BudgetBudget jbarber32 Wed, 06/27/2012 - 16:03
Annual Operating Budget (Proposed Budget)Annual Operating Budget (Proposed Budget)
The Georgia Institute of Technology budget expresses in terms of dollars the funded programs and plans of the Institute for the specific budget (fiscal) year. Revenue estimates are also identified to support these programs and plans. Budgetary approval by the Board of Regents (BOR) of the University System of Georgia (USG) and by the Institute administration constitutes authorization to expend the funds as budgeted and to collect the anticipated revenue. The approved budget is the primary instrument of fiscal control and must contain all revenue and expenditures of the Institute.
Institute revenue or program support derives from State Appropriations and Internal Income such as Student Fees, Indirect Cost Recoveries from Sponsored Projects, Gifts and Grants, Sales and Services, and Sponsored Operations. Each year the State of Georgia Legislature appropriates funds to the University System of Georgia for support of all Institutions in the system. The BOR in turn allocates state funds to each institution on the basis of a funding formula and specific guidelines established in the state Appropriations Act.
Guidelines & Policies
The Georgia Tech Office of Budget Planning and Administration (the “Budget Office”) is required to follow an established set of guidelines and policies set forth by the State of Georgia, the Board of Regents, and the Institute. These guidelines require an annual operating budget be prepared for each budgetary unit of the Institute.
- General Policy
The Board of Regents (BOR) annually allocates funds to each institution at its April meeting or next regular meeting following the approval of the appropriations act or as soon after as practical every year. The BOR approves the budgets of the institutions and Office of the Board of Regents at its regular May meeting each year, or as soon thereafter as practical.
The Board of Regents is the only medium through which all formal requests are made for appropriations from the General Assembly and the Governor of Georgia.
- Operating Budgets
Each institution in the University System prepares an Operating Budget for educational and general activities of the Institution for the fiscal year within the limit of funds allocated, plus estimated internal revenue. In addition, a budget is prepared forAuxiliary operations that are supported by fees and other revenues.
- Sources of Revenue
There are five basic sources of revenue for the Institute Resident Instruction operating budget:1) State Appropriations; 2) Internal Revenue; 3) Sponsored Operations; 4) Departmental Sales and Services; and 5) Georgia Tech Research Corporation (GTRC) and the Georgia Tech Foundation (GTF).
- State Appropriation
Annual allocation of funds from the Board of Regents' legislative appropriation, funded by the State of Georgia.
- Internal Revenue
Derived primarily from tuition and fee income and recoveries of indirect costs from research conducted atGeorgia Tech. (Note: Direct cost is anything that is directly related to a sponsored project, such as salaries and work supplies. Indirectcost recovery refers to the funds used to pay for administrative and support costs of the Institute, such as administration, facilities, and the Library.)
- Tuition and Student Fees
- Gifts and Grants
- Indirect Cost Recoveries
- Sales and Services of Educational Departments
- Other Sources
- Sponsored Operations
Revenues from sponsor reimbursement of direct costs of sponsored research, instruction and other sponsored institutional activities.
- Departmental Sales and Services
Revenues collected on behalf of a specific program to be used solely for that program, such as students are charged a computer fee to be used to maintain the computer facilities they use and colleges charge fees for non-credit courses offered to businesses and the community.
- GTRC and GTF
Limited resources are available from the Georgia Tech Research Corporation and from the unrestricted (not designated for specific purposes) endowment of the Georgia Tech Foundation.
- State Appropriation
- Distinctions in Sources of Revenue
Sponsored operations and departmental sales and services revenues are collected to support a specific project or program and therefore are limited in their use to that project or program alone. GTF funds are generally used to support students, faculty and staff in non-research activities. GTRC funds are generally allocated to students, faculty and staff for research purposes. State appropriations and internal revenue, on the other hand, can be used for any part of the Resident Instruction program, including state-funded research activities.
Separate processes are used to allocate the funds from the different sources. Resident Instruction funding is usually placed in a unit's budget and forms the base budget for the next year. Additional money added to the base is called "new workload" funds. Generally, the base plus new workload forms the base for the following fiscal year. Funds from the Foundation and the Georgia Tech Research Corporation, on the other hand, are more likely to be treated as one-time grants.
Forms to be used in preparing the Annual (Proposed) Operating Budget are specified each year in the guidelines and instructions provided to campus units. See the Budget Office web site for current forms.
Budget AmendmentsBudget Amendments
The Office of Institute Budget Planning and Administration (“Budget Office”) is responsible for the development, implementation, maintenance, and control of Georgia Tech’s non-sponsored budgets, based on allocations approved through appropriate academic and administrative processes. The budget consists of funding from general, departmental services, special funding initiative, research consortium, lottery, sponsored, auxiliary, student services, and agency operations. In addition, budgets are maintained for a large number of capital projects.
The budget for each department or project should be amended to reflect the current estimate of expenditures and income (if applicable) for the fiscal year. The following list shows some, but not all types of transactions that would require a budget amendment:
- Establish a budget amount or change the amount budgeted for non-personal services expenditures, such as travel, operating supplies and expense, and equipment.
- Establish a budget amount or change the amount budgeted for anticipated income (revenue and departmental sales and services) for the fiscal year.
- Establish or change the amount budgeted for a vacant position.
- Make an approved increase or decrease to your original budget amount.
Steps in Budget Amendment Process
- Log into the IBS System
- Enter your Operator ID (GT ID number).
- Enter your password.
- Click “enter.”
- Check Totals
- Go to Totals Page
- Verify approved budget for all funding sources.
- Check Amendment
- Go to Review and Submit Page
- Check Salary Planning and Distribution for any changes automatically generated by IBS.
- These changes are driven by and reflect the SPD system the day the amendment was run. Delete/correct accordingly.
- If increasing or decreasing budget, make adjustments to your personal services and/or non-personal services to reflect the change. After each entry is made make sure you click “Save.”
- Complete “Amendment Notes” and “Comments” fields (see “Use of Comments Fields” section below)
- If there is no change to the “bottom-line” budget and funds are being transferred between personal services and non-personal services, there must be a zero balance.
- Check Request Prior to Budget Submission
- Go to “Review and Submit” page.
- Verify funding source totals for any increases or decreases.
- Verify total.
