Academic Plan drives base budget adjustments

Ohio State is making a major move to support implementation of its Academic Plan by aligning internal resources more closely with identified academic goals.

Base budget allocations in Ohio State's 18 degree-granting colleges are being aligned with goals of the Academic Plan, the University's strategy to become one of the world's truly great universities. Plans call for allocating and redirecting $9.5 million to $13 million among the colleges over the next five years -- including those housing departments and programs that are expected to be leaders in the effort to advance academic excellence throughout the University.

Budget rebasing, as the process is termed, is one component of an overall University plan to change the budgeting process, which has been on the administration's agenda for several years. The restructuring is expected to align the base budgets of colleges with the needs of the Academic Plan, create budget practices with regard to the allocation of new revenues that more effectively support Ohio State's instructional, research and service missions, and provide incentives to reduce costs and generate additional revenues needed to address academic priorities.

The restructuring of the budget process is considered a critical step in positioning the University as a premier teaching and research institution, said Edward J. Ray, executive vice president and provost.

"Through the Academic Plan, The Ohio State University has initiated an ambitious effort to articulate how it can substantially enhance the excellence of its academic programs and meet its commitment as a land-grant university to contribute to the economic and social well-being of the people of Ohio,"Ray said. "Realigning our college base budgets in this way not only helps the colleges contribute most effectively to the University's goals, but represents the most productive and responsible use of the funding support we receive from the public."

In some cases under the rebasing, funds that colleges receive from the University through revenue transfers from other units will be decreased. In others, the funds some colleges contribute to the University that are transferred to other units will be decreased, meaning those units will retain more funds within their budgets. A number of college base budget allocations will remain unchanged. These allocations are based on a number of factors, including the expected role of the college in the Academic Plan, its ability to generate revenues and the cost structure of its academic programs.

"It is not my goal to make every college a'tub on its own bottom' by driving every college to a break-even position under some formulaic procedure,"Ray said. "Instead, the goal is to give every college a clear understanding of what we expect from them academically, what resources they can expect to generate themselves and what resources they can expect from the University."

The rebasing, which would begin July 1, is designed as a multiyear process to avoid excessive disruption to academic programs and to allow for annual review and modifications, if needed, of budget decisions. A comprehensive review of the base budget approach will take place in five years.

"With a change of this magnitude, it has been critical to consult broadly and build checks and balances into the process as the budget restructuring is implemented -- that has happened and that will continue to be a part of this process,"noted President Brit Kirwan. "This University has very publicly committed to joining the top ranks of the nation's public research and teaching institutions. To do that, bold steps of this nature are essential."

He added that budget restructuring and rebasing have been done entirely within the context of the Academic Plan. "Fund transfers among the colleges and future investments in them will only occur based on proposals by the colleges as to how the additional funds could advance the Academic Plan,"Kirwan said.

College clusters

Under the rebasing, Ray has clustered colleges into three groups:

• Six traditional core colleges that include Selective Investment programs. Thirteen University departments and initiatives have been identified as those with the greatest potential to become top national programs under the Selective Investment program. The colleges housing them are: Engineering, Humanities, Law, Mathematical and Physical Sciences (MAPS), Medicine and Public Health, and Social and Behavioral Sciences (SBS).

• Five colleges traditionally defined as core colleges -- those that must be strong for any university to be among the truly great -- that do not house Selective Investment programs. These are: Arts, Biological Sciences, Business, Education, and Food, Agricultural and Environmental Sciences (FAES).

• Seven additional professional colleges in the health sciences and human and social services areas: Dentistry, Human Ecology, Nursing, Optometry, Pharmacy, Social Work and Veterinary Medicine.

Continuing commitment to Selective Investment programs, and rewarding them for their excellence, is a major element of the rebasing, Ray said. "The colleges housing these 13 quality programs will benefit the most from the budget realignment. If the University is to be successful in achieving its goals regarding faculty, academic programs, quality of teaching and learning, and creation of a diverse community, these academic units, and ultimately many others, need to be successful,"he said.

The six Selective Investment colleges account for 60 percent of tenure-track faculty, 70 percent of sponsored research and 50 percent of all degrees awarded. The five other traditional core colleges provide 35 percent of all degrees granted and are home to a number of high-quality and internationally visible programs. They also play a key role in interdisciplinary initiatives and contribute significantly to outreach and engagement.

The professional colleges provide high-quality teaching, research and service, and many are highly ranked within their fields. Dentistry, Nursing and Pharmacy posed a rebasing challenge, Ray said, because they all are effective and important to the University and to the people of Ohio, but receive substantial transfers despite having less relative immediate impact on effective implementation of the Academic Plan.

Taking all of these issues into account, Ray said base budget goals (see table) for the next five years, based on recent estimates of transfers among colleges, include reducing transfers from Humanities and SBS to 5 percent and to 0 percent for Medicine and Public Health. Three other Selective Investment colleges, MAPS, Engineering and Law, will continue to receive transfers at current levels.

