The University of Alaska continuously seeks to increase the efficiency of its operations, resulting in a higher return for the state’s investment in higher education. Efficiencies are gained through centralized functions at the university’s statewide office, and cost savings at the four major administrative units: statewide; University of Alaska Southeast; University of Alaska Anchorage; and University of Alaska Fairbanks. The following examples, while not a complete list, provide a sense of the measures UA has taken both recently and over time.

University of Alaska Centralized Functions (by Functional Area)

• Academic
• Workforce training coordination and outreach UACP
• UA Scholars Program administration
• University Relations
• Government relations (state and federal)
• Finance
• Controller functions
• Financial reporting
• Cost Accounting for F&A recovery
• Federal indirect cost rate negotiation
• Procurement card administration
• Travel policy administration
• Risk management
• Loss prevention coordination
• Adjustment services
• Insurance placement and administration
• Claims processing and administration
• Internal audit
• Financial policy development
• College Savings Program administration
• Land Management
• University of Alaska Foundation
• Foundation accounting
• Investment management
• Debt acquisition and management
• Cash management
• Banking services
• Investment services
• Land Grant Trust Fund administration
• Procurement policy administration and reporting
• Facilities policy administration and reporting
• Capital budget development
• Human Resources
• Labor and employee relations (including collective bargaining)
• Human resources policy development
• Payroll and benefits accounting
• Compensation management
• Health and retirement benefit management
• Information Technology
• Wide area network, telecommunications and video conferencing
• Administrative computing (Banner System)
• All Administrative transaction systems
• Financial information system
• Student information/enrollment management systems
• Human resources information system
• Facilities administration system (implementation by June 30, 2005)
• Legal
• Legal services

University of Alaska – System

Recent Cost Saving and Efficiency Efforts

• Developed a new process for reviewing, on a case-by-case basis, expanded eligibility for the Optional Retirement Program.
• Implemented the university’s first flexible benefits health plan, UA Choice, which includes medical services network savings of up to $5M annually.
• Concluded negotiations for successor collective bargaining agreements with three of the four unions at the university, and are currently in negotiations with the fourth.
• Completed comprehensive market studies of faculty salaries and began implementation of market adjustments.
• Provided support to the staff compensation task force, a group that studied compensation issues and made recommendations that make UA more competitive.
• Worked closely with the Staff Alliance to develop new policy and regulation regarding promotional probationary periods.
• Developed a plan for automation of time-consuming transactional processes and obtained funding commitments to implement the highest priority projects.
• Discontinued costly mailing of notices of automatic payroll deposit.
• Increased the bankcard procurement limit to $5,000 which should further streamline the purchasing process.
• Successfully transferred the teleconferencing function from ATN to Genesys Conferencing for a rate change from $0.20/min per site to $0.04/min per site.
• Developed partnerships with Alaska Public Broadcasting, National Institute of Health (Lariat INBRE Project), and Alaska Telecommunication Users Consortium (non-profit telecom users) for an overall cost avoidance of $670,000.
• Implemented the Virtual Private Network (VPN) to better support secure telecommuting for staff and faculty, as well as secure communications for students at a distance.
• Discontinued the subsidized dial-up service for a cost savings of $279,000 annually.
• Incorporated academic reviews in the annual fall financial reviews and renamed operational reviews.
• Changed bankcard processing merchant for a reduced cost of approximately $70,000 annually (implemented Feb. 1 st).
• Implemented electronic payment processing for intra-UA payments.
• Instituted a web check payment option for students.
• Increased capitalization levels from $2,500 to $5,000 for equipment and $25,000 to $50,000 for facilities improvements to make the inventory/asset management process more efficient.
• Improvement in working capital from $32.6M to $40.1M in the past year. This improvement can be primarily attributed to the increase in tuition revenue.(note1)
• The University of Alaska Foundation private contributions from organizations and individual people increased from $16.9M in FY00 to $19.4M in FY04 an increase of 15% (includes large project-specific donations to UA Museum and KUAC).(note2)
• The operating revenue for UA from private grants and contracts and private giving has increased from $25.2M in FY00 to $31.9M in FY04 (27%).(note3)
• Net accounts receivable decreased 23% from $74.9M at June 30, 2003 to $58.0M at June 30, 2004.
• Decrease in accounts payable from $20.7M at June 30, 2003 to $13.2M at June 30, 2004.
• Administrative costs defined nationally as “institutional support” has declined as a total percentage of expenditures from over 16% in ’99 to 13% in FY04.
• Reviewing vehicle pool operations.

