Arizona Board of Regents response to Senate Bill 1517 (Laws 2005, Chapter 330): the University of Arizona, College of Medicine-Phoenix

              Arizona Board of Regents Response to Senate Bill 1517 (Laws 2005, Chapter 330) The University of Arizona College of Medicine-Phoenix



Submitted to Joint Legislative Budget Committee September 1, 2005



This document, along with the companion document containing Appendices A-L, may be accessed at www.abor.asu.edu



Table of Contents President's Letter................................................................................................ 1 Introduction ......................................................................................................... 3 Vision............................................................................................................... 6 Mission ............................................................................................................ 6 LCME Accreditation......................................................................................... 7 ABOR Responses to SB 1517 Requests...........................................................8 1. Detail on expenditures to date by the Arizona Board of Regents, its institutions, and its partners.............................................. 9 2. Detailed five-year operational and capital budgets, including information on the expected sources of all funds ....................................................................................................... 10 The University of Arizona ......................................................................... 10 FY 2006-FY 2010 Operational Budget................................................ 11 Sources of Funds.............................................................................18 State funds .................................................................................... 19 Tuition............................................................................................ 19 Sponsored research grants and contracts..................................... 20 Clinical revenues ........................................................................... 22 Hospital support ............................................................................ 23 Philanthropic goals ........................................................................ 23 FY 2006-FY 2010 Capital Budget ....................................................... 24 COM 1, COM 2, and COM 3 ......................................................... 25 Arizona Biomedical Collaborative 1 (ABC 1) ................................. 26 Educational Facility for The University of Arizona College of Medicine-Phoenix......................................................... 26 Arizona State University ........................................................................... 27 FY 2006-FY 2010 Operational Budget................................................ 27 Capital Budget (ABC 1)....................................................................... 29 Sources of Funds.............................................................................31 First-year funding .......................................................................... 31 External funding from federal agencies ......................................... 31 External funding from private sources ........................................... 32 National foundations......................................................................33



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3. A five-year description of enrollment, growth capacity, and graduation expectations by practice area .................................... 34 The University of Arizona ......................................................................... 34 Admissions ......................................................................................... 34 Career choice of graduates................................................................. 35 Demographics of student class........................................................... 36 Graduate medical education ............................................................... 37 Graduate students .............................................................................. 37 MD/PhD students................................................................................38 Arizona State University ........................................................................... 38 Projected enrollment and growth capacity .......................................... 38 Projected graduation numbers............................................................ 39 4. A 20-year financing plan detailing each funding source, including options to maximize resources and partnerships with the Maricopa County Special Health Care District and other health care entities. Funding sources may include federal grant monies, private donations, and contributions from other public entities .................... 42 The University of Arizona ......................................................................... 42 20-Year Operational Budget ............................................................... 42 Sources of Funds.............................................................................46 State funds .................................................................................... 46 Tuition............................................................................................ 46 Sponsored research grants and contracts..................................... 46 Philanthropic goals ........................................................................ 47 Maximizing resources....................................................................47 20-Year Capital Budget.......................................................................48 Arizona State University ........................................................................... 51 20-Year Operational Budget ............................................................... 51 Sources of Funds.............................................................................51 5. The programs and areas of practice offered ....................................... 54 The University of Arizona ......................................................................... 54 Practice Disciplines.............................................................................54 Statewide Retention of Practicing Graduates ..................................... 56 Rural Outreach ................................................................................ 56 Rural Health Professions Program ................................................ 56 Arizona Area Health Education Centers Program ......................... 57 The Arizona Telemedicine Program .............................................. 59 THealth .......................................................................................... 59 The Arizona Health Sciences Library ............................................ 59



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Minority Outreach ............................................................................... 60 The Office of Minority Affairs ......................................................... 60 Med-Start--Office of Minority Affairs ............................................. 60 Native American Research and Training Center ........................... 61 Commitment to Underserved People Program.............................. 61 Arizona State University ........................................................................... 61 Degree-Granting Programs................................................................. 61 Non-Degree Programs........................................................................62 6. All partners involved in the Phoenix medical campus project, their roles, and an organizational chart ................................. 63 Partners....................................................................................................63 Arizona Commission on Medical Education and Research................. 63 City of Phoenix Mayor and Council ..................................................... 64 Translational Genomics Research Institute ........................................ 65 Hospital partners.................................................................................65 Education ...................................................................................... 65 Graduate medical education..........................................................66 Research ....................................................................................... 66 Other partners.....................................................................................67 7. The contributions and financing arrangements of all partners contributing to the capital plant, as well as the legal and financial relationships of the Arizona Board of Regents and its institutions to these partners .................................... 68 COM 1, COM 2, COM 3 (former PUHS buildings) ................................... 68 Arizona Biomedical Collaborative 1 (ABC 1) ............................................ 68 Additional Facilities to Expand Class Size and to Reach Build-out ................................................................................................... 69 List of Figures Figure 1. Figure 2. Figure 3. Figure 4. Figure 5. A Timeline for the Supply of Physicians.............................................. 6 Sources of Revenue to Support Operations in Research-Intensive Medical Schools................................................ 19 Arizona State University Department of Biomedical Informatics Projected Revenue Sources FY 2025 ............................ 52 Arizona Area Health Education Centers Program Map..................... 58 The University of Arizona College of Medicine-Phoenix Partnership Organizational Chart ..................................................... 63 iii



Figure 6. Figure 7.



Master Development Site Plan for Phoenix Biomedical Campus ............................................................................................ 70 Land Use Scenarios for Phoenix Biomedical Campus...................... 71 List of Tables



Table 1.



The University of Arizona College of Medicine-Phoenix Planning Expenditures: Arizona Board of Regents, The University of Arizona, and Arizona State University FY 2003-FY 2005 ..................................................................................... 9 The University of Arizona College of Medicine-Phoenix Level I and Level II Enrollment and Budget Projections Summary FY 2006-FY 2025 ............................................................. 10 The University of Arizona College of Medicine-Phoenix FY 2006-FY 2010 Summary Budget................................................. 14 The University of Arizona College of Medicine-Phoenix Projected Students, Faculty, and Staff FY 2008-FY 2025 (selected years) ....................................................................... 15 The University of Arizona College of Medicine-Phoenix Tuition Estimates FY 2006-FY 2025 ................................................. 20 NIH Biomedical Research Funding Ranking for The University of Arizona College of Medicine Departments ................... 21 Arizona State University Department of Biomedical Informatics FY 2006-FY 2010 Operational Budget ........................... 27 Arizona State University Department of Biomedical Informatics Capital Budget................................................................ 29 Numbers of Academically Qualified Applicants Rejected for Admission by The University of Arizona College of Medicine, 2001-2005 ........................................................................ 35



Table 2.



Table 3. Table 4.



Table 5. Table 6. Table 7. Table 8. Table 9.



Table 10. Practice Settings Chosen by The University of Arizona College of Medicine Graduates, 1995-2004 ..................................... 35 Table 11. Comparison of The University of Arizona College of Medicine and National Distributions of Racial and Ethnic Composition of Medical Students, 1996-2005 .................................. 36



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Table 12. Projected Numbers of Arizona State University BMI Majors and Students Receiving BMI Instruction ............................... 39 Table 13. Projected Graduation Numbers for Arizona State University BMI Degrees and Majors ................................................. 39 Table 14. The University of Arizona College of Medicine�Phoenix FY 2011-FY 2015 Summary Budget................................................. 44 Table 15. The University of Arizona College of Medicine-Phoenix FY 2025 Summary Budget ............................................................... 45 Table 16. Breakdown of The University of Arizona College of Medicine-Tucson Space, 2005 ......................................................... 48 Table 17. The University of Arizona College of Medicine-Phoenix Capital Expenditure Cost Model FY 2010......................................... 49 Table 18. Projected Facilities on the Phoenix Biomedical Campus .................. 51 Table 19. Examples of Arizona State University's Expanded Collaborations with Maricopa County Special Health Care District Partners ....................................................................... 53 Table 20. Residency Selections by The University of Arizona College of Medicine Graduates, 2001-2005 ..................................... 55 List of Appendices Appendix A. The Arizona Physician Workforce Study Part I: The Numbers of Practicing Physicians 1992-2004, 2005 Appendix B. Memorandum of Understanding Regarding the Expansion of Medical Education and Research in Phoenix signed by Regent Gary L. Stuart, President Peter W. Likins, and President Michael M. Crow, August 4, 2005 Appendix C. Governor's Executive Order 2004-25 Establishing the Arizona Commission on Medical Education and Research, October 19, 2004 Appendix D. Implementation of the Phoenix Program of The University of Arizona College of Medicine: Directions and Imperatives, Interim Executive Report, Kurt Salmon Associates (KSA), June 15, 2005 Appendix E. The University of Arizona College of Medicine-Phoenix FY 2006-FY 2010 Budget Detail v



Appendix F. Economic Quantification Study, Phoenix Biomedical Campus, Executive Report, Tripp Umbach, July 15, 2005 Appendix G. Legislative Briefing Book on the Phoenix Program of The University of Arizona College of Medicine Level I Five-Year Projection, April 27, 2005 Appendix H. Arizona Commission on Medical Education and (ACMER) and ACMER Task Forces membership lists Research



Appendix I. Arizona State University Department of Biomedical Informatics Draft Business and Implementation Plan, July 17, 2005 Appendix J. The University of Arizona College of Medicine-Phoenix FY 2011-FY 2015 Budget Detail Appendix K. The University of Arizona College of Medicine-Phoenix FY 2025 Budget Detail Appendix L. Intergovernmental Agreement between City of Phoenix and Arizona Board of Regents relating to Lease of Buildings and Building Pads at Phoenix Biomedical Campus, February 5, 2004 List of Abbreviations and Acronyms AAMC ABC ABOR ACGME ACMER AHEC AHS Library AHSC AMA ASU ATP AZHIN BMI BNI COM CTHVAHCS CUP DO DOD ERE F&A F.A.C.E.S. Association of American Medical Colleges Arizona Biomedical Collaborative Arizona Board of Regents Accreditation Council for Graduate Medical Education Arizona Commission on Medical Education and Research Arizona Area Health Education Centers Program Arizona Health Sciences Library The University of Arizona Health Sciences Center American Medical Association Arizona State University Arizona Telemedicine Program Arizona Health Information Network Department of Biomedical Informatics Barrow Neurological Institute College of Medicine Carl T. Hayden Veterans Affairs Health Care System Commitment to Underserved People Program Doctor of Osteopathy Department of Defense Employee-related expenses Facilities and administrative costs Fostering and Achieving Cultural Equity and Sensitivity vi



FTE FY GME HB GPA IGA IGC IT JCCR JLBC KSA LCME MCAT MD MOU MRI NARTC NAU NIDDK NIH NRC NSF PBC PhD PUHS RHPP RRC SB TGen UA UMC UPH



Full-time equivalency Fiscal year Graduate medical education House Bill Grade point average Intergovernmental agreement International Genomics Consortium Information technology Joint Committee on Capital Review Joint Legislative Budget Committee Kurt Salmon Associates Liaison Committee on Medical Education Medical College Admissions Test Medical Doctor Memorandum of Understanding Magnetic resonance imaging Native American Research and Training Center Northern Arizona University National Institute of Diabetes and Digestive and Kidney Diseases National Institutes of Health Neuroscience Research Center National Science Foundation Phoenix Biomedical Campus Doctor of Philosophy Phoenix Union High School Rural Health Professions Program Residence Review Committee Senate Bill Translational Genomics Research Institute The University of Arizona University Medical Center University Physicians Healthcare



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Board Members Christina Palacios Phoenix President Fred T. Boice Tucson Robert B. Bulla Scottsdale Ernest Calder�n Phoenix Lorraine W. Frank Scottsdale Chris Herstam Phoenix Jack B. Jewett Tucson Gary L. Stuart Phoenix Student Regents Benjamin W. Graff UA Kolby Granville ASU



September 1, 2005



Representative Russell K. Pearce, Chair Senator Robert L. Burns, Co-Chair Joint Legislative Budget Committee 1716 West Adams Phoenix, AZ 85007 Re: Arizona Board of Regents Response to SB 1517 Requests Dear Representative Pearce and Senator Burns: Pursuant to SB 1517 (Laws 2005, Chapter 330), the Arizona Board of Regents is pleased to submit for your review our responses to the seven specific requests relating to the operational and capital plans for The University of Arizona College of Medicine-Phoenix Program. These responses were authorized for submission by the Board of Regents at its August 16, 2005, meeting. Our submission is limited to be responsive to the specific requests contained in SB 1517, and reflects the best thinking, to date, on the development of The University of Arizona College of Medicine-Phoenix Program. This is not intended to be a final plan for the Phoenix Program. A number of planning processes, both within the universities and in the larger community, are actively engaged in addressing the many complex issues which must be resolved to successfully implement both Level I and Level II of the Phoenix Program. This response, along with the other foundational work accomplished by The University of Arizona and Arizona State University this summer, will be used as tools for the Arizona Commission on Medical Education and Research (ACMER) to work towards finalizing a complete plan for the Phoenix Program. We thank the Legislature and Governor for providing state funding to support this historic and critically important effort. We appreciate your Committee's oversight role, and trust that this submission is responsive to the statutory mandate.



