SBB 6562 explained by staff:

The UW supports the bill:

What percentage of state funds makes up the UW’s budget? If the bill passes, what assurance is there that the number of minority and middle-class students won’t drop and that the debt load on students won’t increase?

What about graduate and professional students?

Freshman retention rates:

Husky Promise is our guarantee that financial challenges won’t stand in the way of eligible Washington state students achieving their potential and earning a UW degree. To quote Gov. Gregoire, “Education is the single best investment for our future and the key to success for our children.” We at the University of Washington are doing all we can to make sure finances are not a barrier to a college education for eligible students.

UW leaders and students have more visits planned this month: Lummi High School in Bellingham on Feb. 8, Kent-Meridian High School on Feb. 9, Mariner High School in Everett on Feb. 10 and Rogers High School in Spokane on Feb. 16. You can learn more about Husky Promise on our Web site. You can also keep up with the Husky Promise tour by following us on Twitter and Facebook.

With the 2010 legislative session now underway, I want to take this opportunity to follow up on my November e-mail message in which I communicated the University’s strategies in the wake of the latest state revenue shortfall. As we move forward, we are focusing our message in Olympia on four key planks:

1. Stop further budget reductions that would erode our ability to meet the educational needs of our students and to serve the citizens of Washington.
2. Preserve funding for the State Need Grant program that serves so many Washington students from economically stressed families and that makes our Husky Promise program possible.
3. Provide reasonable tuition flexibility.
4. Provide greater management flexibility in our operating processes.

Governor Gregoire spoke to a couple of these points in her State of the State message to the Legislature two weeks ago. Notably, she strongly urged legislators to preserve the State Need Grant program. Including this in her message signals the high priority she places on the program and is a good sign that she and her administration will do everything possible to ensure that Washington students continue to have access to higher education regardless of their financial circumstances.

She also urged the Legislature to provide the four-year universities “with competitive tuition flexibility so we can continue to be ranked among the best in the nation in producing the most innovative workers and employers.” This, too, is welcome support, as the University would have the ability to manage one of its key sources of revenue, the tuition our students and their families pay.

Right now, the UW is the only institution among our peers whose governing board does not establish tuition rates for resident undergraduates. Washington is one of only three states in the nation in which tuition is set solely by the Legislature. This session, we are seeking authorization for our Board of Regents to establish resident undergraduate tuition, within a responsible framework established by the Legislature. This would result in greater predictability and consistency in tuition policy.

Along with the ability to set tuition rates comes a responsibility to maintain access to the University for those who are economically disadvantaged. I am very proud of the UW’s economic diversity. The median family income of dependent resident undergraduates is $61,000. Sixty-three percent of resident undergraduates receive some sort of financial aid and 46 percent receive financial aid in the form of grants, scholarships, or waivers. This year, 7,000 students attend the University on the Husky Promise and pay no tuition at all. That’s one out of every four resident undergraduate students. We are committed to ensuring that those who need help with tuition get it. Our legislative proposal for having the Regents set tuition rates imposes reasonable caps on how much tuition can increase annually and in total, and it increases the University’s contribution to student financial aid from 3.5 percent of tuition revenues to 4.5 percent, along with continued support for the State Need Grant program.

Our message is straightforward: Since state funding of higher education continues to decline, of necessity a greater share of the cost must be borne by students and families. However, in doing so, we are fully committed to ensuring that those who cannot afford to pay more still have the wherewithal—through increases in financial aid—to afford the price of attending. No Washington student should miss out on pursuing higher education because she or he can’t pay. And all of our students expect and deserve the highest quality educational experience money can buy—and we can provide.

Sincerely,

Mark A. Emmert
President

The funding model is broken:

Is there a floor to state support, which is now less than tuition revenue in the university’s budget?

Do institutions have a problem with cohort pricing?