- Make sure funding is not transferred from one source to another. For example, do not move funds from General Operations to Departmental Sales and Services (DSS).
- Budget Submission
- Click “Submit” button.
- Your department is locked out to allow the Budget Analyst to process your changes.
- An e-mail is generated and sent to the Budget Office to process your request.
- Your budget amendment is updated. An e-mail notification is sent to you that your budget amendment is ready to print.
- Printing Reports
- Go to “Reports” page.
- All reports are available in MS Excel.
- Note that Bud802 and Bud805 are generated after the BA is submitted.
- Print report for use by your unit’s financial administrators in review of authorized monthly budget activity.
Use of Comment Fields in the Amendment Process
Department Level Comments – provide a description of your budget changes.
- This page differs from the detail level comments on the Personal Services and Non-Personal Services pages in that here you must include any high-level description to document why you made budget adjustments. The description should be similar to the information previously provided on the cover sheets.
Detail Level Comments (on Personal Services and Non-Personal Services pages)
- Your department is either receiving or giving out a mixture of funding (example: both Tech Fee and Research Consortium funding).
- Enter totals by funding source in comment.
- Funding to or from more than one other department/project.
- Enter each of the other departments’ org numbers and amount in comment. Don’t just enter a lump sum total by department.
Actions that result in a NET change to your department’s budget require comments
- SPD adjustments or transfers from one account to another within a department do not require comments. Within comments, always include the project number org # or the name of the department that is either providing additional budget to your department or receiving funds from your department. Your analyst can help you with the transition to paperless documentation within amendments.
Any BA submitted with a net change in a department’s budget but without any documentation in the comment fields will need to be corrected before it will be processed
- Your analyst will contact you to request that you submit the missing information and resubmit the amendment.
Budget Amendment Close-Out Process
- Budget Office balances the changes to the Original Budget.
- The files are processed and submitted to update the PeopleSoft General Ledger.
- The Budget Office notifies the unit budget contacts that IBS is available for your use and the next budget amendment due date.
Please contact your Budget Analyst if you have any questions about these policies and procedures.
Capital BudgetsCapital Budgets
Capital projects, generally those costing more than $1 million, are funded from various sources. These sources, which include State of Georgia, Board of Regents, Georgia Tech Foundation, and campus funds, usually dictate who has administration of the project.
The State of Georgia funds the construction of buildings and the Georgia State Finance and Investment Commission (GSFIC) coordinates the project and disburses the funds.
The Board of Regents (BOR) receives an allocation from the state legislature referred to as Major Repair and Rehabilitation (MRR) funds. The MRR Fund is generally used for projects costing less than $1 million. The Board of Regents allocates these funds to the various units of the University System. These funds may be funneled through GSFIC if they are bond funds. The administration of the project may be handled by GSFIC or Georgia Tech depending on the type of project.
The Georgia Tech Foundation (GTF) funds various capital projects on campus. GTF retains administration of some of the projects and the facilities office/plant operations administers the remainder. These GTF projects require prior approval from the Board of Regents.
Some projects are funded by resources held by Georgia Tech, i.e. discretionary endowment funds and Auxiliary Enterprises reserve funds. These projects are controlled by Georgia Tech personnel after receiving Board of Regents approval.
State of Georgia Funding
Each year a "Five-year Capital Outlay Budget Request" is prepared by the units of the University System of Georgia and submitted to the Board of Regents. The Board of Regents examines all requests and prepares a consolidated priority list. Only a portion of the list is funded by the legislature's allocation. The unfunded projects normally remain on the priority list the following year. Funds for the approved projects are transferred to GSFIC for disbursement and project administration. These projects are defined as new buildings, building additions, and building renovations estimated to cost $1,000,000 or more.
Board of Regents Funding
The Board of Regents receives a special allotment from the State of Georgia called Major Repair and Rehabilitation (MRR) funds. Each unit of the University System submits to the Board of Regents a prioritized list of repair/renovation projects estimated to cost less than $1,000,000 each. At Georgia Tech this list is prepared by the Space Administration Committee. The Board of Regents reviews each submission and decides which projects will be funded from the MRR allocation. The Board of Regents assigns a project number and authorizes GSFIC to make disbursements from the MRR allocation if the source is bond proceeds. Occasionally projects in excess of $1,000,000 will be funded from MRR funds. When this happens they are usually funded in phases.
Georgia Tech Foundation Funding
GTF funds special projects as determined by the President of Georgia Tech and the Board of Trustees of GTF. These projects may be coordinated by GTF or the funds may be transferred to Georgia Tech and handled by Georgia Tech personnel.
These are discretionary funds held by Georgia Tech consisting mainly of endowment funds and Auxiliary reserve funds. The use of discretionary endowment funds must have the President's approval or his designee prior to establishing a project budget. The Auxiliary Reserve funds are used to renovate existing Auxiliary Enterprise facilities, construct new Auxiliary Enterprise facilities, and purchase equipment needed by Auxiliary Enterprise units.
Unexpended Plant Funds
This fund group is used to account for the construction or acquisition of physical properties, renovation of existing properties, and purchase of inventories and non-inventoried equipment.
Expenditures in this fund group are categorized as follows:
- Buildings - New
- Buildings - Additions (Cost a minimum of $5,000 and a useful life of more than three years)
- Buildings - Renovations (Cost a minimum of $5,000 and a useful life of more than three years)
- Improvements Other Than Buildings - landscaping, parking lots, fences, etc.
- Equipment/Inventories - items costing $1,000 or more; (items made of glass or other fragile materials are supplies)
- Equipment items costing $5,000 or more are capitalized and depreciated
- Equipment/Non-inventoried - items costing less than $1,000 are considered supplies
Capital Budgets Form
The Capital Budgets Form is used to establish plant fund projects and is provided to the units by the Budget Office. The project account numbers for new projects will be assigned by the Budget Office after the project has been approved. If discretionary endowment funds are shown as the source, the President or his designee must approve the project. All plant fund projects must have the Board of Regents' approval.
Commitment AccountingCommitment Accounting
This policy outlines the requirements of Commitment Accounting at Georgia Tech in compliance with USG financial systems and processes.
Commitment Accounting Requirements - General
Georgia Tech departments are required to:
- Review and reconcile salary and fringe benefit data in a timely manner,
- Establish position funding for filled positons,
- Submit, review, and approve transactions in a timely manner.
