Kaua‘i community college

The campus has begun the task of developing the infrastructure for responsible financial allocation utilizing a shared leadership approach. Program review and self study are two of the primary forces working to shape the process. The college has created a new Kaua‘i Community College Memo (KCCM) section 1-7, which established the College Council. This section also created a budget allocation process, which is based on program review. On February 22, 2005 a document entitled, Program Review Action Plans and Resource Allocations, was developed for the Council in preparation for the March 2005 APRU budget prioritization process. This document established the criteria for the council members to rank each request based on the following six criteria: alignment with the college’s goals, outcome expected, evidence, need, collaboration, and impact.

The policy describing the APRU process is located in KCCM 1-6, and guidelines to assist in developing APRU resource proposals were written in 2006 (CampusDocs). Some found it difficult to follow the connections between the guidelines and the criteria that the College Council adopted to prioritize funding proposals.

Evidence of various programs becoming more sophisticated in their use of program review to garner a larger piece of the resource pie has been illustrated in the March 2006 resource proposal prioritization process, e.g., a total of thirteen of the forty proposals considered came from the Culinary Arts program. There must be careful attention paid to those programs that have not responded as readily to the mini and full-program review process. In a system built on the ideal that program review allows for self-improvement, the entire campus may be adversely impacted by programs which do not see the need for change. Although it is not mandatory for programs to participate in the program review analysis, the chancellor has been very clear that resource requests must work through the program review process. The program review committee is presently analyzing the process for improvement and recommendations. The Dean of Instruction, in particular, plays a pivotal role in encouraging academic programs in developing their program review and responding to program review reports.

Planning Agenda

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  The Administration and the College Council need to examine the program review process. The guidelines to develop APRU reports should include the criteria on which program funding proposals will be evaluated.
  

III.D.1.c. When making short-range financial plans, the institution considers its long-range financial priorities to assure financial stability. The institution clearly identifies and plans for payment of liabilities and future obligations.

Descriptive Summary

Kaua‘i Community College implemented a planning process in 2005 that reviews the impact of short-range financial plans that could result in future obligations. This process pertains primarily to the filling of vacant appropriated positions, which could result in a long-term financial obligation for the college. Personnel costs make up about 80 percent of Kaua‘i Community College’s budget and carry long-term obligations. Growth in facilities also results in future financial obligations and requires careful planning for operational costs such as utilities and maintenance. Financial planning documents such as the Tuition and Fees and Special Funds (TFSF) projection referenced above are used to analyze future obligations as well as projected funding.

Self Evaluation

Kaua‘i Community College has no long-term liabilities in the form of loans or bond issues. Other future financial obligations, which are taken into consideration in budgeting, are the projected requirements to fund a portion of the collective bargaining costs for facultywhich is estimated to reach $254,722 in FY2009and the commitment to increase financial aid through 2012 to ensure access for low-income students.

Another form of future liability is the annual system assessments against all campuses to fund essential system functions, including assessments for UH Foundation operations, risk management and the central student information system, Banner. These assessment amounts are “taken off the top” in determining the tuition and fees fund allocation for each campus at the start of each fiscal year.
Kaua‘i Community College’s enrollment has ebbed and flowed over the past ten years. Short-range financial plans take into account possible increases and decreases in enrollment as well as the financial commitments noted above. The college has set aside funds for ongoing maintenance and service contracts and must continually seek ways to conserve energy to control the escalating cost of electricity. The Position Request Form (Exhibit I-12: Request to Fill a Position Form) process ensures that due consideration is given to any additional personnel obligation to ensure that the expenditure is aligned with college goals and program plans.

Planning Agenda

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  The college will continue to refine and improve its analysis of financial impact and incorporate that analysis into the data presented to the College Council.
  

III.D.1.d. The institution clearly defines and follows its guidelines and processes for financial planning and budget development, with all constituencies having appropriate opportunities to participate in the development of institutional plans and budgets.

Descriptive Summary

As described in the sections above as well as in Standard I.B, the college has developed a framework for financial planning and budget development which utilizes program review as the basis for financial planning and budget development.

