Business Plan and Budget

Transcription

1 Business Plan and Budget Approved by Board of Governors April 25, 2013

2 LAMBTON COLLEGE Business Plan and Budget Presentation to the Finance & Property Committee April 25, 2013 TABLE OF CONTENTS Page No. EXECUTIVE SUMMARY LAMBTON COLLEGE STRATEGIC PLAN 1.1 Vision Mission College Priorities KEY OBJECTIVES AND ASSUMPTIONS 2.1 Provincial Funding Enrolment Tuition and Fees Staffing Compensation Contract Services Research Apprenticeship International Employment Programs School to College to Work Initiative Fundraising BUDGET SUMMARY BUDGET 14 Lambton College Page 2

3 LAMBTON COLLEGE BUSINESS PLAN AND BUDGET EXECUTIVE SUMMARY The Business Plan and Budget for Lambton College has been prepared at a time of some uncertainty in the Province of Ontario. In the fall of 2012 Premier Dalton McGuinty retired as Premier and prorogued Provincial Parliament. The new Premier has not yet announced a Spring Budget that will have to deal with a Provincial deficit forecasted to close at $11.8 B. While this represents an improvement of approximately $3B from the deficit anticipated in the Provincial Budget, the government is expected to display significant fiscal restraint in order to deal with the Province s economic situation. Deficit reduction measures announced a year ago will take effect in Further cost reduction measures, as well as a new post-secondary tuition policy framework, are anticipated in the Spring Provincial Budget. Provincial funding measures announced last year will take effect in , including reduction in the General Purpose Operating Grant per student of almost 1%. This reduction will grow by another 1% in An International Student Recovery Charge levied on international students attending on-shore campuses will be phased-in over three years, commencing in , with a decision pending regarding implementation of similar type of charge for off-shore students in either the current budget year or in The impact of the recent Federal budget announcement of dramatic change in the transfer payments to the provinces to provide additional funding for a new Canada Works Grant for skilled trades training, based on shared federal/provincial/employer support, is not yet known, and has not been reflected in this budget. The Lambton College Business Plan and Budget anticipates an inyear deficit of $213,500 which includes a contingency of $500,000. This Business Plan and Budget will enable the College to serve a growing number of students and community partners in a flexible and cost-effective manner, while implementing the inaugural year of the Lambton College Strategic Plan The College s new Strategic Plan aligns well with the government s objective to improve access to post-secondary education by aboriginal and first generation students, while beginning the process of establishing Lambton College as a mobile learning institution. The College s move to hybrid course delivery and expanded access to course content through mobile devices is reflected in additional program and capital spending on course development and technology upgrades. Lambton College Page 3

4 Another key strategic goal for is progress toward development of a new Health and Science Centre, as well as continued improvement of College infrastructure. This plan also focuses resources on a number of services to students, including retention initiatives and support for co-operative education. Further development of multiple pathways for students remains a key objective. Research takes on a growing profile as the College develops operational infrastructure to support an extensive expansion of major, funded projects. Lambton College has become a significant presence in the field of applied research, both provincially and nationally. The Lambton College reflects strong cost control and support for efficiency projects, as well as implementation of key initiatives aimed at support for students through teaching excellence and leadingedge use of technology. As the Province of Ontario rebuilds, Lambton College will play an important role in this economic revitalization by providing the citizens and employers of Sarnia- Lambton and beyond with relevant, high quality programs, skilled and well educated graduates, and important commercial innovation through partnerships with business and industry in ever-growing and unique applied research. Lambton College Page 4

