Colleagues,

Yes, this is it — the one you’ve been waiting for. Of all the long emails I send out each year on any myriad of topics, none jumps off the shelves (figuratively) like the spring budget email. Like a brutally long novel (think Russian literature) assigned in a class you didn’t want to take, you don’t really “enjoy” a budget email — you “survive” it to tell stories about the trauma years afterwards.

So, “enjoy.”

We rejoin our FY16 budget (the budget that covers the fiscal year beginning July 1, 2015, and closing on June 30, 2016) after almost a year of modelling and planning. We developed the first drafts in June 2014, sharing the basic approaches and choices with ASCSU, Faculty Council, and the AP and CP Councils early in the fall semester. Deans and VPs then led planning efforts for their units over the fall, and in early November, the Governor released his initial budget that gave us his administration’s thinking on plans for higher ed funding. nce again, Governor Hickenlooper’s administration has stepped up strongly to invest in Colorado’s public higher education system (more on this below), and that investment was factored into the January Strategic Planning Retreat (which Provost Miranda has ironically dubbed “SPARC-Fest.”

This is worth a quick aside: SPARC stands for Strategic Plan Area Review Committee, and I imagine “Fest” is a twisted mangling of the concept of a festival.(Many of us think this name is a sign that Rick needs more vacation time.)

The joy that is SPARC-Fest moves directly into the January Planning & Budget Hearings, where each unit discloses its thinking and planning from the fall. This results in a reasonably detailed budget, which is shared with campus leadership groups, posted online, and reviewed with our Board of Governors. Then, we wait for the Colorado General Assembly to finalize its work on the entire state budget.

That’s where we are today, and heading into the final weeks of the Colorado legislative session, we have good news on CSU’s budget front for next year. The Colorado Joint Budget Committee’s budget package for 2015-16 includes an 11% increase ($66.6 million) in funding for higher education overall, with about a 10.4% increase ($12.7M) of this total designated for the CSU System. The budget bill passed the Senate last week and moves to the House this week, but even though it’s not yet final, we clearly have many reasons to feel positive — increased state revenues will provide additional funding for scholarships, help keep tuition increases lower than anticipated, and help make progress in rebuilding our overall state funding for higher education to where it was before the recession hit in FY08-09.

Thanks to the state’s leadership in restoring higher education support, we’ve been able to decrease the planned tuition increase for next year to 5.5% for resident undergraduates (about a $216 increase) and 4% for non-residents (~$481), per semester. The intended increase for graduate students — both resident and non-resident — is 3%. The PVM tuition rates are proposed at 1% for non-residents and 6% for residents. It’s important to note here that tuition rates are set with a goal of access for Colorado residents, maintaining strong and diverse enrollment across both resident and non-resident populations, and assuring the financial health of the academic foundation of our university. The tuition rates we’re proposing for next year keep CSU solidly in the middle of its national peer group for both resident and non-resident costs, reflect the increasing enrollment demand we’re seeing after several years of record enrollment, and allow us to continue to make progress on several key quality initiatives on which our campus has been focused. Most importantly, this increase will help us recover some of the ground lost during the last several years of economic downturn by adding about 40 new faculty positions across the institution.

The entire discussion about tuition and student debt in American public higher education is complex. In brief, the 2/3 of the students who enroll at America’s public colleges and universities carry only 1/3 of the total student loan debt, they have the lowest default rates in the country, they enjoy dramatically improved employment rates vs. folks without a college education, and the hourly wage gap between a college-degree holder and a non-college degree holder has never been higher. The Brookings Institution reports that the return on investment for the average student loan is 15 percent annually. There are a variety of other ways one can further assess the ROI of a college education; for some information specific to our CSU graduates, visit csueffect.colostate.edu/ and you’ll find some relevant materials on this topic.

It’s probably also worth mentioning here that CSU is once again on track to set another record for private fundraising this year — surpassing last year’s record, when we raised more private gifts in a single year than any other campus in the history of Colorado. Last year’s private support of $143 million was $46 million more than we received in operational funding from the state — and while private gifts don’t fund our day-to-day operations, they provide us the opportunity to grow the quality of the university and pursue excellence.

But along with the positive revenue news, we need to acknowledge that increased enrollment comes with increased expenses. The latest summary budget is available on the Office of the President’s website at www.president.colostate.edu/budget/ — and it’s important to note that this is only a summary of the incremental changes to the education & general (E&G) fund portion of the budget.

