1,820 0 State Appropriations $ (514,938) $ 4,402 $ 1,820 $ 0 Resident Tuition and Fees $ 0 $ 744,263 $ 732,516 $ 262,227 Nonresident Tuition and Fees 0 248,087 81,391 19,771 International Student Tuition 900, Expanded Summer Revenue FY Expanded Summer Revenue Adjustment FY 2013 (2,301,756) Expanded Summer Revenue Adjustment FY 2014 (5,225,642) New to Campus Student Success Fee 200, Designated Student Fees 1,685, ,101 Other Fee Revenue Enrollment /Mix 9,947,308 (1,444,252) (2,615,926) 379,741 Student Fees $ 5,205,139 $ (451,902) $ (1,802,019) $ 760,840 Facilities and Admin Expense Recovery $ 1,200,000 $ 0 $ 21,000 $ (5,000) Interest Income 0 (200,000) (500,000) (6,000) Other Income 31,836 0 (907,500) 10,000 Revenue s $ 5,922,037 $ (647,500) $ (3,186,699) $ 759,840 Reductions from Units 0 2,028,135 1,672,261 0 Reallocations - Legislative Supplement 0 0 2,000,000 0 Reallocations - SAA / $40M Challenge 12,338, Reallocations - Fee Remissions (Net Student Fees) 13,415, Total Revenues, Reductions and Reallocations $ 31,675,551 $ 1,380,635 $ 485,562 $ 759,840 Expenditure Allocations West Lafayette PUC IPFW PNC Salary Increases and Adjustments $ 6,664,500 $ 75,500 $ 0 $ 267,900 Faculty in Academic Rank 933,364 71, ,000 48,720 Benefits Related to Salary Increase 1,256,916 41,950 42,000 57,894 Benefits (929,732) (72,028) (769,396) (145,201) Total Compensation Increases $ 7,925,048 $ 116,472 $ (607,396) $ 229,313 Fuel, Utilities, and Insurance $ 3,143,352 $ 5,200 $ 69,879 $ 65,022 Repair and Rehabilitation 0 2,615 (62,524) 10,891 Plant Expansion 2,152, Miscellaneous Unavoidable Costs 54, ,222 (207,530) 7,065 Mandatory Cost Increases $ 5,349,516 $ 125,037 $ (200,175) $ 82,978 Remissions (37,429) 28, ,188 3,065 Scholarships 42,930 40, ,125 0 Expanded Summer Adjustment FY 2013 (2,654,591) Expanded Summer Adjustment FY 2014 (4,756,665) ,000 Faculty Retention and Equity Allocation 1,000, College of Engineering Expansion 9,000, School of Management Expansion 1,564, Benefits Stabilization for Future Allocation 2,582, Research Incentive Allocation 831,250 Purdue Moves 3,280, Purdue Moves - Scholarships 5,125, Other Allocations 2,938,042 1,066, , ,502 Carry Forward for Future Commitments ,881 Debt Service from Appropriations (514,938) 4,402 1,820 0 Other Debt Service Allocation ,101 Total Expenditure Allocations $ 31,675,551 $ 1,380,635 $ 485,562 $ 759,840 Page 1 of 1

10 FY 2015 GOVERNANCE REPORT STUDENT FEE RATES AND CONCEPTUAL BUDGET PLAN FY 2015 Board of Trustees Meeting May 2014

11 APPROVED FY 2015 FEE STRUCTURE General Biennial Increase 0.0% for West Lafayette Campus and Statewide Technology for resident and nonresident students 2.0% for Regional Campus resident and nonresident students West Lafayette Previously Approved Increases Engineering Differential Fee for undergraduates Increased by $250 per year (Year 4 of 4) Student Activity Fee for resident and nonresident students Increased by $10 to $40 per year effective Fall 2014 (Year 4 of 4)

12 FY 2015 GOVERNANCE REPORT CONCEPTUAL BUDGET PLAN FY 2015 Board of Trustees Meeting May 2014

13 FY 2015 BUDGET PARAMETERS WEST LAFAYETTE 0% general student fee increase (2 nd year of tuition freeze) 0% operating appropriation increase (2 nd year of biennium) 1.5% merit increase salary policy, 1.0% + 0.5% from medical savings 6% medical inflation assumed for CY % increase in supplies and expense budgets $12.3M planned Student Affordability contributions to balance second year of the biennium ($40M challenge) Funding allocated for Purdue Moves and Scholarships

