wildcatIDEAS

Encourage us not to "spend out" year-end operating budgetfunds

I wish to thank Cindy Hauser for a query long ago that leads to this submission.

 

In collaboration with Ed Kania, I propose we develop incentives for

budget managers who are appropriately frugal (that is, they have worked

intentionally or have been fortunate to save money on their budget's

full portfolio (e.g., energy costs in a particular year were lower because of weather, or a

one-time supplies sale price offered savings)) to _not_ spend out their operating budgets at year end so that these funds can be put to excellent use. I know that some academic departments intentionally spend down their year-end budget because of the fear that if they don't, their budget will be reduced in subsequent years. Yet they, Ed, and I would like to find ways to motivate us to not spend funds at year's end by knowing that (a) the saved funds would be put to good use, and (b) the operating budget generally will not be penalized for this frugal behavior in a subsequent year (because the idea is that there was a good reason for the budget underspending). Ed points out that sometimes the college has a budget overrun and thus needs to recoup saved funds, but in years with a balanced budget or budget surplus, those saved funds could be used in various ways. So... What would the saved funding be used for, and how do we use this as an incentive to best encourage folks not to spend out? Determining how the saved funds will be used will determine, in part, folks' motivation to decide not to spend down at the end of a fiscal year. For example, perhaps half of the unspent funds would go back to the college and half would come back to the budget manager or the division. Or the unspent funds would go to a "gold pot" discretionary fund for a particular community need (e.g., staff coffee hour (or another kind of community-building gathering), or a staff scholarship fund).

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Idea No. 26