5 LAMBTON COLLEGE BUSINESS PLAN AND BUDGET LAMBTON COLLEGE STRATEGIC PLAN 1.1 Vision Lambton College fosters innovation and entrepreneurship among our faculty, staff, and students and in the local and global communities we serve. As the sole provider of higher education in our region, we remain committed to providing teaching and learning excellence in a broad range of program offerings, and a full range of credentials. We will enhance the student experience and learning outcomes by becoming a mobile learning college. In particular, we will distinguish ourselves amongst all Canadian colleges by leveraging our unique strengths to become a global leader in education and applied research in the areas of Energy & Bio-Industrial Technology, and Fire & Public Safety. 1.2 Mission Lambton College is committed to student and community success. We achieve our mission through quality teaching and an innovative learning environment that: provides relevant, accessible, value added programs and services that engage and develop the whole student. proactively addresses the needs of a constantly changing labour market. supports community & economic development through innovative partnerships and applied research initiatives. 1.3 College Priorities We will realize our vision and fulfill our mission by achieving results and measuring our success in: 1.0 Enhance the Student Experience 2.0 Establish a Centre of Excellence in Energy & Bio-Industrial Technologies 3.0 Enhance Our Centre of Excellence in Fire & Public Safety 4.0 Provide Students with Innovative and Flexible Learning Options 5.0 Partner with Industry, the Community, and Other Post-Secondary Institutions 6.0 Renew our Campus Environment Plans and new initiatives contained in are directed at fulfilling the strategic priorities of Lambton College. Lambton College Page 5

6 2.0 KEY OBJECTIVES AND ASSUMPTIONS 2.1 Provincial Funding The Province of Ontario has not yet passed a Provincial Budget which will need to address the province s $11.8 B deficit. Curtailments of operating funding and limited capital spending are expected to impact all public services in the Province in coming years. Funding for post-secondary education will decline in Already announced, a reduction of almost 1% in grant funding for colleges, from $4,358/WFU to $4,317/WFU, will be enacted for September 2013, with further 1% reduction in the following year. A similar 1% reduction in university program grants will affect Lambton s BScN program funding. The government remains committed to its stated goal of increased participation in post-secondary education, and will fund enrolment growth in the college sector, but at the reduced level of per student funding. Lambton College benefits from this additional funding, due to rapid enrolment growth over the past few years. The Base General Purpose Operating Grant (GPOG) declines to $12,976,900, a $125,700 reduction from the GPOG. Enrolment Growth funding for reflects historic rates of increase in Lambton s full-time domestic postsecondary enrolment and is estimated at $2,397,500, a decrease of $166,200 from the Enrolment Growth funding received in This reduction stems from the cut to the per student funding level, as well as a very slight decline in the number of Lambton students funded through this growth formula, which recognizes enrolment two years past. The net decrease in GPOG enrolment-based grant funding to be received in is $291,900 from the previous year. The Second Career program, which supports retraining of unemployed and under-employed Ontarians, continues. This program provides in-year funding to post-secondary institutions, with grants to eligible participants for tuition and living expenses. A reduction of 38 students in Second Career- and WSIB-sponsored programs are included in this budget, resulting in a reduction in grant revenue of $314,600. The impact on enrolment of closure of two major, local employers in is not expected to be repeated in An expected increase of Bachelor of Nursing Science students will result in an inyear grant increase of $109,000 over , after taking into effect the per student grant funding cut to university programs. The Northern/Rural Grant funding pool remains frozen, again resulting in a grant of $4,160,700 for Lambton College in Lambton College Page 6

