Regent Policy Document 21-8

Policy on the Annual Distribution of Tuition and Fee Revenue and State General Purpose Revenue

Scope

This policy addresses how state general purpose revenue and tuition allocations are created for UW institutions, UW System Administration, and UW System-wide activities during the 2013-15 biennium. It is anticipated this policy will sunset June 30, 2015.

Purpose

The purpose of this policy is to clarify how state GPR and tuition allocations are created, and to describe how state GPR and tuition combine to form the GPR/Fee base.

Policy Statement

The Board of Regents adopts an annual budget which includes allocations of state funding (GPR) and tuition (Fees) for each UW System institution, and allocations of GPR for UW System Administration and System-wide activities. Combined, these allocations constitute what is known as the GPR/Fee base.

The UW System uses a base-plus approach to create the annual GPR/Fee base budget. The starting point for each new GPR/Fee base is the previous year’s budget. This base is adjusted up or down based on final decisions by the Legislature and the Board of Regents. Adjustments include funding approved by the Legislature for salary and fringe benefits adjustments for state-supported positions, utilities, debt service, approved new initiatives, or other changes to the UW System’s appropriation as determined by the Legislature.

The UW System’s GPR/Fee base is heavily dependent on tuition revenue and therefore enrollment levels of the various institutions. The tuition revenue component of each institution’s GPR/Fee base budget is known as the tuition revenue target.

In an effort to maintain educational quality at all UW institutions, the following principles are considered when creating GPR/Fee allocations:

  1. Funding for cost-to-continue increases (pay plan, health insurance, and utilities) should be distributed in a way that makes each institution whole for these cost increases.
  2. The amount of tuition generated by each institution should be maintained from year to year. Tuition revenue levels need to be maintained from year to year to maintain GPR/Fee allocation levels.
  3. All of the tuition generated by an institution should remain at that institution, so that it can be applied toward the institution’s budgeted tuition revenue requirement.
  4. When the UW System faces sizeable GPR base reductions or when GPR funding cuts, adjustments, or legislative mandates disproportionately impact UW System institutions (such as tuition remissions for veterans), resource allocations to institutions should attempt to make the impact on each institution proportional to its share of the overall GPR/Fee base.

In any given year, the actual tuition collected by an institution may exceed its tuition revenue target because of fluctuations in enrollment level or student mix (part-time/full-time or resident/non-resident). Such tuition revenue remains at the institution to cover any unbudgeted expenses, or if unexpended is added to the institution’s year-end fund balance. If an institution exceeds its tuition revenue target on a recurring basis, it may request additional budget authority. The additional authority will be added to the institution’s GPR/Fee allocation and to its revenue target.

Likewise, an institution may also request additional budget authority for revenues from institution- specific programming/initiatives. These include tuition differentials, tuition from students in self-supported programs, tuition generated from enrollment growth, tuition above the regular graduate rate for students in professional schools, tuition from nonresident students enrolled via the Midwest Student Exchange, the Tri-State, or the Return to Wisconsin programs, and growth in application fee revenues. This additional authority will be added to the institution’s GPR/Fee allocation and to its tuition revenue target.

If the actual tuition collected by an institution falls short of its tuition revenue target, the institution will need to reduce expenditures or reallocate revenues from another appropriate source. If an institution falls short of its tuition revenue target on a recurring basis, it may request a reduction in budget expenditure authority. The reduced authority will be removed from the institution’s GPR/Fee allocation and the tuition revenue target will be lowered.

Related Regent Policies and Applicable Laws

Chapter 20, Wis. Stats.
RPD 21-7: Policy on the Expenditure of Tuition and Fee Revenue and State General Purpose Revenue

 

History: Res. 10293, adopted 12/06/2013, created Regent Policy Document 21-8.