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CU �Ǹ�Թ�’s model is most closely aligned with incentive-based budgeting. It flows tuition revenue to colleges and schools based on quantitative factors related to student enrollment including student credit hours (SCH), student retention and graduation as well as qualitative factors based on campus-wide priorities.

The��previous model allocated funding to colleges, schools, and campus support units using an incremental model. This type of model means��colleges, schools and campus support unit budget allocations were based on what they had received the previous year, plus or minus a small amount depending on whether campus revenues increased or decreased.������

The current budget model provides increased transparency and predictability in resource allocation while creating incentives that strengthen the connection between institutional activity, financial resources, and strategic priorities.��

The current model was implemented in July 2022 for fiscal year 2022-23.����

The model design includes a formal review every 3-5 years, the first of which was completed in June 2026. Adjustments to the model resulting from the review will be implemented in fiscal year 2027-28.

While the overall structure of the budget model was maintained, small adjustments were made to align the way the allocation model works more closely with our intentions. For details, see: A Quick Guide to What’s New in 2026.��

Budget models, in and of themselves, do not generate revenue. CU’s budget allocation model uses quantitative and qualitative methodologies to determine how revenue is allocated to colleges and schools and campus support units. For information on types of revenue at CU �Ǹ�Թ�, check out How CU �Ǹ�Թ� is Funded����

The design of CU �Ǹ�Թ�’s budget model focuses on net tuition; net tuition is graduate and undergraduate tuition less financial aid, refunds, tuition remission (the portion not covered by departments) and bad debt. Tuition is CU �Ǹ�Թ�’s largest revenue source.��

The current budget model excludes ICR funds (including Department Allocation of Indirect Cost Recovery, DAICR).��

Over the last decade, direct state funding has ranged between 2% and 8% of CU �Ǹ�Թ�’s total budget. While an important source of funding for campus, state funding is not included in the model due to its volatility.����

Auxiliary units generate their own revenues to support their distinct activities and operations. Revenue from auxiliaries including Housing and Dining, Parking Services, the CU Book Store, and Continuing Education is not included in the budget allocation model.��

Net tuition revenue from summer session is integrated into the campus budget model according to the established design methodology; meaning there is no difference between how academic year tuition revenue and summer revenue is treated. Each school/college determines how model revenue is allocated to specific departments and programs.����

Yes. The budget allocation model recognizes differential tuition through driver weighting and also accounts for double majors and minors. Details are included in the new 2025-26 Budget Allocation Model Design Review: Process and Outcomes document.��

Support for strategic campus priorities, including leading sustainability efforts, is addressed in a few different areas: the Strategic Fund, the Comprehensive Fund and in the Support Unit Qualitative Fund.��

The model allocates budget to colleges and schools. How a school or college in turn allocates budget to specific departments, programs, or divisions is a college/school decision.

In preparation for designing the current budget allocation model, the project team conducted interviews with deans, shared governance bodies, finance leaders, and other campus partners. These interviews indicated a widespread desire for school/college budget allocations to be tied more explicitly to college/school activities, such as enrollment (number of majors) and credit hour delivery. Tying school/college budgets more explicitly to student enrollment and student credit hours enables schools and colleges to be more responsive to enrollment shifts.

During model design, campus partners expressed that SCH-related metrics should not to be the sole feature of a quantitative tuition allocation formula. CU �Ǹ�Թ�’s model uses additional quantitative methods such as undergraduate student retention and graduation, and qualitative, decision-based methods via the Strategic and Comprehensive Funds to allocate budget.��

Not all mission-critical activities at CU �Ǹ�Թ� generate sufficient revenue to be self-supporting. The Comprehensive Fund represents our commitment to CU �Ǹ�Թ�’s comprehensive teaching and research mission and provides a qualitative aspect that complements the quantitative metrics of the model.����

The current budget model was designed and developed for CU �Ǹ�Թ� by CU �Ǹ�Թ�. The principles and practices embedded within the model were created by budget model governance committees, with input from campus partners. Huron Consulting Group was engaged to support the CU �Ǹ�Թ� budget model governance committees with data analysis, modeling, peer institution benchmarking, examining case studies and sharing best practices.����

Engagement with stakeholders across CU �Ǹ�Թ� included:��

• 40+ stakeholder interviews and listening sessions
• 6 thematic listening sessions
• 9 “Coffee and the Budget” sessions
• 23 town hall meetings for faculty and staff in individual schools and colleges
• 3 meetings with each individual school/college dean to review budget model details
• Ongoing updates to shared governance – �Ǹ�Թ� Faculty Assembly (BFA), Academic Affairs Budget Advisory Committee, BFA Budget and Planning, Staff Council, etc.
• Bi-weekly Strategic Alignment Committee open office hours
• Various presentations to Finance Leaders Council and other university groups
• Participation of over 50 university members on project committees
• University-wide updates in CU �Ǹ�Թ� Today and through videos and related materials on the Budget and Fiscal Planning

Engagement with campus partners included:��

• A feedback survey administered campus-wide, August 2025
• Town Hall presentation, November 2025
• Ongoing updates shared with key partners including Academic Affairs, Finance Leadership Council, the �Ǹ�Թ� Faculty Assembly's Budget & Planning Committee and the Academic Resource Management Advisory Committee (ARMAC)��
• All deans of degree-granting schools and colleges served on the project's Strategic Alignment Committee
• All finance leaders of degree-granting schools and colleges served on the project's Design Review Committee
• Campus leaders from Operations, Academic Affairs, Business, Finance and Infrastructure and the Chancellor's Office of Strategic Initiatives served on the Steering Committee
• Faculty representatives served on all three governance committees