Taking Steps Toward Budget Transparency
By Mark Rahdert, Charles Klein Professor of Law and Government, President of Faculty Senate
The new era of decentralized “RCM” budgeting at Temple University is practically upon us. Over the past year-and-a-half, the office of Treasurer and CFO Ken Kaiser has labored hard to design a workable and fair structure for decentralizing Temple’s budgeting system in order to establish greater control and accountability at the school and college level. That system is now largely in place, and beginning on July 1 the Temple’s new decentralized budget era will be fully in operation.
The process began in 2013 with the appointment of a University-level “steering committee” composed of administrators, deans, and faculty members. In conjunction with the CFO’s office, the committee devised a set of guiding principles for decentralized budgeting at Temple, identified criteria for generating revenue and assessing costs, worked on setting the numerical baselines and algorithms to be used for quantification, and assisted with refining those measures through interaction with the colleges and their deans. One of the governing premises was that the schools and colleges would be “held harmless” during the transition to the new system, meaning that their budget allocations would be equal at the outset with what they had received under the old budget process. Another governing premise was that a substantial fund would remain with the President and Provost, and would be distributed to schools, colleges, and other budget units in a strategic fashion designed to promote and support new initiatives.
During the Fall 2013 semester, the CFO’s office provided training on the operation of the new system to administrators, staff, and faculty members responsible for budget management throughout the University. During the Spring 2014 semester, each budget unit was asked to submit financial reports and proposals, which were presented to a set of “budget conference committees.” Units asking for additional new funds were asked to explain and justify their requests to these committees, which have included representatives from the CFO’s office, the Provost’s office, the Council of Deans, and faculty. I was among the faculty members who were recruited for this work. It was time consuming, but also stimulating; I think it is probably fair to say that I learned more in these meetings about the financial workings of the University’s individual budget units than I had been able to learn in my previous thirty years on the faculty.
From the outset, one of the central aims of the transition to the new budget model has been to achieve greater budget transparency. In particular, it has been understood that at all levels of the process faculty participation in budget development and assessment will be a critical component for the success of the enterprise. I have been personally impressed at how open CFO Kaiser and his staff have been to including faculty members in the process in meaningful ways. Our input has been solicited at every stage, our ideas and concerns have been considered and addressed, and on many occasions our suggestions have been implemented. In my judgment, a spirit of true collegiality and common purpose has been pervasive – a very promising start to what I hope and trust will prove ultimately to be a very successful enterprise.
But the planning and structural work that has been done so far, important as it is, is just the beginning. The real ongoing work of RCM budget development and implementation must occur at the school/college level. To make that happen, we need Deans and college administrators who are as open to sharing budget information and responsibility with their faculty members as the CFO and his office have been, and we need faculty members who are willing to undertake the time and effort to become knowledgeable monitors, advisers and stewards regarding their school/college’s budgetary affairs. All of us need to develop basic college budget proficiency. Some of us need to press further and acquire true budgetary fluency. We must earn our seat at the budget table.
Transparency on budgetary matters has not been the norm at Temple, to say the least, and I anticipate that there will be some resistance in some schools and colleges to the idea that faculty should have a meaningful role in setting budget priorities or advising on budget issues. Sharing that concern, the Faculty Senate’s Budget Review committee proposed, and the Faculty Senate Steering committee recently adopted, the following resolution:
Resolved, that the Faculty Senate Steering Committee, in response to a resolution from the Faculty Senate Budget Review Committee, approves and will transmit to President Theobald, and urge him to endorse, the following practices for budget advisory committees of the schools and colleges:
Each school and college shall have a Budget Advisory Committee, at least some of whose members should be elected, which should receive full and detailed information about the school/college budget, and should meet regularly with the Dean and other responsible members of the administration to address budgetary matters. Matters within the committee’s purview should include, but not be limited to, tuition revenue, other program-based sources of revenue, external funding, expenditures for scholarships, assistantships, and other forms of student financial support, expenditures for various academic departments and programs, expenditures for student services, library and technology expenses, special projects, other administrative expenses, capital expenses, investments in new programs, the impact of the university budget system on school/college finance, financial trends affecting the financial well-being of the school/college, and the capacity of the school/college’s financial team to support short and long term fiscal planning. The committee should report regularly to the school/college collegial assembly regarding financial issues affecting the school/college.
We have communicated that resolution to the President and Provost, and they have undertaken to communicate its contents to the Council of Deans. President Theobald responded to the resolution by stating that he would see that the resolution was distributed to all deans, have the Provost or his designee meet with each dean to endorse the spirit of the resolution, have the deans indicate how they would affirmatively respond, and make clear that the new dean review process includes inquiry into how deans involve faculty members in college governance. Exactly how these principles get implemented will naturally vary from college to college, as each unit has its own distinct style of shared governance. But these basic principles represent the minimum that is necessary to ensure that the RCM system is truly transparent at the school and college level. I hope that every dean and every faculty collegial assembly will take active steps to see that these principles are fully implemented. •