Janet Napolitano Governor of Arizona Tom Horne Superintendent of Public Instruction



Executive Director Joel Sideman



2020 N. Central Ave. Suite 230 Phoenix, AZ 85004 (602) 229-2500 fax (602) 229-2555 www.abor.asu.edu



Arizona State University



Northern Arizona University



University of Arizona



Representative Pearce and Senator Burns September 1, 2005 Page Two



Questions raised at the July 21, 2005, JLBC meeting and committed to writing in Director Stavneak's August 2, 2005, letter, will be addressed in a separate submission. Sincerely,



Christina A. Palacios President cc: Governor Janet Napolitano Members, Joint Legislative Budget Committee Members, Joint Committee on Capital Review Members, Arizona Board of Regents President Peter Likins, The University of Arizona President Michael Crow, Arizona State University Executive Director Joel Sideman Richard Stavneak, JLBC Director



Introduction The need for Arizona to educate more MDs is dramatic, immediate, and well documented. Arizona is among the nation's fastest-growing states and suffers a physician shortage, especially in rural communities. The Arizona Physician Workforce Study 1992-2004, conducted by Arizona State University and The University of Arizona Health Sciences Center, and sponsored by the Flinn Foundation, St. Luke's Health Initiatives, and BHHS Legacy Foundation (please see Appendix A) indicates that the physician-to-population ratio in Arizona is 207 physicians for every 100,000 people, far below the national average of 283 physicians for every 100,000 people. In an effort to respond to this critical need, in August 2004 the Arizona Board of Regents approved a Memorandum of Understanding (please see Appendix B) establishing an unprecedented collaboration to expand the operations of The University of Arizona College of Medicine in Phoenix, an effort involving the leadership, faculties, and strengths of both The University of Arizona and Arizona State University. The Memorandum of Understanding also provided for the establishment of a Department of Biomedical Informatics at Arizona State University that will be closely linked with the College of Medicine. This expansion is a complex undertaking because of the resources and partnerships required. Academic leaders, health care leaders, and politicians around the nation are tracking this Arizona initiative, for they recognize, as do we, that this is an opportunity to learn from the past and to build intelligently for the future. The University of Arizona College of Medicine-Phoenix Program will be part of the Phoenix Biomedical Campus, located on 15.8 acres in downtown Phoenix. The Campus will serve a key role in addressing Arizona's shortage of physicians, pharmacists, and other health care professionals. Regent Gary L. Stuart, immediate past-President of the Arizona Board of Regents, has worked closely and tirelessly since August 2004 with The University of Arizona, Arizona State University, Northern Arizona University, the City of Phoenix, TGen, Phoenix-area teaching hospitals, and other partners to establish the Phoenix Biomedical Campus. The overall concept is straightforward: to establish in downtown Phoenix a University of Arizona College of Medicine-Phoenix Program that in a very short time period will graduate as many as 150 new MDs per year, with the expectation that a majority will remain in Arizona or return to Arizona following residency training. Phoenix is the largest city in the nation without an academic health center, and this fact creates a strategic liability for the long-term health and prosperity of its population. The Arizona State Legislature and Governor Janet Napolitano seized this unique opportunity by appropriating $7 million of General Fund support to expand The University of Arizona College of Medicine into rapidly revitalizing downtown 3



Phoenix. This expanded College of Medicine will lead to improved health care throughout Arizona and will allow more Arizonans to attend medical school in their own state, increasing the likelihood that they will choose to practice here. The City of Phoenix has provided the land to establish the Phoenix Biomedical Campus, which, in addition to The University of Arizona College of Medicine expansion, is the site of the internationally noted Translational Genomics Research Institute and International Genomics Consortium, and the future site of the Arizona Biomedical Collaborative with facilities to house medical school researchers from The University of Arizona and Arizona State University. Future plans call for expansion of the nationally preeminent University of Arizona College of Pharmacy to the Phoenix Biomedical Campus, possibly at the Mercado, and the relocation of the Arizona State University College of Nursing to nearby Arizona State University at the downtown Phoenix campus. (The Arizona State University College of Nutrition will be located at the Arizona State University Polytechnic campus.) Another key element of the plan for the expanded College of Medicine is the strong foundation that exists in Phoenix because The University of Arizona College of Medicine has been active in the Phoenix area for more than 30 years. Since 1992, the College has maintained a "regional campus" in Phoenix, allowing about 40 percent of third- and fourth-year University of Arizona medical students (approximately 80 students each year) to complete their final two years of medical school in Maricopa County, training at nine Phoenix-area teaching hospitals. The College now has more than 400 volunteer faculty members in Greater Phoenix. In order to coordinate the activities of the various stakeholders for this project, on October 19, 2004, Governor Napolitano issued Executive Order 2004-25, "Establishing the Arizona Commission on Medical Education and Research" (please see Appendix C), appointing a statewide Commission to help guide establishment of the Phoenix Biomedical Campus. The Commission was charged to develop a plan to implement the principles enumerated in the Memorandum of Understanding signed August 4, 2004, by then-Regents President Stuart, The University of Arizona President Peter Likins, and Arizona State University President Michael Crow. Members of the Commission include Governor Napolitano; Phoenix Mayor Phil Gordon; Gary L. Stuart, Arizona Board of Regents; Peter Likins, President, The University of Arizona; Michael Crow, President, Arizona State University; John Murphy, President and Chief Executive Officer, Flinn Foundation; Jeffrey Trent, President and Scientific Director, Translational Genomics Research Institute (TGen); Peter Fine, President and Chief Executive Officer, Banner Health; Linda Hunt, President, St. Joseph's Hospital and Medical Center; and James Kennedy, Chief Executive Officer, Maricopa Integrated Health System. Senator Carolyn Allen and Representative Laura Knaperek are ad hoc members of the Commission.



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The Commission engaged, with financial support from the Flinn Foundation, Kurt Salmon Associates as consultants, to help develop an inclusive process for the planning of The University of Arizona College of Medicine-Phoenix, including the creation of various task forces (please see the Kurt Salmon Associates report at Appendix D). With a tremendous need and active participation by many key players, the ingredients are in place for a success story: � The primary leadership of The University of Arizona, a major research public university with 40 years experience in the training of medical students and physician-residents The partner participation of Arizona State University, especially in areas of biomedical informatics and basic sciences education for medical students The partner participation of outstanding community hospitals that for many years have supported the clinical training of third- and fourth-year University of Arizona College of Medicine students The partner participation of the Translational Genomics Research Institute helping to connect the research endeavors of The University of Arizona and Arizona State University and to provide opportunities for students to engage in translational research Continued leadership by the Arizona Commission on Medical Education and Research and the Arizona Board of Regents



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The ethos of the academic health center will be what is already foundational to The University of Arizona, Arizona State University, and TGen: the seamless linkages of teaching, research, clinical activity, and outreach. This assures that The University of Arizona College of Medicine-Phoenix students will engage in a set of research-supported learning environments, recognizing that knowledge and protocols in academic medicine are changing at lightning speed, and that graduates in the present and future must be capable of tracking, and leading, change. The net result will be yet another economic driver for the state of Arizona, but more importantly, the net result will underscore to people and businesses considering Arizona as a home that health and welfare is a strategic priority, and that Arizona intends to increase its capacity to serve these needs.



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The urgency to act is best understood with one look at Figure 1. It takes from 5 to 13 years beyond the bachelor's degree to train an MD, depending on selected practice area. We must begin now.

Figure 1. A Timeline for the Supply of Physicians



The Governor's Office and the Arizona Board of Regents are committed to ensuring that the momentum and enthusiasm that have driven this project to date are sustained in order to respond to the urgency of this need. As emphasized by Kurt Salmon Associates: "The continued leadership of the Arizona Commission for Medical Education and Research and the Arizona Board of Regents will be necessary to ensure progress across the broad range of participants and constituencies involved in the Phoenix Program. This is likely to be the case for at least the initial years of implementation." Vision The vision of The University of Arizona College of Medicine-Phoenix is to create the physician of the 21st century, who will be equipped with the knowledge, continuous learning skills, and technological tools to understand and apply the increasingly complex array of scientific data to the prevention and detection of, and treatment of patients with, a broad spectrum of diseases. This vision will be created through a unique and creative set of collaborations that will draw on the strengths of partnering universities, hospitals, and research institutes in a city and state that support the growth of this enterprise. Mission The University of Arizona College of Medicine-Phoenix will provide the outstanding faculty and curriculum to educate and shape physician leaders through the three integrated elements of education, research, and patient care. Faculty, students, and researchers will continually improve the diagnosis, treatment, and prevention of disease for the people of Arizona, with the common goals of improving people's health and alleviating suffering from disease. This 6



will be accomplished by becoming a national leader in innovative medical education, clinical care, and biomedical research--and by being nationally recognized for innovations in personalized medicine, biomedical informatics, and translational research. LCME Accreditation Programs for granting the MD degree are accredited and monitored by the Liaison Committee for Medical Education (LCME), an independent organization affiliated with both the American Medical Association (AMA) and the Association of American Medical Colleges (AAMC). Accreditation requires presentation of a high-quality curriculum, facilities, faculty, student support services, financing, and a supportive setting (clinics, hospitals, etc.). The University of Arizona College of Medicine is accredited by the LCME; the plan is to extend this accreditation to The University of Arizona College of Medicine-Phoenix Program. This extension must be approved by the LCME approximately six months prior to matriculation of students. The College has been in close consultation with the LCME on these issues, including a consultation site visit in January 2005. The College will continue to take all necessary steps to meet LCME accreditation requirements.



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ABOR Responses to SB 1517 Requests SB 1517 (Laws 2005, Chapter 330) states: "The University of Arizona shall establish a medical campus in Phoenix, utilizing the campus of the Phoenix Union High School. The Phoenix medical campus shall address medical education needs throughout the state." In addition, SB 1517 makes seven specific requests for information relating to the expansion of The University of Arizona College of Medicine in Phoenix from the Arizona Board of Regents: "By September 1, 2005, the Arizona Board of Regents shall submit for review to the Joint Legislative Budget Committee its operational and capital plans for the Phoenix medical campus. These plans shall include at least the following: 1. Detail on expenditures to date by the Arizona Board of Regents, its institutions, and its partners. 2. Detailed five-year operational and capital budgets, including information on the expected sources of all funds. 3. A five-year description of enrollment, growth capacity, and graduation expectations by practice area. 4. A 20-year financing plan detailing each funding source, including options to maximize resources and partnerships with the Maricopa County Special Health Care District and other health care entities. Funding sources may include federal grant monies, private donations, and contributions from other public entities. 5. The programs and areas of practice offered. 6. All partners involved in the Phoenix medical campus project, their roles, and an organizational chart. 7. The contributions and financing arrangements of all partners contributing to the capital plant, as well as the legal and financial relationships of the Arizona Board of Regents and its institutions to these partners." The responses of the Arizona Board of Regents follow. Please note that throughout this report all revenues and expenses are expressed in 2005 dollars, except where noted otherwise.



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1. Detail on expenditures to date by the Arizona Board of Regents, its institutions, and its partners Expenditures to date by the Arizona Board of Regents, The University of Arizona, and Arizona State University are fairly limited (please see Table 1). Although much time has been devoted to this effort by ABOR staff and UA and ASU faculty and staff, no new salary lines have been created.

Table 1. The University of Arizona College of Medicine-Phoenix Planning Expenditures: Arizona Board of Regents, The University of Arizona, and Arizona State University, FY 2003-FY 2005 3-Year Total



FY 2003 Arizona Board of Regents Salaries Project Operations TOTAL The University of Arizona Salaries Travel Operations TOTAL Arizona State University Salaries Travel TOTAL GRAND TOTAL $ 10,892 59,595 $ 70,487



FY 2004



FY 2005



$



5,630 79,130



$



0 68,965 $ 224,212



$ 84,760



$ 68,965



$ 140,000 41,200 129,100 $ 310,300 $ 310,300



$



3,750 2,750 6,500 $ 6,500



$



$ 541,012



The expenditures by the Arizona Board of Regents supported general site assessment studies, environmental assessments, site plans, schematic drawings, and programming of facilities for the renovation of the historic Phoenix Union High School buildings. The University of Arizona expenditures supported the salary of the Phoenix Biomedical Campus project manager, consulting services, and completion of an economic impact study. Arizona State University expenditures supported a graduate assistant and travel, both relating to researching Biomedical Informatics departments at other universities.



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2. Detailed five-year operational and capital budgets, including information on the expected sources of all funds The University of Arizona Table 2 presents a summary of projections for numbers of students and budget requirements for both state support and non-state support for The University of Arizona College of Medicine-Phoenix during Level I and Level II. Level I is the initial stage of the UA College of Medicine-Phoenix and is limited to a class size of 24 medical students. During this Level, the curriculum will be refined and research efforts will begin. Level II is the growth period of the UA College of Medicine-Phoenix that will see the medical school expand from 24 students per class to a full build-out of 150 students per class in FY 2015.

Table 2. The University of Arizona College of Medicine-Phoenix Level I and Level II Enrollment and Budget Projections Summary FY 2006-FY 2025 ($ in millions and in 2005 $)

Legislative Briefing Book State Budget



Current Projections (7/05) First-Year Medical Students Total Medical Students Science Graduate Students



Fiscal Years Level I 2005-06 2006-07 2007-08 2008-09 Level II 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2024-25



Projections (4/27/05) (All Level I)



Post-Doc Fellows



Total Students



State Budget



Total Budget



$ $ $ $



6.0 6.0 8.5 12.0



0 0 24 24



0 80* 104 128



0 0 48 136



0 0 24 68



0 80 176 332



$ $ $ $



6.0 6.0 8.5 12.0



$ $ $ $



8.8 14.5 21.1 30.0



$ $



16.0 20.0



64 80 104 128 144 150 150



192 272 352 456 536 606 680



216 310 404 498 592 691 1,060



130 184 238 292 346 403 600



538 766 994 1,246 1,474 1,700 2,340



$ $ $ $ $ $ $



23.5 21.1 24.1 25.9 26.0 33.6 45.0



$ $ $ $ $ $



78.2 90.2 110.8 120.4 147.6 168.9



$ 218.6



*Although the first class of 24 Phoenix Program students will begin in July 2007 (FY 2008), tuition revenue for 80 third- and fourth-year Tucson Program students is included in the Phoenix Program FY 2007 revenue projections, and will be foregone by the Tucson Program, to ensure the success of the Phoenix Program financial model and to limit the request for state support. Therefore, these Tucson Program student counts are included in Table 2.



