President's Campus Communication 9/07/10
It’s great to have everyone back on campus, and I’m looking forward to building on the work we began last year. First, I’d like to invite you to the State of the University Address, which will be Sept. 21 at noon in the University Center ballrooms. Lunch is complimentary but space is limited, so please RSVP by e-mail to firstname.lastname@example.org or by calling 351-2121 by Sept. 10.
It was a busy summer for policy makers in Denver, and the Colorado Higher Education Strategic Planning effort launched by the Governor has given us a clearer picture of where the state is headed with higher education funding. There is no question that the state’s ability to invest in higher education has been significantly, and probably permanently, impaired. In addition, the results of the state planning process indicate that the priority for state higher education funding will be undergraduate instruction, particularly access to low- and middle-income students. It’s also apparent there is little understanding of the other valuable things universities do, such as civic and community engagement, research and graduate education. Along with this lack of understanding comes the perception that we are not efficient and should be subject to greater regulation.
This context of limited funding, emphasis on undergraduate credit hour production and misperception of what it means to be a University confirms it remains imperative for UNC to take control of the things we can control. We have already made a number of important steps by articulating our shared vision for the University, developing our strategic enrollment management and multi-year financial planning capabilities, launching our Bringing Education to Life branding campaign, and beginning to better connect our fundraising and alumni operations to the University. Last fall, we began preparing for a $14 million loss in state funding over a two- or three-year period. We have already lost $3.5 million of the $14 million, which is reflected in our current budget, and it’s likely we will lose an additional $10.5 million next year (FY12).
To address this drop in state funding, we must keep focusing on revenue generation and further define our efforts to contain costs. We will be discussing this at the upcoming Board of Trustees retreat, and I will recommend that we generate revenue to address half of the lost state funding and identify sustainable cost savings to address the other half. Using this approach, we would need to identify at least $5 million in cost savings during this fiscal year for implementation over the next three fiscal years (FY12, FY13 and FY14).
By “sustainable cost savings” I don’t mean one-time or draconian budget cuts. I believe this is an opportunity for us to liberate ourselves from thinking about doing more with less (or even doing the same with less) and start thinking about how to operate differently. In fact, it is crucial that we not approach this as a budget cutting exercise. We simply can’t get where we need to go by slashing line items and temporarily paring back necessary expenditures.
There are many brilliant and creative people on our campus, including many who are extraordinarily passionate about their work. This is an opportunity for us to come together to reinvent our operations in ways that improve our effectiveness, save money and make UNC a better place to work. I’ll be talking more about this at the State of the University Address, where I hope you will join me.