The disaster that has hit the island nation of Haiti is nothing short of horrific. Our hearts go out to the people of Haiti and to the many citizens of other countries who have been working there to help improve the lives of Haitians. Our own Department of Global Health, through its International Training and Education Center for Health (I-TECH), has had an office there since 2004 strengthening the response to HIV/AIDS. Fortunately, as far as we know, most of its people are safe and unharmed. But that cannot be said for the thousands trying to cope in the aftermath of this devastating earthquake.

Many in our UW community have inquired about ways in which they can help and provide assistance for the international relief efforts being mounted in response to this disaster. The Office of Global Affairs has assembled a list of organizations that are accepting gifts and volunteers. The list is not exhaustive and may be found at the Global Affairs web site.

I hope you will take a moment to visit the page and contribute in any way you can to help those in need in Haiti. It is hard to fathom how desperate their plight is and the difficulties they face in the coming days and weeks.

Sincerely,

Mark A. Emmert
President

Yesterday, Governor Gregoire released a 2010 supplemental budget proposal that addresses an additional $2.6 billion projected shortfall for the 2009-11 biennial state budget (see my Nov. 19 message to the University community). By law, the governor is required to submit a balanced budget based on current state tax revenue.

The proposed budget is by any measure a train wreck for the state, and without additional revenue would surely result in very negative consequences for many people, including students and the higher education institutions they attend. As Governor Gregoire said yesterday, she does not support this budget proposal and believes the state must consider ways to generate additional revenue to fill the gap.

We are especially concerned about the impacts this budget proposal would have on our students. Losing over half of our state’s nationally-recognized need-grant program would shut out thousands of Washington’s finest students from a chance at a college degree and a better future. Without the state need-grant program, Husky Promise scholarships would be severely curtailed, and the 7,000 students who currently are able to attend the UW because of these scholarships would likely be unable to continue. Higher education would become a luxury only the well-to-do could afford.

This budget proposal also includes a state funding cut of $20.9 million for the University, or an additional 6.4 percent. While we hope many of the proposed budget cuts will not survive legislative action, it is likely that higher education institutions, along with other state agencies, will be asked to take a further budget reduction in the remainder of this biennium. Coming on the heels of the cuts we have already taken this biennium, it will be very difficult to find additional areas to reduce spending.

Further erosion of state support for the UW will make it even harder for us to meet the educational needs of our students. As I said in a press statement I issued yesterday, no one—the governor, the Legislature, or the University—can control the economy. But we also cannot afford to decimate critical programs and opportunities for our state’s students. It is time for the Legislature and the governor to look for additional revenue sources to help moderate these unacceptable impacts on our state’s citizens.

We will keep you informed about the progress of budget discussions in Olympia and ask once again for everyone to pull together as we find ways to make it through these difficult economic times.

Sincerely,

Mark A. Emmert
President

Losing half of our state’s nationally-recognized need-grant program will shut out thousands of our state’s finest students from a chance at a college degree and a better future.

Without the state need-grant program, Husky Promise scholarships would be severely curtailed, and the 7,000 students who are able to attend the UW because of these scholarships would be unable to continue. Higher education would become a luxury only the well-to-do could afford.

The further erosion of state support for the UW will make it even harder for us to meet the educational needs of our students. No one—the governor, the Legislature or the University—can control the economy. But we also cannot afford to decimate critical programs and opportunities for our state’s students.

Even during a long, hard winter you can’t eat your seed corn. It is time for the Legislature and the governor to look for additional revenue sources to help moderate these unacceptable impacts on our state’s citizens.

The condition of the Washington economy and the revenue it generates in state taxes continue to concern everyone watching the state budget. All of us at the University are still dealing with the aftermath of the 2009 legislative session and the budget cuts resulting from a historically large revenue shortfall. The most recent revenue forecast from Olympia unfortunately reflects a continuing downward spiral in state tax revenues and an even larger budget hole the state will need to address in the 2010 session. Though the nation’s economy in recent months has shown welcome signs of recovery in various sectors, unemployment continues to be a nagging problem. And with our state’s heavy reliance on the sales tax, people’s confidence level and willingness to make purchases directly affect the condition of the state budget. The turnaround in state tax revenues we have all been hoping for has yet to materialize.

