MINUTES OF THE MEETING OF THE RESOURCE PLANNING AND PRIORITIES COMMITTEE

MINUTES OF THE MEETING OF THE RESOURCE PLANNING AND PRIORITIES
COMMITTEE of Erindale College Council held on Monday, November 29, 2010 at 1:00 p.m. in 3214
William G. Davis Building
Present: L. Bailey (in the Chair), P. Donoghue, C. Capewell, A. Mulllin, P. Goldsmith, L. Kramer, R.
Reisz, H. Miller, B. Schneider, A. Wensley, S. Prosser, U. Krull
Regrets: N. Basiliko, L. Kohn, J. Lim, D. Saini,
In attendance: B. McFadden, D. Mullings, S. Borg, C. McGrath
1) All in attendance introduced themselves.
2) Approval of Minutes of the Previous Meeting (September 27, 2010)
A member asked for verification of the +2.5M recorded on page two of the minutes. C. Capewell
will review and provide verification or correction to the dollar figures in the operating budget.
The minutes of the meeting on September 27, 2010 were corrected to read M. Tombak.
Approval of the September 27, 2010 meeting minutes to be approved at the January 11, 2011
meeting.
3) Reports of Committees and Officers:
a) For information: SARG University of Toronto Guidelines and Policy – Sonia Borg
Ms. Borg provided the members with an overview of the SARG University of Toronto guidelines
and policies. She explained that all University of Toronto ancillaries must follow certain budget
guidelines as put forth in the Guide to Financial Management. It states that every ancillary must
operate without a subsidy from the operating budget, they must have sufficient revenue to support
regular capital renewal, once the first two objectives are achieved ancillaries are to create and
maintain an operating reserve and where they have met the first three objectives they will could then
contribute net revenues to the operating budget. The fifth is a guideline There is an additional item
that was added in 2000 but is not part of the objectives but came about as an exception to cover
those occasions when an ancillary had to make a major capital investment. The guideline It states
that they need to achieve breakeven annually over the first five years after the completion of the new
building construction and renovation and achieve a cumulative breakeven position within eight years
of completion of the building construction.
The Chair opened the floor to questions.
In response to a member’s question, Mr. Donoghue explained the current relevance of the fifth
guideline additional item to the ancillaries. He reiterated that this guideline item is not part of the
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policy but is an exception to the policy. It was instituted around the year 2000 to provide for
necessary expansion of student residences that would not be possible under the basic policy. There
was a subsequent exception to the exception in relation to the building of Oscar Peterson Hall
because it was recognized that this project could not achieve the five and eight breakeven mandate.
An additional exception was made in that case for five and 13 breakeven. At the moment we are
standing at an annual breakeven of four years and nine years to cumulative breakeven. He
emphasized that it is important to recognize that this is an exception to the policy and that there
cannot be an expectation that the five and 13 exception is a current option.
(The above record has been modified to reflect clarifying information submitted by an attendee post meeting.)
b) For information: Ancillary services status reports and preliminary figures in preparation for
the next meeting in January, when these items appear for approval
i. Food services - Bill McFadden, Director of Hospitality and Retail Services
Mr. McFadden referred members to the Food Services Statement of Operating Results 2009-10 to
2011-12, which is attached hereto as Appendix A. Mr. McFadden presented a graph that indicated
the transaction volume at food services throughout the campus. He pointed out the heavy volume
periods that show how the infrastructure is stressed by campus growth. He reported they are on the
brink of 10,000 transactions a day which has taken the existing infrastructure to its capacity. He
explained that this tracking is additional data used for planning. They are targeting .45 NASM at
11,000 students as a starting point. Between 2008/09 to 2011/12 there has not been any expansion
and they are just keeping up.