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FY 2006-FY 2010 Operational Budget The proposed budget summary for FY 2006-FY 2010 represents a comprehensive analysis of the 5-year needs for the UA College of MedicinePhoenix (please see Table 3). All amounts in the budget summary are derived from the detailed breakdown of expenses, provided in the tables presented in Appendix E. Also provided in the detailed budgets in Appendix E is a partial list of revenue streams required to cover the operating costs associated with the UA College of Medicine-Phoenix. These budgets assume a phased move from Level I to Level II beginning in FY 2010. Level I is the initial stage of the UA College of Medicine-Phoenix and is limited to a class size of 24 medical students. During this Level, the curriculum will be refined and research efforts will begin. Level II is the growth period of the College and will see the medical school expand from 24 students per class to a full build-out of 150 students per class in FY 2015. The timeframe between FY 2007 and FY 2010 is also characterized by the need for larger facilities for the education and research endeavors. The logic for doing so, and the financial implications of that strategy, are discussed below. The single most important message from all the budget information provided is that academic health centers are financial engines, and will generate revenues and economic impacts far in excess of expenses. This is the message delivered in detail in the Tripp Umbach economic impact analysis of the Tucson and Phoenix Programs referenced above (Appendix F). "Tripp Umbach estimates that the Phoenix Biomedical Campus will rank among the state of Arizona's leading economic engines by 2025 when the campus has the potential to generate $2.1 billion in annual economic impact and generate employment for 24,000 Arizona residents. Further, the campus has the opportunity to generate more than $80 million annually in government revenue providing the state of Arizona with $2 in government revenue for every $1 invested." A reading of the 12-page executive summary of this analysis is vital to truly appreciate the full economic ramifications of the Phoenix Biomedical Campus, and to recognize the tremendous return on investment that will occur. The budgetary needs reflect the attempt of the UA College of Medicine-Phoenix to capture the total costs of an academic medical school, while limiting the resources required of the state in the early years to those presented in the Legislative Briefing Book shared with legislators on April 27, 2005 (please see Appendix G). This has been accomplished in several important ways. The total amount of state resources requested for the UA College of MedicinePhoenix over the first four years, FY 2006-FY 2009, is consistent with the Legislative Briefing Book, reaching $12 million annually in FY 2009. The total FY 11



2009 budget for the PBC of $30 million will support the 128 students that will be in the program at this time. These projections reflect the College's strategy to generate non-state funds to subsidize the medical school program, even in the early stages. The $16 million requested for operating costs for FY 2010, the first year of Level II, is consistent with the Legislative Briefing Book, which anticipated continuation of only Level I in FY 2010. However, with the one-year advancement of Level II implementation, $5 million in one-time capital funds and $2.5 million for technology are included in the revised FY 2010 total state request of $23.5 million. The FY 2011 state request drops to $21.1 million. This is compared with the $16 million presented in the Legislative Briefing Book for only Level I in FY 2010, and the $20 million for only Level I in FY 2011. Thus, the College of Medicine has significantly reduced the April 2005 state funding request developed for only Level I. This strategy involves achieving economies of scale and scope between the Tucson and Phoenix Programs. In addition, while discussions are in the early stages, and will be continued through the Arizona Commission on Medical Education and Research (ACMER) process, the College is projecting extensive involvement of all our partners--Arizona State University, BNI/St. Joseph's, TGen, affiliated hospitals, National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK), and others--in implementing the teaching, clinical, and research efforts. We believe that we should and can develop an excellent medical school program in Phoenix, while still remaining cost conscious. UA College of Medicine-Phoenix budgets were developed using the process and assumptions described below. The numbers of faculty, staff, and students required for the education, research, and clinical needs were determined for each fiscal year beginning in FY 2006. The personnel needs shown in Table 4 were used to derive the budget projections shown in Table 3. Faculty will be recruited and hired during Level I to occupy space in COM 1, COM 2, and COM 3 (the renovated Phoenix Union High School buildings) and in Arizona Biomedical Collaborative 1 (ABC 1). These faculty will have UA College of Medicine faculty appointments, will be intimately involved in the educational mission of the College, and will have varying degrees of involvement in the clinical and research missions. The number of faculty recruited corresponds in Level I to the available space and to the opportunities provided by economies of scale. The College projected expenses for faculty recruitment (both salaries and recruitment packages) based both on faculty rank--assistant, associate, full professor--and on job description, rather than assuming a fixed amount per faculty member. For faculty predominantly engaged in teaching, the start-up costs are modest and extend over a limited number of years. For faculty with a 12



strong research orientation, the start-up costs are more substantial and extend over a longer period. A linear model was constructed to project all recruitment costs at all ranks over the time periods shown. Although the details of that model are not shown, they are available and justify the funds requested.



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Table 3. The University of Arizona College of Medicine-Phoenix FY 2006-2010 Summary Budget

Revised 8-10-05



Table 3.

New State Requests FY 2006-FY 2010



Proposed FY 2006-FY 2010 Budget - Level I moving to Level II in FY 2010

FY 2006 Initial State Budget Re que st FTE FY 2007 Annual Ne w State State Budget Re que st FTE FY 2008 Annual State Budget Ne w State Re que st FY 2009 Annual State Budget Ne w State Re que st FY 2010 Annual State Budget Ne w State Re que st Le v e l I Ne w State FY 2006



FTE

EDUCATI ON Adm ini stra tion Dean of Ac ademic Affairs As s oc iate and Assistant Deans Admis s ion/Ac ademic/Financ ial Support Admin As s istant and Associates/Reception Bus ines s Affairs/Development/Facilities Special As sis tant to the Dean Minority Affairs Director Student Rec ruiters Adminis trative Assistant Ba sic Scie nce Faculty Yr 1 & Yr 2 Students PhD Fac ulty MD Faculty Educational Consultants MD, part time Adminis trative Assistant Re se a rch Faculty PhD Facult y MD Facult y Res earc h Staff Admin Staff Fa culty 3rd & 4th Year Clinical Education MD Faculty -Teaching MD Faculty Teaching & Research Res earc h Staff Admin Staff Inform a tion/Me dia Technology Media Support Medic al Computing Gross Ana tom y Lab St aff Pre -Clinica l Training MD Faculty -Direc tor As s t Dir Admin. As s istant Me dica l Library Librarian Library Support Staff Computer Staff Me dica l Bookstore Office St aff Sha re d Support Facilities Office staff Tota l Pe rsonne l (including ERE) OP ERATI ONS Operations Leas e Costs Building Operations and Maintenance Hos pital Arrangements Faculty Start Up Tra ve l Ca pi ta l Computer Systems (inc software) IT Infrast ruc t ure Furnis hings Office Machines TOTAL 39.0 0.0



Budget



Budget



FTE



Budget



FTE



Budget



Le v e l I Ne w State FY 2007



Le v e l I Ne w State FY 2008



Le v e l I Ne w State FY 2009



LEVEL II Ne w State FY 2010



Ne w State T OT AL



$1,529,321 1.0 2.0 3.0 7.0 3.0 2.0 256,518 1.0 3.0 1.0 1,947,852 7.0 3.0 3.0 0



$437,783 1.0 4.0 3.0 6.0 5.0 2.0 0 1.0 3.0 1.0 1,947,852 7.0 3.0 3.0 0 8.0 4.0 18.0 12.0 0



$1,837,707



$94,112



($343,671) 1.0 4.0 3.0 6.0 5.0 2.0



$1,920,747



$89,253



($4,859) 1.0 4.0 3.0 6.0 5.0 2.0



$1,921,547



$168,515



$79,262 1.0 6.0 3.0 10.0 7.0 3.0



$2,017,627



$0



($168,515)



$437,783



($343,671)



($4,859)



$79,262



($168,515)



$0



263,502



0



0 1.0 3.0 1.0



263,502



0



0 1.0 3.0 1.0



263,502



0



0 2.0 4.0 1.0



412,132



0



0



0



0



0



0



0



0



1,947,852



1,947,852



0 16.0 4.0 6.0



3,502,100



3,502,100



1,554,248 20.0 6.0 10.0



4,395,360



4,395,360



893,260 23.0 7.0 11.0



4,533,480



4,533,480



138,120



1,947,852



0



1,554,248



893,260



138,120



4, 533,480



3,567,284



1,366,773



1,366,773 16.0 8.0 36.0 16.0 0



7,140,680



2,150,356



783,583 22.0 12.0 51.0 22.0 0



10,232,548



2,880,644



730,288 28.0 15.0 65.0 43.0



13,719,100



4,295,710



1,415,066



0



1,366,773



783,583



730,288



1,415,066



4,295,710



33,667,014 44. 0 44. 0 264.0 13. 0



2,632,728



2,632,728



0



0



0



0



2,632,728



2,632,728



141,175 1.0 1.0 0



60,120 1.0 1.0 1.0



143,335



62,280



2,160 1.0 1.0



289,272



206,917



144,637 1.0 1.0



289,272



206,917



0 4.0 4.0



737,600



655,245



448,328



60,120



2,160



144,637



0



448,328



655,245



48,440



48,440



48,440



2.0



96,880



96,880



48,440



1.0



96,880



96, 880



0



2.0



145,320



145,320



48,440



0



48,440



48,440



0



48,440



145,320



0



0 2.0



216,672



216,672



216,672 2.0



216,672



216,672



0 2.0 2.0



466,560



466,560



249,888



0



0



216,672



0



249,888



466,560



91,965 1.0 0.5



91,965 1.0 0.5



93,275



93,275



1,310 1.0 1.0



116,865



116,865



23,590 1.0 1.0 1.0



161,349



161,349



44,484 3.0 2.0 1.0



396,560



396,560



235,211



91,965



1,310



23,590



44,484



235,211



396, 560



0



0



0 1.0



44,484



0



0 1.0



44,484



0



0 2.0



94,360



0



0



0



0



0



0



3,966,831 1,753,000



2,537,720 574,600



85.5 0.0



7,901,395 5,737,500



3,612,732 1,548,400



1,075,012 973,800



137.0 0.0



13,591,202 7,311,700



6,379,043 1,975,000



2,766,311 426, 600



178.0 0.0



17,621, 614 7,768, 955



8, 126, 337 2, 813,068



1,747,294 838,068



616.0 0.0



56,189, 753 16,503,300



13,125,603 4,856,197



4,999,266 2, 043,129



2,537,720 574,600



1,075,012 973,800



2,766,311 1,001,200



1,747,294 838,068



4,999,266 2,043,129



13,125,603 5, 430,797



30,800 2,866,880



20,800 2,866,880



45,071 803,797



35,071 803,797



14,271 (2,063,083)



57,200 88,757



57,200 88,757



22,129 (715,040)



75,400 473,540



75,400 985,195



18,200 896,438



111,800 5,406,400



111,800 5,406,400



36,400 4,421,205



20,800 2,866,880



14,271 (2,063,083)



42,929 (1,974,326)



18,200 896,438



36,400 4,421,205



132,600 4,147,114



39.0 $8,617,511



$6,000,000



85.5 $14,487,763



$6,000,000



$0



137.0



$21,048,859



$8,500,000



$2,500,000



178.0



$25,939,509



$12,000,000



$3,500,000



616.0



$78,211, 253



$23,500,000



$11,500,000



$6,000,000



$0



$2,500,000



$3,500,000



$11,500,000



$23,500,000



14



Table 4. The University of Arizona College of Medicine-Phoenix Projected Students, Faculty, and Staff FY 2008-FY 2025 (selected years) FY 2008 176 104 48 24 24 27 12 15 18 18 39 12 27 FY 2009 332 128 136 68 24 64 34 30 51 51 66 22 44 FY 2010 538 192 172 44 86 44 64 161 43 30 88 329 65 264 127 43 84 FY 2011 766 272 252 58 126 58 80 212 63 33 116 443 95 348 157 63 94 332 72 166 72 104 262 83 35 144 557 125 432 187 83 104 FY 2012 994 352 FY 2013 1246 456 412 86 206 86 128 312 103 37 172 671 155 516 210 103 107 FY 2014 1474 536 492 100 246 100 144 362 123 39 200 785 185 600 235 123 112 FY 2015 1700 606 576 115 288 115 150 (capacity) 416 144 42 230 906 216 690 274 144 130 FY 2025 2340 680 920 140 460 140 150 (capacity) 552 230 42 280 1220 345 875 360 230 130



STUDENTS/FACULTY Total Students (including graduate) Total Students COM (4 yr) UA Grad StudentsBasic Science (4 per PI) UA Grad StudentsClinical Science (1 per PI) UA Post-Doctoral Fellows- Basic Science (2 per PI) UA Post-Doctoral Fellows-Clinical Science (1 per PI) Educational (students per class)1 Total Faculty2 Basic Science PIs ED Clinical Science PIs3 Total PI Support3 Basic Science Staff4 Clinical Science Staff5 Total Support Staff PIs Staff Administrative Staff

1 2



Numbers reflect students per class, not total COM students. FTEs. 3 Assumes that 50% of these physicians (Clinical Science Principal Investigators) will be doing research. 4 Basic Science Staff includes technician and laboratory manager (1.5 per PI). 5 Clinical Science Staff includes data manager, research nurse, laboratory manager, research coordinator, technician, and biostatistician (6 per PI).