Through a collective, collaborative process, Kaua‘i Community College has established its mission statement and accompanying strategic goals. These documents form the foundation of the Strategic Plan. Faculty, staff, students, and administrators, with input from community, county, and business advisory groups, took part in the development and revision of the mission and goals. The College Council selected four of the college’s goals for priority budget considerations. Goal selection was based on data such as declining enrollments, workforce demands, and faculty demographics, as well as feedback from UHCC systemwide budget discussions.
One of the key elements of this process has been the organization of the College Council, which provides the platform for participatory governance. KCCM 1-6 and KCCM 1-7 clearly define the program review process and the ways in which the College Council and program faculty and staff are actively involved in the planning and decision-making processes. The document, Program Review Action Plans and Resource Allocation Decisions, which was emailed to all faculty and staff and placed in CampusDocs, further explains the process for budget priority setting and the key role of the College Council in that process.

Self Evaluation

As discussed in the sections above, the college has taken steps to develop the processes for institutional planning where all stakeholders have opportunity to participate. As per the memo on the APRU priorities issued by the chancellor during the Spring 2006 semester, there is a need for the College Council members to assess the process. The ability to provide input and gain better understanding of the responsibilities of the College Council and its role in budget development would help all stakeholders own the process and fulfill the purposes outlined in KCCM 1-7 (Exhibit II-9: KCCM 1-7). It may also help to align the APRU format and guidelines more clearly with the criteria for evaluation used by the College Council.

All programs need support to strengthen their use of reliable data in their own decision making when developing Program Review/APRU action items and budget requests. The existing process expects all campus constituents to participate in campus budget planning and, more importantly, program planning and development through program review. More in-depth understanding of the processand how to interpret and use the quantities of data on student and community needs we havemay help stakeholders to use the process more effectively.
On a more philosophical level, the campus needs to ensure a cooperative and supportive environment lest the nature of the prioritization process become purely competitive and political. There are never sufficient resources to fund everyone’s requests. The prioritization of those requests must remain focused on the mission, goals, and ultimately, student learning.

Planning Agenda

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  See action items in sections above.
  

III.D.2. To assure the financial integrity of the institution and responsible use of financial resources, the financial management system has appropriate control mechanisms and widely disseminates dependable and timely information for sound financial decision making.
III.D.2.a. Financial documents, including the budget and independent audit, reflect appropriate allocation and use of financial resources to support student learning programs and services. Institutional responses to external audit findings are comprehensive, timely, and communicated appropriately.

Descriptive Summary

Kaua‘i Community College’s budget document reflects the five major programs of the college: Instruction, Public Services, Academic Support, Student Services, and Institutional Support. The budget also accounts for funding and expenditures by programs within the major programs. Each of the five programs supports student learning. The bulk of the budget is allocated to those areas of the college which directly support students, i.e., Instruction, Academic Support, and Student Services.

Kaua‘i Community College is currently a part of the University of Hawai‘i's A-133 consolidated financial audit, which is required by the federal government. However, beginning with the fiscal year ended June 30, 2005, the university’s audit contract with PricewaterhouseCoopers, LLP, will include a presentation of a combined balance sheet and income statement of Kaua‘i Community College.
The college has provided timely corrections to audit exceptions and management advice resulting from the A-133 financial audits. In the past few years, concerns have been identified in the financial aid audits, and these concerns have been promptly addressed. For example, timely return of Title IV refunds has been a concern. Changes to the Banner System to streamline processing, as well as improved communication between the Financial Aid Office and the Business Office have been some of the campus responses to this issue.
Self Evaluation
The bulk of the campus budget is allocated to personnel and such overhead costs as utilities. The campus relies on the program review process and the College Council funding prioritization process as the mechanisms to ensure appropriate financial resources are allocated to support the mission. Program managers and fiscal personnel who have authorization to expend funds are responsible for assuring that all funds received by the college are spent in accordance with their intended purpose, ultimately supporting student learning programs and services.
Staffing in the Financial Aid Office was recently increased with the addition of a professional staff person with many years of experience with computerized financial aid systems.

Planning Agenda

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  Review FISAP report for quality control with the new APT employee to eliminate reporting errors and keep ongoing communications with the Banner financial aid group.
  

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  Continue to actively collaborate with Principal Investigators and program managers to prevent incorrect charges and decrease journal voucher adjustments by 10 percent. Collect data on document processing.
  

III.D.2.b. Appropriate financial information is provided throughout the institution.

Descriptive Summary

The focus of the college’s financial information has been on the two main sources of funds (general funds and Tuition and Fees Special Fund) for its operating budget. The college also shares funding information on facilities repairs and maintenance projects and Capital Improvement Program projects during Convocation at the beginning of each academic year. Reports on the progress of major grants, such as the HEA Title III grant, are also presented at fall or spring convocation.

