Policy Statement

This policy governs the incentive budgeting strategy in which divisions of the College are permitted to carry forward from one fiscal year to the next a portion of the remaining balances in the non-salary accounts of the units within their division. The sharing of the unexpended balances in the non-salary accounts between the Divisions and the College will be 25% to the Divisions and 75% reverting to Ramapo’s unallocated unrestricted net assets.

Reason for Policy

This policy provides guidance and parameters to help reduce or eliminate unnecessary year-end spending which in turn may increase the College’s unrestricted net asset balance; increase accountability for spending decisions at the unit level; and enable Divisions to develop reserves to meet contingencies, purchase equipment that would be too costly to acquire within a single years’ budget allocation, or provide funds for strategic initiatives.

To Whom Does the Policy Apply

President, and Division Heads, Budget Managers

Related Documents

Procedure 480: Budget Savings Incentive

Contacts

Budget Office 
(201) 684-7266

I. Timeline
The current incentive reserve addition is calculated a month after the final accounts payable check run of the fiscal year based on the unexpended non-salary account balances within each unit.

II. Availability
The incentive reserve addition is calculated on a unit level and set up as a reserve of net assets.

Each Division Head can view their portion of the reserve balance by unit via the College’s web-based budgeting and planning tool. The Incentive Reserve addition funds are allocated by Division, not by unit. It is the Division Head’s prerogative on
how to use and distribute the funds available and to provide approval of any intradivisional transfer of these funds.

The reserve is available to the Division in the current or future years. Any unit requesting additional funds during the fiscal year must make the request through their respective Division Head. The Division Head or designee makes the decision on the validity of the request and notifies the Budget Office of the amount and of the requesting unit if funds are to be distributed.

III. Uses and Limitations
Reserves set aside for this program are for use in periods of financial stability and should only be used as a last resort when other funding is not available from current sources. In addition, at the discretion of the College President and the Vice President for Administration and Finance, these funds may be expended to meet a College emergency but would be restored in full within the earliest reasonable timeframe. The Vice President for Administration and Finance is responsible for approving transfers of reserve funds in a manner that does not negatively impact the minimum reserve level required to be maintained by the College.

Accumulated reserves do not have a timeframe limitation but are limited to not exceed 10% of a unit’s non-salary budget in a single year and to not exceed 50% of a single years’ non-salary budget over the term of the reserve. Any increases to unit budgets approved during the year to address deficits caused by inadequate budget controls are deducted from the available reserve balances prior to the calculation.

Policy Statement

Ramapo College provides mass communications and distribution list services to academic and administrative units as needed in order to facilitate communications. Mass communications are electronic communications intended for and addressed to large set(s) of recipients (hereafter “audience groups”) within the Ramapo College community. Mass communications systems generally include: email, text message, Web message, official social media accounts, and voicemail.

Thoughtful coordination of and limited authorization to distribute unsolicited mass communications to large and specific audience groups is required in order to foster the integration of communication efforts and increase the effectiveness of mass communications that are sent to the following audience groups:

1) all undergraduate students,
2) all graduate students,
3) all faculty,
4) all staff,
5) all managers,
6) all members of the Board of Trustees,
7) all RCNJ Retirees, and
8) all RCNJ alumni.

This policy does not apply to emergency situations, communications by first responders, Timely Warnings, and regulatory notices when timely notice to avoid danger and/or ensure compliance or understanding outweighs the benefits of wider review and approval of messages.

Reason for Policy

The purpose of this policy is to instruct users on the appropriate use of mass communications to include their purpose, coordination, and controls. It also serves to provide recommendations on how to effectively send mass communications to reduce recipient fatigue and confusion, and effectively utilize campus communication resources. To set forth policy and procedure relative to the purpose, coordination, controls, and approvals for the development and distribution of unsolicited mass communications via various systems to specific Ramapo College audience groups.

To Whom Does the Policy Apply

The policy applies to all members of the college community.