7 The instructional equipment capital grant is assumed to remain at the level of $163,200. The facility renewal fund grant was lowered to $176,200 in , and is expected remain at that reduced level for Lambton College continues to be a major participant in the School to College to Work Initiative (SCWI). After many years serving as Regional Coordinator for this program, the responsibility for that role, along with the funding for that activity was rotated to a partner college part way through As a result, net funding for this program in is expected to be $1,816,400, a decrease of $193,400 from the previous year. Taking effect in is a new International Student Recovery Charge (ISRC) of $750 on first year International students enrolled in post-secondary programs on Ontario college campuses, along with imposition of a tax of $75 in lieu of Municipal tax on each International student on campus. The ISRC will be applied to each successive academic level over the next two years. Tuition rates have been adjusted to recover most of these costs. Discussions are ongoing with government regarding the implementation of an International Student Recovery Charge on off-shore students. As no decision has yet been made, no estimate of this proposed expense has been included in this budget. It is likely that the charge, once determined, will come into effect in The level of this Recovery Charge ultimately levied by government could affect the viability of offshore partnerships. 2.2 Enrolment Full-time enrolment at Ontario post-secondary institutions has slowed from the record-setting pace of recent years. Total enrolment at all post-secondary institutions across the province is expected to increase by up to 3% over Lambton College s full-time post-secondary enrolment for Fall is budgeted at 3,498, a 0.6% decrease over Fall enrolment of 3,519 fulltime students. Second Career enrolment is expected to decline as students sponsored by the program in the past year as a result of the closure of two major employers begin to graduate from the College, and no further large, local business closures are anticipated in The total number of international students enrolled in all programs in Fall 2013 is conservatively budgeted to be 448, a 2% decrease from the 457 international students enrolled in Fall Non-diploma programs, which are attracting an increasing number of international students, are delivered on a twelve month basis, with enrolment increasing in all terms. International students enrolled in post-secondary diploma programs are conservatively estimated at 300 in the Fall 2013 term, with students hailing from India, China, Nigeria and other countries. Lambton College Page 7

8 2.3 Tuition and Fees A MTCU Tuition and Compulsory Ancillary Fees policy for has not yet been published. The Minister recently announced an annual tuition increase of 3% per year for each of the next four years. This is a rate lower than has been Ministry policy for the past number of years. Further policy change to tuition collection procedures which may yet be announced may require reduction in budgeted revenues. Compulsory ancillary fees, including fees imposed by the Students Administrative Council, have increased by an average of 3.5% over the previous year. This increase, larger than in recent years, reflects growth in demand for tutoring service which aids in student success, as well as additional spending to improve IT wireless and remote access for students. 2.4 Staffing The budget includes addition of six faculty positions that fill existing vacancies, required to support budgeted enrolment. Two vacant support staff positions will also be filled, along with a vacancy at the management level. Ten new support staff positions are proposed in this budget. Six are proposed as Initiative and Opportunity (I/O) positions. Two are administrative support positions in the Research office that will not be filled until anticipated research grant funding is solidified. One responds to growing demand for co-op job development, particularly related to international student placement, and will be funded through increased co-op fee revenue. Another will serve students involved in programs classified as Mobile Learning programs. This latter position will be funded from the Mobile Learning reserve. A new position will provide support to Access programs, funded through the Literacy and Basic Skills grant. The sixth I/O position will coordinate activities related to academic integrity and copyright compliance. Partial funding will come from the accrual for copyright expense already recorded, and reduction in the cost of part-time staff. Two other new positions represent conversion of existing part-time to full-time status, and result in virtually no added cost due to growth of revenue generation potential or alternative cost savings. One new position stems from need to add resources to support the Financial Aid process. A new IT Programmer is required in order to gain efficiencies of operation across the College. This position, and the Financial Aid position both replace part-time staff, resulting in some cost saving. Three administrative management positions are created. One is to support a greatly expanded research portfolio. Two administrative management Lambton College Page 8