If a department is awaiting funding from internal or external awards, salary and fringe benefits must be allocated to the undesignated driver worktag, or another discretionary funding source. Departments should not allocate salary and fringe benefits from delayed funds to the suspense worktag for their Department, or another grant.
Change Position Funding (CPF)
When salary and fringe benefit distribution for a future pay period needs to be updated, Departments must follow the requirements outlined below to execute a CPF transaction.
Express Direct Retro (EDR)
If the salary and fringe benefit distribution for a prior pay period within the current fiscal year needs to be corrected, Departments must follow the requirements outlined below to execute an EDR transaction.
Late EDR - Special Documentation Requirements and Limitations for Externally-funded Sponsored Awards and Cost Share
Per 2CFR §200.431, EDR salary distribution changes that add salary charges to externally-fundedsponsored awards and cost share worktags must be accompanied by a written (or system-recorded) justification statement at an appropriate level of detail. Specific reasons for the transfer must be provided in the explanation. Cost transfer requests of this type that are not properly documented with an acceptable justification statement will be moved to the unit's sponsored undesignated worktag number by the Commitment Accounting central office and must be reallocated off of undesignated by the end of the fiscal year.
EDR salary cost transfers to externally-funded sponsored projects beyond 90 days of the original expense posting will not be allowed under normal circumstances. Exceptions to the 90 day limit must be approved by the Commitment Accounting Manager (Institute Budget Planning and Administration Office) , Sr. Director of Grants and Contracts Accounting (Grants and Contracts Accounting Office), and Vice President for Research Administration (Georgia Tech Research Corporation). Exceptions will be considered when:
- Initial or continued sponsor funding is delayed beyond 90 days after the effective date, and the transfer is requested within the reporting period of the sponsored award (typically 60-90 days after the expiration date of the award).
- The terms and conditions of the sponsored agreement provide for acceptance and payment of the expenses covered by the proposed cost transfer and appropriate supporting documentation is provided.
- Other exceptions will be reviewed on a case-by-case basis by the Senior Director of Grants and Contracts, and/or the Vice President for Research.
When a request doesn’t meet the one of the exceptions above, the Vice President of Finance and Planning (Administration and Finance Office) may also be required to approve the over 90 days EDR request.
Transfers between grants associated with the same sponsored award and sponsored gifts not identified as cost share projects funded by the Georgia Tech Foundation and Georgia Tech Research Corporation are not subject to special documentation requirements or the 90 day limitation.
Invalid Funding / Suspense
Departments must run and review the Invalid Funding Report daily and correct entries found on the report prior to payroll processing for the pay period. In order to correct the invalid funding entries, a change position funding transaction must be submitted and approved.
Failure to correct invalid funding entries before the payroll is processed for the period will cause the allocations to post to a suspense worktag. If suspense transactions are not corrected in a timely manner, the transactions will be transferred to departmental undesignated driver worktags or cost overrun.
This policy applies to all departments of Georgia Institute of Technology.
The actual amount of the encumbered portion that has been spent to date. An encumbered amount becomes an actual when an encumbered amount is paid. Actuals represent salary and fringe benefit expenses.
Change Position Funding (CPF)
The process of assigning or updating future pay period salary and fringe benefit distribution to a position by percentage and effective date.
The Commitment Accounting business process enables departments to budget for salary and fringe benefit expenses and track actual salary and fringe benefit costs.
A claim against funds; a projection of future expenses.
Express Direct Retro (EDR)
An Express Direct Retro is the retroactive redistribution of salary and fringe benefit costs.
Invalid Funding Report
The invalid funding report displays positions with an error for future pay periods that have not been processed.
A Provisioned Initiator is a security role which gives an individual access to complete transactions for positions, position funding, EDRs, and other tasks for departments. Information regarding training to become a Provisioned Initiator can be found here.
A Suspense is a combination code that allows for the review and resolution of errors, to track payroll costs that do not have position funding, and to track when funding ends in the middle of an earnings period.
5.1 Change Position Funding Procedure Requirements
A CPF transaction must be submitted by a user with appropriate access to update future pay period (encumbrance) postings of gross salary distributions.
Provisioned Initiators must identify if the employee for which the CPF is being processed is funded from multiple departments or awards. If employees are funded from multiple departments or awards, all departments must approve the CPF transaction. If all required departments are not included in the approval workflow the transaction will be denied.
5.2 Express Direct Retro Procedure Requirements
EDR requests must be submitted by a user with appropriate access to correct actual payroll postings of gross salary distributions.
An Employee Cost Detail report and supporting documentation are required to be attached to each transaction. Failure to attach the required documents to the transaction will cause the transaction to be denied.
Provisioned Initiators must identify if the employee for which the EDR is being processed is funded from multiple departments. If employees are split funded, all departments must approve the EDR.
The accounting date of the EDR transaction must be approved at all levels within the current accounting period in order to post the transaction to workday. The monthly cutoff for EDR transactions is determined by the Workday month end schedule. If the accounting date of the transaction is outside of the current accounting period, the transaction will be denied.
Example: the transaction was initiated on May 1st with the same accounting date, however the transaction was not approved until June 10th. This transaction will be denied because Workday closed for May prior to the approval date. The user will need to resubmit the transaction with a June accounting date and ensure the transaction is approved within the same month.
An EDR request over 90 days past the original payroll posting date, where funding is being moved to a grant requires additional documentation and approval by the Commitment Accounting Manager, and the Sr. Director of Grants and Contracts Accounting. When a request doesn’t meet the one of the exceptions noted in the Policy Statement above, the Vice President of Finance and Planning (Administration and Finance Office) may also be required to approve the over 90 days EDR request. Users must complete the transmittal form, attach the employee cost detail report, supporting documentation and submit the request to the GT Financials Service Now.
8.1 Institute Budget Planning and Administration – Commitment Accounting Team
The Commitment Accounting team in Institute Budget Planning and Administration is responsible for:
- Managing, reviewing, and approving all commitment accounting related transactions,
- Submitting EDR transactions over 90 days on behalf of campus users,
- Correcting fringe benefits and tuition errors
- Verifying transactions post to Workday general ledger
8.2. Departmental Initiators/Approvers/Reviewers
Departmental Initiators/Approvers/Reviewers are responsible for:
- Verifying position funding,
- Verifying salary, flate rate fringe benefits, and tuition remission distributions are accurate,
- Reconciling transactions,
- Reviewing transactions in a timely manner and ensuring transactions are approved or denied.
