“We have state money, we have federal money, we have private money, and we generate our own money,” said Bruce Cherrin, chief procurement officer in the purchasing department.
According to the 2014 annual report from the UNM Controller’s website, the majority of the University’s money is generated by UNM Hospital, with clinical operations accounting for 34 percent of total revenue. All tuition accounts for only 9 percent.
“You can really see that in our operations at the University as a whole, hospital operations dominate a lot of the budget,” said Andrew Cullen, associate vice president in the Office of Planning, Budget and Analysis.
However, tuition accounts for a much larger percentage of UNM’s revenue when looking solely at a breakdown of main campus — along with money from the state, Cherrin said.
“That’s why when the state is going to reduce our allocation, it has a huge impact on main campus and it has a very small impact on north campus,” Cherrin said. “They generate their own money.”
Money generated by each campus generally goes to fund only that campus, meaning the Health Sciences Center and main campus are more like two separate businesses, Cullen said. According to UNM operating and capital budget plans for 2014-2015, of the total $2.6 billion budget, the HSC accounts for just over $1.7 billion, while main campus accounts for only $833 million.
“You can tell with main campus (revenue) what dominates here is state appropriations, tuition and fees, and then contracts and grants too,” Cullen said.
The grants and contracts category can include things like scientific research grants awarded to professors for research projects.
So how does UNM spend $2.6 billion in one year? By far the majority goes to the faculty and staff in the form of payroll, benefits, and healthcare, Cullen said.
“In general, if you looked at main campus, 80 percent of our costs are labor, 20 percent of our costs include everything else,” Cullen said.
Still, 20 percent of $2.6 billion is not exactly trivial, and purchases made with outside vendors account for hundreds of millions of dollars.
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“[On average] we spend over a million dollars a day here,” Cherrin said. “You’ll find that the top five or six expenses are the same every year. The biggest amount of money goes to the state — for thousands of different things.”
While the expense report shows only one lump sum — about $130 million — being paid to the state of New Mexico, the amount includes many different services, from working with the CYFD office to hiring a licensed accountant, Cherrin said.
Other major expenses include construction costs, utilities, and subscription services, Cherrin said. While lots of money going to construction may not be surprising, UNM also spends millions of dollars each year on subscriptions to different publications and journals — everything from scientific journals featuring the latest research, to magazines that land on waiting room tables.
Finally there are the utilities, everything from electricity to phone service, which both Cherrin and Cullen agree are some of the top expenses.
“We’re the fourth largest city in the state when you look at our phone system. Just UNM,” Cherrin said.
A university is less like a business and more like a small city, said Marty Desautels, associate controller at UNM Procurement Services.
“At the University we do everything. We have hospitals, we have golf courses, we have housing for students, we have dining. We have to have people that know the real estate business. We put on Broadway shows at Popejoy — they have to know that business. We are in big-time sports business. The research business is 25 percent of our business,” Desautels said. “Oh, and by the way, we educate people — that’s the reason that we’re here.”
Lauren Topper is a freelance reporter at the Daily Lobo. She can be contacted at news@dailylobo.com or on Twitter @DailyLobo.