He noted that the number of meal plans remained fairly static however there has been a significant
increase in the average value of the meal plans that are being purchased. Cafeteria sales are right
where it was expected they would be. He noted the current trend indicates more discretionary
spending as people are recovering from the tighter economic climate. He reported that a very
conservative approach was taken to catering sales as it includes only firm contracts. The forecast
shows an increase in catering sales as there were additional conference contracts secured after the
creation of the budget. At present the budget indicates that Food Services is $415K ahead in total
revenue which is about 5%. He noted as sales go up so do the total cost of sales.
Direct expenditures are $73K higher than expected due to incremental sales. This is mainly due to
occupancy costs and other operating expenses. The net result is $4,825 higher operating result
before transfers.
Mr. McFadden then discussed the meal plan rates. He stated that on average there is a 2.3% increase
for the meal plan rates. The increase has been spread throughout the meal plan offerings to
minimize the increase for the minimum commitments within each group and align the costs for the
larger plans with the actual spending rates for each of these plans. The Group A plans, which are
the smallest plans, will increase less than 1%. The increase for the smallest Group B plan is tied to
government legislation pertaining to the number of meals per week (if the rate was less the students
would forfeit their tax exemption).
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The Chair opened the floor to questions.
A member asked for confirmation that UTM still has significantly fewer services than St. George.
Mr. McFadden explained that St. George does not have the same needs because of external
offerings. The member noted that he was trying to emphasize the fact that UTM has more pressure
on it to provide meal services.
A member asked if we reach the target of .45 NASMs would we have sufficient space to
accommodate student needs. Mr. McFadden explained that we benchmark our NASM and revenue
per FTE against comparable institutions that are sitting at the .45-.47. He feels confident at .45
NASMs. He further explained that the master plan identifies the difference between experiential and
task-focused dining. Current expansion and building construction, along with changing the North
Building will open more opportunities. He stated that any more than three dining facilities on the
campus would put a strain on the institution.
In response to a member’s question concerning the expectation of student opposition when this
matter is presented at Council, Mr. McFadden stated that while people do not like cost increases, he
has had extensive discussions at the Resident Student Dining Subcommittee to review the rates and
there were no concerns. He believes that keeping the low entry point as reasonable as possible and
providing flexible add-ons has mitigated opposition. He also noted that UTM plans are reviewed
against comparable institutions and fall in the middle to low end of that comparison for the entry
level. Further, when the full plan is taken into consideration it drops UTM to the second lowest
meal plan in the province.
ii. Conference services – Bill McFadden, Director of Hospitality and Retail Services
Mr. McFadden stated that there has been a change in the way the Conference budget treats the
provision for accommodation on campus. A Conference and Housing Operating agreement has
been negotiated. Housing provides the Conference ancillary at a wholesale rate. They then market
and sell rooms in the same fashion as a hotel would operate. That change has led to significant
differences in the budget from previous years. The approach that has been taken is to only budget
for firm commitments. Positive variances are explained by bookings that came after the budget was
finalized.
With respect to expenses, there is a direct correlation to increased sales. As sales increase the cost of
food, facilities and space rental also rise. Some of the line items associated with repair and
maintenance are also a direct result of the same agreement. The charges still impact the budget
when they are charged back for accommodation. It is merely a change in where the costs are
recorded and net out to zero.
Mr. McFadden advised the members that as per the SARG guidelines the ancillary shows a $100K
commitment to the operating budget.
The Chair opened the floor to questions.
There were no questions for Mr. McFadden.
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iii. Parking services – Christine Capewell, Director of Business Services
Ms. Capewell referred members to the Parking Statement of Operating Results 2009-10 to 2011-12,
which is attached hereto as Appendix B. She began by reviewing the number of parking spaces
available. She noted that we are in a more positive position now that the parking deck is open than
we were in September. We currently have 2,374 spaces and anticipate opening more spots between
now and next September as construction equipment is removed.
She noted that as anticipated and planned for next year, there will be a 3% increase in permit prices
for the 2011-12 academic year.