To report suspected instances of ethical violations, please visit Georgia Tech’s Ethics Helpline a secure and confidential reporting system, at: https://secure.ethicspoint.com/domain/en/report_custom.asp?clientid=7508
Institute Budget Planning and Administration
Elective Fees and Special Charges Approval and Budget Review PolicyElective Fees and Special Charges Approval and Budget Review Policy
The purpose of the Georgia Institute of Technology’s Elective Fees and Special Charges policy is to:
- Ensure Georgia Tech meets the requirements of BOR Policy 18.104.22.168 for establishing and managing elective fees and special charges;
- Provide guidance and consistency for the approval and management of the fees/charges;
- Ensure students are not burdened with costs that should be covered by tuition or state funds;
- Inform the Georgia Tech community about the review and approval process requirements.
Major Categories of Fees. Georgia Tech levies the following two major types of fees:
- Other Elective Fees and Special Charges – fees and charges that are paid selectively by students;
- Mandatory Fees – fees that are assessed to all students, all undergraduate students, or all full-time undergraduate students on one or more campuses. These fees are NOT governed by this policy. See the following Institute policy: Mandatory Student Fee and Budget Review.
Review and Approval Process. Approval by the President of Georgia Tech is required for all elective fees and special charges per the Board of Regents (BOR) policy but Georgia Tech must annually report to the Chancellor any new fees or adjustments to existing fees. All fee changes are implemented in the following academic year, beginning with the fall semester. The following are four exceptions to the president’s autonomous approval authority:
Fees for All Students in a Grade Level – approval by the BOR, following the same approval process as for mandatory student fees, of any fee or special charge that is required to be paid by any subgroup of students categorized solely by grade level or previous credit hours earned, such as a fee that applies to all freshman (no fees in this category currently in place at Georgia Tech);.
Fees for Students in a Specific Degree Program – approval by the BOR of an elective fee or special charge required for all students in a specific degree program or in a specific course, with the exception of laboratory fees and supplemental course material fees;
Housing and Food Service Fees – approval by the USG chief fiscal officer of housing fees for on-campus facilities and fees paid by students who choose a campus food service plan.
General Guidelines for Review of Elective Fees. Increases in all elective fees should be kept moderate and gradual. Fees approved under this policy must be reviewed by the Bursar's Office to determine the most appropriate way to assess and collect these fees; all approved fees must be administered and collected directly by the Bursar’s Office. Elective fees and special charges are reviewed on an annual basis to determine use, effectiveness, and appropriateness for continuation.
Services Funded through Fees. Departments and schools are expected to cover normal instructional costs within their General Operations budgets, and elective fees and special charges should be needed only in exceptional situations. The financial needs of the department or school must be weighed against the impact of the fees on students and the cost of administering the fees (assessment and collection costs). The purpose of assessing an elective fee is to fund specific, unique costs that are the result of an educational choice made by the student. Fees must be used to augment, rather than replace, general budgeted funds for departmental instructional costs.
The following are examples of what may be funded through elective fees and special charges:
- Cost of providing course materials to be consumed, retained or used by the student;
- Special costs associated with the use of Institute-owned tools and equipment for non-mandatory, special supplemental academic programs or educational experiences that directly benefit students;
- Cost of other materials, equipment, or services necessary to provide a special supplemental educational experience or program of direct benefit to the student;
- Salary and fringe benefit cost of laboratory assistants for the time spent in a specific lab for which lab fees are charged;
- Doctoral binding fees and transcript fees.
This policy specifically excludes the following cost items to be paid through elective fees:
- Salaries, wages, and employee benefits of faculty involved in course instruction;
- Instructional equipment located and utilized in classrooms and labs primarily during scheduled periods of instruction;
- Reproduction of copyrighted materials or course syllabi.
This policy applies to all schools, colleges, departments, and units of the Institute.
All elective fees and special charges must conform to this Georgia Tech policy. Departments may not assess and collect course-related or any other fees not previously approved under this policy.
Proposal Format and Submission
To request a new elective fee for an upcoming academic year, a department must complete the New Student Fee Proposal Form on the Budget Office’s website.
Requests for Fee Change
Current fees are updated annually in late fall for the following fall. The Budget Office contacts all of the departments with existing fees and requests confirmation of the fee for the following fiscal year. Changes may be made at this time. To make a change or for questions, unit financial managers should contact the Budget Program Manager, Revenue and External Funds.
All requests to establish a new elective fee/special charge or an adjustment to an existing fee must follow this approval process. These requests are annually reviewed and submitted for approval to the Georgia Tech President and/or the BOR for implementation during the upcoming academic year. Separate fee requests are not required for courses taught during the summer if they have already been approved for the fall and spring. The approved fee is automatically assessed during the summer if the course is offered under the same course number and course description.
Guidelines for Allowable Costs
When proposing new fees, departments must adhere to the following guidelines:
Designation and Collection of Elective Fees and Special Charges Revenue
The Budget Office will assist in establishing each fee in the appropriate fund, project, and account and contact the Bursar’s Office to set up the BANNER detail code to be used. All approved course fees will be assessed through BANNER to all students enrolled in a specific course at the time of registration. The published tuition and fee deadlines for each term will be in effect for these fees. For all other type fee approvals, a review will be made by the Bursar’s Office to determine the most appropriate method for assessment and subsequent collection.
Utilization of Elective Fee Revenue
Revenue from each individual elective fee and special charge must be expended only for the purpose(s) specified in the calculation of the approved fee. Revenue cannot be used for other needs and should not be used as a profit generating mechanism.
The Provost’s Office, Budget Office, and Bursar’s Office are responsible for applying the policy and ensuring adequate campus oversight of all fees. This responsibility includes review of fee proposals, review of the costing and proposed fee levels, reporting fees to the BOR, and the appropriate distribution of collected fees.
