Multi-Year Financial Planning

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10 Νοε 2013 (πριν από 3 χρόνια και 5 μήνες)

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Atlanta, GA

October 7
-
9, 2013

Multi
-
Year Financial Planning

Financial Management and Human Resources
Forum

Agenda


What is multi
-
year financial planning?


Benefits of multi
-
year financial planning.


Major elements of a multi
-
year financial plan.


Creating a multi
-
year financial plan.


Revenue and expense projections.


Example


United Way of Greater Philadelphia and Southern New
Jersey.


Example


Valley of the Sun United Way.


Questions???

November 10, 2013

2

What is Multi
-
Year Financial Planning


Projects revenue and expenses for several years into the future.


NOT the same as a multi
-
year budget.


Illustrates financial implications of a given set of assumptions.


Helps to assess revenue and expense trends, as well as financial
risks.


Principles can be applied at large and small organizations.

November 10, 2013

3

Benefits of a Multi
-
Year Financial Plan


Gives you a guide to your financial health.


Reduces risk in decision making.


Sets revenue and expense goals.


Provides financial direction.


Identifies financial risk areas.


Helps plan available program funding.


Helps build organizational accountability.


November 10, 2013

4

Major Elements of a Multi
-
Year Financial Plan


Revenue projections


Expense projections


Annual surpluses and deficits


Operating reserves



November 10, 2013

5

Creating a Multi
-
Year Financial Plan


Before you start, senior management has to decide the following:



Where does your
United Way want
to be in 3
-
5 years?


What
do you want to accomplish?


What
challenges could get in the way?





November 10, 2013

6

Creating a Multi
-
Year Financial Plan


Gather data on results for the last few years


Decide on your timeframe.


Determine the model you want to use.


Determine your assumptions on revenue and expenses.


Project revenue and expenses.


Get Board, Senior Management, and organizational buy in.


Revisit your plan at least annually.




November 10, 2013

7

Revenue Projections


Get Resource Development input.


Identify your key funding sources and the risks associated with
each.


Identify potential new funding sources.


Determine what resources you will need to meet your goals.


Use historical data as a baseline.


Use plan as a working model, update with current data as gathered.



November 10, 2013

8

Expense Projections


Get the organization involved.


Determine staff and infrastructure needs.


Identify costs associated with new programs or services.


Identify expense trends.


Determine areas of expense risk.


Use plan as a working model, update with current data as gathered.






November 10, 2013

9

Revenue and Expense Projections


Qualitative


“Gut instinct”.


More of an “art” than a “science”.


Quantitative


Relies on data and trends.


A combination of qualitative and quantitative


Use one method to support the other, and vice versa.





November 10, 2013

10

Annual Surplus/Deficit


Determine when it is okay to have a deficit or a surplus.


Understand grant revenue recognition timing.


Understand multi
-
year expenses.




November 10, 2013

11

Operating Reserves


Operating reserves vs. net assets.


Permanently restricted vs. temporarily restricted vs. operating
reserves.


Establish what will be included in “operating reserves”.

November 10, 2013

12

Multi
-
Year Financial Planning

Example: United Way of Greater
Philadelphia and Southern New
Jersey


Implemented by: Karen
Cleary, SVP


Finance and Operations


Multi
-
Year Financial Planning at UWGPSNJ


Implemented long range planning in connection with our strategic
plan two years
ago


Strategy
was to develop a
multi
-
year financial plan that
enables us
to manage our business
model


Key purposes of the plan are:


Minimize risk associated with annual Campaign fluctuation


Aid in setting fundraising goals


Aid in resource allocation


Provide a clear financial direction beyond annual budgeting

November 10, 2013

14

Multi
-
Year Plan
-

Example

November 10, 2013

15

Administrative Fee Sensitivity Analysis

2013
-
2014

2014
-
2015

2015
-
2016

2016
-
2017

2017
-
2018

Gross Campaign


63,500,000


66,675,000


70,008,750


73,509,188


77,184,647

Less: CFC and Government


(4,748,912)


(4,986,358)


(5,235,676)


(5,497,460)


(5,772,333)

Less: Pay
-
directs


(9,297,583)


(9,747,022)


(10,218,471)


(10,713,013)


(11,261,401)


49,453,505


51,941,620


54,554,604


57,298,714


60,150,913

Net overhead to be recovered:

Overhead expenses


11,405,327


11,381,336


11,576,899


11,737,644


11,814,229

Net of rental revenue


(403,000)


(423,150)


(429,665)


(467,554)


(455,831)

Net of Government Campaign reimbursement


(519,698)


(535,289)


(551,347)


(567,888)


(584,925)

Net of miscellaneous income (overhead portion only)


(143,350)


(145,713)


(145,167)


(147,214)


(149,359)

Net of spending policy on endowments


(2,668,351)


(2,728,416)


(2,865,546)


(3,013,605)


(3,032,036)

Out of area processing fees


(450,000)


(463,500)


(477,405)


(491,727)


(506,479)

Amounts funded from reserve generated in prior year


(217,500)