Related Resources

• Appendix 640A: Authorizations
• Procedure 640: Mass Communications
• Policy 228: Emergency Notification
• Policy 604: Responsible Use of Electronic Communications Procedure
• Policy 609: Social Media
• Emergency Preparedness Plan
• CAN-SPAM Act
• Ramapo College Brand Guidelines

Contacts

Office of Communications and Public Relations

I. Mass Communications Guidelines

II. Mass Communications Systems

Ramapo College recognizes the following mass communications systems:

• Mass Email: Mass email, for the purposes of this policy, is the electronic mail distribution of information to the College’s mass communications audience groups.
  • In furtherance of Policy 604: Responsible Use of Electronic Communications:
    • Email is the official communication mechanism with Ramapo College students and employees. All Ramapo College students and employees are provided with email accounts for the purpose of conducting official college business and are required to maintain an “@ramapo.edu” account.
  • Mass email communications must comply with the following content standards:
    • Reply To: All mass email messages include a “reply to” account as part of the message so that recipients will know to whom to direct responses to the message.
    • Recipient List: All mass email messages will mask the recipient list via the use of blind carbon copy when not utilizing an ITS-created distribution group. This practice will mitigate unintended use of the “reply to all” feature within most email programs.
    • Subject Line: All mass email messages deploy Subject Lines that address the primary purpose of the message content. Subject Lines should avoid using symbols.
    • Greeting Line: All mass email messages include a Greeting Line at the top of the body of the message clearly identifying the audience group(s).
    • Mass email messages do not include attachments or embedded images larger than 2 MB.
    • Mass emails shall adhere to the College’s brand guidelines. All authorized digital mastheads for mass emails are designed by the Office of Marketing adn Branding.

All senders of mass email messages are responsible for compliance with the Federal CAN-SPAM Act and all related College policies.

Only emergency/major disruption notifications and Timely Warnings may be broadcast simultaneously over both the mass email and mass voicemail systems.

• Text Message: Text Messaging, for the purposes of this policy, is the distribution of information to the mobile devices of registered audience group members. The use of text messaging for mass communications is generally limited to emergencies and major disruptions and is in accordance with the College’s Emergency Preparedness Plan and Policy 228: Emergency Notification & Timely Warnings.
  • Note: Limited offices also issue Push Notifications/Chat Messaging to select audiences for the purposes of timely non-emergency information sharing. Authorization to distribute these messages is described in Section IV and Appendix 640A: Authorizations.

• Web Message: Web messaging, for the purposes of this policy, is the posting of information to the College’s Internet Home Page and Intranet Home Page, and the College’s Emergency Preparedness Site. The use of Web Messaging for mass communications is generally limited to emergencies and major disruptions and is in accordance with the College’s Emergency Preparedness Plan and Policy 228: Emergency Notification & Timely Warnings.

• Official Social Media Accounts: The College’s official social media accounts, for the purposes of this policy, are stewarded in accordance with Policy 609: Social Media, the Emergency Preparedness Plan, and Policy 228: Emergency Notification & Timely Warnings.

• Mass Voicemail: Mass voicemail, for the purposes of this policy, is the distribution of pre-recorded information to the College’s registered voicemail users. The use of mass voicemail for communications is generally limited to emergencies and major disruptions and is in accordance with the College’s Emergency Preparedness Plan and Policy 228: Emergency Notification & Timely Warning. Only emergency/major disruption notifications and Timely Warnings may be broadcast simultaneously over both the mass email and mass voicemail systems.

III. Mass Communications Audience Groups & Governance

Ramapo College recognizes the following mass communications audience groups and associated governance:

• Undergraduate Students: All campus members with active undergraduate student enrollment status (full-time and part-time students, matriculated and non-matriculated students, and employees who are enrolled in courses). Information Technology Services (ITS) is responsible for the currency and access controls of the undergraduate students audience group.
• Graduate Students: All campus members with active graduate student enrollment status (full-time and part-time students, matriculated and non-matriculated students, and employees who are enrolled in courses). Information Technology Services (ITS) is responsible for the currency and access controls of the graduate students audience group.
• Faculty: All campus members who teach a course (full-time or part-time faculty, adjuncts, staff who teach). Also included in this designation are librarians, advisors, staff in the Office of the Provost, academic deans, and unit secretaries from the schools. People Operations and Employee Resources is responsible for the integrity of the membership of the faculty audience group. Information Technology Services (ITS) is responsible for the currency of the group and maintaining access controls.
• Staff: All non-faculty campus members who receive a paycheck (full-time and part-time). Also included are auxiliary services employees. Student employees are not included. People Operations and Employee Resources is responsible for the integrity of the membership of the staff audience group. Information Technology Services (ITS) is responsible for the currency of the group and maintaining access controls.
• Managers: All employees who receive a paycheck (full-time and part-time) who are not represented by a collective bargaining agreement. People Operations and Employee Resources is responsible for the integrity of the membership of the managers audience group. Information Technology Services (ITS) is responsible for the currency of the
  group and maintaining access controls.
• Board of Trustees: All current publicly appointed members of the Ramapo College Board of Trustees. The Office of the President is responsible for the integrity of the membership of the Board of Trustees audience group, its currency, and maintaining access controls.
• Retirees: All active retired faculty and staff of Ramapo College. People Operations and Employee Resources is responsible for the integrity of the membership of the retirees audience group. Information Technology Services (ITS) is responsible for the currency of the group and maintaining access controls.
• Alumni: All active graduates of Ramapo College. Institutional Advancement is responsible for the integrity of the membership of the alumni audience group, its currency, and maintaining access controls.