For the 12 other colleges, four colleges' allocation formulas already are at an appropriate level: Arts, Education, FAES and Veterinary Medicine. Fisher College is in a position to reduce the transfers it receives over five years through program growth. The transfers Biological Sciences contributes should be reduced. Six other colleges require equity adjustments: Rates of transfers to other units from Optometry, Human Ecology and Social Work are too high and should be gradually reduced. Conversely, the transfers to Dentistry, Pharmacy and Nursing are too high, and need to be reduced.

"The changes I have proposed will, I believe, substantially correct the most glaring inconsistencies between current resources and our academic goals in a timely and thoughtful way,"Ray said.

Consultative process

"It is helpful that the provost is making it clear that he is aligning base budgets with the goals of the Academic Plan and the centrality of certain units, which is consistent with public comments we have all made about our commitment to the academic core of the institution,"said Dan Farrell, who chaired the Senate Oversight Committee on Budget Restructuring for approximately five years while he was chair of the Department of Philosophy.

This launch of budget restructuring results from a series of extensive consultations across the University dating as far back as 1995. Faculty, staff, students and administrators have been involved on a number of committees that examined and reported on the advantages and ramifications of changing the budgeting process.

The University also has taken other institutions' experiences into account. "Incentive-based budget systems have been adopted at many of the best public and private universities,"said William J. Shkurti, senior vice president for business and finance. "We have tried to learn from both the successes and failures at these other institutions in order to develop a model that best meets Ohio State's unique circumstances."

Farrell characterized senior administrators during the lengthy consultative process as "really responsive to our independent and critical reactions. We felt they took us very seriously."

The rebasing announcement in mid-February was a welcome development, Farrell said. "Settling the rebasing question, and seeing that it has been done in a way that is based on principles and goals, is a crucial part of budget restructuring. To have moved to this point, regardless of whether some might have reasonable differences with the fiscal decisions made, is a very good thing. Ed had to make decisions and move us forward."

Ray also noted that the rebasing of budgets was done in full consultation with each dean. Colleges receiving new transfers or whose contributions to other units have been reduced will be held accountable for the additional money available to them. The transfers will not be considered entitlements, but will be conditioned upon successful implementation of college strategic plans that align college and University priorities reflected in the Academic Plan. All deans face a March deadline to produce plans that align their base budget resource use with goals of the Academic Plan.

Fisher College of Business Dean Joseph Alutto said he is supportive of the rebasing plan. "My own sense is that the logic is very clear. That judgments have to be involved in aligning base budgets with the University's goals is very important, and getting to that point has been a very complex process,"he said. "Though it looks in the short run like we may be hurt by the rebasing, we are comfortable with the process and are on board. This is a unique approach for any university to take and it's one that can work at Ohio State."

Alutto explained that the current rebasing doesn't reflect activities in Fisher College that are already generating new revenues for the college, a portion of which will be returned to the central administration over time. The launch of an Executive MBA program and a new master's program in accounting -- both acknowledging market demand for such education and training -- are beginning to generate the revenues that will eventually replace transfers the college currently receives from other units. "We think this is what we should be doing in the College of Business,"Alutto said.

Moving forward

Now associate provost for honors and scholars curriculum, Farrell currently participates on the University Budget Advisory Committee that will assist in developing what are called the rules for going forward under the budget process change, which will take into account the generation of new revenues and revenue sources and define how they are allocated.

The rebasing process covers only general fund portions of college resources, which range from a high of 94 percent in Humanities to a low of 28 percent in Medicine and Public Health. In addition, because the proposed transfers to colleges exceed proposed transfers from colleges by between $5.2 million and $8.7 million, Ray must identify at least $1 million annually in additional funds for the next five years -- through such sources as closed-course funding held centrally, the Provost's Strategic Investment funds and selective reallocation.

Ray said other revenue resources targeted to support the Academic Plan will include base-line growth in the state share of instructional support; tobacco funds primarily supporting biomedical research; "outside-the-box"funds that can be generated through more effective financial management of existing resources and are intended primarily for seed growth in research support; tuition cap relief which, if granted, would be targeted to improving undergraduate education; private gifts; distance education revenue; enterprise development; and targeted state funds such as those from capital budgets and new programs like the Ohio Plan.

The overall budget restructuring process is designed to encourage colleges and departments to provide new programs, create new courses, reduce course access problems, collaborate with industry partners, expand federally funded research and undertake other initiatives. Under the process, revenue generated by such activities as offering more sections of high-demand courses to students closed out of courses and creating new majors that meet student career plans will be used to provide direct financial support for the programs that create them.

"This budget restructuring represents a different philosophy at the University, and pays much more attention to providing incentives to colleges to bring their costs into line with their enrollments and other sources of revenue,"noted Paul Beck, chair of the Department of Political Science, who chaired an ad hoc committee on revenue generation during the consultative process.

"This new budgeting system will make us more responsive to students as a key source of our revenues and a central part of our mission. We're going to have to pay more attention to what student demand is for courses, and I think that's warranted,"Beck said.

"As we move forward, units will have to pay more attention to how their revenues and costs balance out, and with the incentive-based budgeting, there is potential for units to be more aggressive in generating revenues.