The administrative staffing levels were determined based on projections from the current UA College of Medicine staff in Tucson and Phoenix, adjusted to appropriate levels based on class size, as well as on the certain unavoidable fixed costs associated with any start-up operation. Therefore, while the administrative costs per student are high at the outset, they progressively drop, as the size of the student body increases, to levels substantially below current costs in Tucson. The total administrative staff level increases by 7 FTEs between FY 2006 and FY 2010, to support a student enrollment of 80 third- and fourth-year students in FY 2006, and increases to support a student population in FY 2010 of 192 students in all four years, and increases an additional 8 FTEs to support a projected student enrollment of 606 by FY 2015. The estimated



15



administrative staff to total faculty and research and clinical staff ratio is 43 percent in FY 2006, projected to be 4 percent in FY 2010 and 2 percent in FY 2015. In the early years, administrative staff positions must be funded by state resources. As tuition and other non-state funding resources increase, it should be noted that the state resources will be applied to salaries and operations supporting the faculty and student needs, and not to support of administrative salaries. While we are still weighing various options for funding the UA College of Medicine-Phoenix, some aggressive cost-saving assumptions have been used in our projections. However, it should be emphasized that these assumptions may change over time. One aggressive cost-saving assumption relates to the percentages of faculty salary allocated to state funds, especially for faculty with a strong research orientation. Those faculty, in particular, are expected to recover one-half of their salary and benefits from sponsored research funding from the outset of their appointment and in perpetuity. This will not be feasible for many new faculty, particularly those at the assistant professor level, when initially recruited, and alternative sources of funds will be required to support their salaries until research funding is obtained. At this time, The University of Arizona College of Medicine-Phoenix has explicitly chosen not to request those alternative sources from the State Legislature, but rather to work toward developing partner participation arrangements to provide this alternative funding source. As discussed in the economic impact analysis by Tripp Umbach, the multiplier effect for research activities in academic health centers is 3.3. While the vast majority of the economic benefits are not manifested as available cash to cover faculty salaries, this figure nonetheless indicates the tremendous return on investment provided for this enterprise. A parallel aggressive assumption is that no state funds will be used for research support or for research staff salary and benefits, and that the resources to cover those costs will be provided from other sources. Again, this is not the standard model, but reflects the UA's intention to substantially share the responsibility for launching this program. All clinical faculty will receive 15 percent salary support from state funds for teaching activities. The majority of such clinical faculty will spend substantially more than 15 percent of their time in teaching activities, for which there is no other source of compensation. Again, the request from the state for covering these costs is significantly less than might have been anticipated. For example, a recent systematic analysis of teaching activities at the UA College of Medicine, University Medical Center (UMC), and University Physicians Healthcare Hospital at Kino in Tucson determined that the 340 clinical faculty spend 216,080 hours per year in teaching. On average, this amounts to 15.8 hours per week, or 26.5 percent of a 60-hour work week. For now, rather than make a request that the state provide the funds to raise this hourly rate to a more appropriate level, we have chosen to seek other alternative funding sources for these costs. For one-half of clinical faculty, we assume that 16



85 percent of their salary and benefits will be derived from clinical activities. For the other half of clinical faculty, we assume that 35 percent of salary and benefits will be derived from sponsored research activity and 50 percent from clinical faculty activities. Thus, we will cross-subsidize teaching activities with revenues from clinical and research activities. This arrangement is challenging for academic leadership in the national competitive market that academic medicine represents. The challenge is to effectively motivate faculty to be excellent teachers, devoted to students, yet the revenue to cover their salary must be generated from other activities. This is the obligation medical school faculty assume when they choose to work in the academic health center environment for the UA College of Medicine-Phoenix. On the other hand, 100 percent of the costs of the faculty's administrative staff at the outset, and 80 percent of the costs thereafter, were allocated to the state. This assumption is based on practical and realistic considerations, including, but not limited to: � Administrative staff support the faculty and research staff as they conduct the activities necessary in the educational, clinical, and research arenas to generate the funds needed to cover their salary and fringe benefits under the considerations above. Administrative costs are part of the fixed overhead required to make the organization function, and can be neither allocated as variable costs nor covered from operating revenues. Administrative costs cannot be covered from federal research grants from the National Institutes of Health (NIH), by far the largest provider of funds for biomedical research.



�



Notable features of the UA College of Medicine-Phoenix budget include the following: � The expenses grow quickly when the research faculty and support staff are added, but there is a corresponding revenue stream associated with grant activity. Expenses increase markedly in FY 2010, when new facilities are projected to accommodate the new students, faculty, and staff numbers. Additionally, the operations segment for building and maintenance, and new media equipment and IT infrastructure will be needed in FY 2010. Support is projected from the teaching hospitals in proportion to the number of students on clinical rotations. The $305,000 we now are paying for 80 students will increase to $1.2 million with 150 students. While we have not indicated as such in the budget, an option is that this support would come from the hospitals. Future discussions through the ACMER process will determine whether local hospitals will be able to fill the gap in this area.



�



�



17



Sources of Funds The Association of American Medical Colleges (AAMC), in its 2004 The Handbook of Academic Medicine: How Medical Schools and Teaching Hospitals Work (available for purchase at www.aamc.org/publications), discusses the traditional financial model for an academic health center (please see Figure 2): The largest single source of revenue, 35 percent, to research-intensive medical schools (those among the top 20 in research funding from the NIH, including The University of Arizona College of Medicine) is federal research grants and contracts. These grants and contracts are for teaching, research, and service programs, including recovery of facilities and administrative (F&A) costs, i.e., indirect costs, associated with these programs. Federal research funds--totaling $13.7 billion in fiscal year 2003--represent the major component of federal support to medical schools. The second largest single source is patient care reimbursements for physician services. In 2003, these activities generated 28 percent of all revenues. In the 1960s, medical schools developed faculty practice plans--formal practice organizations for billing and collection. Payment for patient care services formerly made directly to the individual faculty physician began to flow into the faculty practice plan and to be recognized as revenue to the school. Most of these funds go toward practice expenses, including salaries of an expanding clinical faculty. However, some are invested in medical school teaching and research programs. Another important source of revenue for medical school programs is hospital support. This source comprised 11 percent of total revenues, the third largest source of funds after federal grants and contracts, and patient care services reimbursement. Other sources of funding for research-intensive medical schools are: � � � � � Other grants and contracts � 10 percent Endowments and gifts � 6 percent Other � 6 percent State and local appropriations � 3 percent Tuition and fees � 2 percent



18



Figure 2. Schools



Sources of Revenue to Support Operations in Research-Intensive Medical



Research-Intensive Medical Schools 2003 Median Total Revenues = $926 million (N=20) 3% 2% 6% 11%

State & Local Appropriations Tuition & Fees Other Hospital Revenues Faculty Practice Plan Endowments & Gifts



35%



28% 10% 6%



Other Grants & Contracts Federal Research Grants & Contracts



While recognizing the usual financial model for medical school revenues, as discussed above, the following projections have been made for funding sources for the UA College of Medicine-Phoenix. State funds The requested funding from the State Legislature for the UA College of MedicinePhoenix in FY 2006-FY 2010 is justified in Table 3, and in Appendix E, and discussed earlier in this section. Tuition The projected tuition revenues from the UA College of Medicine-Phoenix during the first 5 years are illustrated in Table 5. The projections assume student numbers of 24 students accepted per year until FY 2010, at which point the entering class will be expanded to 64. Tuition revenues include an estimated 40 percent of the third- and fourth-year Tucson classes that continue their program in Phoenix. Inclusion of these tuition revenues, but not inclusion of the associated expenses, for third- and fourth-year Tucson Track students is part of the financial strategy to minimize the level of state support required, especially in the early years, and yet to provide the funding necessary for the financial viability of the Phoenix Program. Tuition levels are estimated to increase by 5 percent per year during FY 2006-FY 2010, based on recent historical averages, coupled with the policy of the UA College of Medicine to benchmark tuition near the top of the bottom third of public medical schools. 19



Table 5. The University of Arizona College of Medicine-Phoenix Tuition Estimates FY 2006-FY 2025 (based on 5% annual increases)

Students Students Total Year 3- Students Year 4Tucson Year 4 Tucson Students 0 40* 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 0 0 0 0 0 24 24 64 80 104 128 144 150 150 150 150 150 150 150 150 0 40* 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 40 0 80* 104 128 192 272 352 456 536 606 652 674 680 680 680 680 680 680 680 680



FY 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025



Tuition & Students Students Students Fees Year 1 Year 3 Year 2 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 14,462 15,185 15,944 16,742 17,579 18,458 19,380 20,349 21,367 22,435 23,557 24,735 25,972 27,270 28,634 30,065 31,569 33,147 34,805 36,545 0 0 24 24 64 80 104 128 144 150 150 150 150 150 150 150 150 150 150 150 0 0 0 24 24 64 80 104 128 144 150 150 150 150 150 150 150 150 150 150 0 0 0 0 24 24 64 80 104 128 144 150 150 150 150 150 150 150 150 150



TOTAL TUITION $ 0 $ 1,214,808 $ 1,658,213 $ 2,142,921 $ 3,375,101 $ 5,020,463 $ 6,821,923 $ 9,279,366 $ 11,452,691 $ 13,595,797 $ 15,359,212 $ 16,671,341 $ 17,660,738 $ 18,543,775 $ 19,470,964 $ 20,444,512 $ 21,466,738 $ 22,540,075 $ 23,667,079 $ 24,850,433



Marginal Increase $ 0 $ 1,214,808 $ 443,405 $ 484,708 $ 1,232,180 $ 1,645,362 $ 1,801,460 $ 2,457,443 $ 2,173,325 $ 2,143,106 $ 1,763,415 $ 1,312,129 $ 989,397 $ 883,037 $ 927,189 $ 973,548 $ 1,022,226 $ 1,073,337 $ 1,127,004 $ 1,183,354



*Although the first class of 24 Phoenix Program students will begin in July 2007 (FY 2008), tuition revenue for 80 third- and fourth-year Tucson Program students is included in the Phoenix Program FY 2007 revenue projections, and will be foregone by the Tucson Program, to ensure the success of the Phoenix Program financial model and to limit the request for state support.



Sponsored research grants and contracts The National Institutes of Health (NIH) is the world's premier medical research institution, supporting more than 212,000 research personnel at over 2,800 research universities, medical schools, teaching hospitals, independent research institutes, and industrial organizations throughout the United States and the world. The NIH has been the primary source of federal funding for biomedical research in the United States for nearly 40 years. The largest portion of the NIH budget is devoted to research in the life sciences, mainly biomedical research. In FY 2002, the NIH devoted $19.7 billion, or 89.2 percent of its total budget, to life sciences. This comprised 77.4 percent of the total federal investment in life sciences research. NIH funding for academic health centers has paralleled the growth in the NIH budget. The 125 academic health centers receive nearly 52 percent of the NIH grant funding. Of this distribution, the top 25 centers receive approximately 55 percent of the funds, and the top 50 centers receive nearly 81 percent. The common expectation is that an increasing tendency will be to direct expenditures



20



on a progressively smaller number of institutions, to focus the funding required for team-based research. Hence, there is a compelling argument for being identified as such a center. While the NIH is the largest source of funding for biomedical research, the Department of Defense (DOD), the Department of Veterans Affairs, the Centers for Disease Control and Prevention, and the National Science Foundation (NSF) provide nearly $15.2 billion per year in sponsored research funding in the life sciences. The UA College of Medicine is currently ranked 55th out of 125 Colleges of Medicine in biomedical research funding from the National Institutes of Health. Because these rankings are directly dependent upon organization size, other metrics can and should be used to evaluate performance in comparison to peers. � � For colleges of medicine with fewer than 600 full-time faculty, the UA College of Medicine ranks 3rd nationally in NIH funding. The Departments of Cell Biology and Anatomy, Family and Community Medicine, and Pediatrics rank 12th, 3rd, and 26th in the country, respectively. Several other UA College of Medicine departments rank within the top 50 in their respective fields. (Please see Table 6).



Table 6. NIH Biomedical Research Funding Ranking for The University of Arizona College of Medicine Departments



Department Anesthesiology Biochemistry Cell Biology & Anatomy Emergency Medicine Family & Community Medicine Medicine Microbiology & Immunology Neurology Obstetrics & Gynecology Ophthalmology & Vision Science Orthopedic Surgery Pathology Pediatrics Pharmacology Physiology Psychiatry Radiology / Radiation Oncology Surgery



FY 2004 Rank 40 59 12 3 76 81 66 27 27 68 26 33 37 56 25 59



21



Revenues to cover salary and employee-related expenses (ERE) from sponsored research are projected to increase from $2.2 million in FY 2007 to $27.5 million in FY 2010, and to $65.2 million in FY 2015. These increases are predicated on faculty growth, with the assumptions as to revenue streams for salary as described above. As an alternative and confirmatory approach, we took advantage of our interest and expertise in mathematical modeling for predicting revenues from sponsored research funding. We used probabilities for funding that parallel historical averages beginning in FY 2009. The additional revenues associated with the grant funding, over and above those required to cover salary and ERE, are substantial. Most importantly, the facilities and administrative (F&A) costs associated with the grant revenues in FY 2010 and FY 2015 are $8 million and $19 million, respectively. Clinical revenues Clinical revenues contribute half of the $60 billion dollars of funding for academic health centers nationally. At this time, we are looking at a "dispersed model" for Level I, an arrangement under which hospitals in multiple locations will be used for teaching. Given such a model for the Phoenix campus, the clinical revenues will be minimal at the outset, and would come almost exclusively from an ambulatory facility, which is an option for the campus. Such an ambulatory facility would be a primary care clinic, with a small volume, a focus on teaching, and likely an unfavorable payer mix. Hence, the revenues generated would be sufficient only to cover the overhead and ancillary personnel. As pointed out in the Kurt Salmon Associates report, in the traditional model of the academic health center, there is one core teaching hospital for clinical rotations for the medical students. Seventy-two Association of American Medical Colleges are associated with public colleges of medicine. In this construct, a median of $39 million and a mean of $43 million are provided from the hospitals annually to their associated colleges of medicine. These revenues are provided by the hospital to the college of medicine in explicit recognition that the faculty, residents, and staff of the academic health center enhance the reputation, and the revenues, of the hospital while engaging in educational activities for which no other source of funds exist. These teaching activities are the essence of an academic health center. KSA acknowledges that providing clinical operations is a critical element of moving an academic health center forward. As mentioned, one approach to be considered for Level I is to establish an ambulatory facility on the PBC to provide on-site teaching and learning opportunities, albeit in a more limited fashion than permitted by an adjacent primary teaching hospital. The pro's and con's of establishing a primary teaching hospital for the UA College of Medicine-Phoenix are weighed in the KSA report and the Tripp



22



Umbach report. Issues relating to an on-site ambulatory facility and a teaching hospital will be addressed through the ACMER process. Hospital support Support from AAMC hospitals to their affiliated medical schools is substantial, as documented elsewhere in this report. As indicated in the report from KSA to ACMER, "A substantial change in the financial arrangements between the affiliated hospitals and the UA College of Medicine would be required if the overall program is to achieve the status of the best academic centers." Since the discussions with our clinical partners are in the early stages, it is not yet possible to determine either the scale or the structure of support from the affiliated hospitals to the UA College of Medicine-Phoenix. These issues will be addressed through the work of the ACMER. Philanthropic goals Endowed Chairs: Cancer Diabetes Human Neurosciences Endowed Master Teacher Fellowships: 8 at $250,000 each College of Medicine Educational Facility: 50% of $90 million project Total $2 million $2 million $2 million $6 million $2 million $45 million* $53 million