Firm Fixed Price (FFP) Residual BalancesFirm Fixed Price (FFP) Residual Balances
Some grants and/or contracts awarded to the Institute are considered “firm fixed price” contracts. For these types of contracts, a unit will produce a product for a pre-set price. (Most other grants and contracts are based on reimbursement of actual expenditures.) If a product is delivered and not all the sponsor funds have been utilized, the department may request the remaining funds.
Procedures for obtaining FFP Residual Balances
- Request documentation of FFP residual balance amount from Grants and Contracts.
Note: Units only receive the direct portion of the residual balance.
- Obtain approval of funds transfer from Budget Office. This may be done via email. Please contact the Director of Budget Planning and Administration, copy to the Associate VP of Financial Services. Include Grants and Contracts documentation as an attachment.
- Once approved, the Unit may include the new funding in the next monthly budget amendment.
- The Budget Office will establish a unique project number for these funds and post the appropriate budget amount.
Note: The revenue generated by this transaction is unique. The BOR classifies these funds as either Indirect Cost Recoveries or Other Miscellaneous Income, depending on details of the transactions. Expenditures must be charged to the same fund as the revenue. Budget amendments to these projects are not allowed.
Indirect Research Support AllocationIndirect Research Support Allocation
Georgia Tech allocates 30% of the Resident Instruction F&A (facilities and admin) indirect cost recoveries generated by academic units back to those units. This includes all colleges. Depending on actual performance, a unit may generate additional or reduced budget allocations each fiscal year. Incentive allocations are approved by executive staff, subject to availability of funds. The allocation is made to the college level (not the department level), and funds are distributed at the discretion of each dean.
Original Budget Allocation
Each academic unit’s Original Budget for the next fiscal year contains an F&A base. This base is 30% of the Office of Grants and Contracts' revenue estimate for the current fiscal year as of March 30. The Institute Budget Planning and Administration Office provides estimates to the units of their allocations during the budget development process to permit them to plan their expenditures and budget accordingly.
Mid-Year Budget Allocation
Mid-year permanent budget allocations may be approved by executive staff based on changes to F&A recoveries during the fiscal year. If approved, the allocations will be based on the most current Office of Grants and Contracts' revenue estimates for current fiscal year.
After the close of the fiscal year, the allocations will be re-computed based on actual earnings for the previous year. These funds will be distributed as permanent additional or reduced budget adjustments in the first budget amendment of the new fiscal year. This will make the units whole for recoveries from the prior fiscal year.
Institute Budget Preparation Authority and AmendmentsInstitute Budget Preparation Authority and Amendments
The purpose of this policy is to define the Institute’s basic budget preparation and management requirements, which are governed by the University System of Georgia. The Georgia Tech Budget Office (Office of Institute Budget Planning and Administration) manages the budget process under the direction of the President and the Executive Vice President for Administration and Finance. The office’s functions are to plan, prepare, maintain, monitor, and report on all institutional budgets at Georgia Tech according to established institutional and University System of Georgia (USG) policies.
The Georgia Tech budget presents the priorities of the Institute in terms of dollars and services provided. The Institute establishes an annual operating budget and a capital budget, which span the state-established fiscal year of July 1 through June 30.
- The operating budget contains funding for recurring programs such as instruction, research, public service, and support services. The operating budget contains revenue from all sources, including tuition, student fees, state appropriations, and sponsored (grants and contracts) revenue.
- The capital budget contains major investments in fixed assets, including land, buildings, and equipment, is funded by various earmarked sources. In many cases projects funded in the capital budget span two or more years.
The Board of Regents (BOR) annually approves the Institute’s operating and capital budgets, as well as its tuition rates, mandatory and selected other fees, and state allocations. Any allowable budget changes made during the fiscal year must be processed through an amendment process managed by the Budget Office.
The Board of Regents (BOR) of the University System of Georgia (USG) assigns to the Georgia Tech President the responsibility for planning and administering all programs and the related Institute budgets, as indicated in the BOR Policy Manual Section 2.6.1. The President delegates the budget and planning responsibilities to the Provost, Executive Vice Presidents, and Vice Presidents. This responsibility is further delegated to these executives’ direct reports, including deans and other division heads. The Executive Vice President for Administration and Finance serves as the Institute’s Chief Financial Officer.
Original Budget Preparation and Approval
The Budget Office is required to follow an established set of guidelines and policies set forth by the State of Georgia and the Board of Regents. The BOR guidelines are found in Section 7.2 (“USG Budget”) of the Board of Regents’ policy manual and Section 8.0 (“Budget Process”) of the USG Business Procedures Manual (BPM). A summary of key portions of the BOR policy and business procedures pertaining to the Original (base) Budget follows:
BOR Policy Manual 7.2.3 – Operating Budgets – annual preparation and submission of an annual budget to the Chancellor with funding from all sources;
BPM 8.5.3 – Budget Preparation at the Institutional Level – institutional development of the proposed budget by personal services, fringe benefits, and other expenses to the BOR following establishment of internal priorities;
BPM 8.5.4 – Submission of Proposed Budget – budget submission by the following major categories (fund groups):
- Education and General – budgets that are not any of the categories below
- Auxiliary Services – business-like service organizations such as housing, dining, and transportation
- Student Activities – funded by separate, mandatory student fees for campus recreation, the student center, and student organizations
- Capital – major capital expenditures including land and land improvements, buildings and building improvements, and infrastructure;
BPM Section – 8.5.5 Board Approval of Institution’s Original Budget – June approval by the BOR of the final institutional budgets by the major categories listed in BPM 8.5.4.
As funding circumstances change during the fiscal year, the Institute implements internal budget amendments, in close coordination with Institute operating units. Any amendments involving an increase or decrease in the overall Institute revenue must be approved by the President. These amendments are initiated by the Budget Office or by campus units, with subsequent approval by the Budget Office.
The Budget Office consolidates all internal Institute amendments for each quarter for submission to the Board of Regents on a summary basis. It is critical that the “expenditure authority” approved by the BOR be consistent with the official Georgia Tech budget, including an accurate breakdown of the budget between personal services and non-personal services. Failure to maintain this consistency may result in an audit exception. It is critical for every Institute unit to maintain a budget that closely resembles the expected year-end spending, including the distribution of dollars between personal services and non-personal services. The following are excerpts from key USG Business Procedures Manual sections (USG Business Procedures Manual Chapter 8.6)
8.6 Budget Amendment – The budget amendment process is critical to ensuring that expenditures made during the course of the fiscal year are supported by budgets. Failure to amend budgets to meet changing circumstances may result in an over-expenditure of funds and lead to audit findings.
