The Catholic University of America

New Program Policy

 

Approved by: President
History: Issued    -- February 18, 2010  
  Revised  -- July 30, 2014  
  Additional History
Related Policies:  
Additional References:  
Responsible Official: Provost tel. 202-319-5244

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I.      Introduction

To meet the present and future educational needs of our students, the University is instituting a standardized methodology for program review in order to evaluate the viability of investing resources for new programs (undergraduate, graduate or workshop) and to determine if a proposed program is consistent with the mission of the University. This methodology enables the University to focus on academic programs that ensure that resources of the University are used most productively. Outlined below are the program review guidelines and processes which apply to all University departments and schools.

II.      Definitions
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III.     Need for the Investment in a Proposed or Existing Program

A new program shall meet a critical need as defined within the University's strategic plan. Demand and need for a new program shall be clearly stated. Schools and departments should evaluate the market demand by providing data showing current and projected supply of prospective students.

IV.     New Program Approval

New programs shall undergo the following review process for both academic and budgetary approval:

A.    A program proposal is developed by the department or school proposing the program which, in addition to the curriculum, incorporates several key elements:

1.  A clear statement of the critical need for the program, as defined within the University's strategic plan.

2.  A description of the ways in which this program meets the identified critical need.

3.  The potential demand for the program, with supporting evidence of trends within the field.

4.  The projected student enrollment in the program in the first three years.

B.    The department or school proposing the program will complete the new program questionnaire and submit the questionnaire to the Dean and the Associate Provost for Program Development for review. A completed proposal should be submitted to the Provost for comments and initial approval.

C.     Before final academic approval, the Provost's Office will submit a three-year financial projection for the new program to the Finance Department for review and approval. The Finance Department will coordinate the review of the new program with Enrollment Management. The Finance Department shall complete a return on investment analysis to determine financial viability and either approve the proposal or submit comments or concerns back to the Provost. If the program is approved, the Finance Department will notify the Provost's Office and the proposal will be routed through the appropriate academic review channels (e.g., curriculum committees, academic senate and the like).

After final approval of the program, the Provost will notify the Dean and Enrollment Management that the program is approved. Enrollment Management is responsible for the administrative processes required to set up any new program and will coordinate the budgetary and system requirements.

V.       Fund 12 Usage

Fund 12 will be used to develop new programs. An existing program that is reformatted is not eligible to be moved to Fund 12. Fund 12 use is for new programs and/or workshops only. A Fund 12 org is self-funding and allows for growth of new programs without requiring on-going resources from general operating funds. If the program is a new degree program, it will be kept in Fund 12 for no longer than 3 years or if determined by the Administration, until the program is deemed a viable self-supporting program, at which time the program will be moved into Fund 11, the General Operating Fund. If the program is a non-degree program or workshop program it will remain in Fund 12. If the program is not financially viable and modifications to the program are not feasible to improve the performance of the program, the program may be terminated by agreement of the Provost and the Vice President for Finance and Treasurer. The program may support the mission of the University and supply incremental benefits that are not of a financial nature and may not be terminated.

VI.       Overhead Calculation and Percentage

New programs shall be subject to a graduated overhead requirement during their first three years of operation to permit adequate time for the program to reach its full economic level. The overhead expense ratio will be as follows:

Year 1 - 25%

Year 2 - 30%

Year 3 - 50%

If approved by the administration as an exception and the program stays in Fund 12 for longer than 3 years, the overhead expense ratio will be 50%.

VII.      Program Review

At the end of each fiscal year, all Fund 12 programs will be audited and reviewed for their financial performance and academic requirements. A year-end financial report will be prepared by the Budget Department and submitted to the Provost and Vice President of Finance and Treasurer. Financially, each program should generate a positive operating net, which means revenue less operating expenses less overhead expense ratio should yield a positive number. During the annual review, modifications to the program to gain efficiencies and to generate a positive operating net will be explored.

New programs often times require additional expenses in the first year of the program for start up costs and result in a deficit. If the overall performance is positive at the end of the three year period, the program will be deemed productive and will continue. If the overall performance of the program is deficient or deemed non-productive, the recommendation may be made to terminate the program.

VIII.     Submission of Detailed Budgets

In accordance with the Budget Calendar, University departments are responsible for submitting detailed operating budgets for all Fund 12 activities and associated salary information to the Provost. The initial three-year financial data submitted to provide justification that a new program is viable may not be appropriate to use for the budget submission. From the time that the new program concept is developed until the new program is operational there can be changes to the financial data as further development of the program is finalized. After the Provost's review, the budgets will be forwarded to the Budget Office where an additional review will take place.

The level at which detailed budgets are submitted is dependent upon the type of expense. Salary expenses are budgeted at the detailed account code level. Fringe benefits are budgeted at a summary level and are calculated based on the type of salary expense. The Budget Office provides the percentage calculation as part of its annual budget package to the Vice Presidents for dissemination to departments and/or schools. Scholarships are budgeted at a summary level. Other expenses can be budgeted at a detailed level and are left to the discretion of the departments. Allocations are budgeted at a summary level. A specially designed budget report from the financial system can be used by departments to provide prior year activity, current year budget and current year-to-date activity to assist in the development of the next fiscal year detailed budget.

With the submission of the budgets, the departments include a listing of the employees and their budgeted salaries. The Budget Office maintains position budgets for all employees paid from operating funds. Some position budgets are pooled positions as in the case of temporary and student employment. The positions must be fully budgeted for the fiscal year. Funding permanent employees on "soft money" is discouraged. Soft money is defined as one-time sources, such as gifts which have no written commitment for future years. Funding positions from reserve funds will not be permitted.

IX.        Fiscal Year End Budgetary Transactions

At the end of the fiscal year, the Budget Office, in concert with the Controller's Office, will close Fund 12 activities by making the necessary transfers into reserve funds and ensuring that the funds are in balance (revenues equal expenses less overhead). The transfer of funds will be based on the following Financial Incentive Plan:

The department can only use the positive variance for University reinvestment, preferably reinvestment back into the program or investment into new strategic programs. It is the responsibility of the departmental manager to ensure that the use of the reserve is for this intended purpose.