OperatingBudgetManual2015

Operating Budget Manual – August 2010

C.7 – Establishment of Funded Reserves

Campus Based Reserves In accordance with the Income Fund Reimbursable (IFR) Program policy and guidelines issued December 2, 1996, SUNY campuses are authorized, but not required, to establish funded reserves as necessary for the long-term financial stability of the IFR Program. This includes accounts in the General IFR, SUTRA and Stabilization Funds, as well as the HIFR-IFR programs. The following types of campus based reserves may be established (please contact the University Controller’s office for specific account numbers): • Reserve for Equipment Replacement and Repairs – Funds may be reserved to replace, repair or upgrade existing equipment. Reserves for equipment replacement should reflect replacement cost of the asset, not historical cost. Reserves for equipment repairs may not include routine maintenance costs. The reserve should only be used for major repairs, such as upgrades, that will extend the service life of the equipment, or materially increase the capacity or operating efficiency of the equipment. Equipment Replacement and Repair Plans should be based on a five-year planning cycle. • Reserve for Facilities Rehabilitation and Renovation – Funds may be reserved to rehabilitate or renovate facilities currently used or which will be used in the future for campus programmatic purposes. This reserve represents funds that will eventually be used for expenditures that materially extend the useful life of the facility. The Reserve level should be based on the estimated cost of the future improvements. • Reserve for Program Stabilization – Funds may be reserved for program continuation and fluctuation. This reserve is established to accommodate short- term and long-term program plans, provide for program continuation during revenue downturns and to provide for the orderly and fiscally responsible termination of a program. Items that are to be considered in establishing the reserve include contractual commitments, appointments, refunds for prepayments, equipment and space leases, essential operating expenses, program evaluation and expansion possible liquidation costs associated with the unplanned elimination of a program. Documentation for Reserve A campus plan for the establishment and management of each of the above reserves must be completed and maintained on file by the campus. This plan must include the following information:

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