Ms. Capewell reviewed the operating results in Schedule 1. She noted there was a lower amount for
parking permit revenue because the budget was set anticipating the deck opening in September and
the lower revenue reflects the delay. The number of permits made available for sale was limited to
reflect the limited number of spots available as of September. She further explained that the highest
demand is in August and September and then there is a big drop in November so there was not as
much demand when the parking deck actually opened. They did make an effort to sell additional
permits when the deck opened by contacting individuals on the waiting list and did manage to
increase sales somewhat through that initiative. The net result is a $126K loss in revenue in
September and should not occur next year. The pay and display revenue is up and she felt it was due
to the delay in the deck opening. Total revenue should be down about $100K.
She explained the variance in the Direct Expenditures portion of the budget. She noted that a larger
expense than normal in the furniture equipment and repair line item is anticipated and it is directly
related to equipment maintenance which is the cost to maintain the pay and display meters. The
contract with the provider is connected to usage. Therefore as use of the meters goes up, the cost of
maintenance increases. Therefore it is anticipated that the expense line will be more than was
originally budgeted.
The other significant variance is the Loan Principal & Interest Expense line item. When the budget
was set it was anticipated that there would be two loans. One is the existing loan on the CCT garage
which, like the 2009/10 actuals, the amount is set at $1 million per year. It was also anticipated that
we would add a mortgage or loan for the parking deck however we did not get an external loan.
UTM financed the project which explains the $630K variance. She directed members to Schedule 2
that includes a transfer out of the ancillary operation and into the UTM operating budget. Because it
will not be a full year rather than the full $630K she anticipates the transfer will amount to $420K
this year.
The final item she mentioned was a small positive result of $119K in net operating after transfers.
This will be followed by a small negative result over the next couple of years that the ancillary will
have no problem covering.
The Chair opened the floor to questions.
A member remarked that it looked like pay and display maintenance was budgeted at 30% but is
actually closer to 40% and asked if it was because an unexpected expense had been incurred. Ms.
Capewell explained that there were no unexpected expenses but rather she felt that the budget was
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calculated a little low and it may be related to the timing of payments to the vendor from the
previous year that may not have been captured when calculating the budget.
In response to the member’s inquiry into the competitiveness of the percentage in relation to the
industry as a whole Ms. Capewell said that the percentage is comparable and that thorough analysis
was conducted before the decision was made on which option and vendor to contract.
iv.
Residence – Dale Mullings, Director of Residence
Mr. Mullings referred members to the Residence Statement of Operating Results 2009-10 to 201112, which is attached hereto as Appendix C. He reported that the department provides over 1,500
beds which is the largest residence operation at the university. He reported that undergraduate
demand has remained consistent over the past two years and has been at around 96% since opening
Oscar Peterson Hall. Prior to that they ran at 100% occupancy but overbuilt in anticipation of
continued growth. Family and Graduate occupancy has been projected at 71% which is lower than
last year. The combined demand will be consistent at 95%. We are consistent with local market
demands and within the range when compared to the Ontario vacancy rate.
He directed members to Schedule 1 and spoke to the forecast. He pointed out that the 2010-11 fall
revenues are projected to be lower than anticipated due to the lower occupancy rate however
summer revenues are higher due to the conversion of family graduate units to undergraduate units
which has allowed for an expanded summer operation.
Mr. Mullings reported that supplies and cleaning costs are projected to be higher and are associated
with the conference services agreement. The annual and major maintenance costs are projected to
be higher than planned by approximately $80K due to ongoing construction issues particularly in
Erindale Hall. They have done some contingency planning this year to mitigate this. He advised
members that there will be significant costs this summer, in the range of $100-120K to complete the
required repairs.
He noted that the 2010-11 forecast should come in over $26K less than budget and the total fund
balance coming in over $350K better than plan. On the 2011-12 budget he advised that the
fall/winter rates will increase by an average of 5%. Related expenses will be higher to reflect the
costs associated with the Conference Services agreement. Mr. Mullings summarized the 2011-12
annual and major maintenance projects as follows:
•
•
•
•
•
Completion of the Erindale Hall brick remediation
Complete painting of Roy Ivor Hall units
Bathroom countertop replacement in Roy Ivor Hall
Townhouse roof anchors installation
New roof for SW row
Mr. Mullings concluded by reporting that the current plan will continue to allow the department to
come out of Operating Debt in year 4 of opening Oscar Peterson Hall, and Fund Debt in year 9, as
previously planned.