9 secondments are planned with no increase in total complement: one in applied research and the other to support student recruitment. One existing vacancy will be filled. 2.5 Compensation The current faculty collective agreement, which concludes on August 31, 2014, contains no grid increase for An increase of 1.75% in the third, and final, year of the current Support Staff collective agreement is effective for Additional legislation was added to the Broader Public Sector Accountability Act 2010 extending the freeze on compensation increases for designated executives of Broader Public Sector and Ontario Public Sector organizations for an indefinite period, until the government is in a surplus position. Performance review compensation for administrative employees cannot exceed, in total, the amount expended in the previous year. Direction is awaited from the College Employer Council regarding increase to the grid for eligible salaried employees, who have been under a compensation freeze for the prior two years. Movement through the range for all employee groups has been estimated in this budget. 2.6 Contract Services Corporate training activity is budgeted to improve after a disappointing Restructuring of this revenue generating unit will see commercial and industrial fire school training combined under the leadership of the Dean of the Fire and Public Safety Centre of Excellence. After a difficult year of job loss in Sarnia/Lambton, commences in the light of promising local economic news. Shell Canada announced plans to install a small-scale liquefaction unit at its Manufacturing Centre in Sarnia, to supply liquefied natural gas fuel to its customers in the Great Lakes region. This new liquefaction unit is expected to begin production in about three years. NOVA Chemicals announced its NOVA 2020 project. National Energy Board approval for the Genesis Pipeline Extension Project has been issued. Following early 2013 construction of a short section of pipeline that will run to NOVA s Corunna facility, ethane from the Marcellus Shale basin in Pennsylvania will move to the Corunna site, beginning in the third quarter of NOVA Chemicals is anticipating September, 2013 regulatory approval to convert its Corunna site to utilize up to 100% natural gas liquids feedstock. Completion is expected in early NOVA Chemicals is also exploring construction of a second, world-scale polyethylene facility in North America, with the Corunna site a potential location for this major new facility. Associated with that project is a Lambton College Page 9

10 feasibility study for expansion of NOVA s Corunna cracker to support the new plant. These projects have brightened the employment prospects for the area s skilled trades workforce. Revenue from the Lambton College Fire and Public Safety Centre of Excellence was much improved in The introduction of two new, real-life industrial training scenarios utilizing the new three-tier chemical complex prop attracted new clients and existing customers. Two new industrial training courses were also developed to respond to identified client needs. This level of activity is expected to continue in Research Applied research assumes an increasing profile in Decisions regarding a number of major research grant applications are pending, and activities related to those projects have tentatively been included in this budget. If received, these new grants will herald a major step forward for Lambton College as an applied research institution, recognized on both a Provincial and National scale. Servicing these projects, which will add almost $900,000 revenue annually for five years, will require a redesigned research support structure, including secondment of a management position, reassigned support staff for coordination activities and addition of two new support staff for administrative operations. These costs, along with estimates of researcher salaries and relevant expenses, have been included in this budget. 2.8 Apprenticeship Apprenticeship training activity is expected to decline. The improving trades employment scene is expected to impact availability of some apprentices to attend in-school training. Intakes for one construction trade program will see a more limited numbers of offerings in In addition, a number of non-construction apprenticeships will also experience enrolment decreases or postponement of intakes until the following year. Offsetting these declines is a significant increase in activity at Bruce Power LLP over levels, where the Instrumentation & Control Technician (formerly Industrial Millwright Mechanic) apprenticeship is offered in-situ. The pre-apprenticeship program will not run in Apprenticeship Enhancement Funding for renewal of instructional equipment has been budgeted at the same level as MTCU funding announcement is pending. Lambton College Page 10

11 2.9 International The growth in international student enrolment on campus is expected to decrease slightly from levels. A reduction in the numbers of international students attending diploma programs is mainly offset by continuing increases in the numbers of international students who will attend Lambton s suite of Board of Governors certificate programs in the information technology area. Numbers of students from India continue to climb, as well as increasing numbers from Nigeria. However, the number of students transferring from partner campuses in China continues to decline. Activity at most off-shore campuses is expected to decline in Net revenue from all four major partnership campuses in China is budgeted to decrease by an average 20% as a result of both declining student numbers and the effect of Chinese taxation on expatriate activities. The effects of increased global competition, the state of the Chinese economy and increased capacity available at China s post-secondary institutions continue to impact Lambton s operations in China. Nanchang, the smallest campus, will cease to accept new students in fall These declines in revenue are offset by growth in activity and related revenue from Lambton s partner college in Ontario, where enrolment continues to increase, and a new partnership with Lakeland College in Alberta Employment Programs MTCU has renewed the contract to provide employment services in rural Lambton County, at the same level as the previous year. Revenue for the Summer Job Service program for students has been reduced slightly from level, and the employer subsidy has been reduced School to College to Work Initiative After many years of Lambton College serving as the regional coordinator of the School to College to Work Initiative, this responsibility and the supporting revenue was rotated to a partner institution midway through As a result, total revenue from this very successful initiative will decline somewhat in Participation by Ontario high school students in the Lambton College SCWI program continues to be strong, with growing local school board activity Fundraising The Lambton College Foundation continues to collect on pledges from the Inspiring the Future $5,000,000 capital fundraising campaign that successfully concluded in Included in the budget is $500,000 of donated revenue and related capital spending for equipment and facilities modifications for various academic programs and student success initiatives. Lambton College Page 11

