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Sept. 9, 2004

University of Wisconsin System Board of Regents
September 2004 Meeting
Day 1 News Summary

Challenges ahead will require new ideas, direction

Kevin P. Reilly outlines priorities in first presidential address

Kevin P. Reilly, UW System PresidentPresident Kevin P. Reilly gives his inaugural address to the UW System Board of Regents

MADISON—Kevin P. Reilly set forth several priorities for the University of Wisconsin System as part of his inaugural address as president of the UW System before the Board of Regents on Thursday (Sept. 9.)

To accomplish the university's goals in the state's present funding climate will require some "fresh thinking" and "new approaches," he said.

"I am very optimistic about the future of the university and the state because we have a lot going for us —a lot of champions who want to help us," Reilly said. "I believe in what we stand for: opportunity for Wisconsin's citizens and Wisconsin communities. We are in the 'human potential' business, and it is our job to help our citizens realize their dreams for themselves and their families."

Reilly noted that he has already visited several UW campuses throughout the state, talking with students, faculty, staff and Wisconsin citizens.

"I have come away from my visits and meetings feeling that there is strong consensus for the budget you passed last month," Reilly told the Regents. "The priorities w've identified —rebuilding quality, remaining competitive, keeping college affordable, maintaining and, we hope, enhancing access ―resonate out there."

Reilly outlined four priorities for his presidency this fall:

  • to work with the Governor and the state to increase "brain gain" and raise the percentage of Wisconsin residents with a college degree;
  • to work more directly with the students of the UW System;
  • to make the UW System's operations more transparent and more efficient; and
  • to be a strong ambassador and advocate for the UW System and its 15 institutions.

"I intend to eat a lot of 'rubber chicken' over the coming months as I talk about the UW and our priorities," he said. "I pledge to be open and forthright with our colleagues in the press and I will hold regular sessions with our higher education reporters to discuss what's on my mind and theirs."

Thursday also marked the launch of the university's new practice of webcasting Board of Regents meetings live over the Internet, so "people across the state can hear the business of the Regents from meeting to meeting."

Reilly said he found it "unacceptable" that the UW System has nearly 9,000 more students and close to 700 fewer faculty than it did a decade ago.

 "Quality is in jeopardy when 40 percent of our credit hours are taught by nonfaculty, no matter how talented and dedicated they might be," he said. "Our success depends on our students having access to the best teachers and practitioners."

Reilly also put a high priority on efficiency. He noted that by national measures, the UW System is the most efficient in the nation, "but that doesn't mean we can't do more."

Reilly announced Thursday that he has already launched two studies to increase UW efficiency. First, he has asked Harry Peterson, former president of Western State College in Gunnison, Colo., and a former UW administrator, to study the UW System Administration, to compare its structure to that of other higher education systems, and to suggest ways the UW System might be better organized to serve the campuses, Regents and the state.

Second, he also has asked leadership of UW-Extension and the UW Colleges to find ways over the next two months to increase administrative efficiencies between those two unique institutions.

"This will in no way jeopardize access to these two premier statewide institutions," he said, "but rather will investigate how their administrative units in Madison might work together to achieve greater efficiencies. We owe it to Wisconsin taxpayers to be as thrifty with their dollars as they themselves would be."

Responding to a question from Regent Vice President David Walsh of Madison, Reilly said his goals to reach out to nontraditional students are three-fold. The university should offer curricula that attract working adults, deliver courses and services at times and in ways that are convenient for those students, and should look for sophisticated ways that working adults can satisfy course requirements based on previous learning and work experience, Reilly said.

Regent Danae Davis of Milwaukee congratulated Reilly for outlining what she called "spot on" priorities. She said she hoped students would be willing to reciprocate regarding openness and cooperation, and said she agreed that there is an expectation that there are further efficiencies to be found within the university.

Regent Roger Axtell of Janesville said he thought he spoke for all regents in pledging to help Reilly accomplish the goals he outlined. He especially noted that the university may be able to work with the state to make real improvements in financial aid.

"I, for one, am ready, willing and able to help you with all these priorities," Axtell said.

Read Reilly's full address

Regents approve 2005-07 program revenue operating budget

The Board of Regents on Thursday unanimously approved submitting its 2005-07 Program Revenue Operating Budget request, which included a projected a $20 million average annual increase, or 5 percent, in gift, grant and trust funds, to the state Department of Administration.

Noting this budget does not include state tax or tuition dollars, Reilly characterized this as "good news" for Wisconsin.

"These are dollars we bring into the state economy that ripple out in our communities. These dollars represent the research and services that we provide to our students and state citizens," he said.

University-generated funding, known as program revenue, excluding academic tuition, now represents more than 50 percent of the UW System's total budget. State funding amounts to 27.3 percent of the total university budget, and tuition dollars comprise 20 percent.

The program revenue operating budget request was the final step in completing the university's full budget request, to be submitted to the state on Sept. 15.

