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UW System Board of Regents approves 2005-06 budget (Jul 7, 2005)

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July 7, 2005

University of Wisconsin System Board of Regents
July 2005 Meeting
News Summary

UW System Board of Regents approves 2005-06 budget

MADISON-By a vote of 10-6, the University of Wisconsin System Board of Regents approved on Thursday (July 7) an operating budget that will guide spending levels and tuition rates within the UW System for fiscal year 2005-06.

The budget was approved Thursday following solemn discussion about the priorities of the state and the university, and the impact of reduced state support and increased tuition rates. During their deliberations, the Board heard from students, chancellors and UW System staff about the challenges presented by the 2005-07 budget approved by the Legislature.

"While approving this budget will provide helpful direction for students, their families and our campuses, we all recognize that it does not provide the kind of academic quality and service that our students deserve," said UW System President Kevin P. Reilly. "We must continue to impress upon legislators and the Governor that the state must provide enough funding to support our students' success."

UW System Associate Vice President for Budget and Planning Freda Harris outlined for the Board the 2005-06 operating budget, which funds $4.1 billion in teaching, research and public service activities throughout the UW System, including 13 four-year universities, 13 freshman-sophomore campuses, and the statewide UW-Extension. It reflects cuts and reallocations required by the state, as well as increased costs for fringe benefits, debt service and utilities. It also includes a 2 percent pay plan recommendation, proposed by the Office of State Employment Relations in May.

The budget was based upon the 2005-07 biennial budget approved by both houses of the state Legislature and now awaiting action by Gov. Jim Doyle. The Regents considered the budget before a final state biennial budget was signed to allow students, their families and UW campuses time to plan for the upcoming academic year.

The Legislature's budget would further reduce state support provided to the UW System, which would now comprise 24 percent of the UW's budget, down from 25.5 percent of the budget in 2004-05, Harris said. The balance of the budget is funded through tuition, cuts and reallocations, and outside funding sources.

Students from around the UW System who opposed tuition increases made their case to the board, calling for a 3 percent increase in tuition, which they said would be more in line with inflation. Student speakers argued the proposed 6.9 percent increase would limit access for all students, especially those who come from lower-income and middle-class families.

"Reducing tuition increases from 6 or 7 percent to an inflationary increase of 3 percent next year is socially, politically and morally the right thing to do," said United Council Vice President Guillermo Cuautle, a student at UW-Milwaukee. "It will keep UW campus doors open to all students and their families, regardless of income."

The board also heard from UW-Madison student Sheila Evanoff, who said she recently lost her job and was unable to collect unemployment because, according to Evanoff, a state law does not allow a person to receive benefits while attempting a four-year degree. Evanoff said the loss of her job has made it even more difficult for her to afford tuition.

"As I look to the fall, when I will be living in and attending UW-Madison, I become very worried and afraid that I will not be able to pay the bills when all is said and done," she said. "I am afraid of the decision I will have to make."

The board also heard testimony from UW-Green Bay Chancellor Bruce Shepard and UW-Oshkosh Chancellor Rick Wells, both of whom described the challenges their campuses are facing in light of several biennia of Legislative cuts to the UW System budget.

Shepard said while his campus has been able to protect student instruction to date, it has been forced to reduce support for or eliminate several vital programs. He said the most recent budget cuts would harm UW-Green Bay even further. Shepard said that, following cuts made by the Senate, UW-Green Bay would no longer be able to protect "mission-critical functions."

"I have not a clue how we're going to address the budget cuts fiscally or emotionally," he said.

Chancellor Wells said that while past cuts to the UW System budget have not affected instruction at UW-Oshkosh, 80 percent of the Legislature's most recent reductions will impact it directly, resulting in lost revenue from tuition and fees, increased class sizes and the potential layoffs of some 60 teaching staff in the Spring semester.

"We're at a position now where we've just been pushed over the brink," he said.

Before approving the 2005-06 budget, the Board discussed issues surrounding the proposed tuition increase, with most agreeing that the biennial budget approved by the Legislature left them with few options.