How the state will address what is now estimated to be a $2.6 billion problem is unclear. As all of us know, the 26% cut in our budget this biennium was unprecedented and took our state funding to a level we have not seen since 1999. To manage the cut, we had to make many hard decisions, among them, eliminating 850 mostly administrative and staff jobs, closing branch libraries and writing centers, freezing pay, dramatically reducing faculty hiring, and impacting the experience our students have in their academic programs.

The impacts of the budget reduction were offset partly by a 14% increase in tuition, continuing a 20-year trend of relying more and more on student tuition to fund the UW while the state shrank its share of funding. For the first time in our history, total revenue from tuition is larger than revenue from state tax dollars, a trend that is very likely to continue.

What all of this means is that we may be in for further budget reductions in the second year of this biennium. The Governor will release her 2010 supplemental budget proposal in early December, and the Legislature will take up consideration of its budget proposals when it convenes in mid-January. Whether the budget crisis in the state has reached such proportions that additional sources of revenue are considered is also at this point unknown.

What we do know with absolute certainty is that we will continue to make a forceful and passionate case in Olympia for additional state investment in the UW. The work all of us do is essential to Washington’s future. Working together with faculty, staff, and students and with the support of the thousands of UW alumni and retirees throughout the state, we will do everything in our power to ensure that work is supported. People in our state need to understand the role this University plays in the health and vitality of our region and that further disinvestment in the University of Washington is bad public policy and bad for the citizens of the state.

In the meantime, in this new era of declining state investment in the University, there are some things both the University and the state can do to enable us to be more effective in the way we manage ourselves:

1. Use our existing resources as efficiently as possible: Research shows that Washington’s public universities are already among the most efficient in the nation in producing bachelor’s degree graduates despite being among the most poorly funded. The UW awards more bachelor’s degrees per student than research universities in any other state, and we are second in the nation in degree productivity at the graduate level. The six-year graduation rate for freshmen in the state of Washington ranks third in the nation and has improved by 9% in the last decade. The UW’s six year graduation rate now stands at 81%, up from 71% six years ago. Bottom line: The state is getting extraordinary efficiency in the investment of its dollars in Washington’s public universities.

2. Manage undergraduate resident tuition: Now that the UW receives more of its core instructional budget support from students and their families than from the state, we need to be in a better position to manage all of our tuition revenues. Since 2003, we have been responsible for managing tuition for all graduate and professional programs, as well as undergraduate nonresident tuition. These tuition rates continue to remain at or below the average of our peer institutions. While UW undergraduate tuition is still the lowest among that of its global challenge state peers, future growth can be benchmarked in a fashion similar to those for graduate and professional programs. Further, the UW is deeply committed to increasing financial aid to continue to honor the Husky Promise program for low and lower middle income families. Bottom line: The UW needs to have greater control over its revenue.

3. Greater management and business process flexibility: There are numerous examples of millions of dollars that can be saved in operating our University if we had more flexibility over business processes and had to spend less money complying with a number of regulations in the way we operate basic management systems and processes. These include public works procurement, debt financing costs, purchasing authority, and relief from paying for state systems that we do not use. We want to use all of our resources as wisely and effectively as possible. Bottom line: The UW needs to be granted greater flexibility in costly and time-consuming regulations and processes.

The University of Washington is at a turning point. We must find a way to replace critical state dollars that are gone and no longer available to support our instructional activities. A new financial model and new, more entrepreneurial approaches to doing business are called for. Greater management flexibility is required to fulfill the University’s commitment to serving the citizens of Washington. If we are able to make these changes, the UW can continue to serve the state for decades to come in the exemplary manner we all expect.

Sincerely,

Mark A. Emmert
President