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Report to the Legislature 2003

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Report to the Legislature 2003 REPORT to the LEGISLATURE 2002-2003 December 15, 2003 President of the Senate and Speaker of the House of Representatives: On behalf of the University of Alaska Board of Regents, I am submitting the University’s Report to the Legislature for the fiscal period beginning July 1, 2002 and ending June 30, 2003. The Board of Regents expresses appreciation to the Alaska Legislature, the Governor, and the people of Alaska for their interest in and continuing support of the University of Alaska. Sincerely, Mark R. Hamilton President Mark R. Hamilton, President 202 Butrovich Building P.O. Box 755000 Fairbanks, alaska 99775-5000 PHONE: (907) 474-7311 FAX: (907) 474-6342 email: [email protected] Board of Regents Brian Rogers, Chair (1995-2003) Elsa Froehlich Demeksa, Vice Chair (1997-2005) Frances H. Rose, Secretary (1999-2007) Joe Usibelli, Jr., Treasurer (1999-2007) Michael J. Burns (1997-2005) James Hayes (2003-2011) Cynthia Henry (2003-2011) Mary K. Hughes (2009-2009) Kevin O. Meyers (2000-2007) David J. Parks (2002-2005) Michael Snowden (2003-2009) University of Alaska Statewide Administration Mark Hamilton President Wendy Redman Vice President for University Relations Joe Beedle Vice President for Finance Craig Dorman Vice President for Research James Parrish General Counsel University of Alaska Campus Administrators Edward Lee Gorsuch Marshall Lind John Pugh Chancellor Chancellor Chancellor University of Alaska Anchorage University of Alaska Fairbanks University of Alaska Southeast ���������������� ����������������������� ��� ������������������������� �������������������� �������������� ���������������� ��� ������������� ���������������� ������������ ������������������ �������������������� ���������������� ����������������� ������������������������� �������������� ����������������������� ����������������� �������������������������� ��� ���������������� University of Alaska Statewide System University of Alaska Anchorage University of Alaska Fairbanks University of Alaska Southeast Table of Contents Statewide System 8 University of Alaska Anchorage 16 University of Alaska Fairbanks 30 University of Alaska Southeast 45 Performance Measures 54 Land-Grant Endowment Trust Funds 62 Notes to the Financial Schedules 64 Schedule of Allocated Natural Resources Fund Balances 66 Tables 69 One - Actions Regarding Certificate and Degree Programs 70 Two - Capital Projects Completed in FY03 71 Three - Capital Projects Started in FY03 75 Four- Capital Appropriations 80 Five -Degrees Awarded by Level and Campus 81 Six - Student Headcount by Campus 82 Seven - Student Credit Hours by Campus 83 8 University of Alaska System Office of the President At the commencement of the 2003 legislative session, the issue of a “fiscal gap” was the state’s main on-going public policy issue. With over 75% of Alaska’s general fund dependent on revenues from the declining oil fields and no additional broad-based revenue measures in place (sales or income tax), the fiscal gap was over $600 million as the legislature began its work in January. The Board of Regents requested an FY04 operating budget increase of $15.8 million over FY03 funding. Governor Murkowski campaigned on a 5% increase for the university operating budget, stating publicly, “…as has been shown across the nation, a vibrant university system can be the vehicle for economic growth, development and change. If you have a failing state university system, you have a failing state”. As promised, the governor included a 5% increase for the university in his budget request and remained a strong advocate throughout the legislative session. The overall state budget was held steady this year, and the university’s actual increase was exceptional; the only other program increases were for formula programs in health and K-12 education. In the end, the university received $4.5 million (2%) in new general funds and $2.3 million in general fund replacement monies. On the capital side, the legislature only approved receipt authority for a few university projects and $3.4 million for highest safety priority pieces for the FY04 budget. The prior year’s bonding and debt-reimbursement package covered over $82 million in university projects. The dynamics in the Alaska State Legislature changed in the 23rd Legislature. Sixteen new house members (out of 40) and eight new Senate members (out of 20, five of which came over from the House) make up the new body. The Republicans retain the majority, and all leadership positions in both House and Senate. A new House Ways and Means Committee was formed to address the overriding fiscal questions. The majority concentrated on the key issues of streamlining the permit process, encouraging oil producers to continue