Arts and Science Federation of Associations

Fee Levy Increase Referendum Question

Presented by the Finance Committee

Current ASFA Financial Situation

• In the 2013-2014 year, ASFA posted a deficit of 57,977.00$.

• In the 2014-2015 year, ASFA has budgeted a deficit of 61,690.83$.

• This deficit can be attributed to multiple causes, namely • Financial restructuring 1. Increase of costs 2. Increase of services3. Increase to MA budgets

• Despite the deficit, ASFA has been able to maintain its services due to accumulated cash assets from prior years.

• However, at this rate, ASFA will be below a year-end cash balance of 150,000.00$ (as prescribed in by-laws).

• This either entails budget cuts to the Association’s accounts/services, or a need to increase the levy paid by students.

Current ASFA Financial Situation

Factors in Fee Levy Calculation

Five main factors were included in the calculation of the fee levy increase:

•Term1.Year-end account balance2.Deficit annulment 3.Projected increase in expenses4.Variance

Fee Levy Factor: Term

ASFA decided to opt to work under a 5-year model to restrain the amount of fluctuation in the calculations.

Fee Levy Factor: Year-End Account Balance

• At the 2014 year-end, ASFA had 178,752.00$ worth of cash assets (internal and external bank accounts)

• ASFA must maintain an amount of 150,000.00$ in their account at their account by year-end as per Annex B, Article 3.

• Considering ASFA’s planned deficit, this amount will drop to 117,061.17$ with a 0% average deviation from the budget.

This means, ASFA will require 32,938.83$ to attain their projected account balance of 150,000.00$.

Fee Levy Factor: Deficit Annulment

• ASFA has planned a deficit of 61,690.83$ for the 2014-2015 academic year.

• ASFA assumes to have a base1 constant deficit for future years.

This means, ASFA will require to raise their revenue by 61,690.83$ to match their expenses.

1Increases and variance explained in following slides.

Fee Levy Factor: Projected Increase in Expenses

• An assessment was done to evaluate which expenses we foresee increasing. The list includes:

- Office Overhead and Supplies- Professional Fees- Election Expenses- Council Expenses- ASFA Events- Newsletter Services- MA Retreat Costs- MA Budgets

Fee Levy Factor: Projected Increase in Expenses (continued)

• ASFA had the option to manually impose a projected increase in expenses, an indexation to inflation or both.

• A manual increase was more appealing to ASFA as it would be easier to track the per student levy, as well as control the amount of fluctuation in revenue.

• Using this year’s projected expenses for “increasables”, the total amount is projected at 332,820.50$.

• ASFA opted for a percent increase on “increasables” of 10.0%2.

To account for “increasables”, ASFA would require an additional 33,282.05$.

2A 10% increase in year 5 is equivalent to a 1.9245% yearly increase.

Fee Levy Factor: Variance

• Variance has been naturally accounted for in the calculation in two ways:

• A natural “cushion” has been accounted into the equation from the repeating addition of the 32,938.83$ (which brings back the account to 150,000.00$).

1. A variance is created with the estimated 10% increase on “increasables”. This variance is due to the variable percent increase in costs. However, as previously stated, this variability allows ASFA to better track its projected revenue and levy.

Credit Calculation

• Total credits taken are assumed using an average from the levy received in 2013 and 2014.

This average assumes a total of 342,444.67 credits taken within the Arts & Science Faculty every fiscal year.

Fee Levy Increase

The sum of all required increases previously calculated is 127,911.72$.

The total number of credits is assumed at 342,444.67.

ASFA would therefore have to increase their fee levy by 0.38$3.

3The exact fee levy increase amount is calculated at 0.373525$.

Faculty Comparison

Faculty Association Fee Levy Population*

ASFA 1.22$ 14,998

CASA 2.35$ 7,347

ECA 2.00$ 6,500

FASA 1.35$ 3,700

*Exact numbers for ASFA and CASA are from the Dean of Students Office. ECA and FASA Populations are taken from the Concordia website for the 2012-2013 years.

Table 1. Fee Levy and Population per Faculty Association

Proposed Fee-Levy Increase: 0.38$Proposed Start of Increase: Winter 2015

Referendum Question:Do you agree to increase ASFA’s per credit fee

levy by 0.38$ to a total of 1.60$ per credit, effective starting in the winter 2015 semester

(January 2015)?