8.6.2 Revenue Adjustments – Throughout the fiscal year, various factors necessitate the adjustment of revenue estimates within the budget system. For example, if fall semester tuition were to exceed the original budget estimate, the institution would amend its budget to reflect the increased revenues. Revenue estimates are reviewed and amended on a quarterly basis to reflect projections of either increased or decreased revenue collections during the fiscal year.
8.6.3 Appropriation Amendments – The definitive expenditure authority within the financial system resides at the appropriation level; expenditure authority cannot be exceeded. At a minimum, allocations are in place for personal services and operating expenses.
NOTE: See Georgia Tech’s “Budget Amendments” policy and the links in the next section for more information.
Mandatory Student Fee and Budget ReviewMandatory Student Fee and Budget Review
All mandatory fees (defined below) are annually approved by the Board of Regents (BOR), upon the recommendation of the President of Georgia Tech. This policy implements the following Board of Regents policy pertaining to mandatory student fees: Board of Regents Policy 22.214.171.124 – Mandatory Student Fees. The BOR policy requires that an advisory committee comprised of at least half students provide recommendations to the President on any new mandatory fee or any change to an existing mandatory fee.
The Georgia Institute of Technology Mandatory Student Fee Advisory Committee (“Committee”) is created to implement the provisions of Board of Regents Policy 126.96.36.199 and thereby to ensure student input on changes to mandatory student fees. The Committee shall make recommendations to the President on changes to existing mandatory student fees or on any new mandatory fees. Fees considered by the Committee shall exclude elective fees that are paid by the students who choose to receive specific services. “Mandatory student fees” are defined in the Board of Regents' Policy manual as follows: “… fees that are assessed to all students, all undergraduate students, or all full-time undergraduate students on one or more campuses of a USG institution.”
The Committee shall be composed of twelve voting members selected as follows:
- Eight students appointed by the Graduate and Undergraduate Presidents of the Student Government Associations (SGA);
- Two faculty members appointed by the Provost;
- The Executive Director, Institute Budget Planning and Administration (IBPA), or his/her appointee (permanent member of Committee);
- One additional staff member appointed by the Executive Vice President, Administration and Finance (EVP A&F).
The two faculty members and the second staff member shall serve two year terms. The Committee is co-chaired by one of the eight student members appointed by the SGA Presidents and by the Executive Director, IBPA or his/her appointee. The IBPA Office provides staff assistance to the Committee and submits the required documentation to the BOR in support of Georgia Tech’s fee recommendations.
In addition, there shall be non-voting, ex officio members of the Committee as follows, unless these individuals are appointed as part of the twelve voting members. The ex-officio student Committee members shall be the Presidents of the Graduate and Undergraduate Student Government Associations, the Editor of The Technique, the Vice President for Finance and Chair of the Joint Finance Committee, and any other students appointed by the Student Government Association Presidents. Ex-officio faculty and staff Committee members shall be the Vice President for Student Life, the Vice President for Campus Services, and up to two faculty or staff appointed by the Provost or Executive Vice President, Administration and Finance. Ex-officio members may fully participate in all business of the Committee except that they shall not have voting privileges.
Fees Reviewed by Committee
Below are the fees for which the Committee provides recommendations to the President, along with the organizations that provide recommendations to the Committee:
- Technology Fee – Technology Fee Committee (for recommendations on total fee amount only and not on projects to be funded)
- Transportation Fee – Parking and Transportation Advisory Committee
- Student Health Fee – Student Health Advisory Committee
- Student Activity Fee – Student Government Association
- CRC (Campus Recreation Center) Operations Fee – CRC Advisory Committee
- Student Center Operations Fee – Student Center Advisory Board
- Athletic Fee – Georgia Tech Athletic Association
- Recreation Fee – covers debt service on Campus Recreation Center (fixed fee for term of lease on CRC).
In addition to input from the advisory organizations listed, the SGA is encouraged to solicit input on mandatory fees from students through other means, including surveys and town hall meetings. Excluded from the Committee’s review are any “general purpose fees” approved by the BOR, as stated in BOR policy 188.8.131.52. Other offices or student organizations also may propose new fees to the Committee. It would be up to the Committee Co-Chairs and the SGA presidents whether such proposals are to be considered.
The Committee is responsible for reviewing proposals for rate changes to current mandatory student fees and any newly proposed mandatory fees, and to review budgets funded from the fees. Following its review and votes on the fees, the Committee provides its recommendations to the Georgia Tech president, who submits the requests to the Chancellor of the University System of Georgia for review and final consideration by the Board of Regents. The Georgia Tech president’s recommendations to the Chancellor may differ from the Committee’s recommendations.
The following guidelines shall govern voting by the MSFAC:
- The Committee votes on all mandatory fees, whether changes are proposed or not, and on proposals to add any new fees or to reduce existing fees.
- Where a staff Committee member works in a program funded through a fee, he or she must recuse him/herself from the vote on that particular fee.
- When a Committee member is absent from a meeting, a substitute may be requested for that member, subject to approval of the co-chairs.
- In no case shall the number of voting student members at a meeting fall below one-half of the total voting Committee members.
The Committee meeting schedule must provide recommendations to the President in sufficient time for submission of proposals to the Chancellor in accordance with the BOR calendar. Accordingly, the Committee should strive to complete its review and prepare a preliminary recommendation prior to the end of the fall semester. The staff chair will coordinate with BOR staff to ensure that fee recommendations are made on a timely basis. Submitting organizations are responsible for preparing the forms required by the BOR and by Georgia Tech to support fee submissions, with the assistance of the Office of Institute Budget Planning and Administration.
For each mandatory fee program the submission shall include the following documents for review by the Committee. These shall be available to the members in advance of committee meetings.
- Overview of the fee, including the following: (a) current and proposed fee levels, (b) the previous year’s revenue generated, (c) the fee review/advisory organization, and (d) the current uses of the revenue’
- All required BOR forms, including the fee request form, financial data form, and detail of revenue projection’
- Presentation that includes the following:
- Detailed description of services provided, including utilization data
- Budget summary for the current and following fiscal year
- Fee increase request, if appropriate, with a description of how the students will benefit from the increase and the impact if the increase is not approved
- If there was a fee increase for the current year, how the new funding is being used, compared to the proposal to the prior year’s Committee
- How the program has either generated cost savings or additional revenue outside of the student fee and, if requested by the Committee, how the program would absorb a reduction in the student fee;
- Evidence of students’ satisfaction in the services provided by the unit.
