TowerTalk

The UT System Board of Regents took several actions during their two-day meeting this week in Austin that help our campus. In all, the Board approved:

• Our budget proposal for the coming academic year.
• The purchase of a second station for KUT, allowing for the expansion of both music and news programming for our award-winning radio station. (The funds for this will ultimately come from KUT.)
• The design of our future Engineering Education and Research Center.
• The purchase of land near MLK and Guadalupe streets for the construction of a new Graduate School of Business building.
• And the creation of two new PhDs at UT Austin, one in statistics and the other in African and African Diaspora studies, which will be the first of its kind in Texas.

I thank the Regents for their support and look forward to seeing all of these initiatives unfold.

As you may have now heard, today the UT Board of Regents took actions that will have profound effects on our university.

The Board voted to allocate $25 million recurring, with an additional $5 million for eight years, to fund a medical school in Austin. This allocation — along with a pending $250 million commitment from the Seton Healthcare Family for a new teaching hospital — moves us closer than ever to bringing a medical school to UT Austin. The founding of a medical school at UT would be an enormous event in the life of the University, would offer dramatic new opportunities for our students and our faculty, and would advance health care in Central Texas.

Nevertheless, I’m disappointed to report that the Board declined to adopt our tuition recommendation. Instead it voted to freeze undergraduate tuition at its current level for Texas residents at UT Austin for the next two years. It did allocate $6.6 million of non-recurring money from the Available University Fund (the endowment from the West Texas oil lands) for those same two years. It adopted our request for a 3.6 percent increase for graduate students but declined to adopt it for the second year. Tuition for out-of-state undergraduates will increase by 2.1 percent for two years rather than 3.6 percent as we requested. The tuition freeze was not applied to any other UT System school.

While many students naturally will welcome the news of a tuition freeze, we should understand the serious consequences for UT Austin and for the ability of Texans to benefit from strong public universities.

Our university is supported financially by four pillars: state funding, tuition, research grants, and philanthropy. State support in constant dollars per UT student has fallen for more than a quarter century. With a multi-year tuition freeze, the second pillar of our funding structure effectively will be cut each year by the rate of inflation. While we appreciate the AUF allocation, it will provide less than half of the increase we had planned for. Moreover, a one-time allocation, however much it might mitigate short-term problems, cannot substitute for stable, recurring, sustainable funding needed to support long-term efforts aimed at student success.

This action inevitably will affect our ability to teach our students and make new discoveries. Our tuition proposal, which was unanimously recommended by the students on UT’s Tuition Policy Advisory Committee, was dedicated to fund initiatives to enhance student success, improve four-year graduation rates, and increase scholarships.

As we prepare for next year’s budget, I will work with faculty, students, staff, and our administrative leadership to address how we use our resources to protect the quality of education here at UT.

The University of Texas has pursued excellence and has steadily grown stronger for 129 years. I am committed to protecting the quality of a UT education for Texans, for our children, and for our grandchildren.

In 2000, my predecessor, President Larry Faulkner, identified the need for a small group of leaders to advise him on UT’s complex budget. The resulting University Budget Council has been a very valuable tool for helping direct our funds toward our institutional priorities. Today I’m announcing that, for the first time, we have established dedicated positions on the council for a faculty member and a student.

Professor Andrea Gore of the College of Pharmacy will serve as the first faculty member, and Natalie Butler, a Plan II senior, has agreed to serve as our first student member. (Natalie happens to be Student Government president this year, but this is not an ex officio position for the SG president.)

In addition to these two new seats, the council includes the president, executive vice president and provost, vice provost, chief financial officer, vice president for university operations, budget director, and deputy to the president for a total of nine.

I believe having a faculty member and a student as permanent positions within the council will add two important dimensions to this deliberative body, will help us better incorporate the perspective of those crucial constituencies, and demonstrates our commitment to transparency.

I look forward to getting Andrea’s and Natalie’s counsel on our university’s priorities.

Hook ’em Horns,

Now that the 82nd Legislature and its subsequent special session are over, I’d like to give you an update.

The Legislature passed bills that are designed to make textbooks more affordable to our students, to make the financial aid application process more user-friendly, to improve student success, to provide graduate fellows with insurance coverage, and to relieve some of the costly burdens of state regulation of higher education.