Instructional division chairs and non-instructional unit heads are given a yearly budget, primarily for supplies and equipment. Fixed or generally predictable areas of the budget, such as salaries for permanent positions and overhead costs such as utilities, consume the major part of the budget. Individual programs, grant program managers, and administrators have access to current fiscal information through the University of Hawai‘i’s Financial Management Information System (FMIS) computerized system and may keep track of their expenditures and balances via the system. The chancellor also receives the quarterly Board of Regents BLS Report, which tracks variances from projected expenditures and revenues.
The chancellor shares other financial information such as legislative actions and budget development processes on the system level with the deans, directors, and the College Council in meetings and with the entire campus via email or by posting information on CampusDocs. Announcements about major private gifts are dependent upon the wishes of the donor. Generally, the college makes very good use of those announcements in the public media.

Self Evaluation

Few of the division chairs make full use of FMIS reports. Training sessions with division clerkstenos were held to go over the directions to access the reports. However, the chairs themselves need more training to interpret the reports and use them more effectively.

Financial information is shared at College Council meetings but meeting handouts are not necessarily available.

Planning Agenda

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  A series of workshops will be set up for division chairs and other appropriate personnel to increase their ability to effectively use the FMIS reports.
  

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  College Council handouts should be made available on CampusDocs.
  

III.D.2.c. The institution has sufficient cash flow and reserves to maintain stability, strategies for appropriate risk management, and realistic plans to meet financial emergencies and unforeseen occurrences.

Descriptive Summary

Kaua‘i Community College’s major source of funds is from the State of Hawai‘i general funds and tuition and fees. Other funds from revenues generated through program activities such as non-credit course offerings, culinary operations, early childhood educational services, and grants are restricted to supporting the activities which generated the funds or for which they were granted. Funding from the state provides the necessary stability for the college during a given fiscal year but must be returned to the state at the end of the fiscal year if not spent. The college can maintain a cash balance for working capital and emergencies by reserving cash from tuition and fees and special funded program. The college is covered by the State of Hawai‘i’s self-insurance program and may secure additional insurance in cases where hazardous conditions increase the probability of loss (Executive Policy E8.207).

Self Evaluation
The University of Hawai‘i Community College System has established a reserve target of 3 percent for the community colleges. Kaua‘i Community College has maintained a reserve of 9 percent as of June 30, 2005 (Exhibit III-15: BLS Report).
The college participates in the University of Hawai‘i’s risk management program to limit liability for personal injury and property damage. The college has processed three tort claims over the past five years. The cost of the claims was paid by the State of Hawai‘i.



Planning Agenda

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  The college will continue to adhere to the minimum 3 percent reserve target.
  

III.D.2.d. The institution practices effective oversight of finances, including management of financial aid, grants, externally funded programs, contractual relationships, auxiliary organizations or foundations, and institutional investments and assets.
Descriptive Summary
A principal investigator or program manager manages all funds received by the college with fiscal oversight by the Fiscal Officer and the Director of Administrative Services. These funds must be properly accounted for under the University of Hawai‘i’s Financial Management Information System (FMIS). Externally funded grants may also use the services of the Research Corporation of the University of Hawai‘i (RCUH).
The University of Hawai‘i Foundation is the private fundraising arm of the institution and supports the various accounts of the Kaua‘i Community College Fund. It has a separate accounting system, and used for the purpose for which they are granted, appropriated or donated.
Principal investigators, program managers, and fiscal officers also provide oversight for contracts and college assets. The University of Hawai‘i Bookstore operations oversees the bookstore at Kaua‘i Community College.

Self Evaluation

The Financial Management Information System (FMIS), supported by the UH Information Technology Services (ITS), is the institution’s transactional and management information system. The system is designed to provide checks by an approving authority and Fiscal Officer for the commitment of funds.

The University of Hawai‘i’s Office of Research Services reviews and approves proposals for research and training grants from federal and other external agencies to assure that terms and conditions of the granting agency are met. To verify compliance with federal mandates, an A-133 Single Audit is performed annually for the University of Hawai‘i. The Financial Aid, Business, and Admissions and Records offices meet to review audit findings and develop processes to improve tracking. All audit findings for financial aid and other federal programs have been fully addressed by the college.
Planning Agenda

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  The Dean of Students and Director of Administrative Services will direct the progress in addressing concerns established in the Financial Aid audit.
  