Ongoing, In-process, and Future Cost Saving and Efficiency Efforts

• Continue to grow student tuition and fees from $22.5M in ’90, $48.5M in ’00 to an expected $77M for ’05.
• Use aggressive land management practices, which (in recent years) have converted over $6M annually to investment in the land grant trust endowment.
• Continue growth in research revenue from grants and contracts to recover indirect costs for facilities and administration. Has grown from $7M in ’90, $16M in ’00 to $33M in ’05.
• Decreased travel through increased reliance on teleconferencing capabilities.
• Complete an external Fair Labor and Standards Act review for exempt/non-exempt claims regarding overtime.
• Automation of recruitment, timesheets, and employee action forms.
• Develop a Wellness Program which will result in at least $2 of savings for every $1 invested.
• Implementation of electronic vendor payments.
• Continued utilization of bankcard procurement is over $20M in ‘04, saving considerable paperwork and procurement effort for small (less than $5,000) purchases.
• Like the state, UA is moving to paperless travel by encouraging the Easy-Biz Alaska Air solution, earning miles for business use and saving travel agent costs.
• Continue the system-wide job classification project which is currently at 75% completion and has completed implementation of updated overtime eligibility.
• Vacancies are being left open longer and being reviewed with greater scrutiny. More adjunct faculty vs. tenure tract faculty are being hired. More positions are being filled on “term” vs. permanent/base-funded methods.
• Through UA Corporate Programs, broker needs of business community for corporate, professional & job training with the most efficient program provider.
• Each campus has delegates on the newly formed “Adhoc Committee on Accountability and Sustainability” task force to examine and recommend ways that UA can become even more efficient.
• Continue to increase fund raising activities.
• Continue outsourcing efforts/review where appropriate. A list of current, or previously reviewed, outsourcing examples can be found at the end of this document.
• Consider consolidating certain academic programs.
• Where there is expertise, redundancy and inefficiency try to consolidate.

Prior Cost Saving and Efficiency Efforts

• The University was restructured in 1986 to include community colleges. The four-year institutions in Anchorage, Juneau and Fairbanks (MAUs) assumed the administrative and accreditation ( Valdez – PWSCC, exception) responsibility for the educational missions of the community colleges.
• In 1996, in response to the inefficiency of having 4 independent MIS systems (student, finance, HR, Facilities) UA converted to SCT “Banner” consolidated MIS system, gaining timely on line access to management information.
• Instituted UA Optional Retirement Plan (ORP) at less cost than PERS/TERS for 750 faculty and executive staff. This is a “defined contribution plan” as opposed to a “defined benefit plan,” does not include health care benefits and has a lower employer contribution/liability.
• Instituted “UA2000” Health Care plan for non-represented employees with an average employer contribution lower than most public employers in Alaska.
• Instituted freeze on supplemental pension to the first $42,000 of annual salary at 7.65% or $3,213 per year. Resulting in approximately $3M of savings annually.
• Created consolidated course catalogs for on line courses via “UA On-Line” portal and now investing in new student centric “MyUA.”
• Implemented EMAS plus at all three MAUs as common recruitment/retention software to attract and retain quality students.
• Created on-line enrollment option (currently over 70% choose this option) alleviating the need to support more expensive telephone and personal registration options and resulting in greater access to students and less staff contact.
• Secured bond/debt financing of research facilities (DEC lab in Juneau, West Ridge Research Center), and other project completion costs of numerous community campus improvement projects which were not fully funded by the legislature.
• Students who are currently paying for housing and recreational facilities and parking facilities including debt service are willing to contribute more via bond financing/student fees for improved/consolidated food service and book store support.
• Downsized some previously planned phase funded research facilities to build within the appropriated and self pay affordability.
• Consolidated high cost programs for single point accreditation (i.e. health care and nursing).
• Instituted annual fall financial reviews and spring management reviews designed to show how each MAU has reallocated their resources to meet state and student needs. (i.e. how each MAU manages vacancies and reallocates hires to areas of growth or higher state needs.)

University of Alaska Statewide

Recent Cost Saving and Efficiency Efforts

• Reconstructed the general office space to accommodate approximately 2 dozen additional workstations within Butrovich for occupancy cost avoidance.
• Converted storage space to Supercomputer office space also resulting in occupancy cost avoidance.
• Risk Management expanded the university’s insurance coverage while retaining the same premium.

