What is a budget model?
A budget model is the methodology used to determine the distribution of resources, prioritize how funds are allocated, and support strategic initiatives.
Why a new model?
To address the challenges identified with the previous Budget Incentive Model (BIM), George Mason University is actively transitioning to a new budget model that aligns with our evolving needs and strategic direction. While the BIM served the university effectively for many years, the growth of the university and the changing landscape have revealed several key issues:
Not Comprehensive
The BIM focused solely on budgeting and incentivizing our Education and General (E&G) funds, excluding other critical resources such as indirect costs and auxiliary funds. Additionally, the model primarily supported schools/colleges, neglecting the appropriate resourcing of centralized operations and units. This approach disincentivized shared strategic decision-making and a university-wide approach to funding, hindering multidisciplinary efforts and efficient use of resources. Consequently, schools and colleges established duplicative internal functions that competed with each other and centrally provided services.
Inequitable
The BIM’s “contribution to central” varied significantly across the schools and colleges, ranging from 0% to 48%. Additionally, the inconsistent execution of the model led to a lack of accountability for underperformance, negatively impacting the well-performing schools and colleges.
Lacks Transparency
Schools and colleges lack a clear understanding of how funds are allocated, with no visibility into processes for leveraging multiple funding sources. As a result, they focused on amassing resources rather than spending available funds within a given fiscal year. In addition, schools and colleges had little insight into how central contributions are determined or how those funds are utilized.
Unsustainable
While the BIM model originally provided equal funding to schools and colleges versus central operations, the principle of allocating 80% of new resources to schools and colleges led to central operations becoming increasingly underfunded. This imbalance was further exacerbated by inflation, the need for additional institutional investments in financial aid and infrastructure, and decisions made outside of BIM principles to “hold harmless” underperforming schools and colleges by using central resources to fill budget gaps. The pandemic’s impact on enrollment, several years without tuition increases, and rising inflation placed additional strain on the operating model, resulting in a major deficit in E&G funds by FY 2023 when the BIM was sunset. This deficit was covered by George Mason’s reserves, depleting these resources and putting operations at risk.
In response to these challenges and consistent overspending in Education and General (E&G), George Mason moved to an incremental budget in FY 2023 to stabilize the university budget and concurrently began to lay the groundwork to develop and adopt a new budget model that meets the needs of our evolving institution and aligns with the strategic direction.
What was the committee selection process?
The various committees and workgroups involved the budget model redesign were intentionally designed to be both broadly representative of the George Mason community and nimble enough to allow for active member participation. The Senior Leadership Team (SLT) worked closely with project owners, the faculty senate chair, and finance directors to identify potential members who will represent and solicit feedback from their respective academic/administrative units and the wider community. Committee and workgroup members include representatives from deans, faculty, administrative units, and subject matter experts (SMEs).
Why is my academic/administrative unit not represented on every workgroup/committee?
Each budget model redesign committee and workgroup was intentionally kept small in order to enable timely and efficient decision-making. All George Mason schools and colleges are represented on at least one committee or workgroup, and each group has appropriate representation from across all administrative units and faculty. In addition, while the process will be guided by committee/workgroup members, all deans and finance directors will have ample opportunity to provide input and feedback. We also welcome input and feedback from the wider George Mason community at any time through our Budget Model Redesign inquiry form.
Will the budget model be finalized for the start of FY2026?
Throughout FY2025, we will be prioritizing several major budget model redesign components to be implemented in FY2026. These include:
1. Net tuition revenue and appropriations distribution
2. Indirect costs recommendations
3. Reserves / fund balances / carryforward / rollover definitions and guidelines for use
4. Financial aid definitions and guidelines for use
5. Cost of space
For FY2027 and beyond, our focus will be on exploring technology improvements, continuing to build out our suite of account and budget model principles, and analyzing and refining the model based upon each year of performance.
What is the Ways and Means Workgroup’s role in the budget model redesign?
The Ways and Means Workgroup will act in an advisory capacity to the Executive Committee, providing an all-funds prospective and conducting analysis and research to deliver a net tuition revenue and appropriations distribution methodology. In collaboration with standing committees, the workgroup will also address definitions and guidelines for use of institutional aid and reserves / fund balances/ carryforward / rollover funds.
How can I provide input and get updates?
Frequent, real-time updates will be provided to the George Mason community. Continue to check this website regularly. Throughout this process, all deans and finance directors will receive updates and have the opportunity to provide input and feedback. We also want to hear from you. Submit your questions, comments, and feedback or visit our Engagement Opportunities page to learn more.
As some academic units have created their own versions of central support units (e.g. career services), would this be accounted for in the allocation of net tuition between academic units and central?
The Budget Model Redesign project seeks to create a framework that ensures fairness and transparency in the allocation of resources. In the redesigned budget model, schools/colleges will have resources allocated net of an overhead allocation rate that represents university-wide resources that are available to all university units. Units that choose to provide their own versions of central support services make these decisions as part of their strategic priorities within their approved budgets.
It is also important to note that central services support numerous behind-the-scenes operations essential to student success. These foundational functions, while not always visible, sustain the broader university infrastructure and contribute significantly to equitable support for all units. A portion of the overhead costs is dedicated to maintain the critical infrastructure.
How will cross-listed classes and faculty between academic units, schools, and colleges within George Mason be considered in the new budget model?
Currently we are modeling multiple revenue allocation scenarios for review that take into consideration student and/or course characteristics. The Budget Model Redesign Executive Committee will be making recommendations on which scenario to present to university leadership for final decision. As we move through this process, we will continue to update the community.