III.D.2.e. All financial resources, including those from auxiliary activities, fund-raising efforts, and grants are used with integrity in a manner consistent with the mission and goals of the institution.
Descriptive Summary
The University of Hawai‘i has policies and procedures to assure that all financial resources are properly used and accounted for. Kaua‘i Community College uses various sources of funds to achieve its mission and goals. General funds, which make up the bulk of the college’s operating funds, are received from the state in the form of legislative appropriations. Federal funds are received for financial aid, and as awards for various specific grant proposals. Special funds are derived from self-supporting activities such as the college’s non-credit instructional program. Also available for the college’s use are Agency and Trust funds to account for monies received and earmarked for very specific purposes. Kaua‘i Community College has only one trust fund and that is the Leeward Plantation Trust Fund. Ed White and Vidinha are Foundations monies, not agency or trust. Bond funds are used by the University of Hawai‘i System to account for the proceeds of general obligation bonds issued by the state and revenue bonds issued by the university, which are earmarked for specific uses, such as construction projects. All such expenditures are handled by the UH System Fiscal Office and not by the college.
As noted above, the UH FMIS and RCUH computerized funds management systems handle transactions and reporting of fiscal operations. Various approval levels are built into the process, and generally accepted accounting principles are followed in all business office procedures. While signing authority for requisitions is granted to division chairs, program managers, and principal investigators, the Fiscal Officer must countersign as to fund availability. Expenditures are also reviewed at the UH System procurement level and, for external grants, by the Office of Research Services.
In addition, the UH Foundation (UHF) handles all gifts and expenditures to and from the Kaua‘i Community College Fund accounts. Oversight is also provided from the Kaua‘i Community College Fund Board of Trustees, who must approve all requests for funding from the general development fund, the only unrestricted Kaua‘i Community College Fund account. The board is made up of a group of 16 community supporters, a faculty member, and a student member. A formal written request must be submitted for board approval at one of their regularly scheduled meetings. Requests coming in at other times of the year may also be reviewed electronically. Other Kaua‘i Community College Fund accounts are restricted according to the specific wishes of the donor(s), e.g., scholarships, professional development or specific programs such as Culinary Arts. The University of Hawai'i Foundation follows national standards of best practice, which can be seen on its website.

Self Evaluation

Kaua‘i Community College relies on its principal investigators, program managers, Fiscal Officer, and Director of Administrative Services to review all financial resources for alignment with its mission and goals and in accordance with the University of Hawai‘i’s Administrative Procedures A8.200 for procurement. The college has had minor audit findings such as charges to incorrect accounts and expenditure codes, which have been corrected. There have been no findings that any of its financial resources have been used in a manner that is inconsistent with the mission and goals of the institution. The UH System Office of Research Services monitors compliance for federal grants such as Title III, Rural Development Program, and HUD (Housing and Urban Development).

It has been suggested that grant proposals be submitted to the College Council for review regarding alignment with the college mission, goals and priority actions as identified in program review plans. However, the logistical reality of grant deadlines would make such a review difficult to implement. Because the college does not have a dedicated grant writer, faculty and administrators often become aware of grant opportunities only a short time before due dates. Well-developed program review action plans would greatly facilitate the quick development of solid grant proposals which are aligned with program review results.

Planning Agenda

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  The college will continue to follow applicable regulations and procedures to ensure that funds from all sources are expended appropriately and in support of the Kaua‘i Community College mission and goals.
  

III.D.2.f. Contractual agreements with external entities are consistent with the mission and goals of the institution, governed by institutional policies, and contain appropriate provisions to maintain the integrity of the institution.

Descriptive Summary

Kaua‘i Community College enters into contractual agreements with external entities through purchase orders, formal procurement contracts, real property lease agreements, memoranda of agreement, and memoranda of understanding. Purchase orders and formal procurement contracts are used to acquire goods and services required by programs to achieve the institution’s mission and goals. Lease agreements are used by the college to rent college property or property owned by an external entity. Memoranda of agreement and memoranda of understanding are used by the college to express the terms and conditions of the working relationship (partnership) between the external entity and the college.

All contractual agreements are reviewed through the UH procurement process. Contracts over $25,000 must go through an open bid process. Memoranda of agreement follow a general format, as approved by the Office of Risk Management or the Office of Research Services (Exhibit III-16: Risk Management Templates).

Self Evaluation

Kaua‘i Community College’s contractual agreements with external entities are consistent with the mission and goals of the college and follow the University of Hawai‘i’s procurement and risk management policies and procedures. The college has small purchase agreements for instructional and other supplies and formal agreements for contracts that extend beyond a year such as service contracts for elevators, the air conditioning system, and security. These contracts all support the mission and goals of the college.

