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The University continues to work on a new budget model this semester.
UNM President Robert Frank said the administration is currently devising the Results Oriented Management (ROM) budget model to create a more “dynamic” way of allocating money to University departments. He said administrators been working on the model since the spring.
Frank said UNM’s current “historic budget model” does not function efficiently because it “tends to be much more static.” He said the current model does not address departments’ real needs.
“If you look at our budgeting process, a highly centralized budget, we haven’t really set targets for budget units to perform,” he said.
“Nobody really gets any new money because we don’t get any new money. You … never really look at people as budget managers who have to reconcile the activity of their unit to the demands of what students need.”
Through the current model, departments get their expected amount of money budgeted to them by the University every year, Frank said.
But Frank said ROM will allow the University to consider various factors in departments, such as the demand for academic majors they offer, when deciding how much money to provide them. He said the model will also provide faculty members more opportunities to participate in the decision-making process regarding budgets.
“We wanted to make sure that we have a budget model to allow deans and department chairs to participate in the budget,” he said. “We need more faculty in areas that have big demands. That’s what all of this is about — moving our faculty where demands are and being much more dynamic as an organization.”
At the moment, the office of the president is working with a technical team composed of faculty members and deans to figure out specifics of ROM, Frank said. He said student government leaders will also be involved in the process.
UNM Provost Chaouki Abdallah said the University originally worked on a model called the “Responsibility Crisis Management” model when it started pondering a new budget model in 2012. But he said that after a committee worked on RCM for months, they identified that it isn’t the best model for UNM and started working on ROM.
“One of the keys to ROM is a focus on transparency and performance,” he said. “As a result, we are currently working on building the foundation to run a new budget model. To be successful, we will need a strong foundation of data, reports, and tools to understand how a new budget model would work, as well as for departments to be successful in improving their performance.”
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Abdallah said ROM will “focus the budget process on performance, providing incentives and rewards for departments that improve their financial performance and their non-financial performance.” He said that because of incentives, the model will encourage departments to increase revenues while controlling money they spend.
And he said the model might help keep tuition from increasing in the future.
“With pressures to keep tuition low and limited growth in state funding, we need to look internally at how we can create a model that incentivizes revenue growth and facilitates improving efficiencies and controlling costs,” he said.
Abdallah said the University aims to finish planning for ROM by the end of fiscal year 2014, which is June 30, 2014. He said the University will seek help from the Board of Regents during the planning process.
Frank said although planning is “a long way from being done,” he hopes to implement ROM starting fall 2014. He said he encourages the University community to express their opinions about the University’s budget model to help with planning.
Frank said he is optimistic about the results that ROM would bring to UNM.
“It’s going to help the University grow,” he said. “It’s going to help us be more nimble in the future.”