"The reason we're sitting here in this bind today is because the Legislature acted irresponsibly," said Regent and State Superintendent of Public Schools Elizabeth Burmaster of Madison, who voted against the proposed budget. "Do you think students will hold the Legislature responsible when it comes to cuts in higher education programs?"

Regent Danae Davis of Milwaukee, who also no-voted the budget, expressed her discontent with the lack of support the state has shown for its public university system.

"What we are being asked to do is ludicrous and ridiculous," she said. "I do not feel comfortable doing what we are being asked to do."

Regent Jesus Salas of Milwaukee echoed Davis' sentiments, saying there must be more creative ways than raising tuition to ensure student access and academic quality within the UW System.

"The people of the state of Wisconsin must know we proposed something different," he said. "We must send them this message by voting no to this budget."

Salas said he would vote to approve the budget only if the board added an amendment that would shift $11 million in tuition revenue from the operating budget to the Higher Educational Aids Board to hold lower-income students harmless from the increases in tuition.

However, following advice that the board did not likely have the authority to shift the proposed funds, Salas withdrew his proposal and ultimately voted against the budget.

Other members of the board grudgingly supported the budget, saying they had few other options given the Legislature's severe cuts to the UW System budget. Most agreed that quality would suffer if the proposed tuition increase was reduced.

"Unless you're willing to water down the quality, and have larger classrooms and less faculty, the Legislature is saying we must have a smaller UW System to maintain the quality," said Regent Vice President Mark Bradley of Wausau. "We're going to get smaller unless we raise tuition to compensate for the money the Legislature doesn't give."

Student Regent Chris Semenas said it was "very difficult" for him to vote against the budget.

"I understand what is facing the UW System," Semenas said. "[But] as a student, I need to look out for what's best for my fellow students. No more can we afford to tell students that they have to take a semester off so they can pay their tuition bill." Semenas voted no on the budget.

In addressing the affordability and accessibility of higher education in Wisconsin, Regent Judith Crain of Green Bay indicated that she would vote in favor of the budget.

"I believe almost everything we do is going to limit access," she said. "We've got a lot of work to do with the public and the Legislature."

Regent Thomas Loftus of Sun Prairie said he would support the budget for the good of the UW System as a whole, but hoped the Board might engage in future discussion about enrollment levels.

"The university absolutely needs it," he said. "There are always better times ahead."

Regent President David G. Walsh of Madison said it will be imperative that the UW System make clear to the Legislature in the coming years that its students and campuses deserve more support.

"I think we've been dealt a cruel hand again by people with other priorities," he said. "It is our challenge in the future to go to these lawmakers and prove our value."

The UW System budget calls for a tuition increase of 6.9 percent for resident undergraduate students, equal to increases of $364 at UW-Madison and $356 at UW-Milwaukee for the 2005-06 academic year. Tuition will increase $277 per year for resident undergraduates at UW comprehensive universities and UW Colleges campuses. Nonresident tuition will increase by the same dollar amounts to keep nonresident tuition nationally competitive.

The budget also includes room-and-board rate increases averaging 5 percent, and segregated-fee rate increases averaging 8.8 percent at the 13 four-year campuses and 6.8 percent at the 13 freshman-sophomore UW Colleges.

Reilly reminded the board and guests that the Governor has not signed the state budget, and he encouraged supporters to urge the Governor to try to minimize the harm for the UW System. The Board authorized Reilly to approve any budget changes that may become necessary after a final state budget is approved.

"Support from the state this year represents the lowest percentage ever contributed to the UW System," Reilly said. "Unless we use the university to produce more successful graduates in Wisconsin, to attract more graduates from out of state, and to create the economic opportunities that will hold that critical mass of talent, we will not be a competitive state in the knowledge economy."

In other business, the board unanimously approved expanding the size of the board's executive committee and made clear that the president and vice president of the Board will serve as ex officio voting members of committees. The board also approved resolutions to fund UW-Extension's Lowell Hall Parking Structure Project, as well as facility maintenance and repair projects.

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The UW System Board of Regents will not hold a regular Board meeting during the month of August. The Board will hold its next meeting September 8 and 9, 2005, at the Washington County Cooperative Extension Office in West Bend.