But for UT Austin and our state’s other public universities, the biggest news is the budget.

The state revenue shortfall resulted in cuts throughout government, including higher education. UT Austin’s budget was reduced by $92 million for the biennium, which includes the 2011-2012 and the 2012-2013 fiscal years. That translates into about a 16.5% reduction in our state support.

This action extends a decades-long trend—UT Austin increasingly relies on resources other than state revenue. In the fiscal year ending this August, state support to UT Austin amounts to about 14% of our annual budget. In 2011-2012, our state support will decline to about 13.3%.

It is important that we recognize that our elected representatives faced great challenges during the legislative session. There were no easy solutions. I thank our friends in the Legislature as well as all of you who voiced your support for higher education.

Fortunately, we anticipated the state budget shortfall, and UT Austin has been preparing for these cuts for almost two years. My office, for example, has reduced total spending by more than 10% by trimming entertainment, discretionary programs, and staff.

But make no mistake, a $92-million budget cut will affect our core academic mission. While we have done our best to protect UT’s academic programs, our students will encounter reduced student services, course offerings, and financial aid. Our faculty and staff will have to do more with less, and we will be forced to eliminate jobs. I will share more details about the consequences of these cuts as we move forward.

I recently announced that we will provide modest merit-based salary increases for some faculty and staff. Funding for this has been created internally through our austerity. Remaining competitive for faculty and staff talent is one of our top strategic priorities. To allow our talent base to erode would betray our Constitutional mandate to be “a university of the first class” and shortchange the young people who will lead Texas in the future.

The most important message is this. We are resolved to pursue our vision for UT Austin, and this requires change. We are reinventing the way we do certain things, such as harnessing technology to teach more effectively and more efficiently. We are aggressively commercializing intellectual property and developing other revenue streams. We are working daily to streamline our operations and to make our campus more energy efficient and sustainable. And we are collaborating with other universities across the nation to define the public research university of the future.

But some things never change, such as our commitment to education and to nurturing the people and the research that changes the world.

I have heard from many of you in recent months. I cannot express how grateful I am for your ongoing support. Thank you.

Hook ’em Horns!

Dear Colleagues:

We must be competitive for talented faculty and staff in order to remain a leading university. Even in difficult times, I believe this is a high priority.

The University Budget Council and I have decided to set aside funds for modest, strategic, merit-based salary increases for our faculty and staff for the 2011-2012 fiscal year.

Funding for this has been made possible through budget cuts by the deans and vice presidents, and this action is consistent with our policy of making sacrifices to fund our highest institutional priorities.

As you know, the last permanent salary increase for staff was in 2008-2009. In 2010-2011, we implemented a one-time merit-based payment program for faculty and staff. The 2011-2012 salary increases will be permanent and are independent of the one-time payments. Increases are based on performance, so not all employees will receive one. More information will be forthcoming in August from your department.

Faculty and staff increases will be effective September 1, 2011. Only employees who have been employed for at least six consecutive months are eligible, provided they have not received a merit increase in the past six months.

I want to reinforce that these salary increases are only possible through greater austerity and efficiency on the part of the entire University community. I also want you to know that I am proud of the countless ways that our faculty and staff are meeting the challenges of funding reductions while maintaining the high standards of performance that characterize UT.

The Austin-American Statesman and The Dallas Morning News have recently published my op-ed on UT’s productivity:

With more than 52,000 students and many nationally ranked academic programs, The University of Texas at Austin is one of the most productive universities in the United States. But you wouldn’t know it by reading the Center for College Affordability and Productivity’s (CCAP) recently published report, which suggests that if the 80 percent of our faculty that have the lowest teaching load taught half as much as the top 20 percent, tuition could be reduced by half.

The most obvious flaw in this analysis is that the measure of faculty productivity is limited solely to semester credit hours. There is no attempt to measure the quality, and therefore the true productivity, of the learning experience.

At UT, we could easily increase the appearance of efficiency by doing all our teaching in classes of 300 students. According to the CCAP metric, our university would then be far more productive. But what is the goal of a university? At UT, our goal is to provide the most effective learning experience for our undergraduates and graduate students. In addition, we expect our faculty to conduct research to expand knowledge and benefit society.