-



-



-



-


United Way Worldwide dues


516,500


531,995


547,955


564,393


581,325

Net of restricted grant resources available for overhead support


(230,000)


(230,000)


(230,000)


(150,000)


(150,000)


7,289,928


7,387,263


7,425,724


7,464,048


7,516,924

Calculated Rate

14.7%

14.2%

13.6%

13.0%

12.5%

Multi
-
Year
Plan
-

Example

November 10, 2013

16

5 Year Resource Table Projection

FY 14
Proforma

FY 15
Proforma

FY 16
Proforma

FY 17
Proforma

FY 18

Proforma

Campaign Results


63,500,000


66,675,000


70,008,750


73,509,188


77,184,647

Less: Uncollectibles


(3,429,000)


(3,600,450)


(3,780,473)


(3,969,496)


(4,167,971)

Less: Net designations


(26,474,824)


(27,835,517)


(29,266,264)


(30,767,409)


(32,344,071)

Less: Overhead, net


(5,615,243)


(5,621,145)


(5,602,202)


(5,603,268)


(5,617,363)

Less: UWW dues


(516,500)


(531,995)


(547,955)


(564,393)


(581,325)

Less: CI operating costs


(6,356,194)


(6,561,419)


(6,774,690)


(6,996,368)


(7,226,961)

Add: Designations in from Other UW's


375,000


375,000


375,000


375,000


375,000

Current Year $ Available for CI Agenda


21,483,239


22,899,475


24,412,168


25,983,253


27,621,955

Multi
-
Year Planning Process


D
etermine overarching considerations


“where do we want to be in
five years?”


F
ocused on two key areas




C
alculated cost recovery/administrative fee rate


Funds available for Community Impact grant making


D
evelop annual targets in each area


Considerations and annual targets required senior management
and Board of Directors buy
-
in


November 10, 2013

17

Multi
-
Year Planning Process


Determine the methodology to use based upon goals


Administrative fee calculation


Resource Table calculation


Decide on the scenarios you want to see


“Pie in the sky” versus “Reality”


Estimate your key inputs


Expenses


Campaign revenue


Uncollectibles


Investment income


Other revenue



November 10, 2013

18

Multi
-
Year Planning Process


Did not do a line by line projection for expenses


Applied trends to key expense categories


Resource Development drove Campaign revenue projections


Used trend analysis, prospect analysis, forecasted by type of
giving


Estimated investment income based upon trends and projected new
endowment gifts


Estimated other revenue sources (i.e. rental income, grant overhead
reimbursement) based upon historical trends




November 10, 2013

19

Multi
-
Year Plan
-

Example

November 10, 2013

20

Administrative Fee Sensitivity Analysis

2013
-
2014

2014
-
2015

2015
-
2016

2016
-
2017

2017
-
2018

Gross Campaign


63,500,000


66,675,000


70,008,750


73,509,188


77,184,647

Less: CFC and Government


(4,748,912)


(4,986,358)


(5,235,676)


(5,497,460)


(5,772,333)

Less: Pay
-
directs


(9,297,583)


(9,747,022)


(10,218,471)


(10,713,013)


(11,261,401)


49,453,505


51,941,620


54,554,604


57,298,714


60,150,913

Net overhead to be recovered:

Overhead expenses


11,405,327


11,381,336


11,576,899


11,737,644


11,814,229

Net of rental revenue


(403,000)


(423,150)


(429,665)


(467,554)


(455,831)

Net of Government Campaign reimbursement


(519,698)


(535,289)


(551,347)


(567,888)


(584,925)

Net of miscellaneous income (overhead portion only)


(143,350)


(145,713)


(145,167)


(147,214)


(149,359)

Net of spending policy on endowments


(2,668,351)


(2,728,416)


(2,865,546)


(3,013,605)


(3,032,036)

Out of area processing fees


(450,000)


(463,500)


(477,405)


(491,727)


(506,479)

Amounts funded from reserve generated in prior year


(217,500)


-



-



-



-


United Way Worldwide dues


516,500


531,995


547,955


564,393


581,325

Net of restricted grant resources available for overhead support


(230,000)


(230,000)


(230,000)


(150,000)


(150,000)


7,289,928


7,387,263


7,425,724


7,464,048


7,516,924

Calculated Rate

14.7%

14.2%

13.6%

13.0%

12.5%

Multi
-
Year
Plan
-

Example

November 10, 2013

21

5 Year Resource Table Projection

FY 14
Proforma

FY 15
Proforma

FY 16
Proforma

FY 17
Proforma

FY 18

Proforma

Campaign Results


63,500,000


66,675,000


70,008,750


73,509,188


77,184,647

Less: Uncollectibles


(3,429,000)


(3,600,450)


(3,780,473)


(3,969,496)


(4,167,971)

Less: Net designations


(26,474,824)


(27,835,517)


(29,266,264)


(30,767,409)


(32,344,071)

Less: Overhead, net


(5,615,243)


(5,621,145)


(5,602,202)


(5,603,268)


