DRAFT
University of Maryland
FY 2016 Working Budget Instructions
MEMORANDUM
TO: Divisional and College Business Officers
FROM: Paul S. Dworkis,
Associate Vice President, Finance and Chief Financial Officer
DATE: April 23, 2015
SUBJECT: FY 2016 Working Budget
We are opening the Budget Preparation and Maintenance System Working Budget (BPM WB) to the divisional and college business officers this morning. We currently plan to open BPM WB to departments on Wednesday, April 29th. Please let us know if you prefer we open BPM WB to your departments on an earlier date.
We have attached guidance, pending USM Salary Guidelines, for your use in developing your detailed budgets. We will issue the salary guidelines shortly after we receive them from USM. Major changes to the budgeting guidance from previous years include:
Cost-of-Living Adjustment (COLA)
At the time of this memo, the Governor has not yet decided on whether to restore the COLA given to employees January 1, 2015 but later removed as part of the FY16 budget. For that reason, we have loaded the COLA adjustment each eligible itemized employee received on January 1st as a negative reduction on the set salary screen in BPM WB so that the July 1st salary will reflect the salary without COLA. If not already in sync with the lower salary, please adjust your position budgets to reflect the salary without COLA.
Strongly Encouraged: Budgeting of Educational and General (E&G) - Designated Activities (294XXXX, 295XXXX accounts)
Our campus has about $65 million worth of annual activity in E&G-Designated accounts. These are accounts that begin with 294/295 and are used to track a variety of activities, including consortiums, conferences, publications, faculty start-up funding, revolving funds, etc. It is important, from a financial management perspective, to completely and accurately budget this activity. First and foremost, the state requires us to have “spending authority” for all our financial activity. Not budgeting this activity puts this requirement at risk. Additionally, our current practices separate budgeting and spending responsibility, making variance analysis, actual to budget comparison and other financial monitoring unduly complicated. Historically, the Central University has budgeted this activity in a pool, without input from those departments overseeing the activity. While less than ideal, it has resulted in significant budget gaps between these pooled budgets and actual spending plans at the unit level. We have an obligation to explain this activity, and resulting variances, to a number of constituents including the Board of Regents, State Legislative analysts, State Department of Budget and Management, UMD Finance Committee and others. While budgeting these accounts is not a requirement, it is strongly encouraged and we welcome and appreciate your participation.
In addition to benefitting the Central University, user budgeting of this activity should provide departments a useful tool to help plan for and manage these funds. For example, budgeting the planned financial activity of these funds may provide departments and colleges a clearer picture up front when they assess whether other actions may be necessary to meet their overall financial goals.
For these reasons,
· We have modified BPM working budget to allow budgeting of this activity by the users;
· We are asking users, who would like to, to directly budget their E&G Designated accounts themselves, and
· We will be loading these budgets into KFS.
We understand budgeting of E&G Designated accounts is a new area for most campus users. To help, please be assured budgeting of these activities in BPM WB is similar, in many respects, to the other non-state support accounts that a good number of campus users are already budgeting. We are also providing you historical financial activity to help you develop budgets on these accounts. As this is new, we understand it may be difficult for users to budget with precision. We are not asking for precision, but for a good faith effort that will help the campus improve its budgeting and financial management. The instructions that follow provide more details and tips on how to budget these activities. We appreciate your assistance in this improvement effort.
Please refer to the Experienced or New User Manuals for a review of working in BPM WB. Both manuals are available at:
http://otcads.umd.edu/bfa/bpmsystem.html
These working budget instructions may be found on the Budget and Fiscal Analysis (BFA) web site under Working Budget Instructions at:
http://otcads.umd.edu/bfa/instructionsworkbudg.html
Please direct questions regarding the BPM System to Susan Boblitz at extension 5-5638 or . Please contact Theresa Beck at extension 5-5636 for general budgeting questions.
Thank you.