14 GENERAL FUND BUDGET BY REVENUE SOURCE WEST LAFAYETTE CAMPUS General Fund Revenues FY 2014 Proposed FY 2015 Dollar Operating Appropriation $ 244,792,248 $ 244,792,248 $ 0 Debt Service Appropriation 21,336,918 20,821,980 (514,938) Student Fees 637,224, ,429,529 5,205,139 Facilities and Admin. Recovery 58,000,000 59,200,000 1,200,000 Interest Income 25,500,000 25,500,000 0 Other Income 24,410,111 24,441,947 31,836 Total Revenue Increases $ 1,011,263,667 $ 1,017,185,704 $ 5,922,037 Reallocations - SAA / $40M Challenge 12,338,481 Reallocations - Fee Remissions (Net Student Fees) 13,415,033 Total Revenues and Reallocations $ 31,675,551

15 FY 2015 GENERAL FUND BUDGET WEST LAFAYETTE CAMPUS Expenditure Allocations Amount Salary Increases and Adjustments $ 6,664,500 Faculty in Academic Rank 933,364 Benefits Related to Salary Increases 1,256,916 Benefits (medical, retirement, etc.) (929,732) Total Compensation Increases and Benefits $ 7,925,048 Fuels, Utilities and Insurance $ 3,143,352 Plant Expansion 2,152,041 Miscellaneous Unavoidable Costs 54,123 Total Mandatory Cost Increases $ 5,349,516

16 FY 2015 GENERAL FUND BUDGET, CONT. WEST LAFAYETTE CAMPUS Expenditure Allocations, continued Amount Remissions $ (37,429) Scholarships 42,930 Expanded Summer Adjustment FY 2013 (2,654,591) Expanded Summer Adjustment FY 2014 (4,756,665) Faculty Retention and Equity Allocation 1,000,000 College of Engineering Expansion 9,000,000 School of Management Expansion 1,564,000 Benefits Stabilization for Future Allocation 2,582,488 Research Incentive Allocation 831,250 Purdue Moves 3,280,900 Purdue Moves - Scholarships 5,125,000 Other Allocations 2,938,042 Total $ 18,915,925 Debt Service from Appropriations (514,938) Total Expenditure Allocations $ 31,675,551

17 GENERAL FUND BUDGET BY REVENUE SOURCE REGIONAL CAMPUSES General Fund Revenues Proposed FY 2015 Dollar Proposed FY 2015 Dollar Proposed FY 2015 Dollar Operating Appropriation $ 27,843,362 $ 0 $ 39,018,966 $ 0 $ 13,453,989 $ 0 Debt Service Appropriation 1,478,484 4,402 5,312,223 1,820 2,024,537 0 Student Fees 51,510,454 (451,902) 60,399,643 (1,802,019) 16,843, ,840 Facilities and Admin. Recovery Purdue University Calumet Indiana-Purdue Fort Wayne Purdue North Central 750, ,000 21,000 60,000 (5,000) Interest Income 1,000,000 (200,000) 1,200,000 (500,000) 319,000 (6,000) Other Income 930, ,728,379 (907,500) 851,000 10,000 Total Revenues $ 83,512,300 $ (647,500) $ 107,855,211 $ (3,186,699) $ 33,552,443 $ 759,840 Reductions from Units 2,028,135 1,672,261 0 Reallocations - Legislative Supplement 0 2,000,000 0 Total Revenues, Reductions and Reallocations $ 1,380,635 $ 485,562 $ 759,840

18 FY 2015 GENERAL FUND BUDGET REGIONAL CAMPUSES Expenditure Allocations Purdue University Calumet Indiana-Purdue Fort Wayne Purdue North Central Salary Increases and Adjustments $ 75,500 $ 0 $ 267,900 Faculty in Academic Rank 71, ,000 48,720 Benefits Related to Salary Increase 41,950 42,000 57,894 Benefits (72,028) (769,396) (145,201) Total Compensation Increases $ 116,472 $ (607,396) $ 229,313 Mandatory Cost Increases $ 125,037 $ (200,175) $ 82,978 Remissions 28, ,188 3,065 Scholarships 40, ,125 0 Other Allocations 1,066, , ,502 Carry Forward for Future Commitments ,881 Debt Service from Appropriations 4,402 1,820 0 Other Debt Service Allocation ,101 Total Expenditure Allocations $ 1,380,635 $ 485,562 $ 759,840

19 FY 2015 GOVERNANCE REPORT STUDENT FEE RATES AND CONCEPTUAL BUDGET PLAN FY 2015 Board of Trustees Meeting May 2014

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