(5,617,363)

Less: UWW dues


(516,500)


(531,995)


(547,955)


(564,393)


(581,325)

Less: CI operating costs


(6,356,194)


(6,561,419)


(6,774,690)


(6,996,368)


(7,226,961)

Add: Designations in from Other UW's


375,000


375,000


375,000


375,000


375,000

Current Year $ Available for CI Agenda


21,483,239


22,899,475


24,412,168


25,983,253


27,621,955

Lessons Learned


Identified challenge years early


Made financial constraints and considerations very clear to senior
management and the Board


Helped us determine whether our overarching goals were realistic


Informed future budget and expense planning


Enabled multi year planning for agency grants


Identified need
to grow endowment (or other source of revenue) to
support operations




November 10, 2013

22

Multi
-
Year Financial Planning

Example: Valley of the Sun United
Way, Phoenix, Arizona


Implemented by: Tanya Muñiz, CFO


Multi
-
Year Planning at VSUW


Implemented FYE 2011 as a long range planning tool.


Multi
-
Year community impact strategies required VSUW to look
beyond 1 year cycles.


New community impact strategies required multi
-
year revenue
strategies


Use as a tool for planning at the staff, management, senior staff,
and board level.



November 10, 2013

24

Board Level Reporting


Board uses as a tool to understand the future of VSUW; where we
are and where are we going?


Aligns strategic plan objectives and resources


Gives the board the information necessary to ensure VSUW’s
financial stability


Gives a clear picture of net asset needs


November 10, 2013

25


DATA IS FOR EXAMPLE ONLY

November 10, 2013


26

FYE:
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Revenue
Gross Campaign Revenue
46,830,994


47,324,104


47,832,886


46,319,777


47,796,479


49,073,262


50,422,573


51,814,447


53,250,306


54,747,213


Grant Revenue
20,571,151


30,903,947


54,313,388


57,503,965


58,733,343


59,986,227


61,212,679


62,513,166


63,838,259


65,238,493


Other Revenue
11,939,016


6,416,346


8,252,664


8,756,821


9,549,985


10,273,692


11,010,315


11,769,793


12,546,052


13,341,336


Gross Revenue
79,341,161


84,644,397

110,398,938

112,580,563

116,079,808

119,333,181

122,645,567

126,097,407

129,634,617

133,327,043

Less: Designations
(18,981,610)


(19,651,402)


(19,606,120)


(18,721,148)


(19,698,299)


(20,227,680)


(20,703,646)


(21,187,739)


(21,681,933)


(22,195,986)


Less: Allowance for Pledge Loss
(1,428,918)


(1,404,892)


(1,411,338)


(1,379,931)


(1,404,909)


(1,442,279)


(1,485,946)


(1,531,335)


(1,578,419)


(1,627,561)


Total Net Revenue
58,930,633


63,588,103

89,381,480


92,479,483


94,976,599


97,663,222


100,455,975

103,378,333

106,374,266

109,503,495

Expenses
Program Services
44,601,776


55,770,857


80,114,255


83,577,410


85,106,075


86,663,588


89,113,103


91,018,862


93,111,767


95,105,854


Supporting Services
6,683,348


7,313,457


8,243,845


8,600,161


9,176,133


9,618,481


9,912,547


10,294,993


10,659,026


11,079,249


Total Expenses
51,285,124


63,084,314


88,358,100


92,177,572


94,282,208


96,282,069


99,025,649


101,313,854


103,770,793


106,185,102


Net Assets
Total Net Assets Beginning of Year
37,111,690


46,920,935


45,293,963


46,317,343


46,619,254


47,313,646


48,694,798


50,125,123


52,189,602


54,793,074


Changes in Net assets - Unrestricted and Quasi-Restricted
8,303,165


464,070


479,630


(198,089)


194,391


881,152


930,325


1,564,478


2,103,472


2,818,393


Changes in Net assets - Permanently Restricted
(657,655)


39,720


543,750


500,000


500,000


500,000


500,000


500,000


500,000


500,000


Change in Net Assets - Unrecognized Benefit Plan Cost
2,163,735


(2,130,762)


-


-


-


-


-


-


-


-


Total Net Assets End of Year
46,920,935


45,293,963


46,317,343


46,619,254


47,313,646


48,694,798


50,125,123


52,189,602


54,793,074


58,111,467


Overhead Rate
8.58%
8.79%
7.56%
7.73%
8.00%
8.16%
8.18%
8.26%
8.32%
8.41%
Overhead Rate W/O FTF and WIA
11.81%
14.10%
14.99%
16.18%
16.52%
16.70%
16.61%
16.63%
16.61%
16.65%
FTE's
89.29


104.50


110.75


117.00


122.50


123.50


124.50


124.50


124.50


124.50


Key Financial Measures

DATA IS FOR EXAMPLE ONLY

November 10, 2013

27

FYE:
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Campaign Revenue
Campaign Contributions
46,830,994


47,324,104


47,832,886


46,319,777


47,796,479


49,073,262


50,422,573


51,814,447


53,250,306


54,747,213


Donor Designations**
(18,981,610)