pumping more oil and making Alaska more attractive to new exploration and resource development to revitalizing Alaska’s position as a resource-based economy. The Constitutional Budget Reserve (CBR) account had a balance of approximately $2.2 billion at the beginning of 2003, which, if used judiciously and coupled with new revenue measures, will last through the next election cycle. The governor was clear in his admonition to the legislature that he would veto expenditures down to a point where less than $400 million would be taken from the CBR. No agreement on additional revenue measures was passed this session, nor could the legislature make reductions at the level the governor desired. As a result, the governor exercised his veto power to make nearly $150 million in reductions to the budget, and maintained the CBR draw at $378 million for FY04. The Board of Regents is authorized by law to set tuition rates for the university. The regents’ policy on tuition and fees was amended at the June 2002 board meeting to allow for an increase in tuition of 10%. 2002-03 tuition rates increased by higher education inflation plus 10%. 9 Legislation allowing for forgiveness of student loans for teachers and nurses was passed, along with a housing loan bill to allow for 100% financing for teachers and registered nurses practicing in Alaska. The UA Scholars Program continues to attract Alaska’s best and brightest high school seniors. Initiated in FY00 by the university using funds generated by its land grant endowment, this scholarship provides $11,000 per year for a total of 4 years to the top 10% of every Alaska high school graduating class. During its first year of operation, the program enticed over 30% of the top Alaska high school graduates to attend the University of Alaska. Now in its fourth year, more than 50% of the state’s top high school graduates are expected to enroll at UA campuses. As of Spring 2003, 1016 UA Scholars are enrolled at the university. No legislation or appropriation was solicited from the legislature this past session to assist in funding this program, although the governor envisions a future state resource revenue to pay for this program. (See: www.alaska.edu/scholars) The university has been working with the state Department of Education & Early Development to enhance teacher education programs, and revising its teacher education programs to include a 5th year MAT that will require teachers to obtain a discipline based BA and a 5th year intensive in-school internship with a master teacher. Many partnerships have been established between the high schools and their local college campuses, including a joint vocational/technical high school in Fairbanks, the “College Connection” program, financed by the City of Juneau, which pays the full cost of college tuition for advanced placement students who take college courses, and collaborations in several communities allow high school students to gain up to one year of post-secondary vocational training while they complete their high school curriculum. In addition, the university is working closely with local schools to develop programs in all areas of the K-12 system to include advance placement courses for high school students for joint high school-college credit, job training programs and vocational education opportunities. Summer programs are also being offered to high school students in areas of finance, math, arts, music and English. Governor Murkowski has now appointed five new members out of a total of eleven to the Board of Regents. New Regents include Mike Snowden (Sitka), Cynthia Henry and Jim Hayes (Fairbanks), Mary Hughes (Anchorage), and David J. Parks (Student Regent – Palmer). Accountability continues to be a key issue with the public and the legislature. President Hamilton considers the accountability issue to be of paramount importance and the UA has stayed well in front of the public. Public interest and support for the university is high and is being fueled by support from the governor, by UA President Mark Hamilton’s commitment to accountability and delivery of quality programs focused on the highest demand industries in the state. The legislature intends to measure the success of the University of Alaska in achieving its mission by considering a number of measures, some traditional and some specific to Alaska’s circumstances. A revised “missions and measures” bill was introduced again this session, further refining language to examine various aspects of the university, as well as all state agencies. Enrollment at the University of Alaska reached its highest level this past fall after three years of growth, increasing by an overall 13% over the past two years. Federal receipts are up; university receipts are up; private and corporate giving is up; research work and funding is up; partnerships
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