Review of SOM Revenues and Allocation Process

New Faculty Orientation SessionOctober 19, 2011

S. Dawn BulgarellaSr. Associate Dean for Administration & Finance

SOM Revenues - $569 MillionFY 2010

Federal Grants$194.2 34.1%

Other Grants$44.4 7.8%

Philanthropy$24.1 4.2%

Other$45.0 7.9%

Hospital/Health System

$81.8 14.4%

HSF$39.7 7.0%

State14.1%

IER7.4%

Tuition3.0%

“Discretionary Funds”$139.724.56%

Values are in millions

Mission-Aligned Budgeting

Missions: Teaching Research Patient Care

Budget Sources:

Tuition IER HSF ASETF Grants Hospital

SOM ASETF Allocation FY 2010

Purpose of the ASETF (state) Allocation Process

Align state funding with appropriate missions of the SOM and its departments

Develop a model that helps the Dean evaluate the performance of departments with regard to teaching, research and space utilization

Propose methods to identify and correct inequities in the historic allocation of state funding to departments

Allocation Model for SOM/JHS Depts

Departmental infrastructure 7.5% Size of Faculty (FTEs) 7.5% Teaching Efforts 35% Research Productivity 35% Dean’s discretion 15%

Space costs are factored into final allocation Legislative earmarks are respected outside of the model Basic and Clinical departments are treated the same in

the model

Teaching Subcomponent of the Model

Teaching (35% overall)

- Graduate teaching : credit for graduate students registered/mentored; # of didactic credit hours; # PhDs conferred

- Medical teaching : credit for # of course or clerkship directors; faculty contact hours in MS1&2; contact weeks in MS3&4; mentorship of scholarly activity

- T-series & R21s: credit for NIH training grants

- Post-docs & Residents : credit for headcount

-

Research Subcomponent of the Model

Research (35% overall)

- Total expenditures : credit for total expenditures on extramural funding as a market share across the School – incentivizes grants awarded

- Extramural salary coverage : credit for extramural salary support as a market share across the School – incentivizes collaboration on grants

Accountability for Space Space is assigned to departments and charged back at three

different rates per square foot per year: research space (~$24), admin space (~$15), and clinical space (~$18)

If a department generates sufficient indirect costs to cover the space costs assigned to them, it is held harmless in the allocation

If a department does not cover its space costs via generation of indirect costs, the ASETF allocation is reduced accordingly

Discretionary 15% (~$7.65M) of the allocation of state

dollars to departments is based on Dean’s discretion – primarily now determined by quality and special circumstances as discussed with the Dean by the chairs.

SOM State Appropriation History:Includes Operations and Special Program Support

State Support Principles Protect core missions

Education Research Patient Care/Service

Continued investment in areas of strategic priority Assessment of primary revenue streams (i.e., IER,

HSF/Health System, Philanthropy) for new opportunities to improve operations and strategic growth

Improve productivity and efficiency where possible

A Glass Half-Full Perspective

Every other medical school will be negatively impacted by the current economy – some will figure out how to weather, and even competitively strike, during this down time

UAB ranks 14th in “support from parent institution” among 125 medical schools

In Conclusion Our Allocation Model is complicated, but

tested and transparent We believe that we are rewarding the

behaviors that fulfill the School’s mission The SOM and its departments are well

supported relative to our peer institutions

But, Is There Enough Institutional Funding In Departmental Budgets

to Support Growth

Yes, if we are Productive & Efficient:

- extramural funding thresholds are met and maintained (probably 55-70%)

- faculty reasonably participate in teaching (Medical School and Graduate School)

- departments are efficiently operated (i.e., spending less than 35-40% of state funding on things other than faculty salaries

Questions?

Thank you!