Ongoing, In-process, and Future Cost Saving and Efficiency Efforts

• Consolidation of UAF and Statewide IT departments.
• Grow Land Grant Trust (Corpus & Inflation Proof) & Natural Resource Fund (spending fund), via land and resource sales and investment earnings from $60M in FY93 to approximately $131M at ‘04 year end.(note4)
• Provide incubation for University of Alaska Foundation, started in 1974 to help fund scholarships and provide financial support for UA. Grow from $20M in ’89, to $40M in ’96, to $80M in ’00 and now at ’04 calendar end at $130M. With distributions approaching $10M annually.
• UA Foundation has provided $500,000 per year for the last for years to promote the university to potential students and state constituents.

Prior Cost Saving and Efficiency Efforts

• Instituted annual university fund drive. More than 50% of UA SW employees contributed.
• Consolidated Budget and Institutional Research function and commenced unit level reporting and better statistical tracking for higher education requirements and for management information.
• Eliminated 12 positions in centralized facilities management at statewide offices.

University of Alaska Southeast

Recent Cost Saving and Efficiency Efforts

• Sitka campus negotiated a new teleconferencing contract and had a net savings of $87,100 on audio conferencing expenses.
• UAS deployed campus-wide wireless networks and mobile computing lab technology in the major classroom buildings making it possible for any classroom to be used as a computer lab. This reduced the need for dedicated and often expensive computer lab space and labor costs.
• Various campaigns raised $284,000 for foundation accounts which include scholarships.
• Purchased the Natural Sciences Research Lab to dedicate space for research and to encourage faculty to seek competitive research grants.
• Increased the number of grant awards exceeding $60,000 from FY01 to FY04 by 129%; dollar amount of awards increased to $1.8M in the same four year period.
• Funded through an Education Grant video conferencing was extended to 35 rural communities.
• Instituted an MBA program to meet high demand workforce needs. Also instituted “super tuition” to cover program costs.
• Instituted a $50 per semester parking fee at student housing which generated $9,300 in new revenue.
• Instituted a $25 per phone fee in an effort to cover costs.
• Increased general housing costs by 10%.
• Student and grants billings are now current. Outstanding debt has decreased approximately 90% in the last two years. As a result, grant allowance for doubtful accounts and grant cost overruns have also been decreased.
• Began monthly administrative manager training in areas of budget, grants and contracts, proposals, purchasing and travel.
• Replaced key enterprise servers through reallocation.
• Formed Regional Instructional Design Work Team to establish and promote standards with improved collaboration.
• Provided live and on-demand streaming video capability to the academic programs. Added Windows Media player capability in order to deliver classes to military personnel at sea.
• Revised existing strategic plan to support the direction and guide implementation/change of new and existing programs.
• Successfully promoted UA Online, resulting in a substantial increase in web registration.
• Continued support for UATV. Increased collaboration with UAA resulting in 16 UAA courses broadcast during the spring 2004 semester.
• Developed extensive online training resources for faculty.
• Rolled out new content creation and presentation tools: Camtasia and Breeze.
• Converted all education video course materials to DVD.
• Migrated to electronic course evaluations.
• Rolled out student computer account self-service.

Ongoing, In-process, and Future Cost Saving and Efficiency Efforts

• Continued regional academic and desktop equipment refresh. All equipment is less than 5 years old and the average age of equipment is less than 1.5 years.
• Average annual increase in research grants over the past five years in 156%.

Prior Cost Saving and Efficiency Efforts

• Discontinued athletics and music programs
• Instituted leadership in distance delivery of classes. UA modified the tuition split to 20% for registering campus and 80% for course delivering campus. Thus use extensive UATV/Alaska 3 TV delivery. Expand UATV from 17 to 40 rural communities. UA stopped subsidizing the 800 call-in for telephone distance delivery.
• Focused management team on enrollment and retention.
• Expanding the well-respected Voc/Tech and community jobs focus at campuses.
• Instituted policy of charging auxiliaries and re-charge centers for full administrative costs.
• Expanded community partnering including Ketchikan shipyard, mining, Marine Highways, Alaska National Guard.
• Construction of Noyes Pavilion paid with all private funding exceeding $0.5M.
• Research and grant expansion such as wood utilization grants, Title III minority student support, SEED/Gathering Grants, Headstart/MAT, ARCTIC Tech grant, Community Wellness Grant.
• Added tuition fees to refresh technology.
• Added programs on construction technology, knowledge worker, practical nursing.
• Stopped Pacific High School in Sitka.
• Completed a facilities master plan.
• Bought adjoining property identified in facilities master plan with debt.

