A new budget model will make its way to the chancellor’s office after the campus Faculty Senate approved a resolution encouraging its adoption today.
The resolution encourages campus administration to adopt the Responsibility Center Management (RCM) budget model as a basis for fund allocation. Out of 53 votes, 38 members were in support of it.
“Our concerns about the level of allocations right now and the lack of reasoning for those allocations seem to be well addressed by the responsibility centered management model,” Bret Polopolus-Meredith, Fix UH Mānoa’s secretary, said. “Additionally what I like about the model is that in addition to receiving allocations to cover costs, current costs, and costs for increased enrollment and having that incentive to improve your program and grow your enrollment.”
The model values transparency, accountability, equity and predictability, according to David Chin, Information and Computer Sciences chairman. Chin gave a PowerPoint presentation on the model at the faculty senate’s meeting.
Responsibility center management
According to Chin, the current budget model is known as an incremental model.
“Basically we get state general funds and tuition revenues from our students coming in, and this is distributed to the various units, which are colleges and schools, based on what they got the prior year,” he said. “So no changes or any other reason. What you got is what you will get and have always gotten.”
He added that one reason the RCM model is needed is because no one can say why a particular unit gets the allocation that it currently receives, except that it’s always been that way.
“As a result, that leads to a lack of confidence in our leadership,” he said. “It leads to difficulty and garnering support for Mānoa at the sate Legislature because we can’t explain to them why our budget is structured the way it is. Lack of transparency they feel. And this erodes public confidence in UHM.”
The RCM model advocates for a precisely-prescribed revenue sharing model, he said, and aligns resources with the units that generate them.
At the University of Florida, which has adopted this model, its different revenues—comprised of state general funds, tuition revenues, indirect cost recovery and leverage and strategic initiative funds—go into responsibility centers, which can be departments, colleges or schools. Each responsibility center would receive a large percentage of the revenue it generates and each center would get to keep their carry forward funds.
The responsibility centers would pay their proportionate share to support the support centers, which include areas like student services, academic support and general administration.
Subvention is another aspect of the model, according to Chin, which is “basically a tax on revenues that all responsibility centers pay proportionally.” This would be used to fund strategic initiatives both at the university and college levels.
Although the model encourages revenue transparency, there is still worry that the administration will revert to the ways its used to.
“I’m very nervous because it was very vague and I think that one of the main problems is that there is just a lack of transparency with the current budget and with the current administration,” Marguerite Butler, an associate professor for the Biology department, said. “So because there’s no actual guidelines or requirements, I don’t have any faith that the current administration will actually implement that kind of model in good faith because it’s too vague.”
She said she’s in favor of a model that tracks costs and rewards positive productivity.
“I’m afraid that it’s going to just be there’s going to be lip service to saying they’ve adopted it but they’ll just basically just figure out a way to keep doing what they’ve been doing,” she said.
The senate also approved an amendment to the resolution, which originally only applied to tuition and fees special and general fund allocations. The resolution now applies to these two funds in addition to outreach and research training and revolving funds.