Board of Trustees Meeting Agenda | July 2021

It requires a plan A budget that does not include effective planning is failed from the start. Planning is the hard part, and when done well decisions around budgeting become easy simply because effective planning identifies and prioritizes what is important and what is not. We can then assign financial resources to the important things and the budget becomes the quantitative representation of what is important. This is critical, because while CWU has an abundance of resources, financial resources are finite and we cannot afford to consider, nor fund, everything as equally important. This is an area where we still have opportunities to focus our efforts on the most important things. A budget must include measurements Being able to measure those things that are important is vital to the budgeting process. For example, if we decide through our planning process that maintaining a small average class size is important, putting a measurement on the term “small” is vital so that we can understand together what we mean, and it has implications on budgeting for enrollment, instruction, physical capacity, etc. Measurement is vital to be able to respond to changing circumstances, such as changes to enrollment. Finally, measurement allows us to evaluate outcomes – successes and/or opportunities for improvement that may change future decisions on what is important and therefore what should be funded. Timeframe Understanding the timeframe for a budget is critical. We tend to budget annually, but break our budgets up into months, so every month has a budget. Monthly variances from budget can seem troubling to some, but actually there is a lot to learn from a monthly variance. It indicates that something occurred in reality that is different from your plan, and it can help inform a budget manager about what changes need to be made for the rest of the year to avoid a more significant variance at the end of the year when there is little that can be done to correct the situation. Overspending a budget at the end of the year is a little more serious, however our current practice is to allow overspending at the department level so long as there is a compensating underspend within the same division. Our expectation is that every division ends the year with no overspend. It’s not personal For the purpose of managing the university, and in some part due to state accounting rules, we have arranged ourselves into funds, divisions, subdivisions, and departments. We also have projects, programs and work groups. Each of these units has funding of some sort, in order to accomplish the work that needs to be done in support of our mission. While we all know that the resources of the university belong to the State of Washington, and we are the stewards of these resources, it is hard not to feel a sense of ownership. “Those are my funds, I took a budget cut, I’m not paying for that with my budget, they swept my unspent money” – all too

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