*Assumes lead donor at $20�$25 million. Also assumes permission from City of Phoenix/ABOR for name of donor to go on UA College of Medicine-Phoenix facility when built. Assuming a $25 million lead gift for the Level II facility, the remainder of the five-year, $53 million gift could project out as follows: FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 Total $2 million $4 million $6 million $8 million $8 million $28 million



23



FY 2006-FY 2010 Capital Budget In early 2004, the City of Phoenix presented to the Mayor and City Council site development guidelines for a master plan of 15.8 acres in downtown Phoenix. Located at the northwest corner of the intersection of 7th and Van Buren Streets, the Phoenix Biomedical Campus site is graced with three historic buildings constructed in 1911 that were once the core of the Phoenix Union High School. The International Genomics Consortium (IGC) and the Translational Genomics Research Institute (TGen) were the initial catalysts for redevelopment of this urban component of downtown Phoenix. A master development plan for a Phoenix Bioscience Center was approved by the Phoenix City Council in April 2003. The goal was to construct an appropriate campus that energized the city and encouraged public/private partnerships benefiting the citizens of Arizona. The vision for the future build-out of the campus is to accommodate 1 million square feet of new construction, in addition to the rehabilitation of the approximately 60,000 square feet of existing historic structures and 28,000 square feet of new circulation core. The IGC/TGen facility was completed in December 2004 and occupied in early 2005. The three historic Phoenix Union High School buildings, preliminarily designated as COM 1, COM 2, and COM 3, are currently undergoing an extensive adaptive reuse to house the initial class of 24 students for the UA College of Medicine-Phoenix. ABC 1, a collaborative research facility between the UA and ASU, is in design development, and construction is scheduled to begin in November 2005. The City of Phoenix will release an RFP in late summer 2005 seeking a developer to finance, construct, maintain, and manage a parking structure on the site. ACMER appointed the PBC Master Planning Task Force to provide the Commission with recommendations relative to the mission, plans, and facility development on the PBC (please see Appendix H for membership). This task force consists of members representing the City of Phoenix, the universities, ABOR, TGen, and non-profit health care organizations. The Task Force refined the City's original 2003 master plan development and developed the PBC vision and land use concepts. In addition, they identified issues relating to parking demand for all campus users and developed rules of engagement for future development on the PBC. A planning session with KSA identified options for land use that the Master Planning Task Force reviewed. To achieve the highest and best use of the land, the Master Planning Task Force has identified the allocation of the PBC to be 500,000 square feet for research, 300,000 square feet for academic purposes, and 200,000 square feet for clinical research. Revisions to the original master plan include expanding the planning area from the original 15.8-acre PBC to include City-owned land north of Fillmore Street and the current site of the ASU Downtown Center along Van Buren Street known as the Mercado. The revised plan also identifies and locates the land use for specific activities. These master plan refinements provide direction to prospective tenants and the community regarding the City's expectations for land



24



use, facility location, vehicular and pedestrian circulation, and the location of campus development. FY 2006-FY 2010 (Level I moving to Level II) projects for the Phoenix Biomedical Campus include: COM 1, COM 2, and COM 3 (Phoenix Union High School Historic Buildings) Buildings and cores: 89,215 gross square feet Project Description: Owned by the City of Phoenix and leased to the Arizona Board of Regents, this adaptive reuse of the historic Phoenix Union High School buildings, temporarily designated as COM 1, COM 2, and COM 3 (from west to east). COM 1 will house examination rooms equipped with Telemedicine equipment, student services, and administration. COM 2 will house an auditorium to be shared with other Campus occupants, THealth (please see program description below), and mediated classrooms for the Arizona Telemedicine Program (ATP). COM 3 will house pre-clinical training examination rooms, bookstore, and student pods. Project Cost: Construction Start: Proposed Construction Completion: $19.2 million April 2005 June 2006



Funding Source: The City of Phoenix is leasing COM 1, COM 2, and COM 3 to the UA for 30 years for $1.00 per year. The buildings will be subleased to DESCO Southwest, who will have the buildings renovated and will add a core structure that provides elevators, stairwells, and restrooms. DESCO Southwest will lease the facilities back to the UA for an estimated annual lease of $1.46 million ($16.25 per square foot), funded with the $308,000 rent the UA currently pays for its facilities at Third Street and Indian School Road in Phoenix. The remainder will come in part, if necessary, from the $6 million FY 2007 General Fund appropriation. The City is also providing New Market Federal Tax Credits through the City's allocation from this awarded federal program. THealth will serve as the site of origin of unique, modular health care team educational programming, drawing upon the existing resources of the Arizona Telemedicine Program. These modules are expected to address a number of goals of the Institute of Medicine's report on health education team training. Initially, this will be regarded as a supplemental curriculum, designed to complement and broaden the medical school curriculum. The THealth curricular elements will be heavily dependent on the use of remote "video conferencing" telemedicine clinical experiences. The ATP already links more than 130 clinics throughout the state and a wide variety of rural, urban, correctional, community health, and home-health environments and has affiliation agreements with these sites. THealth will link to these clinical settings to expand medical students' patient experiences throughout their education. Congressionally appropriated 25



federal earmark funds in the amount of $1.2 million for THealth million will equip and staff space on the third floor of COM 2. Arizona Biomedical Collaborative 1 (ABC 1) 85,600 gross square feet Project Description: This new four-story research facility will consist of wetlaboratory research space for The University of Arizona and dry-laboratory research space for Arizona State University. The laboratory space, both wet and dry, is designed for maximum flexibility. Both the facility program and building have been developed to accommodate a future second structure, ABC 2. The importance of the ABC 1 facility to the Phoenix Program of the UA College of Medicine cannot be overemphasized. The UA College of Medicine-Phoenix Program requires research space for faculty recruited to lead the basic science efforts. Through the support of HB 2529 (Laws 2003, Chapter 267), the University Research Infrastructure Bill, we are in the position of having already commenced the planning of such a building, with groundbreaking scheduled for November 2005. Were it not for HB 2529, a necessary component of the initial request for UA College of Medicine-Phoenix funding would have been support for construction of a research facility. While not mentioned explicitly during most of the discussion regarding funding for the College, the availability of ABC 1 provides a quintessential example of the economies of scale and scope, as a facility shared between UA and ASU, with direct ties to research programs in TGen (including NIDDK, IGC, and BNI/St. Joseph's) which will dominate PBC, and lower overall expense. Total Project Cost: Proposed Construction Start: Proposed Construction Completion: $27.2 million November 2005 March 2007



Funding Source: Arizona State Legislature House Bill 2529 University Research Infrastructure (Laws 2003, Chapter 267). ABC 1 is scheduled for review by the Joint Committee on Capital Review (JCCR) in October 2005. Educational Facility for The University of Arizona College of Medicine-Phoenix 310,000 gross square feet Project Description: The new Educational Facility building, housing classrooms, teaching laboratories, student services, administration, and business services, must be built and ready for occupancy by July 2009 in order to expand the Phoenix Program to a class size of 64 new students from a class size of 24 new students. Budgetary details for the Educational Facility are presented in our response to request number 4.



26



Total Project Cost: Proposed Construction Start: Proposed Construction Completion:



$89.8 million 2008 July 2009



Funding Source: It is projected that approximately $45 million of the total $89.8 million cost will be supported by philanthropic efforts. Funding of the approximate $45 million balance is under discussion at this writing. Options for this funding include the possibility of state funding of the annual debt service associated with the $45 million balance (approximately $3.6 million), and/or the possibility of assistance from the City of Phoenix, such as bonds or other nongeneral revenue funds.



Arizona State University FY 2006-FY 2010 Operational Budget Arizona State University is establishing the Department of Biomedical Informatics and aspires to develop a world-class partnership between academic researchers, clinical practitioners, and regional health care providers to advance research and education in the science and practice of biomedical informatics. The programs and degrees administered through the department will prepare individuals who are capable of making major contributions to the creation and evaluation of computational and informatics tools and their application to biomedical or clinical research, health care practice and administration, public health, and the education of health professionals and patients. A detailed FY 2006-FY 2010 operational budget for the Department of Biomedical Informatics at Arizona State University is provided in Table 7.

Table 7. Arizona State University Department of Biomedical Informatics FY 2006-FY 2010 Operational Budget

BMI Legislature Budget Personnel Faculty Chair Associate Chair Professor Associate Professor Assistant Professor Faculty Buyouts (see budget details) Faculty Total: Subtotal Faculty w/ERE: Administrative Associate Director @ 50% Accountant, Sr. Office Specialist Academic Advisor



FY 06



FY 07 $ $ $ $ 200,000 175,000 187,500 200,000



FY 08 $ $ $ $ $ 200,000 175,000 450,000 187,500 200,000



FY 09 $ $ $ $ $ 200,000 175,000 900,000 500,000 300,000



FY 10 $ $ $ $ $ 200,000 175,000 900,000 625,000 500,000



$300,000 $300,000 $300,000 $ $ 762,500 953,125 $ 1,212,500 $ 1,515,625 $2,075,000 $2,593,750 $ 2,400,000 $ 3,000,000



$45,000 $32,000



$90,000 $ $ 32,000 40,000



$90,000 $ $ 32,000 40,000



$90,000 $ $ 32,000 40,000



$90,000 $55,000 $ $ 32,000 40,000



27



Systems Admin/Tech Support Total: Administrative w/ERE: Student Assistants, Workers, and Stipends Student Worker (includes 8 percent additional) Blake Atkinson Teaching Assistants (includes ERE) Research Assistants (includes ERE) Post-Docs Summer fellowships and stipends. Other Personnel : $15,000 $77,000 $100,100



$ $ $



70,000 232,000 301,600



$ $ $



70,000 232,000 301,600



$



70,000



$ $ $



70,000 287,000 373,100



$ 232,000 $ 301,600



$ $35,000 $135,000 $ $ $



30,000 68,000 35,000 100,000



$ $



30,000 68,000



$



60,000



$ $



60,000 170,000



$ 170,000



$ $185,000 $ 233,000 $



30,000 128,000



$



50,000



$ $



90,000 320,000



$ 280,000



Total Personnel: Operations Services Materials and Supplies Voice and Data Communication Software Licenses Travel In-State (see budget details) Travel Out-of-State Travel Foreign Non-capital Equipment & software (See budget details) Other capital (general construction & space reconfigure - see budget details) Equipment Other (see budget details) Total Operations: Total Budget: BMI President Budget Faculty Professor Associate Professor Assistant Professor Total: Subtotal w/ERE: Operations Materials & Supplies Non-capital equipment Total Operations: Total Budget:



$585,100 $20,000 $20,000 $10,000 $50,000 $1,000 $6,000 $3,000



$ 1,487,725 $ $ $ $ $ $ $ 25,000 25,000 15,000 125,000 2,000 7,000 4,000



$ 1,945,225 $ $ $ $ $ $ $ 30,000 52,525 20,000 125,000 3,000 5,000 8,000



$3,175,350 $ $ $ $ $ $ $ 35,000 94,400 25,000 50,000 4,000 6,000 9,000



$ 3,693,100 $ $ $ $ $ $ $ 40,000 83,650 30,000 25,000 5,000 7,000 10,000



$34,900 $50,000



$



6,250



$



11,250



$



26,250



$



31,250



$ $ $220,000 $414,900 $1,000,000 $ $ 153,025 150,000 512,275 $ $



100,000 500,000 200,000



$ $ $



25,000 25,000 25,000



$ $ $ $



25,000 25,000 25,000 306,900



$ 1,054,775 $ 3,000,000



$ 324,650 $3,500,000



$ 2,000,000



$ 4,000,000



$150,000 $125,000 $100,000 $375,000 $468,750 $31,250 $31,250 $1,500,000



$



225,000



$



225,000



$ 225,000



$



225,000



$225,000 $ 281,250



$225,000 $ 281,250



$225,000 $ 281,250



$225,000 $ 281,250



$ $



218,750 218,750



$ $



218,750 218,750



$ 218,750 $ 218,750 $4,000,000



$ $



218,750 218,750



$ 2,500,000



$ 3,500,000



$ 4,500,000



28



Capital Budget (ABC 1) A detailed capital budget for the Department of Biomedical Informatics at Arizona State University is provided in Table 8.