This policy applies to all schools, colleges, departments, and units of the Institute.
Resource Allocation and Overall Budget ProcessResource Allocation and Overall Budget Process
The President of Georgia Tech, within the constraints established by the Board of Regents, ultimately determines Georgia Tech’s internal budget allocations within the constraints imposed by sponsoring organizations, donors, and the Board of Regents (BOR) of the University System of Georgia. Georgia Tech's internal budget process requires all campus units to develop requests on the basis of the Strategic Plan of Georgia Tech and their own strategic plans. Institute executive staff receive input from the college deans and directors of other units and also from committees that make recommendations on fees for the coming year.
The following factors enter into decisions about resource allocations to colleges and other units:
- Revenue projections, including the level of expected state funding and tuition and fee and other revenue
- Budget requests from the units
- Expected impact of requests on Georgia Tech’s overall strategic plan and on individual unit plans
- Committee recommendations
The process begins in the fall with a review by executive staff and division heads of performance metrics that are to be used to help determine budget allocations. The process also involves the review of mandatory and elective fee increase requests from Auxiliary and other units funded through student fees and development of tuition recommendations to be provided to the BOR. Early in the calendar year units are required to prepare budget requests for the following fiscal year. Budget proposals address funding above base budgets and, if required, reallocations or reductions. Requests include the assignment of unitâ€wide priorities and an explanation of how the requests address their strategic plans. In most years the President's Office conducts meetings on unit budget priorities.
The attached flow chart summarizes the budget process, explained in more detail as follows.
The process for determining resource allocations for the following fiscal year generally follows the following schedule:
- July through January
- Institute Planning Activities
The Office of the President, which includes the Provost, Executive Vice President for Research, and the Executive Vice President for Administration and Finance, review the Institute’s strategic plan and the related action plans and also review performance metrics of the Institute’s academic and administrative units. The President establishes unit operating and capital budget request guidelines, Institute operating budget request priorities, capital plan guidelines, operating budget allocation policy and guidelines, and capital plan priorities.
- Unit Strategic Planning Activities
Each Georgia Tech unit reviews its strategic plan, including strategies, objectives, and action plans accompanied by resource requirements. Also, each unit reviews its performance metrics from the previous fiscal year and projections for the current year, to be used in developing budget requests for the following year.
- Preliminary Central Budget Analysis
Offices of the Institute Planning and Resource Management (IPRM) team perform preliminary planning activities, including revenue estimates, preparation of fee and tuition recommendations, and determination of mandatory cost increases anticipated for the following fiscal year. The IPRM office coordinating this effort is the Office of Institute Budget Planning and Administration (IBPA, or “Budget Office”).
- Tuition and Fee Recommendations
The following four efforts proceed during the November through January time period related to tuition and fee review and approval:
- IPRM staff prepare recommended graduate and undergraduate tuition recommendations on the basis of comparisons of Georgia Tech with its peer institutions. The primary office conducting this work is the Office of Institutional Research and Planning (IRP).
- The Mandatory Student Fee Advisory Committee receives recommended fee changes from the following units partially funded through such these fees paid by all students: transportation, student activities, technology, student health, and athletics. The Committee recommends the fee levels to the President, who in turn recommends mandatory fees to the Board of Regents. See the separate policy describing this fee process, which is coordinated by the Budget Office.
- Units that administer fees may recommend changes to these fees for the following year to the Budget Office for review. Except for the mandatory fees noted above, the President approves new fees or changes to existing fee levels. See the separate policy on non-mandatory fees.
- Academic units may seek approval of tuition differentials for professional masters programs. These are submitted to the Budget Office for initial review and must be recommended by the President to the Board of Regents, which approves all tuition differentials. See the separate policy on tuition differentials.
- Institute Planning Activities
- January through March
- Central Budget Analysis Activities
Preliminary allocation figures and detailed budget instructions, including salary administration guidelines, are distributed to units. Revenue and institutional expense estimates are updated on the basis of preliminary information from the Board of Regents and the status of the state appropriations act. The General Assembly is scheduled to complete the appropriations act by the end of March each year.
- Budget Request Activities
College deans and other division heads prepare budget requests for the following fiscal year based on guidelines issued by the Budget Office. Requests must be linked to the Institute and unit strategic plans and must reference performance metrics to justify the requests. The requests could involve reallocation of existing resources or budget reduction plans, depending on the Institute’s expected budget status and the guidelines provided by the President. The Office of the President reviews the Institute budget situation with input from IPRM and holds budget meetings with the major division heads. The Office of the President establishes priorities for the Institute budget following consideration of unit requests and projections of resources available.
- Preliminary Resource Allocation Decisions
The Office of the President determines preliminary allocations and/or budget reductions based on expected resource level information available at the end of March. These decisions are made on the basis of a review of the Georgia Tech Strategic Plan and previous and projected performance data such as student enrollment.
- Central Budget Analysis Activities
- April and May
- Resource Allocation Activities
- The Board of Regents is scheduled to approve the following at its April meeting:
- Tuition rates
- Mandatory fee rates (fees paid by all students such as student activities, student health, transportation, and athletics)
- Budget allocations to Georgia Tech on the basis of the approved appropriations act.
- Detailed Budget Preparation
Campus units prepare detailed “Original Budgets” within the resource allocation and pay raise guidelines. The tool used for this preparation is the Internet Budgeting Solution (IBS).
- May and June
- Final Budget Activities
The individual unit budgets are reviewed and incorporated into the Institute's budget. This final Original Budget is sent to the Board of Regents.
- Establishing and Executing Approved Original Budget
The Budget Office works with campus units to establish final budgets for implementation in the new fiscal year.
- Final Budget Activities
Tuition Differentials & Studies Abroad RevenueTuition Differentials & Studies Abroad Revenue
Units have the option to budget estimated Tuition Differentials and Study Abroad Program revenues for the current fiscal year in September. This allows use of funds before the actual revenues for Fall and Spring are known.
