Town Hall: Budget update

Message from the Principal

Dear colleagues,

I’m very grateful to the many faculty and staff that joined me and the executive leadership team on Friday, January 26 for a town hall update on UBC Okanagan’s budget for the 2024/25 fiscal year.

This was a return to previous practice of campus community budget updates; I truly believe that transparency and openness around the management of our resources is an important principle to help build trust and confidence at UBCO.

Like many other Canadian universities, we are navigating significant challenges amid a global economic shift. Inflation persists, international student demand has shifted post-COVID, and global unrest and geopolitical issues continue.

Meanwhile, tremendous growth at UBCO – from 3500 students in 2005 to nearly 12,000 today – has necessitated strategic investments in the future of the campus, including in new faculty and staff hires; enhancements to the student experience; new technology; and infrastructure that mitigates UBC Okanagan’s significant space constraints and supports UBCO’s continued evolution into a campus with local and global impact.

All these factors have challenged our campus balance sheet.

We’ve also seen other post-secondary institutions in the news lately talking about their grave financial threats. To be clear: that is absolutely not what UBCO is facing. Rather, we are working to stay ahead of declines in revenue that are manageable.

All administrative unit heads and the campus leadership team spent a great deal of time in the last few months discussing how to best navigate reduced revenues while understanding the implications for our services.

While we are in a strong position, we will feel the impact of a reduced budget and there may be impacts on some staffing levels as leadership work within their units to explore the range of available options.

We will exhaust every other option in our toolkit before reducing jobs with people in them. That includes examining discretionary expenses, vacant positions, natural attrition through retirement or people moving on to other opportunities.

We anticipate leaders will be able to share the impacts to services and operations after the UBC budget is approved by the Board of Governors, a process which takes place in March.   

As always, we endeavour to strike the balance between planning for the current and future needs of the campus with the stewardship of the resources that we have available to us. I am confident in our ability to work through this.

If we have learned anything over the past 19 years, it’s that our campus and community are innovative, resourceful and adaptable. Together, we will overcome these challenges and continue to flourish as a campus of a global top 40 university with a unique value proposition.

We will proceed with developing a strategic enrolment plan tailored to the Okanagan, promote our campus across Canada and internationally, explore new revenue-generating opportunities, and revitalize our Outlook 2040 vision to meet the unique needs of our community, on campus and beyond. 

I invite members of the campus community to watch the recording of the town hall as well as consider attending the February meeting of the Okanagan Senate where we will be presenting the campus budget. Faculty members are also invited to attend upcoming faculty council meetings with the Provost and me.

Thank you all for your ongoing commitment and resourcefulness.

Sincerely,

Lesley Cormack

Principal and Deputy Vice-Chancellor

Quick Facts about UBC Okanagan’s Budget

As a public institution, the university’s budget must balance every year. It cannot run deficits.
UBCO’s revenue streams for operational expenses include government grants, tuition, investment income, land development & services revenue.
The provincial grant is $100 million per year and tuition from both domestic and international students totals about $143 million, representing 97 per cent of our operating budget.
Tuition fees were $10.9 million below expectations in fiscal year 2022/2023 and we are projecting that we will be below targets again in fiscal year 2023/2024 by $5.6 million
Other revenue sources, like donations, research grants or endowments can only be used for specific purposes and not for general operating expenses.
Salaries and benefits account for about 80% of UBCO’s operating expenses.

Watch the Recording

Question Follow Up

More questions were submitted during the town hall than time allowed so written answers from members of the executive team on common themes from the Q&A are provided below.

Revenue Generation

Many had questions about plans for alternative revenue generation. Regarding academic opportunities, the Provost’s Office shared the following initiatives underway:

Continuing and Professional Education: UBC Okanagan’s Continuing and Professional Education (CPE) portfolio is well-positioned to meet the rising demand for flexible learning opportunities designed for working professionals – a significant opportunity for revenue generation. Supported by the CPE team, Faculties are already at the forefront, offering tailored micro-credential courses and programs designed to equip learners with in-demand skills. The success of courses like “Fundamentals of Wildland Fire Ecology and Management” and “Health Assessments for Primary Care Nursing” demonstrate UBC Okanagan’s ability to deliver relevant, market-driven education. With an ongoing commitment to develop methodologies that identify and address market needs, in collaboration with faculty expertise, UBC Okanagan is set to not only meet but also anticipate the evolving demands of the professional landscape.
Alternate Pathways: UBC Okanagan is exploring alternate transfer pathways for both domestic and international students through partnership development with other post-secondary institutions. In this context, students spend one or more years at another institution and then transfer to UBC Okanagan, providing an opportunity to increase cohorts of domestic and international students at upper-year levels. Specifically, UBC Okanagan is identifying opportunities for developing Block Transfer agreements to support domestic and international alternate pathway opportunities in partnership with select college and university partners.
Okanagan Global Summer Program: This year, UBC Okanagan launched its new Okanagan Global Summer Program which will welcome students from across the globe for a three-week program in July 2024. With a target of 150 students in its inaugural year, the Okanagan Global Summer Program provides an opportunity to strengthen UBC Okanagan’s international partnerships, showcase our campus as a world class destination for visiting students, and encourage enrollment in graduate programs. The Okanagan Global Summer Program is forecasted to grow in future years and will become an important and sustainable area of revenue generation that bolsters the use of campus during the summer.

