IS&T Adjusts Phone and Net Charges

CORRECTION TO THIS ARTICLE: An article on April 27 incorrrectly cited the annual cost of each telephone at MIT as $200. Phones at MIT range from from $240 per year to $438 per year, and most office phones are digital phones that cost $390 per year. These fees will go away as part of the restructuring in July 2007, when they will be replaced with a fixed per-employee charge.

Offices at MIT currently pay Information Services & Technology about $200 a year for each telephone or computer network address. Starting this July, these fees will be eliminated in favor of a charge to departments based on number of employees. Offices will be able to add more phone lines and computers without increasing their monthly costs.

An IS&T estimate based on head count data from October 2006 suggested a fee of $1310 per employee.

This change means that telephony and networking at MIT will be treated similarly to electricity and water at MIT; there will still be one-time charges to add phones or network jacks (just like electrical outlets), but no recurring monthly charges for them.

It will no longer cost more in network fees to have several computers instead of one. An office with a digital phone and a fax machine will no longer pay more than an office with a single analog phone line.

For student groups, the change may present somewhat of a windfall. Groups will no longer be billed by IS&T, but their accounts technically fall under Division of Student Life, which will pay the employee fee. It is as of yet uncertain whether DSL may choose to pass on some of its cost to student groups.

Details of the change

IS&T proposed this change in late 2005, and it has now been approved for implementation in the 2008 fiscal year, which begins July 2007.

Angie Milonas, director of finance for IS&T, said that the final numbers for the departmental charges have not yet been set: IS&T will be using staff head counts from October 2007 to calculate the per-employee fees. The $1310 per-employee figure was calculated from IS&T’s cost estimate of $15.1 million, based on 11,500 Institute employees as of October 2006.

Milonas said the first charge will be delayed until December or January, and will cover the intervening months from July, and that the charges will be monthly thereafter. IS&T will send “invoices” to departments in November, in order to allow them to confirm the details of the charges in advance, Milonas said.

Some parts of MIT may end up paying more or less than they do now. Margaret A. Warner, director of the Office of Budget Operations, said that the Budget Office will look at the charges at the School level to determine how to minimize any adverse impact of the change in accounting. “Our goal is to not have any adverse dislocations,” Warner said.

Effect on student groups

Student groups’ MIT accounts are technically part of the Division of Student Life, so their phones and network will be covered by the DSL’s employee head count -based fee. It is conceivable that DSL might choose to pass some of those costs on to student groups.

According to Peter D. Cummings, DSL’s director of financial planning, DSL has not yet determined the impact of the changes on DSL’s budget, and does not yet know “whether an imbalance exists that will warrant special consideration.”

Cummings indicated that he did not expect to have these details clarified before late May. He said that “this change makes sense and will be positive for DSL,” and that it “will significantly decrease” tracking of expenses and accounts.

Milonas said that DSL is likely to pay less under the new system than the old, and that the Budget Office will not reduce DSL’s budget in response.

It seems probable, then, that student groups will indeed receive this windfall. Current Association of Student Activities Treasurer James R. Peacock IV ’08 and incoming ASA Treasurer Shan Wu G both indicated that they thought such an outcome would be positive, and that student groups would appreciate the removal of the burden of these fees.

Peacock said that the question of recurring network and phone charges has been an issue for the Undergraduate Association Finance Board in the past, and that Finboard would welcome the elimination of those charges.

There are about 50 student group telephones at the Institute; in aggregate, student groups pay in the neighborhood of $15,000 a year for telephony, according to the MIT Data Warehouse.