Abstract: Budgeting Practices and Strategies

Those charged with developing and preparing a facilities management department budget will benefit from understanding how issues facing higher education have affected facilities management over the past several decades. More recent external environmental factors, from the recession in 2008 to the COVID-19 pandemic, have contributed to an era of reduced funding that has led to staffing cuts, new working environments, and uncertainty about the future. Still, the truth is that higher education had been on a collision path with fiscal uncertainty long before that. Our current budget models reflect how our institutions have handled these challenges and changed our budgeting practices.

Many institutions experience financial stress due to higher operating costs, thanks to students’ inability or unwillingness to pay for additional tuition increases, combined with the cost of deferred maintenance backlogs, the reduction of state funding, inflation in salaries and materials, and the decline in institutions’ ability to sustain alumni giving.

Operations must become more businesslike, more competitive, and more focused, with simpler organizations and a greater ability to invest in programs that support the principal mission of the institution. Managers should adopt goals for their departments that are consistent with those principles.

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