Iowa State's proposed general operating fund budget for the year that begins July 1 includes approximately $32.2 million in additional revenue above the current budget. Most of the new dollars will be invested in salary and benefits increases, new faculty hires, student financial aid and initiatives that support four broad priorities shared last fall by President Steven Leath:
• Maintain academic excellence
• Enhance the university's basic and applied research footprint
• Promote economic development
• Improve the campus environment
The new revenue includes nearly $6.8 million in additional operating dollars from the state and about $2.4 million in interest and fee income. Much of it – about $26.9 million – is in tuition revenue due to both anticipated higher enrollment and tuition increases for resident graduate students (1.2 percent), nonresident students (2.35 percent) and veterinary medicine students (3.5 percent). Tuition will be held flat for in-state undergraduates in 2013-14, as will mandatory fees for all students.
But the net new income also reflects expected decreases in federal appropriations to ISU Extension and Outreach and the Experiment Station (-$0.76 million) and in indirect cost recovery on federal government-sponsored research (-$3.1 million), both due to the sequestration that began March 1.
University leaders will ask the state Board of Regents to approve the FY14 budget when the board meets Aug. 8 in Ames.
"We're grateful for the 2.6 percent HEPI (Higher Education Price Index) operating increase we requested from the Legislature," Leath said. "We take this as a sign that the Legislature and governor see Iowa State as a smart investment in the future of our state."
FY14 new revenue: How it will be used
| Nondiscretionary (subtotal) | $6.76 million |
| New buildings (Troxel, small animal hospital) | $1.00 million |
| Employee insurance plans (3) | $2.49 million |
| Merit employees contract | $0.52 million |
| Inflationary and regulatory increases | $2.75 million |
| Discretionary (subtotal) | $13.94 million |
|
Performance-based salary increases: faculty, P&S, postdocs |
$7.26 million |
| Student financial aid | $5.68 million |
| Deferred maintenance | $1.00 million |
| Priority funds (use set by senior VPs) | $11.51 million |
| Academic affairs | $10.25 million |
| Student affairs | $403,000 |
| Business and finance | $685,000 |
| Central administration | $173,000 |
| TOTAL | $32.21 million |
Priority funds
Nearly one-third of the incremental revenue ($10.3 million) will be used for employee salary and health insurance increases. The decisions and inflationary costs guiding these increases were summarized in a June 6 Inside story.
Another third of the new revenue will support the university-wide priorities Leath announced last fall. He pledged that they would influence operating budgets, building projects and hiring decisions during the next few years.
Each of Iowa State's three major divisions (academic affairs, student affairs, business and finance) received funds for FY14 to support these priorities. Earlier this month, the senior vice presidents submitted proposals to Leath on how they would use their allotted funds, along with any reallocated dollars they chose to put toward priority initiatives. Some of those approved uses follow.
- Student affairs: Staff positions for the Writing and Media Help Center, disability services, international student advising and admissions counseling, as well as additional support for prospective student campus visits and supplemental instruction services.
- Business and finance: Additional support for emergency management and preparedness services and for human resources data needs, new positions and supplies in facilities planning and management, additional officers and a dispatch position in public safety, and an additional accountant in the payroll office.
- Academic affairs: Additional faculty positions for high-demand courses, new Presidential Graduate Scholars program (recruit top students and grow Ph.D. enrollment), new academic advising positions in Human Sciences and Liberal Arts and Sciences colleges, support for 4-H youth programs, funds for organizational development in extension and outreach, additional class sections for an MIS core class in the Business college, distance education additions in Agriculture and Life Sciences, instructional technology and lab safety improvements in the Engineering college, library acquisitions, technology upgrades in general university classrooms, additional funds for the high performance computer initiative, funds for multi-year efforts to expand college research portfolios.
"These investments are critical to ensuring that Iowa State continues to provide excellence in academics, research and economic development, but also continues to provide students with the valuable experiences and opportunities they expect," Leath said.
One-time state funds
Iowa State also will receive one-time state funding in FY14 for these initiatives and building projects:
| Bioeconomy Initiative | $7.50 million |
| Biorenewables Research Lab Phase 2* | $21.75 million |
|
Economic development building at the ISU Research Park |
$12.00 million |
|
Veterinary medicine building at Blank Park Zoo (renovation) |
$1.00 million |
| Deferred maintenance | Undetermined portion of $2.00 million |
* New teaching, research and administrative space for the agricultural and biosystems engineering department, FY14 funding is the third of a 4-year, $60.4 million state commitment
"We are very grateful for the support that was provided for the Bioeconomy Initiative and research park -- this funding will help us to better promote economic development and job growth," Leath said. "However, I am disappointed that funding for the planning of the biosciences building – the university's top priority for capital funding – will not be provided in FY14. We intend to work with the Legislature and the governor again next year to try and gain support for this critical project."
No tuition set aside
Adhering to new legislation approved in the statehouse this spring, Iowa State will not use any tuition dollars from in-state undergraduate students for financial aid. The so-called "tuition set-aside" practice at the three regents universities, which dated back to the 1960s, most recently placed a minimum of 15 percent of tuition dollars into a student financial aid pool. Iowa State's actual practice had been to set aside about 22 percent of tuition dollars.
The 2013 Legislature did not fund a requested $39.5 million student aid program to help meet the financial need of resident undergraduates at the three schools. All university-based resident undergraduate financial aid will be funded from operating appropriations to Iowa State.
The new legislation allows the regent universities to continue to designate tuition revenue from nonresident students for financial aid.
The university's proposed general operating fund budget for the year that begins July 1 is $607.7 million, approximately a 5 percent increase over the current year. Iowa State's proposed total budget is just over $1.2 billion, which includes sponsored research and auxiliary units such as athletics, utilities, bookstore, residence and dining.
