Strategic Budgeting, Frequently Asked Questions
Each school or college varies in its dependency on tuition and state appropriation allocations compared to direct revenues received from other sources. The Strategic Budget Model does not take into account the level of dependency as this could be the result of years of potentially misaligned funding. Instead, it aims at educating Auburn University on the amount of additional resources needed to continue operations and creates a Mission Enhancement Fund, a pool of resources maintained by Senior Leadership, to address issues related to additional funding needs.
Scholarship revenue processed by the Auburn University Foundation in one-time or annual gifts are reflected in the Gifts & Private Support Revenue. Scholarship revenue from endowment earnings is a component of Investment Income Revenue.
Variances from budget are possible in any revenue category. However, because of revenue stabilization measures taken by the State of Alabama, it is unlikely that actual state appropriations received would vary by a substantial amount from the amount budgeted. Actual tuition revenue received could vary from budgeted amounts for reasons such as over- or underestimating enrollment and credit-hour generation, improving or worsening retention rates, or changes in course offerings.
Distribution of license and royalty revenue is contractual and will not change under the Strategic Budget model.
Rate structures for service centers should be computed as follows:
The rate charged to internal users must be based on incurred cost and is not reflected as a revenue, hence there is no Mission Enhancement Fund participation rate charged.
Rates for external users should recover all costs, including the participation rate for the Mission Enhancement Fund and may also reflect market rates. There is no ceiling for rates to external customers.
Indirect Cost Recovery Revenue will be programmatically distributed to the Principal Investigator's colleges/school.