Introduction
Budgeting is a crucial aspect of organizational management that involves planning and allocating financial resources to achieve specific goals. Various budgeting models exist, each with its own approach to resource allocation and each with its own strengths and weaknesses. Since its inception, UC Irvine used a model known as incremental budgeting, in which a unit’s budget allocation for the year is determined by its budget from the previous year modified by any relevant additions for cost increases and new initiatives or any needed reductions. While an incremental budget model can be very useful for its stability and simplicity while a campus is growing, UC Irvine is now at a point where we need to better align budgeting and resource allocation efforts with the strategic planning of individual units and the campus as a whole.
The campus budget workgroup and Budget Office are currently working to develop a new budget model that is informed by our newly established budget principles, outreach to peer higher education institutions, and current budget and planning trends in higher education. Our goal with this shift to a new budget model is to better align resources with strategic priorities and incorporate multi-year planning. Based on these factors, a likely option for the new budget model is a hybrid one, which would allow us to tailor aspects of various budget models to the specific needs of our campus.
The new budget model is being developed to address the following goals:
| Create a more holistic planning process; consider all resources in the context of strategic goals |
Establish a clear rationale for base budget and greater predictability |
Provide increased information, data, and transparency |
Use data-informed decision making and funds flow using predefined metrics |
Leverage non-core sources |
Address funding gap |
