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Regents act on medical school funding and UT Austin tuition

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.

Tuition Recommendation

I sent this message to members of the campus community yesterday:

I want to share with you my recommendation to the UT System and the Board of Regents regarding tuition policy for the 2010-11 and 2011-12 academic years.  The Tuition Policy Advisory Committee recommended an average increase for resident undergraduate and graduate tuition of 3.95%, which has been widely reported and discussed in forums on the campus.  My recommendation to the System follows the TPAC proposal to implement a 3.95% tuition increase and the $65 per semester fee approved by student referendum in 2006 to fund the new Student Activity Center.  The TPAC report also includes non-resident undergraduate, graduate, and professional program tuition rates, far more details than I can share in this message.

The economy is challenging all of us–students, parents, alumni, donors, and institutions.  No one welcomes a tuition increase in this environment. I understand that some families are struggling to keep up, and even a 3.95% tuition increase seems like too much.  For these families, I remind them to explore the many financial aid options on our campus.  In addition, 20% of the resident undergraduate tuition increase will be devoted to resident undergraduate financial aid, and 15% of the resident graduate and professional student tuition increase will be used for resident financial aid.

We raise tuition reluctantly and out of necessity.  UT is not alone in this situation.  The media have reported plans for tuition increases in many states, including a 7.5% increase at the University of Minnesota, at least a 9% increase at the University of Illinois, and a 32% increase at the University of California System.

UT remains a good value.  Kiplinger’s Personal Finance Magazine recently ranked UT 25th among the 100 best values in public universities.  The magazine evaluated more than 500 public colleges and universities.  Nevertheless, we know that the cost of an education is a burden for many students and their families, and we are doing everything we can to control our costs, increase our efficiency, and keep the University affordable.

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Kiplinger’s: UT Austin among America’s Best Values

Today Kiplinger’s Personal Finance announced its annual ranking of best values in American higher education, and UT Austin has jumped six spots to No. 21.

Kiplinger’s ranks the top 100 four-year schools that combine outstanding education with economic value. The journal factors in admission rates, percentage of students who return for their sophomore year, student-faculty ratio, and four-year graduation rate. The rankings also examine tuition and fees, financial aid offerings, and average student debt at graduation.

A university is only a good value if it provides a high-quality education. UT Austin currently ranks 27th in the world according to Times Higher Education and 26th in the world according to the Center for World University Rankings. We should take great pride in these assessments.

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Much To Be Thankful For

Before we break for Thanksgiving, I want to tell everyone in the Longhorn family – students, faculty, staff, alumni, and friends – how thankful I am for you. Because of your combined efforts and your dedication, Texas has a vibrant university of the first class, and that is something for which all Texans can give thanks.

There’s no more appropriate time than Thanksgiving to share this short video with you. In it, UT students express their feelings on “Thanks Day,” which this year fell on November 13 and which marks the day on which our students’ education would end for the school year if we had to depend solely on tuition and state funding. It’s heartwarming.

Lastly, let’s get our Horns up high for a big Thanksgiving night win against Texas Tech and show the Longhorns we’re behind them all the way.

Happy Thanksgiving and Hook ’em Horns!

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We must increase our national investment in higher education

On Tuesday, I had the honor of beginning my year of service as chairman of the Association of American Universities. To mark the occasion, I contributed an op-ed to the Houston Chronicle expressing my hopes for a new national investment in higher education. I’d like to share it with you here and below:

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Today, I’m proud to begin my one-year service as chairman of the Association of American Universities. Since 1900, the AAU has been the chief promoter of the American research university, and the University of Texas at Austin is one of just 62 current members.

In American higher education, there is no issue more critical than affordability. Gov. Rick Perry has made it a priority and President Barack Obama has as well. It concerns me, as it should every leader in higher education and all who understand the crucial role a college education plays in social mobility and national productivity.
In August, the White House published its College Scorecard, an interactive tool families can use to evaluate college options. UT-Austin fares well with a high graduation rate and a below-the-median cost.

In the final analysis, there are only two main ways to decrease the price tag of college for students: 1) decreasing operational costs and 2) increasing support from nontuition sources. Obama has called on universities to control their costs, and at UT, we are doing that. For example, we are undergoing a major initiative to reduce the costs of our operations by consolidating our staff so that multiple departments can share the expertise of specialists in human resources, information technology, procurement and accounting. Universities are behind the business sector in modernizing these functions, and we will all benefit from catching up.

But holding the line on costs — even cutting costs — is not sufficient for the needs of the future. We must also increase support for higher education from nontuition sources. These sources fall into four main categories: philanthropy, research grants, nontraditional revenue sources (such as licensing our discoveries or merchandising our brand) and public funding.

On this last count, we all have reason for alarm. In the last 25 years, student enrollment at state universities across America has grown by 62 percent, while total public funding has increased by only 2 percent. Consequently, state funding per student has dropped by 30 percent in those 25 years. And this is not a matter of our collective wealth, but rather, a matter of priorities: Nationally, state support per $1,000 of personal income has dropped by 37 percent. We cannot continue to decrease public funding across the nation and then express shock when the price to students goes up or we fall behind our competitors around the world.

We are witnessing a massive, historic public disinvestment in higher education. In spite of that, higher education is still doing amazing things. In Texas, economists have estimated that our state receives a 21-to-1 return on investment from UT-Austin. That is, for the state’s annual investment of about $300 million, it gets a university that contributes $6.4 billion to the economy through direct and indirect spending by staff, faculty and students.

The reasons for this disinvestment are many and include state- and federally mandated programs that have eaten deeply into the amount over which state legislatures have discretion. Those mandates likely are not going away. But if legislators realized the massive return on investment they are already getting from higher education, they would be going “all in” with public funding like a poker player with the best hand of his life. Of course, it is not just a matter of “throwing money at a problem.” We must be smart and targeted in our spending; but make no mistake, we must invest resources in higher education.

University administrations need to aggressively control higher education’s cost. But the responsibility for the cost of public higher education also rests with the public. Higher education affordability should be a nationally shared priority. State governments should begin making up lost ground by returning to their historical investment levels for higher education. It will help hold the line on the cost to students, and it’s the best investment of public dollars we can possibly make.

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Thank you for your support as I enter this exciting new year of national visibility for The University of Texas at Austin.

Hook ’em Horns,

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Kiplinger’s ranks UT among nation’s best values

Kiplinger’s Personal Finance has featured UT Austin among the “100 best values in public colleges” in its January issue. UT was ranked 27th based on a formula of cost and quality factors that included graduation rates, competitiveness, tuition, financial aid, and student debt.  This recognition reinforces that UT offers outstanding educational opportunities at an affordable price.  Read more in the Alcalde online.

And for a more comprehensive analysis of our academic outcomes, efficiency, and affordability, see this study by SMU Professor Michael K. McLendon.

We’re looking forward to welcoming our students back to campus and to making even more strides in quality and efficiency in 2013.

Happy New Year from the 40 Acres!

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