(19,651,402)


(19,606,120)


(18,721,148)


(19,698,299)


(20,227,680)


(20,703,646)


(21,187,739)


(21,681,933)


(22,195,986)


Provision for Uncollectible Pledges***
(1,428,918)


(1,404,892)


(1,411,338)


(1,379,931)


(1,404,909)


(1,442,279)


(1,485,946)


(1,531,335)


(1,578,419)


(1,627,561)


Net Campaign Revenue
26,420,466


26,267,810


26,815,428


26,218,697


26,693,271


27,403,303


28,232,981


29,095,373


29,989,955


30,923,666


Grant Revenue
First Things First - Scholarships
10,667,985


18,676,197


41,179,706


40,475,555


41,291,694


42,124,989


42,975,415


43,843,309


44,729,103


45,633,193


First Things First - Quality First
6,197,479


8,538,805


9,900,821


14,039,760


14,294,708


14,575,940


14,863,048


15,156,315


15,455,881


15,761,830


First Things First - Rewards
1,345,042


1,749,405


1,484,252


1,491,789


1,522,611


1,554,090


1,586,256


1,619,143


1,652,766


1,687,136


First Things First - Other
360,086


381,277


160,523


167,108


194,578


201,456


208,207


214,647


220,757


226,581


Workforce Investment Act
1,475,516


972,841


929,753


929,753


929,753


929,753


929,753


929,753


929,753


929,753


Other Government and/or Private Grants
525,042


585,422


658,333


400,000


500,000


600,000


650,000


750,000


850,000


1,000,000


Total Grant Revenue
20,571,151


30,903,947


54,313,388


57,503,965


58,733,343


59,986,227


61,212,679


62,513,166


63,838,259


65,238,493


Total Investment Income
7,393,534


(102,619)


2,516,921


3,134,799


3,382,448


3,581,497


3,795,950


4,032,879


4,286,118


4,557,458


Total Endowment and Principal Gift Revenue
(402,655)


104,259


772,500


700,000


700,000


700,000


700,000


700,000


700,000


700,000


Revenue Summary Schedule
DATA IS FOR EXAMPLE ONLY

November 10, 2013

28

FYE:
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Program Services
Community Impact Operations
1,722,052


2,120,858


2,272,385


2,418,085


2,607,247


2,704,464


2,874,574


2,985,435


3,102,348


3,225,644


Community Investment Allocations
18,062,188

17,031,039

15,943,896

14,421,044

13,557,324

13,046,540

13,046,540

13,046,540

13,046,540

13,046,540

Directed Community Investments
1,215,434


1,599,489


3,192,073


3,963,663


4,456,247


4,737,740


5,224,190


5,258,730


5,420,460


5,473,290


Grant-Reimbursed Initiatives and Operations
20,039,916

30,143,689

53,560,762

57,003,849

58,107,415

59,259,265

60,435,121

61,635,686

62,861,550

64,113,228

Total Distributions
41,039,590

50,895,075

74,969,116

77,806,641

78,728,234

79,748,009

81,580,424

82,926,392

84,430,898

85,858,702

Gift-in-Kind Distribution
2,429,706


3,518,302


3,500,000


4,000,000


4,500,000


5,000,000


5,500,000


6,000,000


6,500,000


7,000,000


Total Program Service
43,469,296

54,413,377

78,469,116

81,806,641

83,228,234

84,748,009

87,080,424

88,926,392

90,930,898

92,858,702

Program Services by Community Objective
Children
20,711,865

31,467,607

55,445,988

59,033,049

60,205,299

61,359,678

62,653,088

63,950,570

65,273,381

66,625,007

Homelessness
5,313,089


5,391,421


5,436,629


5,126,471


5,501,070


5,696,449


5,714,726


5,734,034


5,754,367


5,775,799


Youth
6,140,099


5,686,641


6,572,735


7,128,941


7,262,912


7,398,698


7,869,746


7,828,128


7,930,945


7,924,296


Financial Stability
1,853,300


1,707,508


2,151,169


2,144,194


2,165,035


2,192,026


2,237,189


2,261,869


2,287,497


2,314,140


Hunger
1,063,660


1,257,877


1,367,477


1,373,020


1,379,451


1,386,447


1,393,821


1,401,628


1,409,862


1,418,566


Healthy Communities
5,957,576


5,384,020


3,995,119


3,000,966


2,214,468


1,714,711


1,711,855


1,750,162


1,774,847


1,800,894


Total Distributions
41,039,590

50,895,075

74,969,116

77,806,641

78,728,234

79,748,009

81,580,424

82,926,392

84,430,898

85,858,702

Gift-in-Kind Distribution
2,429,706


3,518,302


3,500,000


4,000,000


4,500,000


5,000,000


5,500,000


6,000,000


6,500,000


7,000,000


Total Program Service
43,469,296

54,413,377

78,469,116

81,806,641

83,228,234

84,748,009

87,080,424

88,926,392

90,930,898

92,858,702

Program Expenses Summary Schedule
DATA IS FOR EXAMPLE ONLY

November 10, 2013

29

FYE:
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Operating Expenses by Service Category
Program Operating
3,677,758