Enclosures
TABLE OF CONTENTS Page
I. FY 2016 WORKING BUDGET SCHEDULE 5
II. GENERAL INFORMATION AND CONTACTS 6
III. SALARY SETTING IN BPM WB 7
A. Itemized Employees (object codes 1011-1016) 7
1. Salary Adjustments Effective Before July 1st 7
a. Nonexempts Completing Probation Before July 1st 7
b. Reclasses/Promotions for Exempt and Non-Exempt 7
c. Faculty Return from Sabbatical or Leave Without Pay 7
d. Salary Structure Adjustments
2. Salary Adjustments Effective July 1st 8
a. Cost-of-Living Adjustment (COLA) 8
b. Merit Increments 8
c. Retention Increases 8
d. Equity Adjustments 8
3. Payroll Conversion 8
B. Other Salaries (object codes 1018-21XX) 8
IV. SALARY BUDGETING 9
A. Itemized Employee Position Budgets (Filled and Vacant, Object Codes 1011-1016) 9
B. Other Salary Budgets (object codes 1018 – 21XX) 9
C. Fringe Benefits 9
D. Turnover 10
V. OVERALL BUDGETING 11
A. Budget Reductions 11
B. Alignment of Budget with Actuals 11
C. Summer/Winter/Freshman Connection Revenue Allocation and Extended Studies 11
D. Budgeting in Ledgers 2 and 3 accounts 12
1. Accounts Beginning with 22 and 23 (Cost Share) 12
2. Accounts Beginning with 28 and 3 (Self-Supports) 12
3. Accounts Beginning with 292 (Maryland Industrial Partnerships – MIPS) 12
4. Accounts Beginning with 293 (Designated Research Initiative Funds – DRIF) 12
5. Accounts Beginning with 294/295 (Educational and General – Designated) 12
E. Budgeting in Ledger 4, 5, or 9 accounts 15
F. Other Departmental Revenues 15
1. Tuition and Fees 15
2. Gift Revenue From Foundation 15
3. Miscellaneous Revenues 16
VI. REVIEW CHECKLIST
ATTACHMENTS:
· A - Salary Guidelines (Pending)
· B - Stipend Levels for Graduate Assistants and Fellows for FY 2016 (Pending)
· C - Probation Rules for Regular Status Non-Exempt Employees
· D - Non-Exempts – Probation Scheduled to End Between April 17th and June 30th
· E - Review Checklist
· F - State-Supported Tracking Sheet
· G - Additional Instructions for Self-Supports and Self-Support Tracking Sheets
· H - SVPAAP Allocations
· I - E&G Designated – Five Year Financial History
· J - Increase to Minimum of Salary Range Due to COLA Rescission
I. FY 2016 WORKING BUDGET SCHEDULE
MondayTues-Thursday
Tuesday / April 13
April 14-16
April 14 / State of Maryland Legislative Session closes. BPM WB System Training
Last day to request new accounts or account modifications in order
to be processed for the freeze data for BPM WB
Thursday / April 16 / 3:00 p.m. / Last day to process ELF Budget Adjustments prior to freeze of BPM
Data for working budget.
Friday / April 17 / 5:00 p.m. / Last day for approved updates to PHR prior to freeze of data for BPM working budget. Future-dated appointment changes--effective on or before June 30 for 12-month employees, and effective on or before Pay Period 04 (beginning August 10) for academic year faculty--will be included in the FY 16 working budget system.
Thursday / April 23 / 9:00 a.m. / BFA distributes working budget instructions to divisions and colleges for salary setting and budget allocations.
BPM open to divisions and colleges.
Wednesday / April 29 / 9:00 a.m. / BPM WB system opened to departmental users.*
Friday / May 8 / 5:00 p.m. / BPM WB system closed to departmental users.*
Friday / May 15 / 5:00 p.m. / BPM WB system closed to divisions and colleges. Tracking control sheets due to BFA.
Tuesday / June 16 / Payroll will make available payroll conversion reports to units for verification and correction in PHR.
Tuesday / July 7 / 11:00 p.m. / Last day for units to make payroll corrections in PHR for
July1 salaries and funding/accounts.
*Colleges/Divisions may choose to open BPM WB to departments prior to April 29, and keep the system open beyond May 8, at their discretion. Requests for alternate dates should be made to Susan Boblitz (, Ext. 5-5638).
II. GENERAL INFORMATION AND CONTACTS
The following guidelines are University-wide and apply to all sources of funding in the state-supported and non-state supported budgets, except as noted.