Table 8. Arizona State University Department of Biomedical Informatics Capital Budget



Projected expenses for ASU's portion of Arizona Biomedical Collaborative 1 (ABC 1) are:

PROJECT BUDGET REPORT



PROJECT NAME: AZ Biomedical Collaborative (ABC Building) PROJECT NUMBER: 2004-13011 AREA/ORG: PB6 2404 PM: Vance Linden PROJECT / FILING TYPE: MAJOR A Object Cost Item Code 7880.01-10 LAND ACQUISITION (1) 7880.16-20 New Construction (2A) 7880.11-20 Remodeling Renovation 7880.95-20 Specialized Equip (2C) 7880.06-20 Site Development (2D) 7880.06-20 Parking/Landscaping (2E) 7880.06-20 Utilities Ext. (2F) XXXX.XX-XX State Sales Tax Research Exemption XXXX.XX-20 Directives - Potential SUBTOTAL 7880.21-30 Constr. Manager (3A) 7880.21-30 Architect/Engineer (3B) 7880.21-30 IDC (3C) 7880.21-30 Preprogramming (3C) XXXX.XX-30 Other (Move Mgmt )(3C) SUBTOTAL 7325.XX-40 Furniture, Fixtures & Equipment (4) SUBTOTAL 7330.16-50 Telephone Off-Site 7330.16-50 Telephone Inside 7330.16-50 Equip, Cable, Move-In (Telecom Equip) (8) 7330.16-50 Special Phones/Connections 7330.16-50 Special System Interface SUBTOTAL 7310.52-60 Physical Plant SWOs (10E) 7890.21-70 Surveys & Tests (10A) 7390.99-70 Move-In Costs (10B) 7810.65-70 Public Art (10C) 7310.19-70 Adver/Printing (10D) 7310.99-70 Signage (10E) 7310.52-70 Keying (10E) 7310.52-70 Grounds (10E) 7890.11-70 Asbestos (10E) Appropriated Budget 0 6,359,480 110,280 257,320 220,560 183,800 0 0 7,131,440 73,520 883,343 0 0 35,657 992,520 294,080 294,080 0 0 0 294,080 0 294,080 0 7,352 33,084 0 3,676 14,704 14,704 0 0 B Budget Adjustments 0 1,000,000 1,050,000 0 0 0 0 0 0 222,350 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 C A+B Adjusted Budget 0 7,359,480 1,160,280 257,320 220,560 183,800 0 0 73,520 1,105,693 0 0 35,657 294,080 0 0 0 294,080 0 0 7,352 33,084 0 3,676 14,704 14,704 0 0



DATA DATE: RUN DATE: FILE NAME: AREA/ORG MGR: D Encumbered & Expensed To Date 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00



06/30/05 06/30/05 Excel: 13011pbr.xls Dave Brixen E (Potential) Costs To Date 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 F C-D-E Uncommitted Budget 0.00 7,359,480.00 1,160,280.00 257,320.00 220,560.00 183,800.00 0.00 0.00 73,520.00 1,105,693.00 0.00 0.00 35,657.00 294,080.00 0.00 0.00 0.00 294,080.00 0.00 0.00 7,352.00 33,084.00 0.00 3,676.00 14,704.00 14,704.00 0.00 0.00 F:\BUDGET\2004-



29



7810.99-70 Trash Compactor (10E) 7390.99 - Parking Replacement Reserve XXXX.XX-70 Other (10E) XXXX.XX-XX Project Mgt Fees (.015) 7390.69xxx State Risk Management Ins. (.0034) XXXX.XX-Sci-Quest 7390.00-XX Financial Services Assessment (.0005) SUBTOTAL Design Phase Contingency (5) Inflation Adjustment (7) Constr. Phase Contingency (6) SUBTOTAL TOTALS



2,843 0 0 149,981 28,489 2,487 4,993 262,313 220,560 441,120 363,887 1,025,567 10,000,000



0 0 0 0 0 0



2,843 0 0 149,981 28,489 2,487 4,993 348,210 441,120 363,887



0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00



0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00



2,843.00 0.00 0.00 149,981.00 28,489.00 2,487.00 4,993.00 348,210.00 441,120.00 363,887.00



127,650 0 0



2,400,000



12,400,000



0.00



0.00



12,400,000.00 $12,400,000.00 $0.00



Advantage (APPR Table) Uncommitted Amount as of 06/30/05 Advantage VS PROJECT BUDGET REPORT RECONCILIATION (Advantage less Totals E and F)



Projected total expenses for Arizona Biomedical Collaborative 1 (ABC 1), in partnership with The University of Arizona, are:

PROJECT BUDGET REPORT



PROJECT NAME: AZ Biomedical Collaborative (ABC Building) PROJECT NUMBER: 2004-13011 AREA/ORG: PB6 2404 PM: Vance Linden PROJECT / FILING TYPE: MAJOR A B C A+B Object Code 7880.01-10 LAND ACQUISITION (1) 7880.16-20 New Construction (2A) 7880.11-20 Remodeling Renovation 7880.95-20 Specialized Equip (2C) 7880.06-20 Site Development (2D) 7880.06-20 Parking/Landscaping (2E) 7880.06-20 Utilities Ext. (2F) XXXX.XX-XX State Sales Tax Research Exemption XXXX.XX-20 Directives - Potential SUBTOTAL 7880.21-30 Constr. Manager (3A) 7880.21-30 Architect/Engineer (3B) 7880.21-30 IDC (3C) 7880.21-30 Preprogramming (3C) XXXX.XX-30 Other (Move Mgmt )(3C) SUBTOTAL 7325.XX-40 Furniture, Fixtures & Equipment (4) SUBTOTAL 7330.16-50 Telephone Off-Site 7330.16-50 Telephone Inside 7330.16-50 Equip, Cable, Move-In (Telecom Equip) (8) 7330.16-50 Special Phones/Connections 7330.16-50 Special System Interface SUBTOTAL 0 17,300,000 0 700,000 600,000 500,000 0 0 19,100,000 200,000 2,103,000 0 0 197,000 2,500,000 1,100,000 1,100,000 0 0 0 800,000 0 800,000 0 0 0 0 0 0 0 0 800,000 0 (300,000) 800,000 0 522,350 0 0 (100,000) 200,000 2,625,350 0 0 97,000 0 1,000,000 1,350,000 0 0 0 0 0 0 18,300,000 1,350,000 700,000 600,000 500,000 0 0 Cost Item Appropriated Budget Budget Adjustments Adjusted Budget



DATA DATE: RUN DATE: FILE NAME: AREA/ORG MGR:



06/30/05 07/01/05 Excel: F:\BUDGET\2004-13011pbr.xls Dave Brixen



D Encumbered & Expensed To Date



E (Potential) Costs To Date



F C-D-E Uncommitted Budget



0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00



0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00



0.00 18,300,000.00 1,350,000.00 700,000.00 600,000.00 500,000.00 0.00 0.00



181,280.00 2,741,391.94 0.00 0.00 7.18



0.00 0.00 0.00 0.00 0.00



18,720.00 (116,041.94) 0.00 0.00 96,992.82



2,651.50



0.00



797,348.50



0.00 0.00 0.00 121.14 0.00



0.00 0.00 0.00 0.00 0.00



0.00 0.00 0.00 799,878.86 0.00



30



7310.52-60 Physical Plant SWOs (10E) 7890.21-70 Surveys & Tests (10A) 7390.99-70 Move-In Costs (10B) 7810.65-70 Public Art (10C) 7310.19-70 Adver/Printing (10D) 7310.99-70 Signage (10E) 7310.52-70 Keying (10E) 7310.52-70 Grounds (10E) 7890.11-70 Asbestos (10E) 7810.99-70 Trash Compactor (10E) 7390.99 - Parking Replacement Reserve XXXX.XX-70 Other (10E) XXXX.XX-XX Project Mgt Fees (.015) 7390.69xxx State Risk Management Ins. (.0034) XXXX.XX-Sci-Quest 7390.00-XX Financial Services Assessment (.0005) SUBTOTAL Design Phase Contingency (5) Inflation Adjustment (7) Constr. Phase Contingency (6) SUBTOTAL



0 20,000 90,000 0 10,000 40,000 40,000 0 0 7,734 0 0 408,000 77,500 6,766 0 700,000 800,000 1,200,000 1,000,000 3,000,000



0 0 0 0 0 0 0 0 0 0 0 0 36,000 0 0 14,781



0 20,000 90,000 0 10,000 40,000 40,000 0 0 7,734 0 0 444,000 77,500 6,766 14,781



0.00 0.00 0.00 0.00 583.58 0.00 0.00 0.00 0.00 0.00 0.00 0.00 151,616.58 3,606.55 0.00 213.10



0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 292,383.42 5,714.18 0.00 14,568.39



0.00 20,000.00 90,000.00 0.00 9,416.42 40,000.00 40,000.00 0.00 0.00 7,734.00 0.00 0.00 0.00 68,179.27 6,766.00 0.00



(109,549) 0 (13,582)



690,451 1,200,000 986,418



0.00 0.00 0.00



0.00 0.00 0.00



690,450.51 1,200,000.00 986,418.00



TOTALS



27,200,000



2,400,000



29,600,000



3,081,471.57



312,665.99



26,205,862.44



Advantage (APPR Table) Uncommitted Amount as of



06/30/05



$26,518,528.43 $0.00



Advantage VS PROJECT BUDGET REPORT RECONCILIATION (Advantage less Totals E and F)



Sources of Funds First-year funding For fiscal year 2006, the Legislature has committed to providing as much as $1 million for the Department of Biomedical Informatics as part of SB 1510 (Laws 2005, Chapter 330). ASU has committed an additional $500,000 toward operating expenses. The Arizona Biomedical Collaborative 1 building will be used for research by the UA College of Medicine-Phoenix. Funding for ABC 1 is being provided through HB 2529, the University Research Infrastructure Bill (Laws 2003, Chapter 267). The total amount committed from the research infrastructure funds for this project is anticipated to be $27.2 million. ASU is committing $10 million to cover the shell space, information technology infrastructure, audiovisual equipment, and outfitting of the ABC 1. BMI will occupy approximately 34,000 gross square feet (20,000 net square feet) of space, including some shared space between ASU and UA for utilities, on the first and second floors of ABC 1. External funding from federal agencies Faculty within the Department of Biomedical Informatics will seek individual investigator and multi-disciplinary grants from national funding agencies. Bioinformatics is currently a key focus of the National Institutes of Health's 31



strategic plan, the NIH Roadmap: Accelerating Medical Discoveries to Improve Health. As a result, a number of Institutes at NIH, including the National Library of Medicine, the National Cancer Institute, the National Institute of General Medical Sciences, the National Institute of Biomedical Imaging and Bioengineering, and the National Human Genome Research Institute, are funding research in specific facets of biomedical informatics. Other likely funding sources include the National Science Foundation, Health Resources and Services Administration, Agency for Healthcare Research and Quality, National Aeronautics and Space Administration, Department of Energy, and Department of Defense. In accordance with ASU's aggressive research goals, the Department of Biomedical Informatics expects its researchers to generate in its start-up phase at least $375,000 in FY 2007, $1 million in FY 2008, $2.8 million in FY 2009, and $4.8 million in FY 2010 in research grants and contracts. These numbers are anticipated to grow as the Department of Biomedical Informatics hires new faculty and post-doctoral research scientists, and is able to compete for largescale proposals from major funding agencies. During the first two years of the program, emphasis will be placed on developing the curriculum and recruiting students. Starting in FY 2008, the co-location of the Department with researchers on the Phoenix Biomedical Campus will increase the range of federally sponsored grants for which the BMI faculty are eligible. External funding from private sources The Department of Biomedical Informatics will seek funding from industry partners from established corporations that have a business and strategic interest in biologically- and medically-based informatics systems. These include International Business Machines Corporation, Sun Microsystems, General Electric, Novell, Siemens, Cerner, and Intel. The Department will also explore the possibility of partnerships with local companies such as MediServe. Funding from these sources will be sought for establishing research infrastructure and graduate fellowships. Where appropriate, the Department of Biomedical Informatics will work with its clinical and research partners to leverage existing partnerships and to develop new corporate sponsorships. The Department's clinical partners have a number of existing partnerships that have potential benefit to the program. The Department of Biomedical Informatics and School of Computing and Informatics have a high potential for private support. The Department of Biomedical Informatics expects to secure $2-3 million for inkind gifts, seed funding, joint positions, and clinical space over a period of five years.



32



National foundations The Department of Biomedical Informatics will also explore funding from major foundations such as the W. M. Keck Foundation, Alfred P. Sloan Foundation, and the Robert Wood Johnson Foundation. Our initial analysis demonstrated that each of these organizations is currently funding training programs and projects in the area of biomedical informatics.



33



3. A five-year description of enrollment, growth capacity, and graduation expectations by practice area The University of Arizona The expansion of the UA College of Medicine on the Phoenix Biomedical Campus is expected to begin in July 2007 with a class of 24 students. Because of stringent requirements to meet accreditation standards, the need to develop facilities and infrastructure, the time needed to develop a curriculum, the need to recruit excellent faculty and staff, and much other work, this project is on an extremely fast track. The student number was selected to match the space available with the latest small-group educational teaching models. The second year of the program will see 48 students, two classes, in residence. The renovated historic Phoenix Union High School (PUHS) buildings (COM 1, COM 2, and COM 3) are designed to be ideal for close interaction among students and faculty in groups of eight. However, the renovated historic facilities will not accommodate even a small expansion of this class size. In fact, the teaching of Gross Anatomy will have to be done offsite in Level I of the UA College of Medicine-Phoenix. Admissions The process of selecting applicants to the University of Arizona College of Medicine-Tucson is a holistic one in that many factors are taken into account. Each application includes a personal statement, academic history, Medical College Admissions Test (MCAT) results, relevant experiences, interviews, and letters of recommendations. The Admissions Committee is comprised of eight faculty, four students, and a faculty chairperson. Each application is thoroughly reviewed by a team of three committee members (two faculty, one student) who then rank-order the applicants based on who they believe will make the best physicians for Arizona. Two-thirds of the full committee must support placing an applicant on the accept list. There are no formulas, point systems, or quotas used in the process. Therefore, the final determination of who is qualified is a subjective judgment of the committee. For the purpose of compiling this data, strictly academic criteria (GPA and MCAT scores) were used as the best estimate for who might be considered qualified by the committee. When non-cognitive information is included, up to 50 percent of these applicants would likely be rejected. It is the consensus of the Admissions Committee that we have enough qualified applicants in our current applicant pool of Arizona residents to select an additional 24 students for Level I of the Phoenix Program (please see Table 9). Moving to Level II (up to 150 students per class) will require efforts to increase the size of the qualified applicant pool; however, Arizona's population growth alone should produce additional qualified applicants.



34



Table 9. Numbers of Academically Qualified Applicants Rejected for Admission by The University of Arizona College of Medicine, 2001-2005 Rejected Applicants Who Were Academically Qualified 78 74 68 69 96



Matriculation Year 2001 2002 2003 2004 2005



Applications Considered 445 454 429 449 539



Offers of Acceptance 132 139 157 154 149



Class Size 100 110 110 110 110



Applications Rejected 313 315 272 295 390



The Phoenix Program likely will establish a separate admissions process from that used for the Tucson Program. The Liaison Committee on Medical Education (LCME) allows this as long as the regional admissions committee functions as a subcommittee of the College Admissions Committee. Because 30 to 40 percent of current UA medical students spend their third and fourth years in Phoenix, the College has already established a process for students to declare a preference for Tucson or Phoenix, or both, at the time of their application. Career choice of graduates The UA College of Medicine is focused on training practicing physicians who are well prepared to meet the health care needs of the state. As is the current situation, the large majority of students enrolled in the UA College of MedicinePhoenix will practice clinical medicine. The percentages of students practicing clinical medicine graduating from the UA College of Medicine over the last 10 years are shown in Table 10. On average, 92 percent of graduating students enter the practice of clinical medicine. The selection criteria for the students, and the organization of the training experience, reinforce and encourage this situation. This reflects both the mandate from the state and the desire of the applicant pool.