Budget Changes

We received many questions regarding where budget cuts will be felt and how they will be distributed.

The UBCO Budget Committee takes a campus-wide view each year to decide on funding priorities based on the needs of students, faculty and staff. Administrative Units make requests for short- and long-term funding for their needs annually as a part of the annual budgetary process. For Administrative Units, budget cuts were made equally across all Associate Vice-President (AVP)/Managing Director (MD) portfolios; AVPs and MDs then worked within their units to decide on the most appropriate allocations for their individual portfolios and services.

Individual Faculty budgets fall within the responsibility of Deans and directors, who will be looking at their five-year projections and working to create balanced budgets in those years.

Technology and Cost Savings

Faculty and staff asked great questions about options to consolidate costs across units and implement technology to reduce costs. Of course, that is something leadership is always exploring.

As technology and our campus evolves, UBCO leadership assesses and discusses where opportunities may exist for improvement of service delivery. Such improvement to processes can allow for increased capacity at reduced costs but we also recognize that this assessment is often very service–specific. What works for one process may not necessarily work for a different one. UBCV and UBCO are in the early stages of using the Project Management Office (PMO) team within the VP Finance and Operations portfolio to help support projects to assess opportunities, while recognizing that there is often a balance between the right amount of centralized vs decentralized duties to create the best overall service.

Hiring Review

There were several questions regarding the hiring review process, in particular relating to leaves (i.e. maternity leaves). For clarification, the hiring review process is in place to demonstrate the thoroughness of each decision being made with the limited resources available. In the normal course of work, when people go on leave, a manager needs to think about the best way to have the work performed during that time. The review helps support the existing decision-making process while incorporating the current budget situation.

Faculty and staff questions about particular leaves are best dealt with at the department level. Managers are encouraged to have open conversations with employees to help address concerns about future planning. The University remains committed to ensuring that EDI principles are upheld throughout operational decision-making.

The complete hiring review process can be found on the HR website.

International student study permits

There were many questions about the potential impact of changes to international education policies, including caps on study permits, and UBC’s response. The situation is evolving, and we don’t yet know all the implications.

We deeply value our international students and the unique and diverse perspectives they bring to our campus. The university will be working with the provincial government and Immigration, Refugees and Citizenship Canada (IRCC) over the coming weeks as the details of the IRCC announcement are clarified. Current information includes:

The cap does not impact international students who are already here, nor will it apply to graduate students
The BC Ministry of Post-Secondary Education and Future Skills will provide more details shortly on new rules for public post-secondary institutions which set expectations for maximum international student enrolment levels, tuition transparency and student supports.
Further information can be found on the Global Engagement Office website, which will continue to be updated as more becomes available.

Recruitment

There were many questions about recruitment plans, particularly for international students.

International students bring important perspectives to our learning environment that enhance the learning experience for all. As students, researchers and community members, they enrich the fabric of our campus community.

UBC has a multi-modal international student recruitment strategy which leverages the UBC brand globally while allowing us to showcase and distinguish the attributes and programs available at each campus. Additionally, UBC Okanagan-specific marketing and recruitment initiatives are undertaken annually and supported centrally to further increase the demand for the Okanagan campus, which has been effective; in the last decade, international undergraduate student enrolment has grown 155% while overall demand for the Okanagan campus has increased 194%.

To stimulate demand, we have introduced new awards specifically for international students applying to the Okanagan campus. These awards are in addition to six existing entrance awards available for international students. Six of these eight awards are multi-year awards providing funding to students for the four years of their degree program.

The UBC Okanagan entrance awards for international students will provide $6.6M of funding dedicated to the recruitment and retention of international undergraduate students to our campus in FY25. Funding is also available to support experiential learning opportunities for enrolled international students including Work Study, Co-operative Education, undergraduate research and community engagement.

All efforts, despite the global downturn in demand for study abroad being experienced across Canada and in other study destination countries, are being undertaken to attract, admit and enroll international undergraduate students to meet UBC’s enrollment goals.

DVC Lesley Cormack