"But there will always have to be central protection of some of those costly activities that don't necessarily generate high revenues, and that's appropriate and very important."

The complete document outlining the base budget changes, "Budget Restructuring, Base Budgets and the Academic Plan,"is available in the Office of Academic Affairs, college offices and on the Web at www.oaa.admin.ohio-state.edu and www.rpia.ohio-state.edu.

Advising changes enhance undergraduate education

15,000 students stand to benefit

Ohio State is consolidating, streamlining and expanding its advising services as the University continues to refine and improve the quality of undergraduate education and student life.

Relationships will be strengthened and enhanced among offices specializing in services to undergraduates -- ranging from financial aid to academic advising to career counseling -- to reduce the need for students to visit multiple offices across campus.

A component of the restructuring will involve combining the resources currently located in University College and in the advising unit of the Colleges of the Arts and Sciences. This merger will create the Office of Undergraduate Student Academic Services (USAS), which will report directly to the Office of Academic Affairs.

Executive Vice President and Provost Edward J. Ray said the more effective use of resources devoted to advising undergraduates represents action relating to two strategies outlined in the University's Academic Plan: enhancing the quality of the teaching and learning environment, and enhancing and better serving the student body. Up to 15,000 students annually are expected to experience the benefits of the new structure.

The new office will primarily serve the academic advising needs of students enrolled in the traditional liberal arts and sciences, as well as undecided students and those reconsidering their majors who now are advised in University College.

Academic administrators note that along with this change, the University will more aggressively pursue direct enrollment of entering students into their desired areas of study as early as possible. Historically, University College has served as an "intake"college for students, who typically entered their major home colleges as juniors. Direct enrollment has been a growing trend already at Ohio State -- a little more than half of the freshmen entering in 2000 directly enrolled into their colleges, compared to about a third of the entering freshmen in 1999. Between 60 percent and 75 percent are expected to be able to directly enroll into their colleges next autumn.

That early connection to faculty and advisers specializing in a given discipline is key to making students feel at home at Ohio State, officials say. "Students need to be confident that this is their place, that they belong in their programs, that their majors will lead to their desired futures,"said Martha Garland, vice provost and dean for undergraduate studies. "When such feelings of identification occur, we know that students are increasingly likely to meet our goals for them: They are likely to stay, to prosper academically and to graduate."

In addition to improving student life, the streamlined advising structure will reduce redundancies, eliminate administrative competition and provide optimal resources for service to students, Ray said.

"Students frequently tell us that their experience with academic advising produces mixed results,"Ray said. "We know that the volume of students each adviser must work with is a major contributing factor, and this restructuring will address that problem. For example, the number of administrative staff will be reduced from 16 to eight and the number of academic advisers will be increased from 31 to 40 as a result of the consolidation of University College and Arts and Sciences advising activities. This change makes great fiscal sense and aligns our allocation of resources with a top priority: improving the chances that our undergraduates will be successful and ultimately will become graduates of Ohio State University."

Students who intend to enroll in undergraduate professional programs with preliminary entrance requirements also will be advised through the unit. The hope is that such programs eventually will take most, if not all, of their students directly into the colleges upon students' admission to Ohio State.

"As direct enrollment is phased in, faculty and advisers will work with students from their freshmen year through the senior year and graduation, rather than inheriting them from University College when they are sophomores or juniors,"said Jack Cooley, who, under the restructuring, will be named assistant vice provost for undergraduate studies. "That gives students a much greater sense of continuity."

Within the new unit specifically, student support will include: advising and scheduling services, tutoring and extended learning support, retention programs, academic and retention support for minority students, advising for students re-thinking major selection, pre-health sciences and pre-law advising, and monitoring of courses and programs with high demand.

The advising reorganization will involve some personnel shifts in the academic arena, though no loss of jobs is expected. As already noted, a reduction of administrative positions will coincide with an increase in the number of counselors available to work directly with students.

"We're going to be organized to work together in different ways than we have in the past,"said Cooley, currently assistant dean in the Colleges of the Arts and Sciences, a federation of five colleges that collectively enroll about 10,000 undergraduates. "This will tighten the net of people who are already linked to the undergraduate experience."

Cooley noted that the new structure will provide a better way to work with students according to their interests. "The best organization of advising resources is to structure them according to student interests. We want to make counseling both deeper and broader. We'll build on the depth by strengthening the connections to colleges, departments and faculty, and we'll create greater breadth by seamless linkages to a much wider variety of service offices than at present.

"Counselors specializing in biological sciences or the humanities will be connected with the departments and faculty in those colleges, but they also will be connected to an extensive array of academic, financial and personal support offices. To students, it should not appear to be a single kind of academic counseling. Rather, there will be a variety of academic and career-related clusters of counselors commingled in a seamless web of support."

Cooley said the counseling specialties will be connected to many other offices -- including the Office of Minority Affairs, the First Year Experience Office, those housed in the Younkin Success Center, the Honors and Scholars Center, and Residence and Dining Halls.

Administrative details concerning other functions operated by University College are not yet final.