The regents approved its state-supported operating budget request in August. That request totals an annual average increase of $105.8 million over the biennium and includes an average 7.2 percent in state support each year.

The budgets were largely developed with guidance from the Regents' study of the university's future, titled Charting a New Course for the UW System.

Business and Finance Committee

Due to years of low or no pay increases, salaries within the UW System are as much as 20 percent below market, and the UW System is facing a real hiring crunch, the Business and Finance Committee heard Thursday.

George Brooks, UW System associate vice president for human resources, reported to the board the results of a review of salaries [PDF] within the UW System, requested by Regent President Toby E. Marcovich of Superior. Marcovich asked for data that showed the UW's regional and national competitive position.

"It's going to be a problem like we have not seen before," Brooks said. "The need is here now, and we're going to have to respond to it."

The report was for information purposes only, and the committee did not make a formal pay plan recommendation during Thursday's session.

Brooks said that more than one-third of the university's faculty members are currently at retirement age, and the same is true for one of every four academic staff.

"Meager pay plans are going to make retirement more attractive, particularly when dividend increases are larger than annual pay increases," Brooks said. "That should be a concern to us."

Due to several factors ―fewer professors entering the workforce than are eligible to retire, competition from new education sectors, and successful recruitment away of UW faculty due to low salaries in Wisconsin ―the UW System will have to replace faculty and academic staff more quickly and more often than expected.

Brooks also outlined the median salary histories of UW faculty, academic staff and university leadership. According to recent survey data, salaries of UW faculty are 17 percent behind their peers. The most dramatic gap is among the faculty at UW Colleges campuses, where assistant professors are 25.3 percent behind their peers, Brooks said.

Chancellors attested to the fact that the system's junior faculty members are being more actively recruited by other institutions because their salaries are not competitive.

"Wisconsin now has a reputation of paying on the cheap," Brooks said.

Academic staff are paid 17.7 percent less than their peers, he said. In order to catch up to market values in the next budget biennium, all UW academic staff would have to be reassigned to the next higher salary range to become competitive, Brooks added.

University leaders throughout the system are also paid less than their peers, notably chancellors who have been with the UW System for many years. Due to market factors, chancellors who have been hired more recently have higher salaries than many of their colleagues, a fact UW-Green Bay Bruce Shepard called a "loyalty tax."

"This extends beyond the competitive issue," said Regent Chuck Pruitt of Shorewood. "It's a fairness issue."

Brooks noted that 13 of the system's 35 academic leaders are actually paid below the minimum allowed for their position.

UW-Oshkosh Chancellor Rick Wells thanked the regents for recognizing the impact of salary compression and low pay plans on university employees and for including a 2-3 percent salary "catch up" in the board's 2005-07 budget request.

"The symbolism of that was as important as the amounts," Wells said.

Marcovich encouraged the members to review the survey findings and come back to the board in November with pay plan recommendations that are "at least, minimally fair."

Members also heard from UW System Vice President for Finance Deborah Durcan, who said that in July, the state mandated an across-the-board reduction of 7 percent of the auto fleet on top of an approximate 6 percent reduction in June, which was targeted at underutilized vehicles. This represents a reduction of 225 vehicles, on top of a 10 percent reduction in 2002.

This summer's reduction by campuses amounts to more than $3 million in replacement dollars. Any proceeds from selling the vehicles go to the state Budget Stabilization Fund, not back to the UW, she said. She added that campuses are concerned over the likely cost increases and decreased services to faculty, staff and students as a result of these fleet reductions.

Durcan also noted that she had an initial meeting with the State Controller's Office and DOA budget analyst about a UW proposal on cash management. Because the state depends on the UW's cash flow, it is unlikely that the UW System will be allowed flexibility until the state's budget and cash flow experiences a significant improvement, she said.

In other business, the committee passed resolutions to:

  • Approve appointments to the UW Medical School Oversight and Advisory Committee;
  • Approve amending an agreement for vending services at UW-Madison;
  • Accept the UW System Auxiliary Reserves report;
  • Accepted the statutorily required 2003-04 Report on Base Salary Adjustments to Recognize Competitive Factors;
  • Accepted several bequests of $50,000 or more.

View the Faculty, Staff and Academic Leaders' Salary Review presentation [PDF]

Physical Planning and Funding Committee

The board's Physical Planning and Funding committee opened Thursday with a discussion about capital projects at UW-Milwaukee.

Specifically, UW System Assistant Vice President David Miller updated committee members about developments with UWM's Kenilworth project, a public-private development of property donated to the university by the federal government. The building currently contains research and storage facilities for the Department of Anthropology and the School of Fine Arts.

Miller said the current proposal for development, submitted by the Weas Development Company, includes renovating the building and surrounding space to house classrooms, upper-class student housing, retail space and parking.

UWM Associate Vice Chancellor for Administrative Affairs Monica Rimai told the committee that the project will help the university return something back to the City of Milwaukee. The Board of Regents will be asked for authority to enter into an operating agreement for this project at its October meeting.