12 The Foundation Board is gearing up for a new fundraising campaign to support the proposed Health and Science Centre. This activity is in the early stages, but is supported by an existing $3 million reserve of capital and donated funds. Lambton College Page 12

13 3.0 BUDGET SUMMARY Revenues $ 65,020,500 Expenses $ (63,877,900) Surplus before GAAP Adjustments $ 1,142,600 Total GAAP Adjustments $ (1,356,100) (Deficit) / Surplus after GAAP Adjustment $ (213,500) Transfer from Reserve $ 814,100 Transfer to Reserve $ ( 100,000) Net (Deficit) / Surplus after Reserve Transfer $ 500,600 Opening Accumulated Unrestricted Surplus (see Note) $ 1,758,342 Closing Accumulated Unrestricted Surplus $ 2,258,942 Note: Opening Accumulated Unrestricted Surplus has been adjusted to reflect the effect of adjustments required by Public Sector Accounting Board (PSAB) rules governing Government Not-for- Profit Organizations. In-year adjustments requiring actuarial estimates are not yet available so have not been included but are assumed not to be material. Lambton College Page 13

14 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Budget Statement of Revenue and Expenditure for the year April 1, March 31, 2014 Page 14

15 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Statement of Revenue and Expenditure For the period: April 1, March 31, 2014 Supporting Schedule BUDGET REVENUE Post Secondary Sch 2A $ 39,049,100 Contract Services Sch 2B 16,802,400 Child Care Services Sch 2C 780,900 Student Services Sch 3 2,540,600 Administrative Services Sch 4 523,700 Physical Resources Sch 5 441,300 Ancillary Sch 6 4,882,500 $ 65,020,500 EXPENDITURE Post Secondary Sch 2A $ 29,636,400 Contract Services Sch 2B 13,602,600 Child Care Services Sch 2C 857,300 Student Services Sch 3 5,616,200 Administrative Services Sch 4 5,396,000 Physical Resources Sch 5 4,213,800 Ancillary Sch 6 4,555,600 $ 63,877,900 EXCESS OF REVENUE OVER EXPENDITURE BEFORE GAAP ADJUSTMENTS $ 1,142,600 LESS: GAAP ADJUSTMENTS Depreciation/Contribution Amortization expense 1,189,200 Vacation pay expense 162,900 Termination gratuity expense $ 4,000 1,356,100 NET EXCESS OF EXPENDITURE OVER REVENUE $ (213,500) TRANSFER FROM CAPITAL RESERVES 814,100 TRANSFER TO CAPITAL RESERVES (100,000) EXCESS OF REVENUE OVER EXPENDITURE $ 500,600 OPENING ACCUMULATED UNRESTRICTED SURPLUS 1,758,342 CLOSING ACCUMULATED UNRESTRICED SURPLUS $ 2,258,942 Page 15