IV. Authorization for Mass Communications Systems and Audience Groups

Authorization to use the College’s mass communications systems and to access the mass communications audience groups is limited and is outlined in Appendix 640A: Authorizations (pdf).

Authorized Primary Senders may craft, endorse, and distribute mass communications.

Authorized Secondary Senders may craft, endorse, and distribute mass communications in the absence of an Authorized Primary Sender or at the direction of an Authorized Primary Sender.

Unless noted in this procedure, Authorized Primary and Secondary Senders are not permitted to distribute mass communications on behalf of other parties.

Unauthorized use of the College’s mass communications systems and/or audience groups may be subject to investigation and discipline.

Policy Statement

The Vice President for Administration & Finance is authorized, with the prior written approval of the President and the Finance Committee Chair of the Board of Trustees, to borrow sums as set out in the Short-term Borrowing Procedures, when such borrowing is necessary to meet College financial obligations.

Reason for Policy

To set out process and procedures for short-term borrowing to meet financial obligations of the College.

To Whom Does the Policy Apply

College officers and Controller

Related Documents

Procedure

Contacts

Vice President for Administration & Finance / Controller
(201) 684-7621
(201) 684-7494

When it is necessary to meet College financial obligations, the Vice President for Administration and Finance is authorized, with the prior written approval of the President and the Finance Committee Chair of the Board of Trustees, to borrow sums not to exceed $4,000,000 for periods not to exceed 120 days.

The Controller is authorized to arrange for an appropriate line of credit to be available to the College for such purposes. The terms and conditions of that banking arrange­ment will be reported to the Finance Committee of the Board and to the Board of Trustees at the next regularly scheduled meeting(s).

Policy

This policy governs the use of debt to finance capital projects. The College will use debt prudently to help achieve its strategic objectives while maintaining a credit rating that appropriately balances financial flexibility with cost of capital. It is the objective of the College to maintain no less than a single “A” category underlying rating for all debt at the time of issue. The College may use debt management strategies to structure its overall debt portfolio with the approval of the Board of Trustees.

Reason for Policy

• Prudent utilization of debt to provide a low cost source of capital to fund long-term capital investments in order to achieve the College’s mission and strategic objectives and to address priority items in the Capital Plan.
• Manage the College’s overall debt level in order to provide appropriate access to capital and to maintain a credit rating deemed acceptable by the Board. The minimum target underlying rating for a College issue is the single “A” category by the major rating agencies.
• Limit risk within the College debt portfolio by balancing the goal of attaining the lowest cost of capital with the goal of managing interest rate risk.
• Manage outstanding debt over time to achieve a low cost of capital and to take advantage of interest rate cycles and refunding opportunities.
• Assure projects financed have a feasible plan of prepayment and that pledges are utilized prudently.
• Issue debt through the New Jersey Educational Facilities Authority (NJEFA) or other independent financing organization and continue to comply with all debt agreements between the College and financing organization.

To Whom Does The Policy Apply

• Board of Trustees
• President and Senior Officers
• Associate Vice President for Administration and Finance
• Executive Director of the Budget
• Controller/Treasurer

Related Documents

• Debt Management Procedures
• Borrowing Policy
• Reserves Policy

Contacts

Vice President for Administration and Finance
201-684-7621

Debt Capacity

It is the objective of the College to maintain no less than a single “A” category underlying rating for all debt at the time of issue. Core financial ratios that are strongly correlated with single “A” rated higher education peers will be monitored to ensure central oversight of College-wide leverage levels. The following ratios will be reported annually to the Board at the meeting following the approval of the audited financials: Expendable Resources to Debt, Expendable Resources to Operations, Debt Service to Operations, and operating margins. These core ratios will be monitored against the goals listed below from Moody’s “A2” Medians for Public Universities.

