Jan. 11, 2002 1. Committee on athletics to hold public forums 2. U prepares for budget reduction 3. Commentary: "Is the Public Research University Dead?" 4. Alumni giving increases 8 percent 5. U student wins advertising award Past Issues 6. U recognized by National Wildlife Federation 7. New dean named for Carlson School Dec. 13, 2001 8. Rochester to offer MBA classes Nov. 29, 2001 9. 'Tiger' scientists stalk elusive origin of cosmic rays Nov. 8, 2001 10. U of M happenings Oct. 26, 2001 11. Links Oct.11, 2001 Sept. 27, 2001 U IN THE NEWS Current Issue COMMITTEE ON ATHLETICS TO HOLD PUBLIC FORUMS The University of Minnesota Board of Regents Ad Hoc Committee on Athletics will hold public forums on Jan. 28 and 29 to hear views on strategies to address the financial challenges facing intercollegiate athletics on the Twin Cities campus. "While intercollegiate athletics are a valued part of our university community, the department is facing significant budget challenges that will require difficult decisions," said Regent David Metzen, committee chair. "We encourage public comment--what do people value at the University and in our athletics program, and how would they like to see us reduce costs and/or increase athletics revenues? The comments we receive will help shape the University's response to this financial challenge." The committee was formed in December following the release of a report, "Current and Future Financial Challenges in Intercollegiate Athletics," which projects a $31 million deficit in the department over the next five years. Other members of the committee include Regents Lakeesha Ransom and Jean Keffeler. The forums will be held at 11:30 a.m. Monday, Jan. 28, and 4:30 p.m. Tuesday, Jan. 29. Both forums will be held on the Twin Cities campus in Suite 600, McNamara Alumni Center, 200 Oak St. S.E., Minneapolis. Individuals wishing to speak at the forum must sign up by noon, Jan. 24 by calling the board office at 612-625-6300 or writing to: Board of Regents, McNamara Alumni Center, Suite 600, 200 Oak St. S.E., Minneapolis, MN 55455. Written requests must include the speaker's name, any organizations he or she will be representing, and the speaker's relationship to the University. Individual speakers will be limited to five minutes; organizations to 10 minutes. The athletics financing report can be found online at www.unews.umn.edu. Board of Regents meeting agendas can be found at www.umn.edu/regents. Return to top U PREPARES FOR BUDGET REDUCTION Thursday, Jan. 10, Gov. Jesse Ventura proposed to balance the state's 2002-03 budget through a combination of spending cuts, tax increases, funds from budget reserves, and one-time actions. Of the proposed $700 million in spending cuts, $71 million are from higher education, including $33 million from the University of Minnesota for FY2003. President Mark Yudof complimented the governor’s approach and outlined how the governor’s proposal might affect the University. "Budget cuts are always difficult, but we agree with the governor that a balanced approach is the best way to manage the situation." Yudof said the University will work to manage any budget cuts in ways that allow it to provide the best possible education for students while maintaining its academic priorities. "We will employ a strategy to balance our budget using resource reallocation, cost reductions, and expense deferral. Tuition increases will be considered only as a last resort." But he also emphasized how important it is for the University to sustain its current momentum. "This is an exciting time for the University of Minnesota; by almost any measure, we are on the move. Budget cuts always represent a challenge to the progress we’ve made," he concluded. Return to top IS THE PUBLIC RESEARCH UNIVERSITY DEAD? This commentary by President Yudof will be published in the Jan. 11 issue of the Chronicle of Higher Education, a national newspaper. Public colleges and universities have raised tuition this year at the highest rates in eight years, according to "The 21st the most recent annual College Board survey -- century will see ratcheting up fees by an average of 7.7 percent, or the evolution of more than twice the rate of inflation. Most observers a hybrid public point to the faltering economy as the major reason for research the increases, as public institutions have sought to university, one offset drops in state support. More recently, the attacks with roots in of September 11 have compounded pre-existing both the public economic difficulties. and private spheres." Indeed, the National Conference of State Legislatures —U of M has reported that 43 states are experiencing revenue president shortfalls and more than half are considering budget Mark Yudof cuts. And at least nine governors have warned universities to expect midyear rescissions in their state appropriations. For public research universities, those developments represent only the deepening of a long-term and structural trend toward relatively less state support. Even in the past few years, when state budgets were expanding, public research universities made little headway against the legacy of previous lean years. Thus, regardless of the economy, in the foreseeable future, students at public research universities will have to pay more of their own educational costs, and the role of such institutions will fundamentally change. More than a century ago, state governments and public research universities developed an extraordinary compact. In return for financial support from taxpayers, universities agreed to keep tuition low and provide access for students from a broad range of economic backgrounds, train graduate and professional students, promote arts and culture, help solve problems in the community, and perform groundbreaking research. Yet over the past 25 years, that agreement has withered, leaving public research institutions in a purgatory of insufficient resources and declining competitiveness. The gap between professors' salaries at public and private universities, for example, has grown from $1,400 in 1980 to $22,100 today. As a result, public institutions find it increasingly difficult to compete for the best faculty members who, in turn, attract the brightest students and significant research dollars. Demographic changes lie at the heart of public research universities' predicament. Over the past 40 years, the proportion of American family households with children has declined from almost one-half to one- third. The country's aging population appears more interested in issues like health care and public safety than higher education. While higher education's share of average state spending fell 14 percent from 1986 to 1996, Medicaid's share nearly doubled. The funds allocated to correctional facilities grew by more than 25 percent. Observers may note that, over the past 25 years, state support for higher education has generally kept up with inflation, as measured by the consumer price index. But public research universities are extraordinarily labor- and technology-intensive enterprises; to attract top talent and stay on the cutting edge, they must invest and spend significantly more than the inflation rate. Meanwhile, as state support for higher education has declined relative to other public services, the value of education to students has increased substantially. After adjusting for inflation, a male college graduate today makes an average of $32,000 more each year than a high-school graduate, compared with a $15,000 gap in 1975. Over a lifetime, a person with a bachelor's degree will earn an average of $1 million more than a high-school graduate; a professional degree widens the differential to $3 million. With the wage premium rising, education is increasingly seen as a private, rather than a public, good. Given that reality, both federal and state policy makers are asking students to shoulder a larger share of their higher education expenses. Already students at public research universities are paying more; at the University of Minnesota, for example, their tuition covers nearly two- thirds of the direct cost of instruction, compared with the one-third that their peers paid 25 years ago. In the same vein, elected officials prefer market accountability -- with institutions competing with each other for students -- rather than traditional public oversight to ensure quality. And rather than provide operational support to universities, they encourage universities to charge higher tuition, then favor giving direct aid to students in the form of scholarships and tax benefits to help make that tuition affordable. As state support erodes, flagship research universities face other challenges. Many local businesses now operate more globally and are less oriented toward state or regional concerns. In addition, businesses are creating their own educational programs, such as Motorola University or Dell University, to focus on specific work-force needs. Moreover, increased enrollment in higher education over the past 30 years, and the growth of regional universities within states to meet that demand, has further diluted state support. Although such institutions often have limited research capacities, their emergence has sharpened competition for state dollars. Where will such trends lead? The 21st century will see the evolution of a hybrid public research university, one with roots in both the public and private spheres. That new hybrid will confront significant new challenges. The first will be to convince the public and decision makers -- governors, legislators, and regents -- that tuition must increase significantly to keep public research universities viable and competitive with private research universities. Raising tuition further will be anathema to many students, who are already paying a larger part of their instruction costs. University advocates will have to demonstrate that it is "worth it" -- to their regional economy and society, as well as to students -- to charge more in order to support a high-quality research institution.