Let me give one example. As a part of our curriculum reform at UT, we now require all freshmen to complete what we call a First-Year Signature Course. In these courses, taught by senior faculty, students concentrate on writing and speaking, critical thinking, and research. These courses are often taught in small seminars, such as the one that I teach. The CCAP analysis would penalize a faculty member for teaching any small class. Yet exposing our freshmen to a rich learning experience with our best faculty is central to our mission and increases our overall educational productivity.

By the CCAP’s measure a faculty member teaching a class of 300 is 16 times more “productive” than one teaching an 18-student seminar. Our small freshman seminars are labor intensive, but we value the student-faculty interaction, and students tell us they value it, too. The same point could be made regarding upper-division and graduate seminars, which are small and relatively expensive. But we believe that providing high-quality graduate education is important for training the next generation of researchers, scholars, and leaders.

At UT we offer a few classes that are large, some with more than 500 students. But we offer many more small classes: 34 percent have fewer than 20 students, and another 41 percent have between 20 and 49 students. Universities need a healthy balance of class sizes to be efficient while maintaining the quality of our teaching. Therefore it comes as no surprise that a minority of UT instructors teaches a majority of semester credit hours, and there is nothing problematic about this.

Furthermore, our faculty devote large amounts of time to student advising, research, scholarly publications, administrative responsibilities, participation and leadership in national and international organizations, and public service. None of this is measured in the CCAP analysis. Overall productivity is important; the mix of individual contributions to productivity is a tactic to achieve it.

At UT, we are very serious about increasing productivity in teaching, research, business operations, and commercialization of intellectual property. Indeed, among the nation’s 120 leading research universities, we are the 10th most efficient when measuring the amount of tuition and state money we spend to achieve our six-year graduation rate. And we spend less state money and tuition per faculty member than all but one other research university in America.

We welcome all productivity analysis that measures quality—because outstanding teaching and research are our goals. With our state’s largest enrollment, highest ranked programs, and highest four-year graduation rate, we are very productive. And we do this with tuition of less than $10,000 per year while receiving only 14 percent of our budget from state appropriations. However, we’re still not satisfied, and we are implementing multiple initiatives to further improve our efficiency.

For the citizens of Texas, we are a very good investment. Last year, our faculty attracted $648 million in research grants, more than double our current state appropriation of $318 million. When combined with other revenue from tuition, philanthropy, and auxiliary enterprises, taxpayers received the benefit of $5.8 billion in economic activity. All of this comes at an annual cost of about $13 per Texas resident.

It’s curious that advocates for productivity should take aim at one of the most productive universities in the nation. In any event, at The University of Texas at Austin, we welcome productivity analysis that includes measures of academic quality, and we will continue to strive for even greater efficiency and effectiveness.

I wanted to share this message, which I sent to our faculty and staff today:

Dear Colleagues,

The regular session of the Legislature ended on Monday, and I want to give you an update.  In the current budget, which must be completed during the special session, the 2012-2013 budget for UT Austin will be down by 16.5% from the original 2010-2011 budget.

This represents a $92.1 million decrease in funding for the 2012-2013 biennium compared to 2010-2011. The impact of this is complex and could change as a result of action taken in the special session. But if these changes stand, the budget reductions will be close to the cuts that the units were anticipating. Budget reductions of this scale will be painful, but careful planning by the University Budget Council, the deans, department chairs, and vice presidents will make them manageable.

The cost of group insurance may increase, and there may be revisions to annual deductible amounts and copayments. The employer contribution to retirement plans could also be affected.

Finally, there is the question of how this budget will affect salaries for faculty and staff.  That decision has yet to be made. The University Budget Council will review the situation and reach a decision by the end of June. And of course, I will keep you informed.

I know there has been a great deal of uncertainty about our budget, and I want you to know that we are doing our best to minimize the negative impact of these cuts on our people and programs.

I appreciate everything you do for UT.