1. Expendable Resources to Debt of at least .30
   This is a measure of the College’s leverage on its assets. Expendable Resources is defined as unrestricted net assets plus restricted expendable net assets plus foundation unrestricted and temporarily restricted net assets less foundation net investment in plant. Expendable Resources is divided by outstanding debt. As of June 30, 2006, the College’s ratio of unrestricted resources to debt was approximately .10.
2. Expendable Resources to Operations of at least .37
   While this measure of liquidity is less directly affected by the issuance of new debt, it provides a useful indication of the institution’s financial cushion relative to operations and its ability to service debt. This ratio is expendable resources divided by operating expenses. As of June 30, 2006, the College’s ratio of expendable resources to operations was approximately .28
3. Debt Service to Operations not to exceed 4.3%.
   Debt Service to Operations is the typical measure used to evaluate an institution’s use of borrowed funds. The use of debt with bullet or balloon structures that defer principal payments until far in the future makes the calculation of debt service more difficult, therefore the College will include not only required annual principal and interest payments in its definition of debt service, but also an annual equivalent for sinking funds. Ratio is calculated by peak annual debt service divided by total operating expenses. As of June 30, 2006, the College’s debt service to operations was approximately 13.4%.
4. Operating Margin will remain positive
   Operating margin indicates the excess margin (or deficit) by which annual revenues cover operating expenses. It is calculated by adjusted total restricted revenues (adjustments include limiting investment income to 5% of average of previous three year’s cash and investments and subtracting net assets released for construction and acquisition of fixed assets), less total unrestricted operating expenses, divided by adjusted total unrestricted revenues.As of June 30, 2006, the College’s operating margin was -2.20.If the College is unable to maintain a rating in the single “A” category, the Board will develop a long range plan to address those factors that resulted in a downgrade. The plan will be reviewed on an ongoing basis.

Debt Compliance and Reporting

1. Continuing Disclosure Compliance
   The College will meet the ongoing disclosure requirements in accordance with SEC Rule 15c2-12. The College will submit all reporting required with respect to outstanding bonds or certificates of participation to which such Rule is applicable.
2. Post Issuance Compliance Requirements
   The College will develop and implement procedures to comply with any post issuance compliance requirements, including but not limited to, maintaining items found on the Tax-Exempt Bond Financing Compliance Check Questionnaire.