Recent Cost Saving and Efficiency Efforts

• Web-based parking decal system resulted in $40,000 in personnel savings.
• Contracted out custodial services saved $100,000 annually.
• Bought used bed-frames from UAF for a cost savings of $72,000.
• Developed a more efficient dresser design which resulted in $54,000 savings.
• Outsourced UAA large format offset printing for a $100,000 savings in personnel and material costs.
• Through improved inventory management and turnover the Bookstore generated an additional $85,000 in savings.
• Redirected $65,000 through elimination of an Associate Director position in Facilities Maintenance.
• Saved $20,000 on parking lot asphalt by enrolling in a recycled asphalt program partnership with the Municipality of Anchorage (FY04 & FY05).
• Municipality of Anchorage variance on Ecosystems/Biomedical Lab parking resulted in $630,000 cost avoidance.
• Implemented “just-in-time” parts delivery in fleet maintenance shop reducing on-hand inventory and expediting costs by $40,000.
• Reduced total costs of worker’s compensation claims from $140,000 to less than $30,000 since FY01 with the implementation of the Spikies ice cleat give away program.
• Redirected $746,000 to highest priority needs by reducing off-campus lease payments from $1.35M in FY02 to $600,000 in FY04.
• UAA and UAF Police partnered to purchase a Computer-Aided Dispatch/Records Management System program and were able to negotiated the program’s price through a small vendor at a savings of approximately $5,000 per department.

Ongoing, In-process, and Future Cost Saving and Efficiency Efforts

• Continue to expand corporate sponsorships.
• Continue $12M private sector fund drive for the capital campaign of which $9M has already been raised.
• Continue partnering with the community: Hospitals/allied health, logistics, engineering, social work, and research.

Prior Cost Saving and Efficiency Efforts

• Instituted Performance Based Budgeting revenue incentives including tuition to be retained at department level after reaching a certain threshold.
• Private build/purchase via turn-key University Mall 100,000 square feet (including land at less than $150 per sq. ft.), completely refurbished at one half cost construction as compared to normal campus building costs and accomplish one stop service for students. This effort was recognized and lauded by NACUBO (National Association of College and Business Officers).
• Caused auxiliary housing, food service and bookstore to be self supporting, pay debt service and build reserves for renewal and replacement.
• Closed the Adult Learning Center.
• Instituted “super tuition” in new high demand programs - Masters in Social Work, Project Management programs (Engineering and Construction).
• Implemented high cost nursing program statewide including partner funding from health community.
• Expanded corporate sponsorship with Wells Fargo paying for naming rights on the sports complex.
• Alaskan Natives in Science and Engineering Program (ANSEP) raised $5M via private sources for a Center for Innovative Learning facility.

University of Alaska Fairbanks

Recent Cost Saving and Efficiency Efforts

• Generated the equivalent of approximately $50,000 worth of free tickets through using Easybiz.
• Grants and Contracts reduced the allowance for doubtful accounts by over $600,000 through an aggressive collection campaign.
• Have begun visits to remote/satellite sites to provide hands-on training and in order to understand their environment and unique needs.
• Eliminated four full-time and part-time positions in safety services, cutting Police, Dispatch, and Fire personnel costs by approximately $231,000.
• Reduced safety services expenditures for commodities and services and increased revenue generation by $36,000.
• Annual savings of $70,000 by reducing the use of Purchase Orders, Limited Purchase Orders, and Blanket Purchase Orders through increased use of Procurement Card (ProCard) purchases.
• Eliminating an executive position within the former Procurement and Business Services department, reorganizing the department, and distributing those duties saves approximately $100,000 per year.
• Leaving vacant positions unfilled saved approximately $5,000.
• Converted the Risk Manager position to an Industrial Hygiene position which will assist with the Radiation Safety Program for a cost savings of $58,000.
• Added a Hazardous Waste Training Program which will assist long term in reducing workplace injuries and property loss. EHS & RM trained a total of 1568 people during FY04.
• Eliminating and re-evaluating positions and/or reassigning duties within the UAF Bookstore and UA Technology Center generated $45,000 in savings.
• Through better inventory control reduced textbook returns for a cost savings of $300,000.
• Realignment of software procurement will generate $64,000 annually.
• Combined Bookstore and Technology Center marketing for a savings of $18,000.
• Technology Center prices on computer, peripherals, and software saved UA students, faculty, staff, and departments approximately $500,000 in FY04.
• Saved $8,700 by changing shipping practices to other UA campuses.
• Batching orders from vendors increased efficiency and resulted in better prices and reduced shipping costs for a savings of $63,000.
• Polar Express and Dining Services were combined into one unit resulting in more efficient operations and better service to students without adding resources. Merging positions resulted in a $20,000 cost savings.
• Based on survey results Dining services added several new meal options and dining formats resulting in better service, more efficient scheduling, and other reduced operating costs.
• Expansions of Uniprint centralized printer reduced paper usage and saved approximately $4,000 annually.
• Utilizing the state contract for copier replacement and consolidating copier contracts reduced costs by approximately $10,000 annually.
• Consolidate and volume paper purchases resulted in favorable pricing and saved 28%-32% per order.
• Facilities Services was able to redirect $200,000 saved in salaries and benefits by not immediately hiring vacated positions.
• Redirected $13,000 through elimination of three leased vehicles.
• Began electronic distribution of financial reports reducing paper usage and printer cartridge costs by $1,500.
• Purchasing bulk mastic remover resulted in a $3,000 (35%) cost savings.
• Purchased E-Business solution, a web-based software program allowing parking decals, payment of citations, and appeal processing to be made on-line resulting in $25,000 personnel savings.
• Instituted an inventory bar coding system generating $10,000 in savings at the Warehouse.
• Reduced Facility Services supply budget by $31,500.
• Installed a reverse osmosis water system providing a savings of $8,000 to be redirected.

