UC IRVINE ADMINISTRATIVE POLICIES AND PROCEDURES
Business and Financial Affairs
Sec. 703-12: Fund Management - Budgetary Savings Policy
Responsible Administrator: Vice Chancellor - Planning and Budget
Revised: June 2009
References / Resources
- UC Planning and Budget Manual, Section 4020, Budgetary Savings
- UCI Administrative Policies & Procedures
- Section 703-10, Budget Office Terms and Definitions
Contact: Budget Office at (949) 824-7676
University budgetary savings represent State of California general fund appropriations which are not expended during the fiscal year in the specific subaccounts for which the funds are allocated. The University's levels of budgetary savings targets are a negotiated rate between the University and the state.
Budgetary savings accrue from unused appropriation balances from the following subaccounts:
- Salary savings (from subaccounts 0, 1, and 2) generated by position turnover and recruitment delays, by filling vacancies at salaries below budgeted levels, by leaves of absence without pay, and by sabbatical leaves at less than full salary for which no replacements are provided.
- Underexpenditure of funds in other subaccounts such as general assistance, supplies and expense, equipment and facilities, and special items.
B. Policy Guidelines
- Upon establishment of a total University budgetary savings target, the Office of the President notifies each Chancellor of the savings target amount each campus is expected to realize in a given budget year. Targets are similarly established for the Office of the President. Since the general fund expenditure level approved for the University is funded in part from anticipated budgetary savings, the University must achieve its assigned budgetary savings target.
- University general funds may be expended or committed only in the year appropriated; savings in excess of assigned budgetary savings targets lapse to the state for use in financing the University's budget in the succeeding year.
- Any shortfalls of University general fund income below budget on a campus shall be covered by excesses generated by the campus's other general fund income sources or by budgetary savings realized in excess of the assigned target. If the shortfall is a result of conditions imposed upon the campus by the Office of the President, the deficit may be referred to the President to be covered by excesses generated within the overall University system.
- University general fund income in excess of amounts estimated in the operating budget must lapse at year end and will be carried forward to fund the University general fund budget by offsetting the following year's state appropriation request. In the event University general fund income estimates are not realized in a given year, additional budgetary savings will be assigned in excess of current year assigned targets to offset deficiencies.
C. Authority and Approval
The Chancellor may request the Office of the President's approval for:
- An allocation of budgetary savings to cover general fund overdrafts or deficits which are created by conditions not subject to precise management controls, such as deficits resulting from "mysterious disappearance" losses of property, and for which campus funds are not available. Such losses are not covered by either commercial insurance or the University self-insurance program.
- Allocation of excess budgetary savings for equipment and other nonrecurrent purposes.
- The Chancellor is responsible for meeting the campus budgetary savings target and for ensuring that all uses and requested allocations of budgetary savings are within established policy guidelines.
- Vice chancellors are responsible for meeting budgetary savings targets as designated by the Chancellor.
- The Budget Office is responsible for:
- Making recommendations to the Chancellor as to assessment levels and implementing approved levels.
- Making sure that campus functions comply with budgetary savings assessments so the campus target will be met.
- The Accounting Office is responsible for establishing a campus budgetary savings account into which periodic transfers will be made by the Budget Office.
- Department and operating unit heads to which budgetary savings are assigned are responsible for meeting their budgetary savings targets.