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UT System Academic Institutions Tuition Proposals for Academic Years 2010-2012: Cost Saving Initiatives

 

UT Arlington

Specific cost savings and operational efficiencies have been implemented on several fronts:


Flexible Hiring Freeze: UT Arlington implemented a flexible hiring freeze in December 2008 and created a Position Review Committee to review all requests to create new positions, reclassify positions, fill existing positions, and make unbudgeted mid-year salary adjustments. The goal is to gain operational efficiencies, as well as to reduce personnel costs through managed attrition. During the first year alone, the University saved more than $1 million by delaying the filling of certain vacancies. The Position Review Committee includes the provost, the vice president for business affairs and controller, and the vice president for human resources. This review process will remain in effect for the foreseeable future.


Executive Salary Freeze: In February 2009, the University implemented an executive salary freeze for the president, provost, vice presidents, and deans through FY 2010.


Energy Conservation: In December 2009, the University submitted an application to the State Comptroller’s Office for stimulus funding available through the State Energy Conservation Office for additional energy conservation measures (Phase II of the program completed in 2008). The request is for just under $10 million with a payback period of approximately eight years.


Energy Performance Contract: The energy performance contract detailed in UT Arlington’s 2008-2010 Tuition Proposal achieved utility savings that exceeded the projected savings of $2.1 million. The actual amount saved as a result of the 18 energy retrofit measures was $2.5 million.


Utility Savings: UT Arlington continues to team with seven other UT System institutions under a five-year contract to purchase electricity through load aggregation. The University is realizing savings of approximately $2.5 million annually. The University also continues to realize savings in the purchase of natural gas using a balanced approach between index pricing and fixed pricing to take advantage of market fluctuations.


Operational Efficiencies: The University continues to review and evaluate every aspect of its operations and services with a goal of streamlining procedures, increasing efficiency and productivity, and focusing on mission-critical strategic priorities. For example, the University is considering merging its on-campus computer store, previously managed by the University, with the University Bookstore, which is managed by a private outside contractor. Other programs and operations being considered for consolidation include management of on-campus events facilities and venues, printing and print procurement, and computer laboratories.


Sustainability Initiatives: The University’s master plan emphasizes a firm commitment to sustainable development. For example, two major facilities, the Engineering Research Building and the Special Events Center, were designed to meet stringent energy efficiency standards that will translate into significant utility cost savings. Both buildings are being constructed to achieve LEED Silver Certification. In addition, ongoing and expanding campus-wide programs like the “Office Green Teams” have raised awareness and active participation among faculty, staff, and students.


Wireless Device Reimbursement Policy: The University revised its wireless device reimbursement policy for faculty and staff in July 2009. This change has resulted in an annual savings of approximately $300,000.


Travel Restrictions: In November 2008, the University implemented more restrictive travel guidelines designed to reduce travel costs. All travel by faculty and staff must be explicitly justified and approved through a special review by the provost or the appropriate vice president, dean, or director. Additionally, all airfare must be booked through the University’s travel agency to take advantage of special pricing and discounts.


Professional Memberships: The University conducted a thorough review of individual and institutional professional memberships, which netted annual savings of $50,000. This review will continue on an ongoing basis.

 

UT Austin

The TPAC report describes the adverse fiscal consequences resulting from limited state support, the limit that was placed on tuition increases in the last tuition and fee cycle, and the decline of money from the Available University Fund. To maintain high quality in the face of dwindling revenues, the University is being forced to take difficult steps. For example, this year we gave no staff salary raises (including administrators at all levels) and had only a limited pool of money for targeted faculty raises. As another cost-saving measure, we have altered our ongoing program to add new faculty positions each year to help reduce the faculty-to-student ratio. Previously, we added thirty new faculty positions each year; for the coming year (2010-11), we will add only fifteen. (These new faculty positions will be funded with existing resources through reprioritization and reallocation and not from the proposed tuition increase.)


For more long-range and sweeping cost-saving measures, the deans and vice presidents are engaged in an extensive reallocation budget process. In this process, each dean and vice president is scrutinizing her or his budget to find ways to eliminate nonessential programs and reallocate money for essential needs and strategic initiatives. The deans are working on this effort with the Executive Vice President and Provost as they develop five-year strategic budget plans. In a similar effort, the vice presidents are working with a team headed by the Vice President and Chief Financial Officer. (One of the first vice presidential portfolios to undertake this effort was Information Technology Services. The changes made in this portfolio through the reallocation process netted the university a savings of about $5 million in recurring funds, some of which are being reinvested in the aging technology infrastructure.) In light of this exhaustive process, we expect to provide little or no new central funding for college initiatives and we are significantly reducing centrally funded programs to recruit and retain staff and faculty. Appendix 1, “Operating Forecast for 2009-10 to 2011-12,” of the TPAC report provides details of the budget realities we face.

