Students can't afford fiscal reality

An insulated task force leaves students in the cold while recommending tuition hikes.
By
  • John Brown
October 11, 2009

Last Thursday afternoon, the McNamara Alumni Center offered reprieve, or so I’d thought, for my body chilled by fall wind. Only after I entered the crystalline geomorphic dome and sat down in the sixth floor Regents' Board Room to the University of Minnesota Financing the Future Task Force, did it become clear to me wherefrom those chill winds blew.
The 22-member task force including only two students, was charged to set the future course of University finances, heralding an austere “new fiscal reality.” While presenting the report, Vice President and CFO Richard Pfutzenreuter implied the University had been fiscally blindsided by the state of Minnesota in a “dramatic and permanent reset of the University’s sources of revenue.” Posturing as if the Minnesota divestment trend amounted to breaking news, the task force established the foundation for a slate of drastic budgetary recommendations: 1) Grow a larger and more diversified portfolio of revenues; 2) Grow tuition revenue while ensuring financial access; 3) Substantially increase administrative and academic effectiveness, reduce costs and boost efficiency; 4) Narrow the scope of the University’s mission to advance a distinctive constellation of excellence.
For those unaccustomed to the shifty indicators or connotative nature of higher education hyper-jargon, focus on strategies 1 and 2. Note their prominence within the hierarchy. Strategy 1, broad and vague, grows revenues. It relies in part on a new “covenant” with the State of Minnesota (the same state that has permanently reduced University funding) and in part on the speculation of increased private donations. It fails the litmus of institutional sincerity and fiscal dependability. So why include this “non”-strategy? It serves to prime the University to the revenue growth mantra, pitched more specifically as Strategy 2, a “tuition fix.”
True, the taskforce only offered a “roadmap” for the future along which specific actions would eventually align, but the roadmap’s direction was blatant enough for former Student Senate Chair Ryan Kennedy to remark, “I’ve never been more shocked and disheartened by this University and the philosophy of its administration.” And Messianic recitals by Vice Presidents Steven Rosenstone and Richard Pfutzenreuter that tuition “is the revenue stream with the highest potential for long-term growth” offered little calm to students.
Framing the “new reality” as a loss of revenues rather than an explosion of costs establishes justification for the corollary revenue-side tuition fix. Comparatively, the report lacked the will to cut costs. It did graphically represent three approaches for closing or narrowing the widening University revenue gap, which could amount to an annual $1.1 billion by 2025 if trends remain. Conspicuously, all three scenarios hiked tuition (the only strategy that closes the projected gap pegs long-term tuition growth at 9.8 percent annually for Twin Cities undergraduates). None of the graphs modeled programmatic, employee or facility expense reductions — a not-so subtle admission of near-, mid- and long-term reliance on raising student tuition costs.
Strategy 3, far from a cut, actually reads as if administration might get more money, to fund “explicit and consistent incentives in the internal budget model for increased efficiency.” These incentives best not come by the thinning dime of students and families, who have already seen tuition rise some 165 percent over the past decade. Apparently, the University must not have sufficiently “incentivized” its stewards to curb tuition or partner with the state in the past. For its part, the state of Minnesota must plainly reverse its fair-weather University support.
Last year, Chairman of the House Higher Education Committee Rep. Tom Rukavina, DFL-Va., said of administration, “They are going to lose a lot of friends at the Capitol if they jack up that tuition … They’re pricing themselves out of work if they keep going up 7.5 percent.” Are we poised to burn the last remnants of structural integrity in the state partnership bridge?
“Morris, Crookston and Duluth are already priced beyond market and may not be able to absorb significant tuition increases,” but the task force offered a bleak alternative: an “aggressive tuition option” targeting “undergraduate students on the Twin Cities campus, who account for 45 percent of the University’s tuition revenue.” These families and students already pay tenuously close to market, leaving them top-notch debt loads after graduation for Big Ten public universities. But, clearly, these Minnesota students and their families can bend lower. President Paul Strain of the Minnesota Student Association put it simply: “It’s pretty clear that if tuition gets to where people can’t afford it, they’ll stop coming here.”
Ever barred from the chopping block is the sacred cow “strategic positioning agenda” — that broad canard of University priorities approved in 2005 “to become by [2015] one of the top three public research universities in the world.” The directive, planned in the decadent ignorance of post-millennial expansion, appeared at first an earnest attempt toward educational excellence. But to finance planning and implementation, institutional and academic support costs have steadily risen; as we approach the strategic initiative’s halfway point, some indicators point to a net drop in University position.
As we nervously await the move toward specific proposals at future Regent's meetings, Graduate and Professional Student Association President Kristi Kremer’s reaction perhaps best offers direction for students: “It’s a complex situation that demands complex solutions, and the answer cannot be simply raising tuition. This is an opportunity for students to stand up and critically assess how higher education is financed in the future.” After delivering such dark tuition prospects to a largely “optimistic” Board of Regents, University President Bob Bruininks audaciously requested tuition-payers fall lock-step in line, asking that “students, staff and faculty work in partnership with [the] Board.” An especially outrageous assertion, considering only two members of the 22-strong task force were students. If administration sincerely seeks partnership, students deserve drastically better representation on future task forces.

John Brown welcomes comments at jbrown@mndaily.com.
This column was revised on Oct. 11 for clarity.

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