Skip to Content Find it Fast

This browser does not support Cascading Style Sheets.

OVERHEAD ALLOCATIONS

Besides Facilities Services overhead, which is allocated to all units based on net square footage, there are two pools of overhead expenses allocated to RC units. These are:

General Administration – includes: President’s Office, VPFA Office, Human Resources, Computing and Information Services, External Relations, VP for Research and Public Service, OSR, VP for Student and Academic Services, Police, Commissions and transfers to USNH.

Academic Affairs – includes: Provost’s Office, Graduate School, DCE, Center for International Education, Registrar’s Office, Admissions, Financial Aid Office, Writing Center, Honors Program, Faculty Development, Enrollment Management, Institutional Research, Career Services and Business Services among other operations.

Both overhead pools are allocated to all RC units on the same basis: 50% of net expenses allocated based on total personnel expenses and 50% of net expenses allocated based on total adjusted revenues*. (see EXHIBIT 1 for diagram) Total personnel expenses and total adjusted revenues are calculated using all current funds (restricted and unrestricted) and are based on the prior completed fiscal year’s actual results (FY04 budget based on FY02 actuals). While the formula is the same for each overhead pool, the allocation base is different:

Assessment rates remain constant from one year to the next pending further review by the Central Budget Committee. Assessments are applied to the RC unit level not individual departments and programs. These assessments show up in an expense line for each RC unit. Actual allocations occur monthly, through an automated process, and be in the amount of 1/12 of the total unit budgeted amount.

* Adjusted revenues = Gross revenue from all funds less:

EXHIBIT 1

FY04 Example Assessment Calculation for RC Unit

Allocated Overhead Expense Calculation

 

 

Overhead:

Enter FY02 Personnel Expenses from all funds

$ 500,000.00

Enter FY02 Gross Revenues from all Funds

$ 1,000,000.00

Enter FY02 revenue transfers in

$ 25,000.00

Enter FY02 endowment income

$ 5,000.00

Enter FY02 cost sharing revenues )

$ 20,000.00

Enter FY02 Grant Expenses related to equipment

$ 5,000.00

Enter FY02 Grant Expenses related to financial aid

$ 10,000.00

Enter FY02 Grant Expenses related to subcontracts

$ 50,000.00

Enter FY02 Grant Expenses related to indirect costs

$ 50,000.00

Enter FY02 expenses related to mandatory debt transfers

$ -

Adjusted FY02 Revenue

$ 835,000.00

Academic Affairs Assessment:

5% per personnel $

$ 25,000.00

3% per adjusted revenue $

$ 25,050.00

Total Academic Affairs Assessment to Unit

$ 50,050.00

General Overhead Assessment:

10% per personnel $

$ 50,000.00

5% per adjusted revenue $

$ 41,750.00

Total General Overhead Assessment to Unit

$ 91,750.00


EXHIBIT 2

General Assessment
The net administrative cost of UNH is funded by a General Assessment.

Allocation
All units pay a general assessment based on a % of total revenue and a % of personnel (salaries, wages, fringe) expense. This assessment is calculated on the previous completed fiscal year (ie; FY04 budget is based on FY02 actual revenue & expenses) results, regardless of funding source. The exception to the calculation is that revenue associated with endowment payouts, cost sharing, grant subcontracts, grant equipment purchases, and debt payments are excluded from the allocation base.

Funded Units
As outlined in the attached exhibit, the President, VPFA, VPR&PS, and VPSAS are funded in part by the general assessment. The Provost’s area is not funded by this mechanism, but is funded by an Academic Assessment on the Academic Units.

Rate Increase
The assumption is that the assessment rates will not be increased on a regular basis. The growth in revenue and salary expense in the RC units will allow for funding growth in central administrative budgets in a manner that is consistent with the growth in the University. The Central Budget Committee reviews the assessment rates on a periodic basic and adjust if circumstances warrant a change in rates.

Budget Process
1. In September, the total dollars that the general assessment will generate are calculated based on the prior completed fiscal year financial results and the established assessment rates.