 

UT Brownsville

The University of Texas at Brownsville and Texas Southmost College has always focused on maintaining affordable tuition and fees for our students through prudent management of the budget and development of strategies for achieving cost savings. This perseverance and dedication to the concept of cost savings has helped us develop a tuition and fee rate that is the second lowest in the UT System.


During 2009, UTB/TSC continued cost savings initiatives and identified the following areas for potential cost savings:


Staff evaluated computer purchases and determined that a scale back in functionality (operating systems and processors) would save dollars. In addition, the campus pursued cost reductions from the supplier that yielded a savings of $239.82 per unit or $373,873 in 2009. The cost savings provided for the redirection of funds to other priority needs of the University.


University personnel also conducted a review of all copiers on campus to determine departmental needs. A list of recommended copiers was developed and additional pricing reductions were requested from the vendor. We expect to save about $107,000 FY 2010 and will redirect additional dollars to other priority needs of the university.


Budgets for out-of-state travel were reduced during the FY 2010 budget development process for the entire organization. We are using webinars and other online tools to provide training to staff. The approximate savings are expected to total about $92,000 for FY 2010. The cost savings have allowed the university to redirect funds to other unmet needs or to reduce the cost of providing instruction to students.


As part of the budget development process for FY 2010, the university reduced budgets for office supplies, paper, toner, and other supplies. The approximate savings totaled $940,000 for FY2010. The cost savings allowed us to redirect scarce resources to other critical functions within the university.


Finally, our custodial contract was renegotiated and costs reduced by changing the cleaning frequencies of campus space while maintaining the same level of service quality. The approximate savings are expected to total $120,000 for FY 2010. The cost savings provide much needed dollars to fund mission critical initiatives throughout the campus.

 

UT Dallas

Concurrent with the Committee’s work to consider adjustments in tuition and fee costs to students and the programmatic needs of the university that might justify increases in such costs, the university is pursuing an on-going process to identify and implement changes in business practices that can increase efficiencies and reduce costs. Obviously, every dollar of reduced costs of ongoing operations is a dollar that does not have to be generated with additional tuition and fee costs. In accordance with the UT Dallas Strategic Plan (Imperative 8: Reduce Costs), the university continually assesses operations with regards to efficiency, cost reduction, cost avoidance and revenue generation opportunities.

 

Ongoing initiatives include:

  • UT System shared services initiatives:
    o Shared student system (Oracle/PeopleSoft) with UT Dallas, UT Tyler and UT Arlington
    o Shared administrative data center (utilize Arlington data center for student system infrastructure and database administrator services)
  • Employee W-2’s issued via the Web resulting in cost reduction due to reduced printing and postage costs as well as efficiencies from reduction in staff processing time.
  • Utilize student patrol to staff the Information Center and reassign guards to other duties resulting in cost avoidance (reduce need to hire additional guards)
  • Implement Intellecheck software with capability of emailing accounts payable direct deposit payment advices, resulting in reduced printing costs and reduced staff processing time.
  • Implementation of revised budget process of collapsed budget pools, resulting in a 45% reduction in the number of budget adjustments processed each year and reduced staff processing time.
  • Implemented Bursar Office auto-dial system to generate automated phone calls to students advising them of final payment dates, resulting in reduced number of students dropped for non-payment, improved efficiency by not having to reregister students, and improved customer service.
  • Implemented Symposium phone software which allows phone calls to be routed to all available employees in the Bursar Office, resulting in improved efficiency and customer service.
  • Implemented electronic submission of checks for deposit resulting in faster deposits to the bank and increased interest revenue
  • Sealing multiple building envelopes (windows, joints and roofs) resulting in energy cost savings.
  • Implemented shutdown of non-laboratory air handlers in Natural Science and Engineering Laboratory during off usage hours, resulting in energy cost savings.
  • Increased recycling efforts, resulting in reduced trash collection contract costs.
  • Gradual replacement of 20+ year old vehicles with smaller and more gas efficient vehicles and/or carts.
  • Continuing program to increase efficiencies in class scheduling.
  • Review of cell phone policy and use.
  • Gradual transition of telephones to voice over IP.
  • Negotiate for increase in indirect cost rate with Federal government, resulting in increased revenue.
  • Hired fire and life safety specialist with expertise that enables the university to handle small scale fire alarm, sprinkler and gas suppression system projects inhouse, resulting in savings on outside contracts.