4,406,047


5,094,084


5,313,637


5,646,725


5,825,466


6,158,565


6,377,487


6,633,589


6,876,548


Supporting Services
6,683,348


7,313,457


8,243,845


8,600,161


9,176,133


9,618,481


9,912,547


10,294,993

10,659,026

11,079,249

Total Operating Expenses by Service Category:
10,361,106

11,719,504

13,337,929

13,913,798

14,822,859

15,443,947

16,071,112

16,672,479

17,292,615

17,955,796

Operating Expenses by Natural Category
Salaries and Benefits
6,906,364


7,745,592


8,752,012


9,162,921


9,880,275


10,336,916

10,802,622

11,237,770

11,696,576

12,181,057

Professional Fees
296,307


504,446


508,505


509,744


521,519


533,630


546,085


558,895


572,071


585,622


Office Supplies, Computer Services, Fees & Licenses, Postage
558,445


717,981


812,142


786,120


808,338


831,260


854,800


878,975


903,899


929,489


Occupancy-Building, Utilities, Equipment & Insurance
405,412


444,626


629,750


687,541


749,226


788,215


829,242


865,669


903,782


943,664


Printing and Communications
1,092,503


1,100,615


1,167,025


1,209,802


1,213,604


1,267,198


1,271,672


1,327,452


1,332,659


1,390,732


Events & Meetings (including Awards)
200,237


237,733


285,832


262,557


290,586


278,254


306,750


294,888


323,857


312,482


Travel
57,424


90,781


125,159


128,610


132,198


135,879


139,656


143,531


147,606


151,784


Mileage, Education, Recruitment & Dues
87,850


126,990


195,260


203,637


211,960


218,767


225,882


232,748


239,911


247,389


Depreciation and Amortization
288,703


288,444


400,000


441,368


483,252


511,328


541,001


568,052


596,454


626,277


UWW National Dues
467,864


462,296


462,244


521,500


531,900


542,500


553,400


564,500


575,800


587,300


Total Operating Expenses by Natural Category
10,361,109

11,719,504

13,337,929

13,913,798

14,822,859

15,443,947

16,071,112

16,672,479

17,292,615

17,955,796

Operating Expenses Summary Schedule
Senior Staff level reporting


Senior staff reviews at an “operating” level


Negotiates the revenue projections versus expenses


Uses as a tool to prioritize


Uses as a tool for timing of strategy implementation


Provides the necessary information to understand and minimize
risk


Uses as the platform for strategic planning


November 10, 2013

30

November 10, 2013

31

Operating Model Page 1 of 3
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Revenue
Net Campai gn Revenue
26,420,466


26,267,810


26,815,428


26,218,697


26,693,271


27,403,303


28,232,981


29,095,373


29,989,955


30,923,666


Pri nci pal Gi fts
255,000


10,000


79,500


77,313


117,313


157,313


197,313


200,000


200,000


200,000


Grant Revenue - FTF
20,046,109


30,318,525


53,655,055


57,103,965


58,233,343


59,386,227


60,562,679


61,763,166


62,988,259


64,238,493


Grant Revenue - Foundati ons and Other
525,042


585,422


658,333


400,000


500,000


600,000


650,000


750,000


850,000


1,000,000


Endowment Fund Di stri buti ons
498,363


882,300


1,200,902


1,312,025


1,414,043


1,517,829


1,580,508


1,646,895


1,717,679


1,791,335


Interest and Di vi dends
527,324


63,735


382,448


538,200


675,642


758,813


853,255


959,116


1,077,513


1,209,651


Other Revenue
1,519,518


1,885,721


913,243


872,022


917,537


942,195


964,366


986,914


1,009,934


1,033,878


Funder's Col l aborati ve
955,000


925,700


500,000


-


-


-


-


-


-


-


Gi fts-i n-Ki nd
2,473,619


3,603,285


3,550,000


4,050,000


4,550,000


5,050,000


5,550,000


6,050,000


6,550,000


7,050,000


Total Revenue
53,220,442

64,542,498

87,754,910

90,572,221

93,101,149

95,815,679

98,591,100

101,451,464

104,383,340

107,447,023

Expenses
Program
Labor
1,763,917


2,171,837


2,418,306


2,547,725


2,729,412


2,838,956


3,010,705


3,135,379


3,267,121


3,406,471


Operati ng Expense
781,105


875,599


1,030,639


995,143


1,039,472


1,070,930


1,115,182


1,149,638


1,185,599


1,222,925


Al l ocati ons
17,037,188


16,003,339


15,443,896


14,421,044


13,557,324


13,046,540


13,046,540


13,046,540


13,046,540


13,046,540


Funder's Col l aborati ve-Al l ocati ons
1,025,000


1,027,700


500,000


-


-


-


-


-


-


-


Other Heal th & Human Servi ce
20,432,380


30,816,600


55,576,275


59,842,729


61,402,026


62,791,583


64,407,997


65,594,835


66,931,638


68,182,766


Gi fts-i n-Ki nd
2,429,706


3,518,302


3,500,000


4,000,000


4,500,000


5,000,000


5,500,000


6,000,000


6,500,000


7,000,000


Total Program:
43,469,296


54,413,377


78,469,116


81,806,641


83,228,234


84,748,009


87,080,424


88,926,392


90,930,898


92,858,702


November 10, 2013

32

Operating Model Page 2 of 3
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Supporting Services
Marketing:
Labor
619,883