Table 10. Practice Settings Chosen by The University of Arizona College of Medicine Graduates, 1995-2004 (percentage of graduates)



Practice Settings Clinical Practice Governmen t Academics Industry Other



1995 % 94.6 2.7 2.7 0.0 0.0



1996 % 94.5 3.2 1.2 0.0 1.1



1997 % 95.5 3.4 0.0 0.0 1.1



1998 % 93.6 5.3 1.1 0.0 0.0



1999 % 84.7 12.7 0.0 0.0 2.6



2000 % 92.5 5.3 0.0 0.0 2.2



2001 % 92.7 2.1 2.1 0.0 3.1



2002 % 91.5 6.4 2.1 0.0 0.0



2003 % 87.2 10.5 0.0 0.0 2.3



2004 % 93.2 2.7 0.0 0.0 4.1



35



Demographics of student class The breakdown of the racial and ethnic composition of the UA College of Medicine graduates over the last 10 years is shown in Table 11. Also shown are the national averages for these categories. Significantly, the UA College of Medicine enrolls more than double the national average of Hispanic students.

Table 11. Comparison of The University of Arizona College of Medicine and National Distributions of Racial and Ethnic Composition of Medical Students, 1996-2005 (in percent)



The University of Arizona College of Medicine Averages 1996 NonHispanic White Hispanic African American Asian Native American 77.4 13.7 1.0 5.9 2.0 1997 83.9 7.5 2.2 5.3 .1 1998 73.5 13.7 1.0 7.9 3.9 1999 69.3 14.8 4.5 10.2 1.1 2000 67.3 18.4 1.0 10.2 3.1 2001 71.9 8.7 2.9 16.5 0 2002 71.5 14.7 5.9 5.9 2.0 2003 64.1 16.3 2.2 14.2 3.3 2004 79.1 10.3 0 10.6 0 2005 65.5 11.5 2.3 19.5 1.2



National Averages from AAMC Data Book 1996 NonHispanic White Hispanic African American Asian Unknown Native American 68.9 6.2 6.4 16.0 .5 .6 1997 69.0 6.0 7.0 16.0 .3 .7 1998 66.1 6.5 7.5 17.7 .2 .8 1999 65.7 6.7 7.3 18.7 .1 .8 2000 66.5 6.7 7.1 18.1 .1 .9 2001 65.5 6.0 6.9 19.8 .1 .7 2002 64.7 6.2 7.1 20.0 .1 .9 2003 64.1 6.1 6.6 20.7 .3 .7 2004 64.0 4.5 6.5 20.0 1.4 .6 2005 n/a n/a n/a n/a n/a n/a



Based on the demographics and the health care needs of the population, the mandate for more providers from currently underrepresented minorities, particularly Hispanic/Latino, will become even more pressing. The UA College of Medicine is introducing new mechanisms to increase the percentage of admitted applicants from underrepresented minorities, and, in particular, those from Hispanic/Latino populations. These strategies are applicable to both the Phoenix and Tucson Programs. SB 1517 also appropriated $1.5 million from the General Fund in FY 2006 for loans to medical students in public or private schools of medicine in Arizona "who intend to enter and complete a residency program approved by the Accreditation Council for Graduate Medical Education (ACGME) or by the American 36



Osteopathic Association to become board certified in family practice, general pediatrics, obstetrics and gynecology, general internal medicine, or combined medicine and pediatrics, and who are deemed qualified by the Board of Medical Student Loans to receive such loans. Loans shall be granted upon such terms and conditions as may be imposed by the Board. One of the qualifications shall be Arizona residency....The Board shall give preference to qualified applicants who are unable to pay the expenses of obtaining a medical education and to qualified applicants who demonstrate a commitment to serve in an area listed. . . � � � � A rural and medically underserved area of this state. A medically underserved area of this state. A medically underserved population of this state. Any Indian reservation that is located in this state.



Each applicant who is approved for a loan by the Board may be granted a loan for a period of up to five years." Graduate medical education Graduate medical education (GME) is initiated when students complete medical school and enter residency training. Unlike medical school, in which all students take a similar set of courses and clinical rotations, residencies are specialized and designed to train physicians in their chosen area of specialization. Graduating students from the UA College of Medicine may choose to enter residency training in Arizona, or to go out of state for residency training. Similarly, they may prefer to train in a residency program associated with the UA, or to train in a non-affiliated program. The Residency Review Committee (RRC) for the individual specialty accredits graduate medical education programs individually. The Accreditation Council for Graduate Medical Education (ACGME), the residency equivalent of the LCME, also must accredit the sponsoring institution. Current GME programs in Phoenix are sponsored by the nine area teaching hospitals. These residencies have no direct affiliation with the UA College of Medicine except through joint membership in the statewide Arizona Medical Education Consortium. With the growth of the UA College of Medicine-Phoenix, these associations may become even closer. Graduate students The first five years will see an increase in medical students as outlined by the ACMER Academic Task Force. This period of growth in the number of students will occur in parallel with the increase in basic and clinical sciences graduate students from approximately 50 to more than 400 during a five-year period FY 2008-FY 2012 to support the research at PBC.



37



These students enroll through existing UA graduate programs, including Biochemistry, Cancer Biology, Cell Biology and Anatomy, Immunobiology, and Physiology. The top-tiered medical schools are including Genetics as a requirement, and this will be emphasized as part of the curriculum as it impacts every discipline within medicine. Students will graduate with PhD degrees in their selected areas, with a specialty in medicine. Specialty tracks in medicine within the graduate degree-granting program are a new initiative by the UA Department of Biochemistry, in line with the national initiative to produce highquality, state-of-the-art, translational researchers in Molecular Medicine. The ASU Department of Biomedical Informatics (BMI) further strengthens this effort, with faculty, and their students, recruited in partnership with the Computer Science and Engineering Department, Bioengineering Department, and the School of Life Sciences at ASU (please see BMI business plan at Appendix I). The expansion of the graduate-level education in basic science areas by ASU and UA provides an essential link to medicine and is a key element for the success of the PBC. MD/PhD students In addition to graduate students, some MD/PhD students will train at PBC. Although a small percentage of the medical school class, these students will be among the "leaders of tomorrow" in biomedical research and serve as a tangible bridge between the PhD and MD scientists. The existing UA program will provide oversight of the program and will ensure its success. The Clinical Research Scholar Program also will operate at the PBC, as it does at the Tucson campus. This program provides training for MDs to develop their own research programs. The program is a non-degree certificate program that tailors training to MDs currently in practice who wish to expand their careers to accomplish peer-reviewed and nationally competitive translational research. The program is guided by existing faculty at the UA, as well as scientists at TGen and BNI/St. Joseph's. Arizona State University Projected enrollment and growth capacity Table 12 provides an overview of ASU's projections for enrollment and growth capacity for its Department of Biomedical Informatics (BMI). (Please see pages 8-10 of the BMI business plan in Appendix I for a detailed discussion of ASU's enrollment strategies and plans.)



38



Table 12. Projected Numbers of Arizona State University BMI Majors and Students Receiving BMI Instruction Projected majors and students with focus on BMI Graduate concentrations in BMI (through existing departments at ASU) Masters students Doctoral students Medical students receiving BMI instruction* Undergraduate concentrations Totals Long Term



FY 06



FY 07



FY 08



FY 09



FY 10



FY 11



FY 12



FY 13



10 Faculty hired and new courses developed 34



10 10 24 68



10 15 5 48 102



20 20 10 72 20 166



20 30 15 96 30 191



20 40 20 96 35 211



25 50 25 96 40 236



25 50 25 150* 40 290



*The University of Arizona College of Medicine is planning to apply for Level II status which will allow it to expand the number of students in the Phoenix Program. Level II medical schools typically enroll 110-150 students.



Projected graduation numbers Table 13 provides an overview of ASU's projections for graduation numbers for the Department of Biomedical Informatics.

Table 13. Projected Graduation Numbers for Arizona State University BMI Degrees and Majors Students Graduate concentrations in BMI (through existing departments at ASU) Masters students Doctoral students Undergraduate concentrations (through existing departments at ASU) Totals FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 Long Term



10 10



10 10 20



10 15 25



20 20 5 20 65



20 30 10 30 80



20 40 15 35 110



25 50 25 40 140



In the fall of 2006, it is estimated that 10 graduate students will enroll in BMI concentrations through existing units, such as the Department of Computer Science and Engineering and the School of Life Sciences. Over time, it is anticipated that the interest in BMI concentrations at the graduate level may grow 39



to as many as 25 students per year. It is anticipated that other units on campus, such as the Harrington Department of Bioengineering, may also wish to offer graduate concentrations in biomedical informatics in conjunction with the Department of Biomedical Informatics. When the Master of Science degree in Biomedical Informatics is launched in the fall of 2007, an enrollment of at least 10 master's students is projected. When the Doctor of Philosophy program is launched in the fall of 2008, an enrollment of at least 5 doctoral students is projected. It is expected that enrollment in the masters and doctoral programs will grow steadily as the Department hires new faculty and gains prominence. The Department of Biomedical Informatics will also offer biomedical informatics instruction to medical students at the UA College of Medicine starting in the fall of 2007. The Department expects to offer one informatics literacy course per year for each of the four years of medical school. The University of Arizona predicts the medical college will enroll 24 students per class. In the fall of 2009, the Department expects to add undergraduate concentrations in biomedical informatics. It anticipates that approximately 20 undergraduates from across the university will participate in the concentration the first year. This number is expected to grow to about 40 undergraduate students over the longterm. After the master's and doctoral degrees are launched, the Department will consider offering other programs such as combined degrees with the medical and nursing colleges, executive and continuing education, and perhaps an undergraduate degree-granting program. Based on early discussions with community clinicians and local health care providers, there is great interest in executive and continuing education courses in biomedical informatics. Ultimately, the Department of Biomedical Informatics expects graduate enrollment of between 75 students in the master's and doctoral programs, 25 graduate students in the BMI concentrations, 40 undergraduate students in the BMI concentrations, and 150 medical students receiving informatics instruction. The numbers are comparable with other BMI programs around the country. The Department of Biomedical Informatics will recruit exceptional students with strong backgrounds in the computing and information sciences (mathematics, electrical engineering, computer engineering, bioengineering) or the relevant application domains (clinical, basic biological sciences, public health, etc). The American College of Medical Informatics recently conducted a broad-based study of informatics programs in which it found that trainees with strong informational and computer science backgrounds offer perspectives that are complementary to those of trainees with strong biological and medical domain backgrounds. It is expected that in the year the BMI graduate program is launched, some of the students in BMI concentrations will transfer directly into master's and doctoral 40



degree-programs. It is also expected that some students graduating from the professional master's program in Computational Biology at ASU may also wish to enroll in the BMI doctoral program. In order to attract the best and the brightest students in this competitive environment, it will be necessary for the Department of Biomedical Informatics to devote a great deal of time and energy into recruitment, especially during the early years of the program. The Department plans to host at least one open house at ASU, and invite and host a number of prospective candidates to visit ASU and meet with faculty. As an enticement to attend the BMI program, especially during the first several years of operation, the Department will need to offer as many graduate research assistant positions as possible, as well as summer fellowships. The first class of master's students is expected to graduate in the spring of 2010, and the first class of doctoral students is expected to graduate in the spring of 2012 at the earliest. Students enrolling in graduate and undergraduate concentrations will graduate in accordance with their departments' schedules.



41



4. A 20-year financing plan detailing each funding source, including options to maximize resources and partnerships with the Maricopa County Special Health Care District and other health care entities. Funding sources may include federal grant monies, private donations, and contributions from other public entities The University of Arizona 20-Year Operational Budget Our response to this request required us to prepare the budget projections presented in Table 14 (FY 2011-FY 2015) and Table 15 (FY 2025). A discussion of these projections is warranted prior to a discussion of funding source options. A class size of 150 students ultimately could matriculate in the UA College of Medicine-Phoenix, resulting in a total class size of 260 for the combined UA College of Medicine Tucson and Phoenix Programs. This would make class size at The University of Arizona College of Medicine among the nation's largest medical school classes. To expand the size of the PBC class to 150 students, however, a substantial increase will be needed in faculty size over the next 10-20 years. Faculty will be needed in both the basic sciences and in the clinical sciences. Extrapolating from the faculty size of the Tucson program, and from peer institutions around the country, a full faculty of 120-150 basic scientists and 350-400 clinician scientists is a reasonable estimate of faculty size at full build-out in FY 2015. Several countervailing factors drive these numbers. Medical education is becoming increasingly faculty intensive, given the mandate for smaller cohorts of learning and simultaneous participation of basic scientists and clinicians in those groups. This requires more faculty and more faculty time. On the other hand, a mandate exists for more self-learning, use of digital curricula, web-based modules, teleconferencing, and other modalities to decrease faculty time demands. Nevertheless, faculty sizes at academic health centers have expanded dramatically in the last decade, largely based on the demands of the research mission. This, in turn, is being driven by the importance of team-based research. Therefore, the most reasonable plan is to suggest that the size of the faculty at full build-out should be similar to the Tucson program, but that these faculty will be located at a variety of institutions and organizations in Maricopa County. In other words, the model for growth will be more collaborative than currently is the case for expansion efforts at most academic health centers nationally. Just as is the case for students, a mandate exists for recruiting, supporting, and retaining faculty from underrepresented minorities. Currently, 18 percent of UA 42



College of Medicine faculty are non-white, including 9 percent Asian/Pacific Islander, 6 percent Hispanic/Latino, 2 percent African American, and 1 percent Native American and Alaskan. Expanding representation from the latter groups is a challenging task and requires aggressive and bold approaches. Table 2 and Table 4 illustrate the projected growth of the UA College of Medicine-Phoenix over the next 20 years. The students and faculty listed are from all constituencies, including, but not limited to, UA, ASU, TGen, Carl T. Hayden Veterans Affairs Health Care System (CTHVAHCS), NIDDK, and affiliated hospitals. The economies of scale and scope provided by the synergies between these organizations are reflected in the limited amount of state support requested for an enterprise of such magnitude. A summary of expenses for the UA College of Medicine-Phoenix for the period FY 2011-FY 2015 is shown in Table 14. A detailed breakdown of projected expenditures for years FY 2011-FY 2015 is shown in Appendix J. These tables illustrate the financial organization of the expanding College for the second fiveyear period. The College projects continued growth in student, faculty, and staff size over the second decade, as illustrated. Accordingly, Table 15 illustrates a summary of projected expenses after the second decade of operation, beginning in FY 2025. Appendix K provides a detailed breakdown of projected expenses in FY 2025.