New initiatives include:

  • Formation of a university-wide committee to generate and review cost savings and operational efficiency initiatives.
  • Implementation of T2 parking software that will end manual entries and reconciliations currently performed by two employees (50% of their time) resulting in more efficient use of staff time and improved customer service.
  • Revise police department shift scheduling procedures resulting in reduction in overtime pay.
  • Create office size and furniture standards, resulting in reduced costs and more efficient use of space.
  • Standardize carpet, paint, trash receptacles, etc., resulting in reduced costs.
  • Selection and implementation of new finance, human resource, payroll and budget systems with electronic workflow and approval capability to improve efficiencies and reduce staff processing time.

Other possible initiatives include:

  • Reduce level of service by issuing accounts payable checks 1 or 2 times per week instead of daily.
  • Mandate use of the purchasing card program for all purchases under $1,000.
  • Reduce number of desktop printers and copiers and transition to area network combination printer/copier/scanners) resulting in reduced costs.
  • Mandate the use of eShipGlobal for priority shipping needs.
  • Mandate the use of StaplesLink for office supply purchases.
  • Review treasury/cash management procedures to increase interest revenue.
    • Implement lock box service for check payments
    • Consolidate university credit card payments to TouchNet Market Place software
    • Implement just-in-time AP payments.
  • Improve the timeliness of collections of sponsored program revenues by assessing interest on late payments.
  • Review service center policy with regard to recovering laboratory support costs from contract and grant sponsors.

UT El Paso

The University continues to implement strategies that will increase economic efficiency by either reducing costs (cost saving) or increasing the benefit received from existing resources (cost avoidance). Over the past few years, these programs have generated aggregate savings in excess of $10 million and include significant efforts in HVAC operations and management, energy conservation, outsourcing efforts, and other institution-wide initiatives. In 2008-09 alone, UTEP added $1,856,000 in additional savings through the following cost saving measures:

  • U.S. Mail processing improvements to increase use Non-Profit rate ………………$130,000
  • Standardized campus-wide building operating temperatures …………………………$350,000
  • Electronic Course Catalogs & Schedules ……………………………………………………………$49,000
  • Centralized Computer Replacement Program …………………………………………………$120,000
  • One year suspension of computer replacement program ………………………………$577,000
  • Nine month flexible hiring freeze ………………………………………………………………………$750,000

The University will continue its efforts to identify and implement additional cost savings/avoidance initiatives to ensure that future tuition increases are mitigated. The University has also constituted the President’s Task Force on Efficiency, a campus-wide committee that meets biennially to recommend improved efficiencies and cost savings. UTEP’s student and community profile makes these efforts a critical part of the university’s overall management philosophy. 

 

UT Pan American

Given the socio-economic characteristics of our student population, UTPA is engaged in efforts to reduce cost in order to keep tuition and fees affordable. Perhaps this commitment is most visible in the work of the Cost Avoidance Task Force which to date has generated 153 cost avoidance strategies. 44 of these have been implemented and another 58 are scheduled to be implemented.


In addition, the University Sustainability Council has been formed to promote the most efficient use of natural resources. Cost-saving improvements are being made in areas as diverse as building design, dining services, and landscaping.


Several initiatives are currently being pursued in order to cut energy costs. These include optimization of building automation systems, metering all campus buildings to improve measurement of consumption, and updating cooling plant equipment. UTPA is currently completing a campus-wide retrofit to efficient lighting fixtures, a project expected to pay for itself through energy savings in 3 years. Also, a campus energy audit is being planned to target improvements that will reduce costs.


Starting in mid-FY 2009, UTPA has been able to cut costs and improve its operating margin through a flexible hiring freeze and a heightened commitment to not expending salary savings. The institution also reduced the funds available for salary adjustments effective for FY 2010. These cost saving measures are expected to continue to help keep academic costs low, especially in this time of national economic uncertainty.


Several construction and renovation projects are currently on hold or are being reduced in scope to cut costs and, in turn, reduce the drain on fund balances. The most notable of these is the recent change in scope for the Academic and Performing Arts Complex. 


