LETTER: 'Unrestricted asset' allocation still shows administration's priorities
Attempting to succinctly and clearly explain something as complex as a university budget is difficult for trained professionals, let alone us lay people.
Throughout the course of the 2010-2011 year CM Life and, especially, Carisa Seltz, have done an admirable job of making a mind-numbing, eye-glazing subject meaningful and understandable.
I was surprised, then, to see Seltz's March 25 column, "Administrators do not have total discretion on unrestricted net assets spending." CM Life has used correct figures — $258.3 million in unrestricted funds was accurate when first reported last fall; if the total is now $228.3 million then it must reflect university spending this fiscal year or a new audit.
CM Life has used correct terminology — "unrestricted" means that there are no legislative restrictions on what part(s) of university operations CMU may choose to expend those funds on. On both of these points, I'm sure, Vice President Burdette would agree.
Where Burdette and many of the rest of us would disagree, however, is in the use of the term "designated." Burdette would have us believe that "designated" means "restricted" — as in, "We aren't allowed to spend this money any other way."
Let's be clear: "designated" means no more and no less in budget terminology than, "This is how we currently think we will spend our money. But, if we change our minds later, then we'll shift money from one area of the budget to another."
Think about how we budget our own household income. We have "restricted" funds — i.e., that portion of our money that must be spent on rent, utilities, insurance, food, et cetera. The rest of our income is "unrestricted" — e.g., while we may have planned to save $20 a week to pay off our credit card balance, our car battery died so we spent $70 on a replacement instead.
In this situation, we had "designated" how we intended to spend our unrestricted money but we made changes based on priorities — our need for reliable transportation became a higher priority.
The result may be that it takes us longer to pay off that credit card debt, but we have used our internal control and ability to shift "unrestricted" funds between various "designations," and we had the right to do that. Similarly, CMU has both the ability and right to internally shift "unrestricted" funds from one "designated" budget line to another.
I urge CM Life to continue its strong efforts to help the campus (and wider) community understand both the actual financial position of CMU and what its spending pattern says about the administration's priorities.
Faculty Association President