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Board of Regents meeting summary, Sept. 2011

President Kaler outlined his budget proposal

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Sept. 12, 2011

At the September 8–9 Board of Regents meeting, University of Minnesota President Eric Kaler outlined his proposal for allocating an additional $25 million annually that the University received during the special legislative session. The return of those funds puts the total reduction of state funding at 7.8 percent—a cut of $520.3 million (versus $545.3 million).

The president’s proposal follows the original framework outlined in the provisional budget plan, adopted by the Board of Regents in June, which generated one-third of the needed revenue through tuition increases and two-thirds through program and administrative cost reductions.

While it is too late in the billing cycle to impact tuition for fiscal year 2012 (FY12), which began July 1, Kaler is proposing to spend $4.15 million in spring 2012 on one-time scholarships averaging $310 for 13,400 low- and middle-income Minnesota students eligible for the U Promise scholarship. This will benefit 46 percent of the undergraduate student body. Kaler wants to spend $8.3 million to reduce a planned 5 percent tuition increase to 3.5 percent in fiscal year 2013 for undergraduate students.

The president’s amended budget outlines the following spending in FY12:

One-time allocations: $10.75 million

  • $4.15 million for one-time scholarships for 13,400 Minnesota undergraduate students eligible for U Promise program during spring semester 2012.
  • $6 million over three years to support Doctoral Dissertation Fellowships. The fellowships recognize high-quality dissertation research and scholarly work and support timely degree completion.
  • $350,000 for a network upgrade on the Morris campus.
  • $250,000 additional academic investment on the Crookston campus.

Annual allocations: $8.15 million

  • $4 million for new faculty hires, particularly in the STEM fields, the Carlson School of Management, and the College of Liberal Arts. This will restore about 20 of the more than 50 faculty lines that are open as a result of budget reductions over the past few years.
  • $3.05 million to mitigate impacts of state cuts in the Medical Education & Research Costs (MERC) program, of which $150,000 will be used to restore the Foreign Trainee program within the U’s Medical School. The program helps immigrant doctors qualify to practice in Minnesota.
  • $800,000 to restore state cuts and support the College of Veterinary Medicine’s Veterinary Diagnostic Lab.
  • $150,000 to restore state cuts and support the Undergraduate Research Opportunities Program. This will give about 100 more students access to undergraduate research opportunities. Overall, this program benefits 900 students annually.
  • $150,000 to adjust budget reductions in the College of Pharmacy.

These annual and one-time improvements in fiscal year 2012 amount to $18.9 million. The remaining $6.1 million will be reserved for unforeseen state reductions or additional investments in fiscal year 2013. In 2013 there will also be an additional $8.5 million available for strategic investments.

The board approved the amendments to the operating budget.

President’s report
During the president’s report to the board, President Kaler offered highlights of his first 10 weeks on the job, including the announcement of an extraordinary $14 million gift from the estate of Myrtle Stroud to the College of Liberal Arts, the opening of a new housing community for the growing UMR campus, and the welcoming of an incoming Class of 2015 on the Twin Cities campus that is, by all measures, the best qualified group of first-year students in U history, he said. The first-year students (5,378) have the highest ACT scores ever (on average), the Most National Merit Scholars ever, and the most National Merit Scholars among public universities in the Big Ten.

Educational Planning and Policy Committee
During the meeting of the Educational Planning and Policy Committee, Provost and Senior Vice President Thomas Sullivan presented the annual report on undergraduate and graduate academic program changes. Specific changes are outlined in the docket materials presented to the committee. The document also includes a list of the largest bachelor’s, master’s, and doctoral/professional degree programs at four of the U’s campuses. At the full meeting of the board, Provost Sullivan told the board that 43 percent of incoming U students now come from the top 10 percent of their classes. The average ACT score of honor students, said Sullivan, is now 34—a half-a-point ahead of MIT.

Faculty, Staff and Student Affairs Committee
Vice President for Human Resources Kathryn Brown presented on the University Plan, Performance and Accountability Report to the Faculty, Staff and Student Affairs Committee. Brown’s update focused on key indicators of the U’s goal of Exceptional Faculty and Staff.

In addition, VP Brown told the board that the U’s total compensation is currently nearly $1.97 billion for 25,300 total employees. More than 12 percent are employees of color and 52 percent women. By generation, Brown noted that Millenials (born 1976–94) now make up the largest employee demographic by generation (9,404, or 37 percent), surpassing baby boomers (born 1946-64; with 9,283).

Highlighting employee productivity, Brown stated that from fiscal year 2001 to 2010, the ratio of students per employee are up 11.9 percent, degrees granted per employee are up 31.8 percent, and sponsored research funding per employee is up 50.2 percent, while total employee headcount has risen 6.9 percent over the same period.

Brown also updated the board on a job classification study under way that will better organize the U’s workforce and more clearly indicate the type of work performed in each position. Currently, the U uses 665 job classifications, said Brown, many outdated and unhelpful.

“Some are historical and do not even have a person in them. Some are no longer relevant. Some we don’t have—for example, job classes that include social media,” she said. The end result of the review, said Brown, will be a restructuring and clarification of job families that allows employees to “actually see a career path.” More information on the study is available at Job Family Classification Projects.

Capital Budget Request
The board heard a presentation on the U’s planned 2012 capital budget request, which will be considered for action at the board’s October meeting.

The total request will be $409 million, with $269 million requested of the state. The request calls for $90 million in Higher Education Asset Preservation and Replacement funds (building upkeep, maintenance, etc., systemwide); $200 million for a new Ambulatory Care Clinic at UMTC; $81 million for renovation of Old Main Utility Building at UMTC, roughly $6 million for Itasca facilities improvements, $21 million for Eddy Hall at UMTC, and $11 million for an American Indian Learning Resource Center at UMD.

Other board news
The board approved the addition of a UMR student representative to the board, “another sign of the growth and strength of this campus,” said Board chair Linda Cohen.

The board passed a resolution related to legislatively required performance metrics.

For more complete information, see the board docket materials online.