- Departments are allowed to “pre-budget” up to but not exceeding the total actual revenue earned in the prior fiscal year. Actuals information is provided by the Bursar’s Office. The 5% administrative overhead retained by the Institute should not be included in the department’s budget. It is the responsibility of units to submit a budget amendment in September to receive their early allocations.
- The Bursar’s Office will report to units the actual Fall and Spring differentials and studies abroad revenue earned. Fall totals will be reported no later than the first work day of December, and Spring totals no later than the first work day of May. Units will be required to adjust any pre-budgeted September amount to the actual differentials/study abroad revenues earned in the current fiscal year. For departments that chose not to take advantage of the “pre-budget” opportunity in September, the current year actual revenue amount must all be budgeted no later than the May budget amendment. Board of Regents policy requires that available allocations must be expended during the same fiscal year that the revenues are earned.
- When students are enrolled in dual degree programs with differentials, both programs will receive a portion of the total differential paid. The distribution is determined by the ratio of differentials to each other between two programs. A template for calculating the split of such differentials is available on the Budget Office website (See Appendix A for a sample).
- Summer semester revenues: Units receive 60% of the upcoming summer revenue in the current fiscal year. The remaining 40% will be budgeted for the following fiscal year. This split coincides with requirements for reporting Summer tuition & fees from all sources to the Board of Regents. If desired, a carry-forward of the current year’s 60% may be requested via e-mail to the unit’s assigned budget analyst, no later than May 31. For purposes of estimating the 60%, the maximum allowed carry-forward is 60% of the PRIOR summer’s revenue. A ‘true up’ opportunity is provided in the next fiscal year after Summer semester ends and information about actual revenue earned is provided by the Bursar’s Office in September (See Appendix B for an example of budgeting adjustments).
Units should contact their assigned analysts with any questions or concerns regarding the procedure. To look up the contact information for the analyst assigned to a division/department, go to "Institute Budget Planning & Administration Staff" and click on the link “Budget Analyst Assignments” below the list of Budget Development & Management staff.
Year-End Deficits and Division Carry ForwardsYear-End Deficits and Division Carry Forwards
This policy establishes procedures for handling year-end deficits or surpluses incurred by Georgia Tech divisions. The policy pertains to Resident Instruction General Operations funds budgeted in the following fund numbers: 10010 (State Appropriations), 10015 (Indirect Cost Recovery), 10500 (Tuition), and 10600 (Other General).
General Operations Funds
At the beginning of each fiscal year, an expense budget is established for General Operations funded projects. These budgets are funded by the following revenue streams: State Appropriations, Indirect Cost Recoveries, Tuition, and Other General. During the year the Institute may allocate additional budget authority to units, depending on need and funding availability. At year end budgets should equal expenditures plus encumbrances (total expenses). When a college or other division’s spending exceeds or is less than the final amended budget, either an adjustment must be made to balance the total Institute budget or a documented carry forward plan must be in place.
Departmental Sales Funds
Please refer to the DSS policy for DSS carry forward requirements and request forms; http://www.policylibrary.gatech.edu/business-finance/departmental-sales-and-services-dss
Audit guidelines state that Institutions shall not overspend their Board of Regents approved budget authority, nor will expenses exceed revenues. When budgets are overspent or expenses exceed revenues, an operating deficit is created. Before the fiscal year can be closed, the operating deficits must be corrected. To help facilitate more effective management of the Institute’s budget as a whole, divisions will be responsible for any year end deficits that are not previously approved by the administration.
A division may request the return of surplus funds at year-end for use in the next fiscal year, often referred to as a “carry forward of funds.” To meet the needs of the division, the Office of Institute Budget Planning and Administration (“Budget Office”) must manage the carry forward in the year of close and in the following year as well. Because of the restrictive state rules governing carrying forward funds and year-end closing, surplus/carry forward arrangements must be documented and reviewed to ensure proper accounting and budgeting methods have been followed. This policy establishes carry forward guidelines to ensure that all requirements are met.
Rules and Guidelines
If, during the fiscal year, a division becomes aware of a deficit situation, the Budget Office should be notified by the division head or chief division budget director as soon as possible. The Assistant Vice President, Institute Budget Planning and Administration will inform the administration of the situation. In some cases, operating deficits may be allowed by the administration due to special circumstances. After the fiscal year closes, the Budget Office will conduct an analysis of budget to actual total expenses. If any division has an unapproved net operating deficit, the division’s current fiscal year budget will be reduced on a one-time basis by the year-end deficit amount in the first budget amendment or an approved re-payment plan will be established.
Division Carry Forwards
If a surplus or excess budget is anticipated for year end, and the college or other division would like those funds returned in the next fiscal year, an online request form must be completed (http://status.budgets.gatech.edu/CarryForward/Index) on or before April 15th (or the next business day if the 15th falls on a weekend). In the request, the division should explain:
- the explanation of the source of funding
- the projected amount to be carried forward
- an explanation of why the funds will be available, and
- the purpose for which those funds will be used in the next fiscal year.
These will be reviewed by the Assistant Vice President, Institute Budget Planning and Administration, and where appropriate, by executive staff with a final decision to be communicated to the division by May 15th. Requests submitted by individual departments, programs, centers, or schools will not be accepted except for tuition differential or studies abroad 60/40 split of summer semester revenues.
If, prior to June 1st, the division’s estimate of the year-end surplus changes, the Carry Forward Request Editing form (http://status.budgets.gatech.edu/CarryForward/Index) must be used to update the request and notify the Budget Office. No revisions to carry forward requests will be accepted after May 31st.
The division should keep in mind that expenses funded from carry forward funds are subject to audit. Documentation should be kept to verify that purchases were in accordance with the purpose originally stated.
Approval is subject to the Institute’s generation of an overall surplus of at least the approved amount. These are one-time funds that will not be built into the unit’s permanent base budget. If the unit’s net year-end balance for General Operations is less than the amount requested, only the year-end balance may be budgeted in the upcoming fiscal year. If the net year-end balance exceeds the amount requested, the maximum amount approved per the request may be budgeted in the upcoming fiscal year. The Budget Office will verify final carry-forward amounts with the units in the first budget amendment of the new fiscal year.
|April 2015||Budget Office||Clarification of language/added link to online form|