I wanted to share this message, which I sent to our faculty, staff, students, alumni, and friends yesterday:

Dear Friends and Colleagues,

Recently I attended a meeting of the Association of American Universities in Washington, where I invited the presidents of six prominent public universities to discuss the future of higher education in America. In addition, with help from the Lumina Foundation, I’ve been meeting regularly with presidents of several community colleges and four-year colleges in Texas to explore ways we can help improve the success of all our students. There is a great deal of discussion regarding budget reductions, but a more fundamental conversation about higher education is taking place across the nation. This is the first in a series of communications about these issues.

Our social landscape is shifting in fundamental ways. Families are recovering from a deep recession. Using the Internet, smart phones, and other technologies to learn and communicate is second nature to today’s students. Current demographic and social trends are greatly expanding the number of people who seek higher education. State appropriations, once a primary source of funding, now make up a small fraction of public university budgets (about 14 percent at UT Austin). Far more than merely being a training ground for future employees, universities must be partners in innovation for the private sector, entrepreneurial communities, and other educational institutions. Society’s tectonic plates are shifting, and universities must adapt.

From energy to medicine to the space program, Texas and its universities have long been fertile ground for innovation. This innovation must extend to public higher education, and our University is ideally positioned to lead this effort.

In my five years as president, I have worked with colleagues to strengthen undergraduate teaching, to advance research and problem-solving by our faculty, to foster deeper relationships with our alumni and leading corporations, to improve institutional productivity, and to make UT Austin accessible to a cross-section of Texans and exceptional students from across the United States and around the world.

When I was dean of the Law School, I worked with the Commission of 125, a group of about 200 citizen leaders from all walks of life who studied UT in 2002-04 and made recommendations to shape its future. It became clear to everyone engaged in the Commission’s work that the traditional model for public higher education had to change. Indeed, the overarching theme of my State of the University Address last year was the need to increase our productivity and effectiveness in an environment of diminished resources. But while we introduce change-as one of the world’s great research universities-we must be steadfast in our commitment to teaching and research.

With UT’s large student body and influential alumni network, acclaimed faculty, and powerful research enterprise-combined with its depth and diversity of programs and overall excellence-no university is better positioned to pursue new approaches and make an impact. We must cultivate innovation, exploring new, more effective pathways for how our students and faculty learn and create new knowledge.

In my view, the public research university of the 21st century must:

• Engage in solving major global problems, expanding knowledge, and improving lives throughout society
• Offer the highest-quality undergraduate education, graduate programs, and research to prepare the next generation of leaders who will change the world
• Exploit the opportunities that new technology creates in learning and educational research
• Develop new revenue streams to become even more financially self-sufficient
• Focus resources on those programs that can achieve true excellence and that offer strategic opportunities to advance knowledge
• Increase efficiency and reduce costs in university operations on a continual basis
• Share educational resources with emerging research universities, regional universities, community colleges, and high schools to expand educational opportunities for everyone

This vision for the future is taking shape in many ways on our campus, much of it inspired by the Commission of 125. The Commission emphasized the importance of pursuing excellence, enriching the undergraduate experience, and developing strong leadership for academic departments and research centers. Here are some of the changes under way that reflect our commitment to this vision.

UT has overhauled its core curriculum for all undergraduates, adding a mandatory rigorous intellectual experience known as the First-Year Signature Course, which includes coursework in disciplines such as English, history, social sciences, math, natural sciences, and the performing arts. These courses are designed to develop important skills in writing, critical thinking, quantitative reasoning, ethics, and independent inquiry.

We are redesigning key gateway courses in chemistry, biology, and statistics to shift the emphasis from traditional teaching methods to more innovative and effective student-centered learning. This Course Transformation Program uses technology to gain immediate insights into teaching effectiveness and to individualize learning both inside and outside the classroom. Transformation of these three initial courses will affect more than 9,000 UT Austin students per year.

We are partnering with Harvard and Carnegie Mellon universities to use advanced instructional technology and interactive tools to develop free educational materials and online interactive tutors to help students realize their potential on our campus and at other Texas colleges and universities. One of the objectives of the project is to help students reach similar levels of proficiency across learning environments at institutions with a wide range of missions.

Innovation also requires that we manage costs. In fact, our administrative costs are about half the average rate for state universities in Texas. Current efficiency initiatives in information technology, data storage, purchasing, water and energy conservation, and other areas are projected to save $565 million over a 10-year period.