43



Table 14. The University of Arizona College of Medicine-Phoenix FY 2011-FY 2015 Summary Budget

Revised 7-12-05 FY 2011 Tot al FTE EDUCATI ON Adm i ni stra ti on Dean of Ac ademic Affairs A s s oc iat e and As s is t ant Deans A dmis s ion/A c ademic / Financ ial Support A dmin Ass is t ant and Associates/Reception B us ines s Affairs / Development / Fac ilit ies S pec ial As s is t ant to the Dean Mi nori ty Affa i rs Direc t or S t udent Rec ruit ers A dminis t rat ive Assistant Ba si c Scie nce Faculty Yr 1 & Yr 2 Students P hD Facult y MD Faculty Educ ational Consultants MD, part time Adminis t rative Assistant Re se a rch Faculty P hD Facult y MD Faculty Res earc h St aff A dmin Staff Fa cul ty 3rd & 4th Year Clinical Education MD Faculty -Tec hing MD Faculty Teaching & Research Res earc h St aff A dmin Staff I nforma ti on/Me di a Technology Media Support Medic al Comput ing Gross Ana ta m y Lab S t aff P re -Cl i ni ca l Training MD Faculty -Direc t or A s s t Dir A dmin. Assis t ant Me di ca l Libra ry Librarian Library Support Staff Comput er S t aff Me di ca l Bookstore Offic e Staff S ha re d Support Facilities Offic e staff Tota l Personne l (including ERE) OPERATI ONS Operat ions Leas e Cos t s Building Operat ions and Maintenance Hos pit al Arrangement s Fac ult y Start Up Tra ve l Ca pi ta l Comput er S y s t ems (inc software) IT Infrastruc t ure Furnis hings Offic e Machines TOTAL 809. 0 149, 500 745, 082 149, 500 745, 082 37, 700 (4, 661, 318) 183, 300 187, 536 183, 300 193, 307 33, 800 (551, 775) 149, 500 440, 875 149, 500 440, 875 (33, 800) 247, 568 248, 300 158, 123 248, 300 158, 123 98, 800 (282, 752) 248, 300 1, 316, 487 248, 300 1, 316, 487 0 1, 158,364 37, 700 (4, 661, 318) 33, 800 (551, 775) (33, 800) 247, 568 98, 800 (282, 752) 0 1, 158, 364 809. 0 0. 0 72, 953, 559 16, 333, 200 15, 817, 278 4, 438, 140 2, 691, 675 (418, 057) 1, 005. 0 0. 0 92,311, 755 18,163, 671 19,615, 515 4, 107, 878 3, 798, 237 (330, 262) 1, 192. 0 0. 0 101, 386, 574 18, 442, 300 21, 051, 257 4, 233, 368 1, 435, 742 125, 490 1, 381. 0 0. 0 127, 158, 113 20, 035, 300 22, 055, 540 3, 563, 037 1, 004, 283 (670, 331) 1, 594. 0 0. 0 145, 913, 805 21, 406, 900 29, 400, 705 2, 634, 508 7, 345,165 (928, 529) 2, 691,675 (418, 057) 3, 798, 237 (330, 262) 1, 435, 742 125, 490 1, 004, 283 (670, 331) 7, 345, 165 (928, 529) $2, 017, 627 1. 0 6. 0 3. 0 10. 0 7. 0 3. 0 412, 132 2. 0 4. 0 1. 0 4,913, 580 26. 0 7. 0 11. 0 18,973,560 42. 0 21. 0 95. 0 63. 0 44, 796, 260 58. 0 58. 0 348. 0 21. 0 737, 600 4. 0 4. 0 2. 0 145, 320 145, 320 0 655, 245 0 4. 0 4. 0 2. 0 145, 320 145, 320 0 3, 202, 050 569, 322 72. 0 72. 0 432. 0 24. 0 737, 600 655, 245 0 4. 0 4. 0 2. 0 145, 320 145, 320 0 5, 739, 600 1, 443, 890 56. 0 28. 0 125. 0 84. 0 55,367, 874 4, 397, 380 1, 195, 330 86. 0 86. 0 516. 0 30. 0 737, 600 655, 245 0 4. 0 4. 0 2. 0 145, 320 145, 320 0 4, 913, 580 380, 100 28. 0 7. 0 11. 0 26,635, 940 8, 387, 470 2, 647, 870 69. 0 33. 0 155. 0 102. 0 58, 334, 154 4, 787, 532 390, 152 100. 0 100. 0 600. 0 35. 0 737, 600 655, 245 0 4. 0 4. 0 2. 0 145, 320 145, 320 0 0 0 0 0 0 0 0 2. 0 4. 0 1. 0 5, 166, 980 5, 166, 980 253, 400 30. 0 7. 0 12. 0 32, 561, 400 9, 153, 100 765, 630 83. 0 40. 0 185. 0 120. 0 77, 068, 734 3, 162, 034 (1, 625, 498) 115. 0 115. 0 690. 0 53. 0 737, 600 655, 245 0 0 0 0 0 0 $298, 363 $298, 363 1. 0 9. 0 3. 0 12. 0 9. 0 3. 0 412, 132 0 0 2. 0 4. 0 1. 0 5, 446, 940 5, 446, 940 279, 960 30. 0 8. 0 14. 0 39, 312, 260 11, 258, 710 2, 105, 610 96. 0 48. 0 216. 0 130. 0 89, 070, 306 8, 172, 489 5, 010,455 569, 322 1, 195, 330 390, 152 (1, 625, 498) 5, 010, 455 $2,888, 429 ($298, 363) 1. 0 9. 0 3. 0 12. 0 9. 0 3. 0 412, 132 0 0 2. 0 4. 0 1. 0 5, 733, 140 5, 733, 140 286, 200 34. 0 7. 0 24. 0 45, 070, 248 12, 890, 720 1, 632,010 1, 443,890 2, 647, 870 765, 630 2, 105, 610 1, 632, 010 $2, 791, 548 $0 1. 0 9. 0 3. 0 12. 0 9. 0 3. 0 412, 132 0 0 2. 0 4. 0 1. 0 6, 673, 811 6, 673, 811 940, 671 380, 100 253, 400 279, 960 286, 200 940, 671 $2, 791, 447 $237, 971 $237, 971 1. 0 9. 0 3. 0 12. 0 9. 0 3. 0 412, 132 0 0 0 0 0 0 0 $2, 846, 908 ($237,971) $298,363 ($298, 363) $0 $237, 971 ($237, 971) Budget Annua l Sta te Budget Ne w State Re que st FTE Tot al B udget FY 2012 Annua l Sta te Budget Ne w State Re que st FTE Tot al B udget



Table 14.

New State Requests FY 2011-FY 2015



Proposed Budget FY 2011-FY 2015 - All Level II

FY 2013 Annua l Sta te Budget Ne w State Re que st FTE Tot al B udget FY 2014 Annua l Sta te Budget Ne w State Re que st FTE Tot al Budget FY 2015 Annua l S ta te Budget Ne w State Re que st LEVEL II Ne w State FY 2011



LEVEL II Ne w State FY 2012



LEVEL II Ne w State FY 2013



LEVEL II Ne w State FY 2014



LEVEL II Ne w State FY 2015 Ne w State TOTAL



$0



0



2, 140, 331



8, 595, 010



5, 539, 761



0



0



466, 560 2. 0 2. 0



466, 560



0 2. 0 2. 0



466, 560



466, 560



0 2. 0 2. 0



466, 560



466, 560



0 2. 0 2. 0



466, 560



466, 560



0 2. 0 2. 0



466, 560



466, 560



0



0



0



0



0



0



0



396, 560 3. 0 2. 0 1. 0 94, 360 2. 0



396, 560



0 3. 0 2. 0 1. 0



396, 560



396, 560



0 3. 0 2. 0 1. 0



396, 560



396, 560



0 3. 0 2. 0 1. 0



396, 560



396, 560



0 3. 0 2. 0 1. 0



396, 560



396, 560



0



0



0



0



0



0



0



0



0 2. 0



94, 360



0



0 2. 0



94, 360



0



0 2. 0



94, 360



0



0 2. 0



94, 360



0



0



0



0



0



0



0



0



16, 275, 102 (2, 221, 689)



136, 500 (4, 089, 913)



$90, 181, 341



$21, 150, 000



($2, 350, 000)



1, 005. 0



$110, 846, 262



$24, 100, 000



$2, 950, 000



1, 192. 0



$120, 419, 249



$25, 875, 000



$1, 775, 000



1, 381. 0



$147, 599, 836



$26, 025, 000



$150, 000



1, 594. 0



$168, 885, 492



$33, 600, 000



$7, 575, 000



($2, 350,000)



$2, 950, 000



$1, 775, 000



$150, 000



$7, 575, 000



$10, 100, 000



44



Table 15. Budget



The University of Arizona College of Medicine-Phoenix FY 2025 Summary



7/15/05



Proposed Budget FY 2025 Level II

FTE Proposed Budget Annual State Budget State Budget FY 2015 New State Request



EDUCATION Administration Dean of Academic Affairs Associate and Assistant Deans Admission/Academic/Financial Support Admin Assistant and Associates/Reception Business Affairs/Development/Facilities Special Assistant to the Dean Minority Affairs Director Student Recruiters Administrative Assistant Basic Science Faculty Yr 1 & Yr 2 Students PhD Faculty MD Faculty Educational Consultants MD, part time Administrative Assistant Research Faculty PhD Faculty MD Faculty Research Staff Admin Staff Faculty 3rd & 4th Year Clinical Education MD Faculty-Teaching MD Faculty Teaching & Research Research Staff Admin Staff Information/Media Technology Media Support Medical Computing Gross Anatomy Lab Staff Pre-Clinical Training MD Faculty-Director Asst Dir Admin. Assistant Medical Library Librarian Library Support Staff Computer Staff Medical Bookstore Office Staff Shared Support Facilities Office staff Total Personnel (inc ere) OPERATIONS Operations Lease Costs Building Operations and Maintenance Hospital Arrangements Faculty Start Up Travel Capital Computer Systems (inc software) IT Infrastructure Furnishings Office Machines TOTAL 248,300 2,857,842 248,300 2,857,842 248,300 1,316,487 0 1,541,355 2,614.0 0.0 189,936,769 25,496,300 39,325,858 2,568,000 29,400,705 2,634,506 9,925,153 (66,506) $2,846,908 1.0 6.0 3.0 11.0 7.0 3.0 412,132 2.0 4.0 1.0 6,673,811 34.0 8.0 24.0 67,969,342 153.0 77.0 345.0 705.0 110,194,176 140.0 140.0 875.0 53.0 737,600 4.0 4.0 2.0 145,320 145,320 145,320 0 655,245 655,245 0 9,487,371 8,172,489 1,314,882 21,500,991 12,880,720 8,620,271 4,913,580 6,673,811 (1,760,231) 0 0 0 $0 $0 $0



466,560 2.0 2.0



466,560



466,560



0



396,560 3.0 2.0 1.0 94,360 2.0



396,560



396,560



0



0



0



0



2,614.0 $218,539,211



$45,000,000



$33,600,000 $11,400,000



45



Sources of Funds The Association of American Medical Colleges (AAMC) financial model for medical schools discussed earlier will provide a context for the following discussion of possible funding sources for the UA College of Medicine-Phoenix. State funds Based on the same assumptions used to determine state funding requirements through FY 2015, total state funding at full build-out in FY 2025 would approach $45 million in FY 2005 dollars, an estimated 20 percent of the estimated $220 million total budget required in FY 2025. While this funding requirement is similar to that for the current Tucson Program, there is a critically important distinction. The Phoenix Program will train 39 percent more medical students, and employ, at a minimum, 44 percent more basic science faculty engaged in medical student teaching, than are currently engaged for the Tucson Program. The number of clinical faculty employed in medical student teaching in Phoenix is expected to increase by an even greater percentage in comparison to the Tucson Program. These are direct reflections of the economies of scale and scope which are operative from the outset, and will continue through full build-out and beyond. Tuition Tuition costs nationally are increasing at an average of nearly 7 percent per year for colleges of medicine, far in excess of the cost of living. Such increases are unlikely to be sustainable over a 20-year period. Therefore, UA College of Medicine officials have projected increases at a more conservative 5 percent per year (please see Table 5). Sponsored research grants and contracts Both the UA and ASU are Research-Extensive (Carnegie classification) universities and are recognized as national leaders in the advancement of science. The UA College of Medicine currently ranks 3rd among researchintensive medical schools (the terminology used to refer to the top 20 recipients of NIH funding) with faculty of fewer than 600, and is ranked 55th overall in research funding. ASU is expanding its research in many ways, a prime example of which is the creation of The Biodesign Institute at Arizona State University, the new hub for ASU's biomedical and biotechnology portfolio that cuts across disciplines to directly improve the human condition. The Biodesign Institute combines expertise in life sciences, materials research, computer science, and manufacturing. Rather than being an isolated "ivory tower," The Biodesign Institute is intended to catalyze research across the institution and across metropolitan Phoenix. The UA College of Medicine-Phoenix is particularl