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Appendix A
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Appendix B
University of Toronto Mississauga - Parking
Statement of Operating Results 2009-10 to 2011-12
in $'s
Schedule 1
2009-10
Actual
2010-11
Budget
2010-11
Forecast
2010-2011
Variance
2011-12
Budget
1,685,126
32,725
960,352
988
1,894
2,681,085
1,830,000
31,000
975,000
2,000
2,838,000
1,703,637
30,000
1,000,000
1,800
(83)
2,735,354
(126,363)
(1,000)
25,000
(200)
(83)
(102,646)
1,754,746
30,000
1,050,000
2,000
2,836,746
317,960
51,063
342,483
54,080
681,904
12,060
1,546
9,828
8,404
143,183
2,732,616
345,495
54,384
300,000
20,000
6,374
30,000
67,856
1,673,061
10,023
9,838
94,020
2,611,051
351,498
52,140
339,255
20,000
14,103
1,200
30,000
81,311
1,042,157
10,121
8,144
102,435
2,052,364
(6,003)
2,244
(39,255)
(7,729)
(1,200)
(13,455)
630,904
(98)
1,694
(8,415)
(558,687)
5,489
1,000
30,000
82,676
1,042,157
10,323
8,120
90,023
2,110,898
Indirect Expenditures
Central Overhead Charges
Departmental/College Overhead Charges
Facilities & Services Overhead Charges
Total Indirect Expenditures
Total Expenditures
8,688
58,141
62,676
129,505
2,862,121
9,015
60,301
64,396
133,712
2,744,763
8,655
61,293
64,664
134,612
2,186,976
(360)
992
268
900
(557,787)
8,923
74,449
85,665
169,037
2,279,935
Operating Results Before Transfers
(181,036)
93,237
548,378
(455,141)
556,811
Revenue:
Parking Permits
Cash Fees
Pay & Display Meter Revenue
Investment Income
Other Income
Total Revenue
Direct Expenditures
Salaries, Wages & Benefits
Supplies
Furniture & Equipment Repair
Annual Maintenance Expenses
Major Maintenance Expenses
Furniture & Equipment Depreciation
Replacement of Non-Depreciable assets
Snow Removal
Utilities
Loan Principal & Interest Expense
Finance Charges
Occupancy/Space Costs
Insurance
Telecommunication cost
Other Miscellaneous Expenditures
Total Direct Expenditures
67,947
1,042,157
410,274
48,836
362,000
20,000
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University of Toronto Mississauga - Parking
Statement of Reserves 2009-10 to 2011-12
in $'s
Total Fund Balance - Opening
Schedule 2
2009-10
2010-2011
2010-2011
2010-2011
2011-12
Actual
Budget
Forecast
Variance
Budget
474,740
544,365
293,704
(250,661)
413,264
Net Operating Results before Transfers (Schedule 1)
Transfers in (out) of Ancillary operations
(181,036)
-
93,237
-
548,378
(428,818)
455,141
-
556,811
(630,000)
Net Operating Results after Transfers
(181,036)
93,237
119,560
26,323
(73,189)
293,704
637,602
413,264
(224,338)
340,075
Investments in Capital Assets
Internally Restricted
27,496
13,656
13,393
(263)
7,904
Capital Renewal Reserve
Operating Reserve
New Construction Reserve
Unrestricted Surplus/(Deficit)
177,005
89,203
241,839
382,107
181,242
(60,597)
(163,478)
189,145
143,026
Total Fund Balance - Closing
Closing Fund balance is made up of:
218,629
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Appendix C
University of Toronto Mississauga - Residence
Statement of Operating Results 2009-10 to 2011-12
in $'s
2009-10
Actual
2010-11
Budget
2010-11
Forecast
Schedule 1
2010-11
Variance
2011-12