Next, UW Colleges Vice Chancellor for Administrative Services Steven Wildeck updated the committee on the current state of the UW Colleges. Wildeck explained the relationship that the 13 freshman-sophomore campuses have with 17 municipalities and counties across the state. The university owns the land on which the campuses are situated, but colleges receive municipal and county funding for building renovations, capital improvements and operations support, he said.

The UW Colleges campuses have received $10 million in support from these local governments in the past year, and in return, serve as sources of economic development for the surrounding communities. Wildeck ended his report by relaying a warning that the state might want to back out of their partnerships with local governments in supporting the UW Colleges if the state budget situation becomes tighter.

In addition, Assistant Vice President Miller also announced to the committee the formation of a workgroup to examine policies relating to the construction and financing of residence hall buildings. The workgroup will examine the fee structure for capital improvements to residence halls, whether they should be spread across all residence hall buildings or be covered with a higher price for newly created residence halls. The group will present its findings to the committee at the March meeting.

The committee also approved resolutions to grant authority to construct the American Family Children's Hospital at UW-Madison and to seek a waiver for the construction of a parking ramp attached to the hospital.

"The State of Wisconsin looks forward to having this world-class facility," said committee chair Regent Jesus Salas of Milwaukee.

Assistant Vice President Miller explained that although the project is not being funded with state or university dollars, the Board of Regents must grant approval for construction because the building and the parking ramp will be located on university land. Miller stressed that the request for a waiver to the state Legislature would allow the Findorff Corporation, which is constructing the Children's Hospital, to construct the adjacent parking ramp, but would not replace bidding on the contract work.

In other business, the committee passed resolutions to:

  • Approve a design report and grant authority to construct a Chilled Water Plant at UW-La Crosse. The plant would increase chilled water capacity to the new 350-bed residence hall and the campus' Cleary Center.
  • Lease space on behalf of the Graduate School and the Antarctic, Astronomy, and Astrophysics Research Institute at UW-Madison
  • Increase the Mechanical Engineering Renovation and Addition project at UW-Madison
  • Approve a design report and grant authority to construct a Second Floor Genomics Laboratory remodeling at the Great Lakes Research Facility at UW-Milwaukee
  • Approve a design report and grant authority to construct a Chilled Water Plant at UW-Whitewater.

Education Committee

The University of Wisconsin-Extension's revised mission statement was approved unanimously by the Board of Regents Education Committee during its deliberations on Thursday. The recommendation will be presented for full board approval on Friday.

UW-Extension interim chancellor Marv Van Kekerix told the committee that UW-Extension had engaged hundreds of faculty, staff and stakeholders in the process, including a statewide public hearing which was held via videoconference in six locations, Madison, Menasha, Milwaukee, River Falls, Superior, and Wausau. Participants included Regents Roger Axtell and Peggy Rosenzweig.

Noting that Extension is the "doorway" to the public university "for millions of Wisconsin individuals, families, businesses and communities," the mission statement underscores UW-Extension's commitment to helping the university to address the changing needs of the state and society.

The statement shows how UW-Extension can assist by applying relevant university research; and helping individuals to achieve personal growth and professional success and gain greater access to educational, cultural and civic resources through the use of technologies.

The committee also adopted the theme suggested by UW System Senior Vice President Cora Marrett, "The Continuum of Student Success," as guidance for its work throughout the year. Marrett said the theme emphasizes the importance of preparing students for success before, during, and beyond their years of university education.

The committee agreed that the theme recognizes the partnerships the UW System must have with the PK-12 sector, as well as those with post-secondary institutions, and it acknowledges the imperative for improving access and closing the achievement gap.

In other business, the committee passed resolutions to:

  • Accept the 2004 Research and Public Service Report;
  • Accept the 2003 report on Undergraduate Drop Rates and following a decade of satisfactory performance, request that the Joint Finance Committee discontinue the course credit drop reporting requirement;
  • Approve the Ph.D. in Medical Informatics, a collaborative program between UW-Milwaukee and the Medical College of Wisconsin;
  • Approve the renaming of the UW-Green Bay Professional Studies and Outreach Division and several school and college reorganizations at UW-Eau Claire;
  • Approve minor revisions to the Faculty Personnel Rules at three institutions—Green Bay, Madison, and Stevens Point;
  • Approve the authorization to recruit a new Chancellor at UW-Extension.

The committee also heard first readings of program authorizations for a B.A./B.S. in Multimedia Digital Arts at UW-Whitewater; and an M.S. in Occupational Therapy at UW-La Crosse; and a first reading of a mission revision at UW-Whitewater.

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The Board of Regents will resume its September meeting at 9 a.m. Friday (Sept. 10) in Room 1920 Van Hise Hall on the UW-Madison campus. Live streaming audio will be available from 9 a.m. - noon (times are approximate).


Read Sept. 9 news release

Read Sept. 10 (day 2) news summary