Each college/division has appointed “super users” to assist other users with questions or issues. Please contact your college/division business officer if you are unsure who the designated super users are. If you experience technical issues with BPM WB or have non-BPM WB related questions, please contact your “super user” first if he or she is available. Should you or your super user still have questions, the following contacts are provided:
TOPIC / CONTACT NAME / UNIT / PHONE / E-MAILBPM WB System / Susan Boblitz / Office of Budget & Fiscal Analysis / X5-5638 /
Budget Policy / Process / Theresa Beck / Office of Budget & Fiscal Analysis / X5-5636 /
PHR System / PHR Service center / PHR Service Center / X5-7575 /
Salary Policy:
General / Karen McDonald / University Human Resources / X5-5650 /
Nonexempt Probation / Natalie Torres / University Human Resources / X5-5674 /
Academic Affairs / Cynthia Hale / Office of the Provost / X5-6816 /
We have developed a Technical Issue Reporting Form that users may find useful for reporting issues. The information requested on the form will help us identify the “fix” needed. The BPM Technical Issue Reporting Form is available at:
http://otcads.umd.edu/bfa/bpmsystem.html
Additionally, page 8 of the BPM WB Training and User Manual has instructions regarding technical requirements for the system to work properly.
III. SALARY SETTING IN BPM WB
A. Itemized Employees (object codes 1011 – 1016)
As of now, we have not received detailed salary guidance from USM. Shortly after we receive them, we will communicate the guidelines to the College/Divisional Business Officers and update the instructions on our website. The employee’s salary in BPM WB should reflect what you expect his’ or her’s July 1st salary to be and the funding in effect July 1st.
1) Salary Adjustments Effective Before July 1st.
The employee’s salary brought into BPM from PHR, should be adjusted in BPM for any salary actions that will become effective after the freeze of the PHR data for BPM and prior to July 1st. Enter the salary action as an “adjustment to current base salary” on the left-hand side of the “set salary screen”. Common examples include:
a. Nonexempts Completing Probation Before July 1st
Attachment C – Probation Rules for Regular Status Non-Exempt Employees provides a summary of the probation rules for regular Nonexempt employees regarding the 2.5% step increase. Employees completing original probation, promotion status change probation (with a competitive search), or CII conversion probation before July 1st are eligible for a 2.5% step increase. Please contact Natalie Torres of University Human Resources at ext. 5-5674 or if you have questions about a Nonexempt employee’s eligibility for the 2.5% step increase received after the successful conclusion of certain probationary periods.
Attachment D - Non-Exempts – Probation Scheduled to End Between April 17th and June 30th is a list of Nonexempts who are scheduled to complete probation during this time period. To impact the employee’s pay, the department must enter the 2.5% increase in PHR directly. BPM has a field on the set salary screen current adjustments side that allows users to also reflect the salary adjustment made in PHR after the freeze and before July 1st. Please refer to page 15 of the BPM Training and User Manual.
b. Reclasses/Promotions for Exempt and Non-Exempt Before July 1st
Promotions and reclasses for Exempt or Nonexempt employees effective before July 1st and entered into PHR by the department after the April 17th data freeze should also be entered into BPM as an adjustment to the current base salary on the salary setting screen. Please refer to page 15 of the BPM Training and User Manual for Nonexempts and page 17 for Exempts.
c. Faculty Return from Sabbatical or Leave Without Pay
If a faculty is returning from sabbatical or leave without pay before the start of the fiscal year, please enter the amount to increase “adjusted current base salary”. Please refer to page 18 of the BPM Training and User Manual.
d. Salary Structure Adjustment
Because of the COLA rescission, some Exempt and Nonexempt employees may fall below the minimum salaries in the respective pay scales, if left unadjusted. Staff whose salaries are below the new range minimums at that time (after the COLA back-out) should have their salaries brought up to the salary range minimums both in BPM WB and in PHR. Attachment J - Increase to Minimum of Salary Range Due to COLA Rescission provides a list of the impacted the regular status employees. Please refer to page 15 of the BPM Training and User Manual for Nonexempts and page 17 for Exempts on how to enter this information into BPM WB.
2. Salary Adjustments Effective on July 1st.
a) Cost of Living Adjustment (COLA)
Until we hear otherwise, we have backed out the COLA on the set salary screen as per our understanding of the Governor’s current intent to not restore the COLA. If COLA is restored, we will notify the college/divisional business officers and post the announcement on our web site with further instructions. The COLA field is currently blocked from user edit in BPM WB. Until the salary guidelines are issued, we are assuming the only allowable adjustments to the COLA are for FTE changes. If the COLA needs to be adjusted due to FTE changes, please email Susan Boblitz at with the FTE change, the dollar adjustment to the COLA and an explanation.
b) Merit Adjustments
The Governor’s budget did not include merit increments for FY 2016.
c) Retention Increases for Faculty and Staff
USM salary guidelines are pending. Further guidance will be provided with the Salary Guidelines once received.