Contracts with external entities for Capital Improvement and Facilities Improvement projects are administered by the University of Hawai‘i’s Office of Procurement and Real Property Management. These projects address critical program and health and safety needs of the campus.

Planning Agenda

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  The college will continue to adhere to university policies and procedures regarding contractual agreements.
  

III.D.2.g. The institution regularly evaluates its financial management processes, and the results of the evaluation are used to improve financial management systems.
Descriptive Summary
Kaua‘i Community College uses the University of Hawai‘i’s Financial Management Information System (FMIS) to manage its financial resources. FMIS was implemented by the University of Hawai‘i on July 1, 1996, and currently utilizes nine modules: General Ledger, Accounts Payable, Contracts and Grants, Budget Level Summary (BLS), Payroll Inquiry, Purchasing, Accounts Receivable, Departmental Checking, and Fixed Assets. Managers of FMIS have enhanced the system by adding a web-based requisition process, web-based financial accounting screens, payroll information, and budget-related improvements.
In 2004, the UH Business Process Council recommended that the University of Hawai‘i System participate in the Kuali Financial Management Information System. The Kuali Financial System is a proven financial system used by Indiana University. It has a base system of Chart of Accounts, General Ledger, Transactions, Reporting and Workflow, as well as Accounts Receivable, Budgeting, Capital Assets Management, Endowment, Enhanced decision Support/Reporting, Labor Distribution, Purchasing/Accounts Payable, and Pre- and Post- Award Research Administration. The base Kuali System for the University of Hawai‘i is scheduled for release in 2006.

Self Evaluation

The University of Hawai‘i is transitioning to a financial management system that the college anticipates will be user friendly and efficient in processing the necessary procurement and accounting transactions and financial reports.

Planning Agenda

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  Review campus processes to identify issues to be addressed in the new system.
  

III.D.3. The institution systematically assesses the effective use of financial resources and uses the results of the evaluation as the basis for improvement.
Descriptive Summary
The college has developed a process to tie program resource planning to resource allocation. With the development of the Request to Fill Position process, program review now impacts decisions about current service base allocations as well as requests for new funding (Exhibit I-12: Request to Fill a Position Form). The review format also asks programs to consider internal reallocation of resources from services or activities which are no longer needed to new initiatives or expanding services (KCCM 1-6, APRU Guidelines).
The program review process begins with the examination of data on program effectiveness such as completion and graduation rates, enrollment trends, and efficiency measures such as SSH/FTE faculty. Non-instructional programs have also defined various measures of effectiveness and efficiency applicable to their areas of responsibility, e.g., time to process work orders, numbers of students served by the College Success Center.

The programs are then asked to analyze how well they are doing in accomplishing the strategic goals of the college, which are derived from the mission. For example, to respond to the goal of Access, programs are asked to describe outreach efforts and tie that to the data on enrollment. From this analysis, the programs are to develop their plan of action and any resource reallocations or requests for new resources. The APRU focuses on the status of the action plans, including how the projected outcomes materialize.

Self Evaluation

The college has completed the third year of the five-year program review cycle; the next cycle will start in 2009. In each iteration we have identified improvements that are needed, such as changes to the data being made available, the need for deans and directors to meet separately with each program under their authority, and the general need for professional development on using data for better decision making. A few programs have begun to look seriously at internal reallocation. The Academic Support unit reallocated funds from a vacant position to increase funds available for books, journals, and electronic databases. Student Services also elected to reallocate funding in order to upgrade a clerical position to a professional or APT position to improve enrollment services in Admissions and Records. Finally, the Chancellor’s Office has reallocated and relocated a clerical position that reported

to the chancellor’s secretary to report to the Dean of Instruction to assist with the development of the schedules, catalog, and student advising sheets and with tracking curricular actions.
Not all programs are systematic in following the APRU format to analyze the program health indicators, measures of demand, efficiency and effectiveness. The guidelines for the APRU are not as explicit about measuring alignment with college goals and the importance of outcomes measures and data as the criteria the College Council uses to determine priority. The College Council may want to analyze these criteria to create a clearer connection between the demonstration of successful use of current resources and requests for future resources.
There have been concerns raised in program reviews about the filling of instructional positions. The APRU deadlines in the spring semester do not leave sufficient time to recruit for positions, which are approved before faculty depart for the summer. In response to those concerns the College Council decided to move the due dates of the APRU up to the fall semester.
Planning Agenda

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  See action steps for sections III.D.1.a-c