In addition to finding new efficiencies, we must also create new income streams to support our academic priorities.

• We are aggressively pursuing the commercialization of our intellectual property through programs to create new companies and connect them with investors.
• In 2010 we launched H2Orange bottled water, a partnership that generates scholarship funds from water packaged in a recyclable bottle shaped like the UT Tower.
• Earlier this year we announced the Longhorn Network, a 20-year partnership with ESPN and IMG College that will guarantee $300 million in revenue to support UT Austin. We have already committed funding from this agreement to create new faculty chairs in philosophy and physics.

American research universities are the envy of the world. Nations worldwide are aggressively trying to replicate them because they attract the best faculty, who attract the best students, who become tomorrow’s leaders. Research universities drive economic development in their regions because they produce the educated workforce companies need and new knowledge that generates innovation and economic development.

Texas has a history of leadership and innovation. To build a stronger future for the people of our state, we need to lead in higher education. At UT Austin, we are working to unify our 470,000 alumni and many other important constituent groups to make this shared vision a reality. It’s a vision that will strengthen all public universities, our state, and our nation.

Sincerely,

I wanted to share this message, which I sent to our faculty and staff yesterday:

Dear Colleagues:

The 82nd Legislature is under way, and news reports have focused on the difficult budgetary challenges facing our state and proposed cuts to higher education and public schools.

Our elected officials must make some tough choices during this session, and those choices will have a significant impact on our university.

I know we are all concerned about how we will be affected by the state’s budget shortfall.  Budgetary issues will be debated in the coming months.

I cannot predict how these deliberations will turn out, but I want to assure you that we have been preparing for this scenario for more than a year and a half. Thanks to the hard work of our provost, deans, vice presidents, and many of you across the campus, we have made significant progress in examining our financial situation, cutting costs, improving efficiency, and planning for a possible reduction in state funding.

This uncertainty is challenging and stressful. I understand how important it is to keep you informed on developments that affect the future of our university.  I also understand that budget cuts are a greater burden for our staff.

Every time I go to our Capitol I am mindful that I represent the interests of faculty, staff, students, and alumni who make The University of Texas at Austin one of the world’s leading institutions of higher education.

We will continue to pursue our mission to become the nation’s leading public research university.

The quality of our university is the result of the dedication, talent, and commitment of all of you.  With your help, I believe that we can emerge from this period as a strong and vibrant institution better poised to pursue our vision to be the best.

Thank you for your continuing support.

Earlier this month I was in Houston with Texas A&M President Bowen Loftin to meet with legislators, alumni, and the editorial board of The Houston Chronicle. As many of you know, Texas is facing a large budget shortfall. President Loftin and I are traveling to several key cities in the state to build awareness of the importance of state support for UT Austin and Texas A&M–the only public Tier 1 universities in Texas.

Our message is simple.

In the budget cut earlier this year, higher education in Texas was treated disproportionately compared to other state agencies. Higher education represents only 12.5% of the state budget, but it bore 41% of the budget reductions. We want to do our share, but continuing with disproportionate reductions will erode our state’s universities.

The Research University Development Fund (previously called the Competitive Knowledge Fund) rewards research universities by providing $1 of state support for every $10 earned in external research grants. Our research enterprise provides much needed economic stimulus to the Texas economy. UT and Texas A&M attracted more than $1.3 billion in external research grants to Texas in 2009-10. That’s 62% of all externally funded research at public universities in Texas. The Research University Development Fund is an effective way to support comprehensive research universities in the state.

UT and Texas A&M educate more than 100,000 students every year, that is nearly one of every five public university students in Texas. And our two universities have the lowest administrative costs in Texas—about half the state average.

Finally, UT and Texas A&M each have key building projects. At UT, our highest priority is a new building for our highly ranked engineering program, which would greatly benefit from Tuition Revenue Bond support.

I believe that higher education is an investment in our state’s future.  In the months ahead, President Loftin and I will continue our efforts to communicate the crucial importance of preserving the competitiveness of our state’s national research universities.  I hope the alumni and friends of both our universities will support us in this endeavor.