Budget Model Resources

Budget Model Resources

Learn more about the IU Bloomington Budget Model Redesign process through the FAQs and definitions on this page, and check back for updates. Resources and training opportunities will be developed and posted as the model is further refined and the campus moves closer to implementation of the new model in FY 2027.

Funding

The Bloomington campus receives funding from undergraduate tuition and fees, graduate tuition, state funding, grants and contracts, gifts from IU donors, and through services and sales.

Academic units at IUB receive funding from multiple sources, including undergraduate and graduate tuition and fees, state appropriations, grants and contracts, IU Foundation funding, and other sources such as sales or services they provide. For an in-depth discussion on how those funds are allocated, please visit the Conceptual Budget Model.

The campus and its many units have multiple sources of funding for strategic initiatives. At the campus level, a portion of funding from tuition revenues and state appropriations will be set aside for the Strategic Funding pool. These funds will support 1) the Provost Fund, from which units annually request funding for their strategic priorities that align with campus priorities, 2) IUB 2030 strategic initiatives, such as the Academic Advising initiative, and 3) faculty hiring initiatives, such as Faculty 100. Additionally, academic and support units often reallocate funds within their budgets to support strategic initiatives and innovation.

The new budget model encourages interdisciplinary programming in several ways. First, the budget model incentivizes academic units to innovate in areas that appeal to student interest and demand, including interdisciplinary offerings. Second, the Strategic Funding pool, which includes the Provost Fund and funding for other IUB 2030 priorities, supports interdisciplinary activity. Throughout the prototype model, the Steering Committee will purposefully consider how to remove barriers to and encourage interdisciplinary work between units and programs.

Every university and campus needs a system for allocating "overhead expenses," including general administration, facilities, and the cost of various support services such as Libraries, Student Life, Undergraduate Education, the Graduate School, Enrollment Management, Faculty and Academic Affairs, and general finance and administration. With accountability, predictability, and transparency as its guiding priorities, the committee recommends a metric-based formula to allocate these expenses. This also aligns with the university model framework for allocating central costs and services. It provides a track record of how allocations are determined and creates a data-driven model to fairly allocate expenses while ensuring the campus can prioritize campus needs. In general, these data-based methodologies provide incentives to 1) control costs through planning, 2) find administrative efficiencies, and 3) reallocate resources to common good priorities when possible.

The campus is continuing to collect feedback and will review alternatives that develop during campus conversations before determining the final model for allocating central expenses.

Indiana University recently implemented a new formula for distributing Indirect Cost Recovery (ICR) received on grants and contracts. ICR covers the "overhead" costs associated with any research project (such as IT services, HR, finance, Research Administration, etc.). In the new formula, 30% of ICR goes to the Office of the Vice President for Research to support high-impact research that crosses academic disciplines, to expand the services that support our researchers as they apply for and manage awards, and to ensure the appropriate infrastructure is in place for our world-class researchers. The remaining 70% flows directly to the school where the Principal Investigator resides.

For FAQs related to the university’s budget model, please visit Indiana University Finance