Public universities are not for-profit businesses with an easy-to-understand bottom line: their financial reports are not designed to convey information to the public fully or to reflect all the costs of teaching and research. Financial reports do track every dollar in accordance with the accounting rules required by auditors, but they do not…

Faculty members have a legitimate interest in the amount of budgetary appropriations devoted to salaries and the rank of those appropriations among other institutional priorities. Faculty must protect academic affairs from peripheral activities and must examine the manner in which priorities are developed. (MLW)

If faculty and other groups are to play a significant role in the budget process, the administration should format the budget to invite discussion. A properly prepared budget can serve as an excellent means of consensus building on campus. A new technique known as "framework" budgeting is described. (MLW)

Faculty members must understand the actual finances of educational institutions in order to achieve less biased allocations. Increased faculty awareness of total resources can help shift allocation patterns, making institutional resources more effective in accomplishing the mission of higher education. (MLW)

The assumption that universities derive financial benefits from intercollegiate athletics is false in most cases; sports programs can and often do drain large sums from the academic aspects of the budget. Institutional budgets can be deceptive. The case of the University of Maryland at College Park is an illustration. (MSE)

The art of retrenchment is in selecting among the available budgeting options that fit a given institution at a given time. One option that deserves increasing consideration is across-the-board cuts. In coping with student demands, institutions should also be concerned for curricular integrity and liberal learning. (MSE)

The American Association of University Professors' collective bargaining office and Collective Bargaining Congress are described. Their program includes services designed to prepare collective bargaining chapters to effectively address resource allocation issues that will be determined in contract negotiations. (MLW)

Detailed knowledge of how an institution obtains and expends its resources forces faculty to look at the whole picture of an institution. The budget process should be one in which the various institutional interests achieve mutual recognition and consensus about policies, people, and perquisites. (MLW)

Analysis of resource allocation in Michigan's higher education institutions indicates that spending is not driven by fixed costs, as often assumed. Most functions connected to the fundamental missions of the universities have been given lower priority than ancillary functions. Faculty compensation has lost ground overall, rather than leading…