Regents heard the results of the recent economic impact study conducted by Tripp Umbach.
By Adam Overland
March 15, 2011
During a work session at the Board of Regents meeting on March 11, Regents heard further details about the U's economic impact on the state of Minnesota from Paul Umbach of TrippUmbach—a firm that conducted a recent economic impact study of the University of Minnesota.
In late February, results of the study were released, showing that the U has an annual $8.6 billion impact on the Minnesota economy (measured in FY 2009). "You might think that’s a big number—$8.6 billion—it's actually in the top two or three of all universities we’ve ever studied," said Umbach.
Of the $8.6 billion total annual economic impact, one-sixth—or about $1.5 billion—results from the U's research activities. As Regent Beeson suggested, that impact, along with the 16,193 jobs it supports, would otherwise have to go out of state.
Overall, the U supports nearly 80,000 jobs in the state—1 of every 43. That includes 37,178 jobs in communities across the state through University spending, and 42,000 in direct employment (faculty, staff, fellows, students, post docs, graduate students, residents, University of Minnesota Medical Center-Fairview, and University of Minnesota Physicians).
Statewide, said Umbach, every dollar invested by the state in the University generates $13.20 in the economy. The U also generates a total of $512 million per year in state and local tax revenue, said Umbach.
The report further broke down the U's impact by region.
"Over $600 million of impact is actually outside the counties of the Twin Cities region," said Umbach. "That’s like having an entire other university operating statewide."
The southeast region, for example, which includes UMR and the Hormel Institute among other U operations, generates 900 total jobs and $61 million in economic impact, the report showed. The Crookston region, which includes UMC, the NW Research and Outreach Center, the Area Health and Education Center, and a Regional Extension Office, generates $34 million per year. The region which includes UMD generates nearly $350 million, while the UMM region, which includes the West Central Research and Outreach Center and an extension office, accounts for approximately $65 million.
Beyond the $8.6 billion impact measured in the study, Umbach said that likely two or three times that amount was not accounted for, in areas ranging from research commercialization to in-state alumni impact. He said the graduating class of 2010 alone will have an $8.9 billion economic impact on the state over the span of their careers, above and beyond the impact of University operations. About 14,000 students graduate every year from the U.
For more information, see economic impact report.
Minnesota economic report
State economist Tom Stinson presented an update to the board on the revised Minnesota budget forecast. A $264 million projected increase in the expected ending balance for the current biennium combined with an $896 million improvement in the budget forecast for the 2012–13 biennium outlook has reduced next biennium's projected budget deficit to about $5 billion—$1.16 billion less than forecast in November.
For targeted information on the Minnesota budget and how it relates to the University, see Minnesota's Budget and the U.
President Bruininks told the board that the University continues to model significant budget reductions across all academic and support units systemwide. Bruininks stressed that actual reductions will be differential and strategic—more details of that work are outlined in the reports of the Blue Ribbon Committees.
The actions now being taken, Bruininks told the board, include a wage freeze (subject to collective bargaining), a reform of fringe benefits to achieve savings of between $12 and $15 million, a third Retirement Incentive Option (RIO), and reductions in new investments and core operating expenses.
Blue Ribbon Committee reports
Senior vice president for system academic administration Robert Jones and senior vice president for academic affairs and provost Tom Sullivan presented an overview to the Educational Planning and Policy Committee on the reports and recommendations of the Blue Ribbon Committees.
Each campus and college formed Blue Ribbon Committees in 2009 and received a formal charge from the two senior vice presidents. Recommendations from the committees were focused on four areas of their operations: size and scope; revenue generation; cost containment; and investments.
Sullivan highlighted some of the scope and size recommendations to come from the Blue Ribbon Committee reports. Among them:
Regarding new revenue generation, Sullivan and Jones reported that colleges and campuses will continue to invest in opportunities:
Other board news
The Board recognized five new McKnight Land-Grant Professors for 2011–13. The award aims to advance the careers of junior faculty members who have demonstrated potential to make significant contributions to their respective academic fields.
The award includes a research grant for two consecutive years, summer support, and a research leave in the second year. Typically, recipients go on to win increasingly prestigious awards, both inside and outside the University, and pursue productive careers.
The 2011-13 recipients and their areas of research are:
For more information, see McKnight Land-Grant Professors.
Chair Clyde Allen appoints ad hoc committee to look at possible conflict of interest
Regents Chair Clyde Allen announced the appointment of an ad hoc committee to determine whether there is a conflict of interest with new Board of Regents member Steve Sviggum serving both as a Regent and as an employee of the U's Humphrey School of Public Affairs.
Sviggum has a 53 percent time appointment at Humphrey as a lecturer with the title of Legislative Fellow.
Allen, vice chair Linda Cohen and Regent Patricia Simmons will serve on the committee and report to the full board at its next meeting in May, Allen said.
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Last modified on March 15, 2011