Debt Management Strategies

1. Mix of Fixed and Variable Rate Debt, Derivatives and Other Hedging Products
   The College may structure its overall debt portfolio, using a combination of fixed and variable rate debt, to provide an appropriate and prudent balance between interest rate risk and the cost of capital as well as to integrate asset-liability management.Variable rate debt can be a valuable tool for the College to use in the management of its assets and liabilities. Variable rate debt allows the College greater diversification in its debt portfolio as well as reduces its overall interest costs. However, the use of variable rate debt increases interest rate risk that the College must consider as the interest rate is subject to market fluctuations and tax risk.In considering the use of variable rate debt, the College shall assess the amount of short-term investments and cash reserves since the earnings from these funds can serve as a natural hedge offsetting the impact of higher variable rate debt costs. In addition, the College should also consider other strategies to allow assets and liabilities to move in tandem, such as entering into interest rate swaps under appropriate circumstances, and in accordance with these guidelines.In general, and as guidance to the appropriate level of variable rate interest rate exposure as specified within these guidelines, the College should maintain its flexibility and continuously review new products and opportunities to allow it to take advantage of changing interest rate environments and new products or approaches as they become available.In addition to considering asset/liability mix, variable rate debt can be used to manage the overall cost of capital. For example, in low interest rate environments, the College should consider ways to lock in low fixed rates, through conversions, fixed rate debt issuance, and either traditional or synthetic refundings. In high interest rate environments, the College should consider ways to increase variable rate debt exposure and evaluate other alternatives that will allow the College to reduce its overall cost of capital.The College should consider maintaining a portion of its portfolio in variable rate debt. In doing so, the College shall attempt to increase and manage its variable rate exposure in a manner that takes into consideration its investment portfolio and stays within a range of 20% to 30% variable rate debt as it relates to all of the College’s outstanding indebtedness. Any synthetic fixed rate debt, achieved through a swap transaction whereby the College swaps underlying variable rate for fixed rate should not be counted toward this variable rate ceiling.
2. Purchase of Insurance or Credit Enhancement
   The College will evaluate insurance and credit enhancement opportunities and utilize them if they are deemed cost effective.
3. Refunding Targets
   The College will monitor its debt portfolio for refunding and/or restructuring opportunities. Advance refunding transactions must weigh the current opportunity against possible future refunding opportunities. Since there are limitations on the number of allowable re-financings, it is important to use refinancing opportunities wisely. In evaluating refunding opportunities, the College will consider the value of the call option to be exercised, including the amount of time to the call date and the amount of time from the call date to maturity.In general, the College will consider refinancing when a current or advanced refunding of debt provides a net present value savings of at least three percent. Refinancing or restructuring opportunities that provide savings of less than three percent, or with negative savings, may be considered if there is a compelling objective such as: a.) realizing lower savings is appropriate given the results of call option analysis on a maturity-by-maturity basis, or analysis of current vs. historic interest rate levels, or b.) to restructure financial or legal covenants that prove disadvantageous to the College.Where analyzing or pursuing the implementation of refinancing transactions using fixed rate swaps or other derivative products, the College should generate a greater projected savings than the savings guidelines the College would consider for traditional bonds. The higher savings target reflects the greater complexity and higher risk of derivative financial instruments. Such comparative savings analyses shall include the consideration of the probability (based on historical interest rate indices, where applicable, or other accepted analytic techniques) of the realization of savings for both the derivative and traditional structures, where applicable. Such analyses should also consider structural differences in comparing traditional vs. derivative alternatives, e.g., the noncallable nature of derivative transactions.
4. Hedging Instruments
   The College will consider the use of interest rate swaps and other interest rate risk management tools after carefully evaluating the risks and benefits of any proposed transaction. Such agreements or contracts include without limitation, interest rate swap agreements, forward payment conversion agreements, or contracts providing for payments based on levels of or changes in interest rates, to exchange cash flows or a series of payment, or to hedge payment, rate spread or similar exposure.In general, interest rate swaps are utilized to reduce the cost and/or risk of existing or planned College debt. By using swaps in a prudent manner, the College can take advantage of market opportunities to reduce debt service cost and/or interest rate risk. The use of swaps must be tied directly to College debt instruments. Swaps may not be utilized for speculative purposes. Master swap agreements entered into by the College shall contain terms and conditions as set forth in the International Swaps and Derivatives Association, Inc. (ISDA) Master Agreement, as amended.
5. Fixed Rate Debt
   When issuing fixed rate bonds the existing yield curve will be considered. Optional call dates may be negotiated to less than the traditional 10-year period after analyzing the cost to the College. Bonds without optional call dates should be limited in the institution’s debt portfolio, and should be issued only if investors are willing to pay a substantial premium. Discount and premium coupons issued for callable bonds are expected to be in the range of 96% to 104% of par value but may vary outside that range under exceptional circumstances.
6. Term of Debt
   The College will determine the appropriate duration and the specific amortization schedule of par value but may vary outside that range under exceptional circumstances. each bond issue by evaluating itsoverall debt portfolio. Considerations will include the life of the assets being financed, interest rate costs, risk assessment, general market conditions, and the College’s future financial plans. If and when bullet or balloon payments are used, the College will budget appropriately over the life of the bond issue such that the bullet or balloon maturity payments do not unduly impact any one fiscal year.
7. Use of Tax-Exempt versus Taxable Debt
   In general, the College will look to avoid the use of taxable debt where other alternatives are available, including equity financing. However, the College may have to utilize taxable debt in certain situations where Federal tax law limits the use of tax-exempt debt for particular projects, especially those where use of the project includes both private and non-profit purposes. The College may also consider taxable debt under other circumstances where market conditions and debt flexibility make it an appropriate alternative. When utilized, the College will consider structuring taxable debt to shorten its term and allow it to be redeemed at the earliest possible date.