16 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Post Secondary Expenditure For the period: April 1, March 31, 2014 Schedule 2A BUDGET REVENUE: Fees: Tuition and Other $ 15,323,100 MTCU Grants 23,142,600 Other 583,400 39,049,100 EXPENDITURE: Compensation $ 25,175,700 Instructional software and equipment 1,641,900 Equipment maint./rentals 129,700 Field work 68,300 Advertising/Promotion 29,200 Instructional 1,053,600 Premise rental 3,900 Office 105,100 I.T. Networking 191,400 Professional development 219,800 Travel 149,300 Tuition set aside 868,500 29,636,400 CONTRIBUTION: $ 9,412,700 Page 16

17 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Contract Services For the period: April 1, March 31, 2014 Schedule 2 B BUDGET REVENUE: Contract Revenue $ 586,600 Course Fees 2,412,500 International 4,150,100 MTCU Apprenticeships 983,300 MTCU Contracts 2,537,800 Other Provincial Contracts 2,374,900 Municipal Contracts 267,900 Research Contracts 2,027,200 Fire School 1,102,100 Other 360,000 16,802,400 EXPENDITURE: Compensation $ 7,497,600 International Recruitment 1,818,100 Stipends/Support Allowances 462,000 Equipment 710,800 Equip & Building Maintenance 183,500 Advertising/Promotion 330,900 Instructional/Program 1,483,300 Office 129,500 Travel Domestic 515,700 Travel International 92,000 Professional development 71,400 Premise rental and utilities 307,800 13,602,600 CONTRIBUTION: $ 3,199,800 Page 17

18 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Child Care Services For the period: April 1, March 31, 2014 Schedule 2 C BUDGET REVENUE: Day Care Centre Fees $ 353,900 Municipal Revenue 427, ,900 EXPENDITURE: Compensation $ 820,800 Equipment 1,500 Instructional 31,400 Office 1,100 Professional development 800 Travel 700 Other 1, ,300 CONTRIBUTION: $ (76,400) Page 18

19 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Student Services For the period: April 1, March 31, 2014 Schedule BUDGET REVENUE: MTCU Revenue $ 736,400 Sundry Fees 1,398,600 Other 405,600 2,540,600 EXPENDITURE: Compensation $ 4,879,500 Advertising/Promotion 245,600 Equipment 99,900 Athletics 210,100 Educational resources 70,200 Office 81,400 Professional development 1,200 Travel 28,300 5,616,200 CONTRIBUTION: $ (3,075,600) Page 19

20 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Administrative Services For the period: April 1, March 31, 2014 Schedule BUDGET REVENUE: MTCU Revenue $ 248,700 Rental Revenue 170,000 Other 105, ,700 EXPENDITURE: Compensation $ 2,697,800 Advertising/Marketing 431,900 Insurance 155,000 Duplicating/Printing 281,000 Postage 125,000 Office 67,800 Service charges 387,400 Professional fees 300,300 Taxes 215,000 Travel 87,500 Staff employment/recruitment 79,200 Contingency 500,000 Other 68,100 5,396,000 CONTRIBUTION: $ (4,872,300) Page 20

21 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Physical Resources For the period: April 1, March 31, 2014 Schedule BUDGET REVENUE: Facilities Renewal $ 176,200 Other MTCU Revenue 25,800 Facilites Fee 176,800 Other 62, ,300 EXPENDITURE: Compensation $ 1,208,800 Equipment 35,000 Equip & Building Maintenance 617,000 Utilities 1,250,300 Contract Security & Cleaning 905,600 Office 3,300 Telecommunications 129,000 Vehicle 7,000 Travel 8,600 Other 49,200 4,213,800 CONTRIBUTION: $ (3,772,500) Page 21

22 THE LAMBTON COLLEGE OF APPLIED ARTS AND TECHNOLOGY Analysis of Ancillary Operations For the period: April 1, March 31, 2014 Schedule BUDGET REVENUE: Bookstore $ 2,794,800 Parking 536,200 Residence 1,551,500 4,882,500 EXPENDITURE: Bookstore $ 2,543,700 Parking 332,300 Residence 1,679,600 4,555,600 CONTRIBUTION: $ 326,900 Page 22