Additional savings have come through outsourcing of printing services, the use of student printing quotas to reduce waste, and ongoing efforts to transition to a paperless workflow environment.


Finally, the implementation and ongoing refinement of the institution’s administrative software systems (Oracle, Banner, and soon, Hyperion projects) still present major challenges, but are starting to pay benefits. Eventual cost savings achieved through better planning, tracking, measurement, and management of processes will be critical to operating successfully in an environment where public support is not keeping pace with the needs of higher education.

 

UT Permian Basin

There are several cost savings measures in effect at UTPB, which have led to greater efficiency for the campus. Some of these include automatic lights in classrooms and meeting rooms, vice presidential review of travel to determine which travel is essential and a recent hiring freeze.


The University centralized the travel reservation and arrangements process in a single office on campus Two individuals are estimated to use approximately .3 FTE time allocation for these activities on a campus our size. When appropriate, advance and/or discount bookings are used to reduce travel costs; state rates are sought and confirmed to insure eligibility for the use of State funds for travel. Travel was limited to absolutely essential trips in January of 2010. The preliminary Annual Financial Report (AFR) numbers indicate a reduction in travel costs from FY 2008 to FY 2009 of $103,900. If 50% of that reduction was attributable to travel efficiencies, the estimated savings are $50,000 per year or about 5% of the total AFR travel costs.


The University and its administrative partners through The University of Texas System increased the use of video conferences and phone conferences for administrative meetings from FY 2008 to FY 2009. Estimated cost savings are based on an average round trip flight cost to Austin of $235 plus a one night hotel stay cost estimated at $93, for a total per trip savings of $328. At a conservative estimate of two participants in each video conference, the travel savings are estimated at $656 per video conference resulting in a savings of $6,560 for the ten increased video conferences Besides the travel savings there are time away from the office savings representing one half to one full day per participant per video conference or ten to twenty saved days per year available for work at the campus. (10 conferences for two participants for one half or one full day equals 10 to 20 saved days.)


Recently, a hiring freeze for new employees was put into effect. This freeze is in response to recent communications from the Governor’s office related to potential budget cuts. Positions are frozen unless a careful review by the department’s vice-president reveals that the position is essential to critical student services. 

 

UT San Antonio

While our campus is experiencing continued growth by serving more students, offering more credit hours, conducting more research and adding new facilities, we engage in cost cutting initiatives on an on-going basis. Most departmental operating budgets have not increased over the past several years. Further, the buying power of those accounts has been eroded to cover increases in salaries to match the market and/or inflation. Improving efficiency is accomplished by consolidating resources, examining our business practices and implementing numerous process efficiencies.


Last year, the campus initiated a website to solicit cost savings ideas from faculty, students and staff: http://www.utsa.edu/financialaffairs/Budget/usrpc/cost_cntnmnt.cfm. Each person who proposes a cost savings idea is guaranteed a response from the university within 30 days of the submission.


The ideas suggested are not all feasible to implement, but are posted at: http://www.utsa.edu/financialaffairs/Budget/usrpc/cost_utsa_ideas.html and include the following: send email holiday greeting cards (implemented this season); reduce energy demand by powering off computers (a campaign has been initiated); reduce the frequency of cleaning faculty offices; etc.


Additionally, the President has requested the Vice President for Business Affairs to lead a Cost Containment Task Force and that group will begin meeting in January 2010.


Here are several other examples reported by administrators of the mandatory fee accounts and others, of efficiency gains and cost savings that help stretch our limited resources: 


Use of Technology:

  • Utilization of free or low cost email services in place of locally managed services.
  • Expanded use of the Electronic Data Interchange (EDI) with other participating Texas colleges and universities to reduce costs of postage, paper and envelopes, as well as maintaining the same level of staffing.
  • Implementation of e-check online deposit process for UTSA Cards (meal plans, etc), which eliminated the need for check handling and processing.
  • Providing UTSA Card balance and transaction history online in lieu of paper copies.
  • Reduced the amount of paper catalogs and Information Bulletins printed by 53-percent. We encourage the campus to access these documents electronically via the web.

Partnerships/Consortia:

  • Implementation of an Off-Campus Apartment Contribution Program where apartments requesting to be on the university bus route will pay a predetermined amount per semester.