Ongoing, In-process, and Future Cost Saving and Efficiency Efforts

• Continue visits to remote/satellite sites to provide hands-on training and in order to understand their environment and unique needs
• The UAF office of Financial Services will continue to provide direct oversight for the fiscal operations at School of Fisheries and Ocean Sciences, Provost’s Office, Athletics, and School of Education to ensure regulatory compliance and effective and efficient business operations.
• Indirect Cost Recovery under-recovery assessment continues to provide up to $500,000 annually for redirected spending.

Prior Cost Saving and Efficiency Efforts

• National Institutes of Health and National Science Foundation awarded $27M in new and continuing grants in September of 2004.
• Consolidated rural campuses within UAF under the College of Rural Alaska for efficiency improvement and to better serve community campuses.
• UAF instituted a permanent reallocation of 6% of their base budget resulting in a net $1.6M being allocated to high demand/high priority programs. Due to research’s success in attracting competitive funding including ICR these reallocations significantly favored academic programs.
• Funding 87 percent of West Ridge Research Center via research revenue generated.
• A $1M Denali Commission Grant was provide for partial renovation of fourth floor of the new TVC building (former state courthouse building, 604 Barnette St.) for allied health programs.
• $6.6M in private donations raised in FY03, including six new scholarship endowments.
• New endowed chairs in several departments, including fully endowed Snedden chair in Journalism, and coming soon are fully endowed faculty chairs in History and in Fisheries and Ocean Sciences.
• Mass re-lamping program was developed and instituted for all academic, research and residence life common areas to provide uniform quality level for lighting in all areas, resulting in a long-term labor savings. Energy inefficient light ballasts also identified and changed out in conjunction with the re-lamping for further long-range savings.
• Volunteers from UAF College of Fellows helped fill 60 flowerbeds around campus with over 30,000 plants grown from seed in UAF’s greenhouse.
• Better training and a strong emphasis on work place safety within Facility Services has resulted in an average annual cost savings of $345,000 in workers’ compensation claims since 2001.

Download this Report

View FY04 Outsourcing Activities

ACAS Efficiency Investment Project Report

Notes

1. Even with this increase the university does not have reserves to sustain a moderation of state support. Our total unrestricted and undesignated net asset balance is only $11.8M.

2. When only general giving is considered (excluding Museum and KUAC donations), total giving increased from $9.8M to $13.2M from FY01 to FY04, with a $2.1M (115%) increase in individual contributions and a $3.4M (35%) increase in contributions from organizations. This increase in contributions allowed for distributions to the MAU for the benefit of UA to increase 109% from $3.9M in FY00 to $8.2M in FY04.

3. By account code, notable revenue increases include Alaska Native Grants and Contracts up $1.1M (88%), Oil Grants and Contracts up $1.2M (190%), and Service Club/Non-Professional Grants and Contracts up $2.4M (208%).

4. Annual gross revenues in recent years averaging $8M (goes to corpus), earnings for distribution 5 yr. POMV @ 5% 4M. Sold over 1,000 parcels of land during last 10 years. During the last five years; 78MMBF of timber harvested, 18 subdivisions developed, 8,000 acres of land sold, gross revenue generated $42M.