Budget
Revenue
Residence Fees - Fall/Winter Session
8,382,743
8,717,217
8,447,736
(269,481)
9,054,850
Residence Fees - Summer Session
302,258
250,000
351,519
101,519
250,000
Laundry Income
152,891
140,002
145,000
4,998
142,500
Commissions & Other Income
602,484
524,369
619,467
95,098
610,521
Value of Dean's & Don's Rooms
432,647
454,807
468,511
13,704
478,946
Total Revenues
Direct Expenditures
9,873,023
10,086,395
10,032,233
(54,162)
10,536,817
Salaries, Wages & Benefits
1,347,989
1,468,168
1,482,842
(14,674)
1,605,360
30,099
36,400
63,242
(26,842)
75,000
965,382
1,103,773
1,115,219
(11,446)
1,140,542
17,049
26,383
28,400
(2,017)
26,000
170,438
177,852
190,970
(13,118)
212,123
54,849
55,746
56,292
(546)
57,418
247,761
274,984
280,400
(5,416)
303,754
1,054
8,000
3,000
5,000
5,000
Annual Maintenance Expenses
781,373
593,891
536,000
57,891
549,686
Major Maintenance Expenses
327,960
269,856
407,863
(138,007)
358,722
Furniture & Equipment Depreciation
25,975
8,000
18,411
(10,411)
30,777
Replacement of Non-Depreciable Assets
36,265
129,100
23,000
106,100
40,451
4,955,088
4,775,818
4,656,540
119,278
4,589,509
8,812
52,090
25,000
27,090
25,750
432,647
454,807
468,511
(13,704)
478,946
46,862
45,000
87,492
(42,492)
71,797
Residence Life Expenses
107,235
114,760
134,522
(19,762)
138,626
Other Miscellaneous Expenditures
155,947
200,500
190,000
10,500
208,520
Total Direct Expenditures
Indirect Expenditures
9,712,784
9,795,128
9,767,704
27,423
9,917,981
Central Overhead Charges
31,332
34,979
34,979
-
36,628
Departmental/College Overhead Charges
179,315
161,038
161,038
-
229,632
Facilities & Services Overhead Charges
4,997
215,644
5,203
201,220
5,203
201,220
-
5,185
271,445
9,928,428
9,996,348
9,968,924
27,423
10,189,426
(55,406)
90,047
63,309
(26,738)
347,391
Supplies
Utilities
Garbage
Snow Removal, Grounds Maintenance
Insurance
Telephone, Cable & Internet
Furniture & Equipment Repair
Loan Principal & Interest Expense
Finance Charges
Value of Dean's & Don's Rooms
Cleaning Costs
Total Indirect Expenditures
Total Expenditures
Operating Results Before Transfers
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University of Toronto Mississauga - Residence
Statement of Operating Results 2009-10 to 2011-12
in $'s
Schedule 2
2009-10
2010-11
2010-11
2010-11
2011-12
Actual
Budget
Forecast
Variance
Budget
(5,020,048)
(5,456,750)
(5,075,454)
381,297
(5,012,145)
Net Operating Results before Transfers
Transfers in (out) of Ancillary
operations
(55,406)
-
90,047
-
63,309
-
(26,738)
-
347,391
-
Net Operating Results after Transfers
(55,406)
90,047
63,309
(26,738)
347,391
(5,075,454)
(5,366,704)
(5,012,145)
354,558
(4,664,754)
175,329
175,329
210,552
Total Fund Balance - Opening
Total Fund Balance - Closing
Closing Fund balance is made up of:
Investments in Capital Assets
Internally Restricted
78,416
Capital Renewal Reserve
526,528
526,528
526,528
Operating Reserve
New Construction Reserve
832,316
-
853,269
-
851,214
-
(2,055)
-
872,584
-
(6,512,714)
(6,746,501)
(6,565,216)
181,285
(6,274,419)
-
Unrestricted Surplus/(Deficit)
526,528
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