Recycling/Reuse/Energy Savings:

  • Multidisciplinary Studies (MS) Building Infill project included lighting and HVAC improvements for energy savings; Library renovation lighting retrofit completed November 2009 will save in electrical costs.
  • Implementation of variable frequency drives to provide better chilled water distribution resulting in energy savings.
  • Implementation of a Preventative Maintenance Program such as thermography to identify inefficiencies or temperature sensor calibration to ensure efficient operations.
  • Funding has been identified for Phase I installation of complete utility metering to identify consumption and correct inefficiencies.
  • Implementation of a HVAC temperature set point policy (Summer: 78; Winter: 72)
  • Retro-commissioning of tri-Campus buildings: retrofit of Biosciences Building (BSB) completed.

Process Efficiencies:

  • Automated the student stipend payment process to reduce manual effort and duplicate vouchers for each month by Disbursements & Travel Services.
  • Increased library services despite business process efficiencies and only nominal additional costs.
  • Improvements to the UTSA bus service by the Transportation Department include:
    • Utilizing larger buses to increase the number of passengers per bus route.
    • Re-designing bus routes for improved efficiency and reducing the number of buses running during non-peak times.
  • Reduction in professional travel in some areas.
  • Reduction in staffing during Recreation Center non-peak periods.
  • In-house production of promotional materials.
  • Cognos® reporting that automates monthly reports that are also emailed to account administrators.
  • Annual management financial subcertification performed electronically through email.
  • Business Affairs is using the Lean Systems methodology to re-engineer disbursements, facility workorder and recruitment and hiring processes.

Rate Adjustments/Vendor Negotiations/Outsourcing:

  • Seeking of sponsorship trade-outs for certain local recruiting and business expenses.

Flexible Hiring Freeze:

  • Comparing data for the twelve months before and after the flexible hiring freeze commenced in February 2009, UTSA had 150 fewer positions filled. Based on an average annualized staff salary of $44,500 and benefits, total savings is estimated at $840,000.

 

UT Tyler

The concern for UT Tyler is that allowing tuition increases to lag behind and not fully replace declining state support is adversely affecting our ability to meet our mission and strategy. Some level of funding pressure is acceptable, even advantageous, as it forces the institution to become more efficient in delivering educational services. But at some point, our quality of service delivery deteriorates, and it is clear that we are at that point.


Cost‐saving efforts are unfortunately having direct impact in the classroom:


Using Fall data, the Faculty/Student Ration has increased from 11.7 students per faculty in 2000 to 16.2 students per faculty in Fall 2008.


The percentage of lower division courses taught by tenured or tenure‐track faculty has decreased from 61.6% in 2000 to 43.9% in 2009.


As a result of cost‐saving efforts, the university is looking at changing the minimum headcount for a class to make for undergraduate classes from 10 to 12‐15 and graduate from 5 to 7‐10. Course loads for instructors not involved in research may increase from 3 to 4 each semester. Summer school classes will be taught by qualified faculty who are on the lower end of the pay scale in order to reduce costs.


None of these actions are preferred, but labor is the most significant driver of cost at the university. We have already taken the less detrimental actions to reduce cost.


Energy Savings Initiatives:


The University of Texas at Tyler conserves energy in many different ways. Our Siemens Energy Management System is the primary tool for monitoring our utilities, which include electricity, natural gas and water. The E.M.S. is monitored 24/7, which controls the heating and cooling, and air handling units, pumps, et cetera for the campus and utility sub‐metering. Manual readings are also taken on irrigation meters throughout the campus.

Conservation items:

  • Conserve electricity and natural gas by seasonally raising or lowering campus thermostats (heating 68 Deg F., cooling 74 Deg. F.)
  • Reduce the number of electric water heaters.
  • Conserve electricity by reducing the number of space heaters.
  • Conserve electricity by turn off lights in offices, conference rooms, classrooms and restrooms while unoccupied.
  • Conserve electricity by turning off computers, monitors and printers.
  • Economizer system is used for free cooling within the air handling units.
  • A Water Source Heat Pump‐Chiller is used to maximize chilled and heated secondary water.

All support service contracts are carefully monitored, such as custodial and grounds keeping, while working to keep up a quality campus environment.


Travel has been decreased from $1.69 million in fiscal year 2008 to $1.42 million in fiscal year 2009. Although travel may not decrease by such a large amount in the future it will be monitored and only essential travel authorized.


Similarly, the budget for Intercollegiate Athletics remains constrained – only $1.6million in 2010.