618,666


683,712


817,634


848,053


880,754


915,144


951,479


989,775


1,030,177


Operati ng Expense
565,281


586,729


964,223


995,289


1,065,147


1,057,539


1,130,945


1,124,285


1,201,114


1,195,470


Total Marketing:
1,185,164


1,205,395


1,647,935


1,812,923


1,913,201


1,938,293


2,046,090


2,075,764


2,190,889


2,225,647


Finance and Administration:
Labor
2,525,893


2,817,663


3,262,519


3,364,063


3,650,293


3,787,827


3,932,163


4,084,221


4,244,238


4,412,786


Operati ng Expense
1,338,488


1,583,725


1,647,853


1,751,883


1,824,771


1,880,410


1,938,016


1,997,749


2,059,502


2,123,349


Total Finance & Administration:
3,864,381


4,401,388


4,910,371


5,115,945


5,475,065


5,668,237


5,870,178


6,081,969


6,303,740


6,536,135


Resource Development:
Labor
1,996,671


2,137,426


2,387,476


2,433,499


2,652,516


2,829,379


2,944,610


3,066,691


3,195,442


3,331,624


Operati ng Expense
769,613


913,324


943,201


1,008,563


1,013,193


1,098,151


1,084,347


1,163,038


1,149,825


1,232,995


Total Resource Development:
2,766,283


3,050,750


3,330,677


3,442,062


3,665,709


3,927,530


4,028,957


4,229,729


4,345,267


4,564,618


Total Supporting Services
7,815,828


8,657,532


9,888,984


10,370,930


11,053,974


11,534,061


11,945,225


12,387,463


12,839,895


13,326,400


Total VSUW Expenses
51,285,124

63,070,909

88,358,100

92,177,572

94,282,208

96,282,069

99,025,649

101,313,854

103,770,793

106,185,102

Operating Net Income (Loss)
1,935,317


1,471,589


(603,190)


(1,605,351)


(1,181,059)


(466,390)


(434,549)


137,610


612,546


1,261,921


DATA IS FOR EXAMPLE ONLY

November 10, 2013

33

Operating Model Page 3 of 3
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Adjustment to SOA
SUB:Endowment Distribution
(498,363)


(882,300)


(1,200,902)


(1,312,025)


(1,414,043)


(1,517,829)


(1,580,508)


(1,646,895)


(1,717,679)


(1,791,335)


SUB:Princpal Gift Payments
(79,500)


(77,313)


(117,313)


(157,313)


(197,313)


(200,000)


(200,000)


(200,000)


ADD: Endowment Pledge Revenue
(657,655)


94,259


543,750


500,000


500,000


500,000


500,000


500,000


500,000


500,000


ADD:Principal Gift Pledge Revenue
-


-


228,750


200,000


200,000


200,000


200,000


200,000


200,000


200,000


ADD:Investment Income on Endowment
6,866,210


(166,354)


2,134,472


2,596,600


2,706,806


2,822,684


2,942,695


3,073,763


3,208,605


3,347,807


Net Gain or (Loss)
7,647,520


519,206


1,025,393


303,925


696,406


1,383,168


1,432,342


2,066,496


2,605,491


3,320,413


Unrecognized Benefi t Plan Change
2,163,735


(2,130,762)


Total Change In Net Assets
9,811,255


(1,611,556)


1,025,393


303,925


696,406


1,383,168


1,432,342


2,066,496


2,605,491


3,320,413


Staff, Management and Finance Committee Level
Reporting
-

REVENUE


Includes strategy level detail ( Ex: Non
-
campaign revenue,
Endowment Gifts, Includes pledge revenue and “usable for
operations”)


Departments provide growth needs by strategy, by company


Investment revenue and Endowment Revenue has a detailed
schedule that feeds into the model


Includes assumption for rates of increase based on economic
factors and known community/company changes


Use each year as the basis for budget planning but DOES NOT
replace the budget process

November 10, 2013

34

DATA IS FOR EXAMPLE ONLY

November 10, 2013

35

2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Revenue
Campai gn Revenue
46,830,994


47,324,104


47,832,886


46,319,777


47,796,479


49,073,262


50,422,573


51,814,447


53,250,306


54,747,213


Donor Desi gnati ons
(18,981,610)


(19,651,402)


(19,606,120)


(18,721,148)


(19,698,299)


(20,227,680)


(20,703,646)


(21,187,739)


(21,681,933)


