Observations
By UW System President Katharine C. Lyall

An exciting, challenging time

For all of us in higher education, this is a very exciting time. Each fall, we are reminded of the importance of our enterprise as families arrive on our campuses to leave in our care some of their most precious possessions-their sons and daughters.

We accept these students with the pledge that we will provide what they need-within and beyond the classroom-to, in the words of the UW Colleges: "Give them the best start for the life they want."

And the experiences that our students have do truly transform their lives.

• One-third of the state's high school graduates walk off the commencement stage and directly into one of our classrooms. They depend on us for the education they need for the futures they want.
  
  
• We train 62 percent of the state's elementary and secondary teachers, 90 percent of the state's pharmacists-think about that the next time you fill a prescription-and the majority of its nurses, lawyers and political and business leaders, who make our lives work day in and day out.
  
  
• Each year, we graduate 25,000 students, the vast majority of whom stay in Wisconsin and improve the quality of life for all of us.

We have just come through a challenging year that included first a budget increase and then a budget cut. Talk about a fast turnaround-I'm not sure there was 30 days between the two! But it is important to remember that we have encountered challenges before, and the UW System has always taken those lemons and made lemonade. I am confident we will continue to be constructive and creative as we "manage for quality" this year.

So what lies ahead for our state and for our university?

I see three major themes that will impact the work we all do this year:

First, the Board of Regents has adopted the theme "Engage Wisconsin." This means we will be strengthening our partnerships with community and business organizations, working closely with the student ambassadors and student governments in UW System and emphasizing the economic impact that our university has statewide. The most recent figures show the UW System has a $9.5 billion annual impact on Wisconsin. Put another way, the state receives $9.50 for every $1.00 it invests in the UW System. (See related story on page 10.)

Second, we will need to build new relationships at every level with the state agency staffs as the next gubernatorial administration gets settled. We know that there will be ongoing challenges to help state government maintain services in the face of budget pressures. We must be flexible and patient and we must seek to forge new alliances and partnerships with state government that can be mutually beneficial to all of us.

Third, the UW System may once again be asked to take budget cuts. I have told the regents that we have "hit the wall" with this year's $44 million cut. Any future cuts must either be offset with tuition or result in enrollment reductions. And we will be seeking additional management flexibilities related to tuition setting, pay plan and cash management to accompany any future cuts.

As we continue through this academic year, we have some very important assets:

• We have a very committed Board of Regents who have made financial support for the UW System their highest priority;
  
  
• We have deep public support for the university;
  
  
• We have a cadre of students, faculty, staff and alumni who care deeply about our institutions and will play an ever more critical role in advocating for us.

And I would remind us that the state economy could look very different a year from now than it does today. Eighteen months ago, state leaders were expecting a budget surplus, and 18 months from now, the economy could be in much better shape. So I am hopeful that the university can actually emerge from this year with a more stable and encouraging outlook. And I am hopeful because of the fine work that all of our UW employees are doing to help stabilize us and keep our services flowing.