Direct Costs     Costs of operation, such as salaries, fringe benefits, and financial aid, incurred by a responsibility center. These costs are within control of the responsibility center.

Direct Revenue     Revenue from instructional fees, sales, investment returns, and other revenues that are credited directly to a responsibility center.

FTE (Full Time Equivalent)     The FTE is how the state government standardizes student credit hours for the purpose of funding. A full-time student, or a combination of part-time students, enrolled for a total of 30 credit hours over the course of one fiscal year = 1 FTE. For example: Student “A” enrolled for 15 credit hours in the Fall semester and 15 credit hours in the Spring semester, for a total of 30 credit hours for the academic year. Student “A” is one FTE. Students “B”, “C”, and “D”, enrolled for 5 credit hours each in the Fall semester and 5 credit hours each in Spring semester, for a total of 30 credit hours as well. Students “B”, “C”, and “D” combined equal one FTE.

Indirect Costs    Costs such as facilities costs, administrative support, academic support, and all other support costs. These costs are generally a percentage of a responsibility center’s revenue, and are thus not within their control.

Investment/Subvention Pool   Responsibility centers are expected to operate within their budgets, to demonstrate efficiency, and to generate sufficient revenues to cover their costs.  To address critical needs and in recognition of the diversity of academic programs, the committee recommends that the university establish a dual-purpose pool to achieve the following:

a.   Provide targeted investments for the development of academic initiatives and other university priorities. Such funding would likely be provided for a specific period of time, after which the initiative would become self-supporting or the need for investment funding would cease.

b.   Address the impacts of differing unit costs within academic programs for which income is less than cost. Such circumstances might be intrinsically related to the nature of the academic offering or a planned feature of resource management. Like new investment initiatives, such programs would be aligned with university priorities. While in rare instances the funding for these activities may be permanent, generally there would be an expectation that such funding is temporary.

Restricted Funds     Revenue that can only be used for a specified purpose. Research grants, scholarship funds, and some endowment donations can only be used for the purpose specified in their decree.

Responsibility Centers     Responsibility centers are those areas that generate revenue.  For Kent State’s RCM model, the responsibility centers will be the Kent Campus Academic Colleges, the Regional Campuses and the Kent and Regional Campuses Auxiliaries. 

Rolling Average    An average which is calculated over periods of fixed length, i.e., a 3-year rolling average.  This analysis is done to smooth out fluctuations in the data and to emphasize the direction of a trend.

State appropriation (state subsidy)    Revenue received by Kent State University from the state government to support the costs of educating students. The amount of money received is determined by the number of FTE’s eligible for state support.

Success Challenge Funds    Success Challenge funds are revenue received from the state on the basis of (i) baccalaureate degree completion of in-state “at risk” students, and (ii) timely completion of baccalaureate degrees by all in-state students.  Funds received for “at risk” students will be allocated across responsibility centers on the basis of revenues generated. Funds received for timely completion of baccalaureate degrees will be allocated directly to units whose (in-state) students generated such funding. 

Support Costs   Support costs are comprised of all non-revenue generating expenses. All responsibility centers pay support costs to fund the following expenses;

• Academic Support
• Administrative Support
• Benefits
• Institutional Support
• Instruction and Departmental Research
• Operation and Maintenance of Plant
• Public Services
• Separately Budgeted Research
• Student Services
  

Tuition    Tuition is comprised of general fee revenues and instructional revenues.  General fees are allocated to certain areas based upon a particular service provided to students, e.g., Campus Bus Service.  Instructional revenues or fees are based on credit hours for each subject.  However, the following expenses reduce the overall instructional revenue to be allocated to the responsibility centers:  PSEOP funds, collection costs, bad debt expense, bank service charges, Kent First program and scholarships.

University Strategic Plan   The plan which guides Kent State University, consisting of the Mission Statement, Core Values, and Strategic Goals. For details of the Strategic Plan, click here (link).

Unrestricted Funds    Revenue from instructional fees, , auxiliary unit sales income, investment return, state subsidy, and unrestricted endowment donations that can be used by a responsibility center for any allowable purpose, including salaries, general operating expenses, capital budgeting, and reinvestment.

RCM RESOURCE MANUAL HOMEPAGE