(22,195,986)


Provi si on for Uncol l ecti bl e Pl edges
(1,428,918)


(1,404,892)


(1,411,338)


(1,379,931)


(1,404,909)


(1,442,279)


(1,485,946)


(1,531,335)


(1,578,419)


(1,627,561)


Net Campai gn Revenue
26,420,466


26,267,810


26,815,428


26,218,697


26,693,271


27,403,303


28,232,981


29,095,373


29,989,955


30,923,666


Pri nci pal Gi fts
255,000


10,000


79,500


77,313


117,313


157,313


197,313


200,000


200,000


200,000


Grant Revenue - FTF
20,046,109


30,318,525


53,655,055


57,103,965


58,233,343


59,386,227


60,562,679


61,763,166


62,988,259


64,238,493


Grant Revenue - Foundati ons and Other
525,042


585,422


658,333


400,000


500,000


600,000


650,000


750,000


850,000


1,000,000


Endowment Fund Di stri buti ons
498,363


882,300


1,200,902


1,312,025


1,414,043


1,517,829


1,580,508


1,646,895


1,717,679


1,791,335


Interest and Di vi dends
527,324


63,735


382,448


538,200


675,642


758,813


853,255


959,116


1,077,513


1,209,651


Other Revenue
1,519,518


1,885,721


913,243


872,022


917,537


942,195


964,366


986,914


1,009,934


1,033,878


Funder's Col l aborati ve
955,000


925,700


500,000


-


-


-


-


-


-


-


Gi fts-i n-Ki nd
2,473,619


3,603,285


3,550,000


4,050,000


4,550,000


5,050,000


5,550,000


6,050,000


6,550,000


7,050,000


Total Operating Revenue
53,220,442

64,542,498

87,754,910

90,572,221

93,101,149

95,815,679

98,591,100

101,451,464

104,383,340


107,447,023


Revenue Adjustments for SOA
SUB:Endowment Di stri buti on
(498,363)


(882,300)


(1,200,902)


(1,312,025)


(1,414,043)


(1,517,829)


(1,580,508)


(1,646,895)


(1,717,679)


(1,791,335)


SUB:Pri ncpal Gi ft Payments
(79,500)


(77,313)


(117,313)


(157,313)


(197,313)


(200,000)


(200,000)


(200,000)


ADD: Endowment Pl edge Revenue
(657,655)


94,259


543,750


500,000


500,000


500,000


500,000


500,000


500,000


500,000


ADD:Pri nci pal Gi ft Pl edge Revenue
-


-


228,750


200,000


200,000


200,000


200,000


200,000


200,000


200,000


ADD:Investment Income on Endowment
6,866,210


(166,354)


2,134,472


2,596,600


2,706,806


2,822,684


2,942,695


3,073,763


3,208,605


3,347,807


Revenue SOA
58,930,633


63,588,103


89,381,480


92,479,483


94,976,599


97,663,222


100,455,975


103,378,333


106,374,266


109,503,495


Staff, Management and Finance Committee Level
Reporting
-

EXPENSES


Includes strategy level detail ( Ex: Children and Youth

Community
Objective, Children


Sub
-
category, Read On, Strategy)


Departments provide growth needs for “discretionary” expenses in
detail.


Departments provide detail of FTE needs in detail by position


Detail for each FTE is kept and feeds to model


Detail for each strategy is kept and feeds to model


Includes assumption for rates of increase based on economic
factors and FTE growth for expenses considered to be

undiscretionary
” (ex. Occupancy, Supplies, Benefits)


Use each year as the basis for budget planning but DOES NOT
replace the budget process

November 10, 2013

36

DATA IS FOR EXAMPLE ONLY

November 10, 2013

37

Resource Development
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Expenses:
Salary and SRE Expenses:
Sal ari es
1,464,516