2. In October, a base budget for the general assessment units are built based on the prior fiscal year budget for all units in accordance with the budget guidelines. This model will determine if a preliminary surplus or deficit exists.

3. In early January, each area prepares a budget request for the President of any funding requested above base funding. As a result of the assessment calculation addition funds may be a available for distribution by the President. If a deficit exists, options must be presented to reduce the deficit. (note: The General Assessment units still have an opportunity for additional funding as outlined in #5 below)

4. In late January the President, VPFA, VPR&PS, VPSAS meet to review the general assessment budget to determine how the budget will be distributed. The result of this deliberation may be that a request is sent forward to the CBC for funding from the University Fund.

5. In March the Central Budget Committee meets to distribute the University Fund, and approves the budget funded by the general assessment. At this time the Central Budget Committee reviews any request brought forward by the President for additional University Fund funding for administrative units.

Revenue
When calculating the administrative allocation, revenue associated with interest earnings, late fees and all other misc revenue, will be used to determine the net cost of general administration that needs to be covered via general assessment. The future year growth on the 18.5% indirect cost recovery return to VPR&PS is excluded from this calculation, because that pool of funds is for the exclusive use of the Vice President.

Student Fee Auxiliaries
Due to the timing of the student fee process, which begins in November, the General Assessment rates charged to auxiliaries, will be the previous year’s rate. In the rare case when the Central Budget Committee approves an increase in the rates, it will not take effect until the next year for Student Auxiliaries.


EXHIBIT 3
Academic Affairs Assessment
The net costs of Academic Affairs will be funded by an Academic Assessment of all the Schools/Colleges.

Allocation
All Academic Units pay a general assessment based on a % of revenue and a % of personnel (salaries, wages, fringe) expense. This allocation is calculated on the previous fiscal year’s results (FY02 actual results are the base for FY04 assessment) regardless of funding source. The exception to the calculation is that revenue associated with endowment payouts, cost sharing, grant subcontracts, grant equipment purchases, and debt payments are excluded from the allocation base.

UNHM's revenue and personnel bases are weighted at .5 to reflect the level of expenditures paid directly from their budget which reduces their consumption of Durham based services. COLSA and CEPS are provided with a $59,000 and $23,000 annual exemption from the assessment, respectively. These exemptions are related to marine program grant activity that has been transferred to their units. COLA is provided with a $24,000 annual exemption to provide funding to the Family Research Laboratory. Since this activity was not subject to the Academic Affairs Assessment in prior years, the units are relieved for the above amounts to preserve equity among the units.

Funded Units
As outlined in the attached exhibit, the net cost associated with the following areas are funded by the academic assessment: Office of the Provost, DCE, Career Services, Business Services, Admissions, Financial Aid Office, Registrar, Graduate School, TRIO, Advising & Orientation, Exchange Programs, ROTC, Honors Program, Institutional Research, Faculty Senate, CIE, Access, Teaching Excellence.

Rate Increase
The assumption is that the rate will not be increased on a regular basis. The growth in revenue and salary expense in the Academic Units allows for funding growth in academic affairs budgets in a manner that is consistent with their growth. The Central Budget Committee will review the assessment rates on a periodic basic and adjust if circumstances warrant a change in rates.

Budget Process
1. In September, the preliminary assessment will be calculated based on the prior fiscal year’s financial results and the prior year rate.

2. In October, a base budget will be built (based on the prior fiscal year’s budget, and inflation on salaries) for all units in accordance with the budget guidelines. This model will determine if a preliminary surplus or deficit exists.

3. In January, each area prepares a budget request for the Provost for any funding requested above base funding.

4. In January the Provost meets with the Provosts extended staff to review the Academic Affairs budget to determine how the budget will be distributed. The result of this deliberation may be that a request is sent forward to the CBC for funding from the University Fund.

5. In March the Central Budget Committee meets to distribute the University Fund, and approve the budget funded by the General Assessment. At this time the Central Budget Committee would review any request brought forward by the Provost for additional University Fund funding.

Revenue
When calculating the Academic Assessment, revenue associated with application fees and other misc revenue is used to offset the costs of Academic Affairs, so that the net cost is recovered via the academic assessment.