It's no secret that university budgets are tight. Lower enrollment, unpredictable government funding, and changing demographics have all been putting strain on budgets for years. To top it off, COVID-19 forced most schools to pivot to remote and hybrid learning in 2020, adding additional financial pressure.
But your facilities don't stop having needs just because university budget cuts are happening. Planning, preparing, and managing campus maintenance, operations, and capital budgets are some of the most important parts of facility management...but also some of the most stressful. However, a well put-together higher ed facility management budget can not only save money, but can ease your teams’ time and stress throughout the year.
Don't just copy and paste what you did last year. Take some extra time and plan out a higher ed facility management budget that works for your university facilities with these four simple tips.
TOP 4 FACILITY MANAGEMENT BUDGETING TIPS
1. Be realistic about your university's budget
The best place to start when creating your budget is to look back at the last few years to see if you can identify any trends. Have your budgets been increasing? Decreasing? Staying basically the same? This can provide you a starting point to work out from.
"Well I have my budget from last year and it's been going up a small amount every year. I can just add 5% and be done right?"
Your budget is going to be based on the university's unique situation. After you get your baseline, take some time to think about where your university is today. Some questions to consider:
- Is enrollment growing or shrinking?
- What percentage of students did we have on campus in 2020?
- Has our space utilization on campus changed at all? Are there buildings that won't be used as much?
- Did we add new buildings we need to plan for?
- How much of my operations and maintenance budget needs to go to COVID-19 supplies?
While you might not know the answer to all these questions, they will point you directionally on how to adjust your budget request. This gives you a leg up on preparing to manage budget deficits and adjust space utilization and planned maintenance strategies accordingly.
2. Build in some flexibility
There aren't a lot of things we can predict with 100% accuracy. Maintaining campus buildings is no exception. But while you can't predict what will go wrong, you can predict that things will go wrong throughout the year. It's inevitable. Facilities are used. Assets wear down. Things break.
To be prepared for this, make sure to build a buffer in your budget to account for these issues that pop-up throughout the year. Looking at the previous year’s budget vs what was actually spent is a good way to analyze how much you may need.
Having this buffer also allows you to be more flexible throughout the year to deal with any seasonality budgeting issues. Instead of having to pull from an existing budget and hope it works out, you can draw from this extra.
3. Don't forget about the non-sexy stuff - Deferred Maintenance and Asset Life Cycle
If your university is like those across the country, you have been dealing with budget cuts and a growing deferred maintenance list for years now. And while you know tackling those deferred maintenance tasks is important, it may seem counterintuitive to focus in on these past due projects when building your higher ed facility management budget. With university budget cuts expected to grow in the next couple years (thanks COVID-19), it's hard enough getting the budget you need to cover this year's maintenance and operations needs, let alone projects you couldn't get to last year.
So how much of your budget should you look to appropriate for deferred maintenance? Well, it depends.
While every campus is different, one thing that all university facility management teams share is a need for better data around their deferred maintenance list and asset life cycles.
It's better to know the what stage of the asset life cycle they are in, what their current condition is, the Facility Condition Index (FCI) is of your buildings, and how big a risk those deferred maintenance tasks pose to your university.
With access to this level of data, you can make better decisions on what budget you absolutely need and what would be a nice to have for deferred maintenance, and adjust your budgets accordingly.
4. Sell Your Needs to University Leadership
Have you ever tried to talk with someone who speaks a different language? Typically you can get the gist through some basic words and hand signs, but you can miss some important details.
A facilities budget isn't that much different. You and your team understand the importance of what you do, but the translation is often lost when talking with university leadership. They know that university facilities are important, but what it takes to fix and maintain them is a harder story to justify. Selling facilities needs can be one of the hardest parts for FM leaders.
Start speaking the same language as university leadership with this one simple step: connect your budget request to student experience.
Everyone cares about student experience. It most likely is a huge part of your university mission. So if you can draw that connection between your budget items and how it will impact students' living and learning environments, you are much more likely to get a captive audience. Providing university leadership with this context, and data from your facility management software, can help them better understand why you built the budget the way you did.
BE READY FOR YOUR NEXT UNIVERSITY BUDGETING CYCLE
Creating and managing a budget is one of the more difficult but important responsibilities university facility teams have. Through proper planning, you can navigate your upcoming university budget cuts and set your team up for success to ensure you deliver a positive student experience.
Need some help getting started? Download our facility budgeting template to help get you started down a path of better budgeting.