1,651,086


1,731,056


1,727,426


1,862,374


1,965,745


2,024,717


2,085,459


2,148,023


2,212,463


Benefi ts
417,396


358,628


514,939


558,169


630,966


696,059


747,855


804,607


866,313


933,439


EE Taxes
114,758


127,712


141,480


147,905


159,177


167,575


172,038


176,626


181,106


185,721


Total Salary/ERE's
1,996,671


2,137,426


2,387,476


2,433,499


2,652,516


2,829,379


2,944,610


3,066,691


3,195,442


3,331,624


Operating Expenses:
Space,Suppl i es,EE expenses
233,183


249,212


331,383


350,492


386,272


414,801


433,530


453,325


474,059


495,780


Legal Fees
-


5,000


5,000


5,065


5,131


5,198


5,265


5,334


5,403


ASU Fel l owshi p
-


34,427


35,755


36,500


36,975


37,455


37,942


38,435


38,935


39,441


Grantwri ter Consul ti ng
10,388


12,000


12,000


12,156


12,314


12,474


12,636


12,801


12,967


Pl anned Gi vi ng/Endowment Consul ti ng
22,075


19,275


18,000


18,000


18,234


18,471


18,711


18,954


19,201


19,450


Professi onal Fees-LE's
10,925


11,044


7,500


-


-


-


-


-


-


Other Professi onal Fees
13,397


10,177


4,000


4,000


4,052


4,105


4,158


4,212


4,267


4,322


Postage
4,524


4,235


4,500


6,500


6,585


6,670


6,757


6,845


6,934


7,024


Subscri pti ons-Lexus Nexus,Weal th Engi ne & Mi sc
10,204


4,320


5,079


5,569


5,641


5,715


5,789


5,864


5,941


6,018


Campai gn Pri nti ng
Production Every Other Year
124,087


125,809


137,800


169,500


139,130


174,925


143,654


180,533


148,335


186,332


Pl anned Gi vi ng Webssi te
5,000


5,200


5,400


5,600


5,800


6,000


6,200


6,400


Di rect Mai l
24,757


101,956


40,000


40,000


40,520


41,047


41,580


42,121


42,668


43,223


Vi deography
58,419


58,000


30,000


60,000


30,000


61,800


30,900


63,654


31,827


65,564


Campai gn Speci al ty Expense/Incenti ves
42,622


31,337


28,500


28,500


28,871


29,246


29,626


30,011


30,401


30,797


Mi l eage and Vehi cl e
28,103


40,960


35,000


35,000


35,455


35,916


36,383


36,856


37,335


37,820


Travel
12,405


13,779


30,050


30,050


30,441


30,836


31,237


31,643


32,055


32,471


Departmental Suppl i es
3,570


3,500


4,950


5,014


5,080


5,146


5,212


5,280


5,349


Staff Devel opment
3,693


14,308


5,500


8,000


8,104


8,209


8,316


8,424


8,534


8,645


Speci al Events
Fdtn Cultivation Every Other Year
146,391


167,933


186,534


167,000


192,610


177,788


203,722


189,234


215,511


201,376


Local Meeti ngs-Regi strtati on/Food and Beverage
11,116


15,031


14,225


16,250


16,461


16,675


16,892


17,112


17,334


17,559


Dues
1,085


2,119


3,875


3,875


3,925


3,976


4,028


4,080


4,134


4,187


Awards
8,422


9,312


13,000


13,000


13,169


13,340


13,514


13,689


13,867


14,048


Mi sc.
247


90


-


-


-


-


-


-


-


Total Other Operating Expenses:
769,613


913,324


943,201


1,002,511


1,006,985


1,091,784


1,077,815


1,156,337


1,142,950


1,225,941


Total Expenses
2,766,283


3,050,750


3,330,677


3,436,010


3,659,502


3,921,163


4,022,425


4,223,028


4,338,392


4,557,565


Actual
Projected
Staff Feedback:

“It
assist the conversation between finance and CI and planning and
implementation. Since it is developed collaboratively there's greater
understanding of all
parties.” Michelle Gayles,
Vice President, Community
Impact

“I
didn’t have to worry about the budget prior to becoming a VP, which
was around the same time as when the financial forecasts went into
place. What
I like about the forecasts are they allow me to plan ahead for
future needs/resources
.” Charlie
Boyce,Vice

President, Community
Impact

“As
a marketer, I find the multi
-
year economic model EXTREMELY
valuable because it enables me to create multi
-
year plans and project the
resources needed to achieve those plans.


Too often, marketers are
expected to focus on the year in front of them, which requires us to treat
resources like a faucet that turns off at the beginning of a fiscal year, then
on the next day when a new one begins.


With multi
-
year models, I can
see into the future, giving me confidence to make resource decisions
today
.” Tamera
Skroven
, Senior VP Marketing






November 10, 2013

38

Staff Feedback:

“Multi
-
year
economic models show the good and the bad.


As a marketer, I
can partner with Resources Develop to look at the tougher years and plan
ahead for communications / calls to action that could shore up and smooth out
the potential dips.


If the model shows the end of a major revenue source, we
can plan ahead to acquire a new source.


There is planning and action, not
surprises and
reaction.” Tamera
Skroven
, Senior VP
Marketing


“For
me, it has provided a stronger management and planning tool. It has
helped to put all departments on the same path toward common goals. I think
it is increased teamwork, understanding and accountability. It can be a
painstaking process but I think it has a great return on our time investment. It
also requires discipline and that makes us a stronger organization
.” Amy
Schwabenlender,

Vice President, Community Impact




November 10, 2013

39

Staff Feedback:

“The
model has been especially good for predictive budgeting purposes;
especially for the short run years.


It makes the budgeting process easier,
although I believe it essential to recheck assumptions and underlying numbers
annually to validate and reassess
.” Nancy Dean, Senior VP Resource
Development


“I
have all the confidence that I need (The board, Sr. Team, Finance, RD, CI) I
need to move toward Community Impact and have the confidence in the
organizational
commitment. The
first

months of modeling, sucked! It was
hard, took a lot of organizational learning and it led to greater discipline and
understanding
.” Brian Spicker, Senior VP Community Impact


November 10, 2013

40

QUESTIONS???

November 10, 2013

41