The entire University budget, which includes directed funding for specified uses (research grants and contracts, housing and dining revenues, directed philanthropy, etc.) is more than $930 million.

That figure, and how it has changed over time, can be followed via our Financial Accountability reports at accountability.colostate.edu/. And if you’d like to drill down, the budgets, including resources available and expenditures for each unit (college, department, VP divisions and departments), can be found and tracked over time at www.budgets.colostate.edu/cdobs.aspx.

But the incremental E&G budget, our subject today, is key because it is the budget that funds the nuts and bolts of the academic backbone of our university — and it is the budget that drives such critical items as tuition increases and salary increases and increases in faculty lines and expenditures on campus safety. About 62 percent of next year’s incremental E&G budget will go directly to academics, and almost everything that was identified as top priority through the Planning and Budget Hearing is funded in this draft. In addition, we are preparing for a 2 percent salary increase for faculty, administrative professionals, and state classified staff, and a 1 percent increase in the university’s contribution to the faculty/admin pro DCP plan. The budget includes new funds to address enrollment growth, about $2.5M in new financial aid and scholarship support, and additional funding for graduate assistant tuition and health care. As mentioned, we will be adding about 40 faculty positions and significant additional support for GTA positions, along with some significant research investments related to start-up funding, seed grants, and core facilities. This budget also commits to initial funding of our Ph.D. program in Communication Studies, provides strong support for student success initiatives and the Honors Program, addresses some of our ongoing responsibilities under Title IX, and includes significant support for Extension and engagement programs. There is additional support for some of our high-demand student programs and key infrastructure areas including facilities, environmental health, web support, and the Ombuds/Employee Assistance Program. And there is funding in here to raise the salary floor for our non-tenure-track faculty.

Now, this budget is close, but it isn’t finalized. There will be open forums to review the budget later in April, and you can submit your thoughts on the budget to Provost Miranda, myself or Lynn Johnson, our CFO, at presofc@colostate.edu. With that final input and after the state passes the Long Bill, the budget will then go to our own CSU System Board of Governors for debate and, hopefully, approval at their May meeting.

If you’re an insomniac and a glass of warm milk isn’t doing the trick, in addition to the resources listed above, you can develop your own budget scenarios via the on-line budget balancer available at budgeter.colostate.edu/Main.aspx. This thing is a kick; sometimes I’ll sit up all night (especially after a Cubs’ loss) just playing around with budget scenarios … well, maybe that’s abnormal and perhaps you won’t find this as riveting as we do in the Admin Building. But if you do, please put down the mouse and seek immediate medical attention.

After all of that, what are we left with? The budget is imperfect.

Many will feel the pinch of the $216.50/semester increase in resident undergraduate tuition. Our faculty and staff deserve better than a 2% salary increase, even with the progress we’re making on benefits.

Revenue pass-throughs to facilitate local decision making in response to enrollment growth are not coming through to the units as fast as needed, and we heard that loudly and clearly when we met with college executive teams and Faculty Council reps this spring. Our investments in tenure track faculty lines, compensation and work environment for our non-tenure track colleagues, and our on-going investments to improve the quality of the work experience in our community for our female colleagues are valuable, but inadequate. There will be those within our community who will suggest we should have prioritized some items higher and others lower. This is part of the normal healthy debate of an academic budget process.

I will highlight one item in the budget that has been the subject of no small amount of recent speculation. There are no E&G funds (no tuition revenues and no fees and no state funding) being directed to the new stadium project. The primary changes to the Athletic department budget include approximately $160K to invest in the so-called non-revenue sports where the majority of our student athletes and especially our women student athletes compete. There’s some money to begin to phase in a 2nd year of a nutrition pilot program (made possible by previous NCAA rules changes), and I’ll be utilizing one-time funds made available when Coach McElwain moved on to the University of Florida to initially fund the new NCAA cost-of-attendance legislation, without investing institutional funds, while we see where such trends end up going on the national stage. If you have questions on these topics, either contact me or members of the Faculty Council on Intercollegiate Athletics, the Faculty Council Committee on Strategic and Financial Planning, or the Faculty Council Executive Committee; these 3 groups were part of a joint session where we discussed the opportunities and challenges that exist in this part of the university budget.

But even though the budget is imperfect and even though we may not find uniform agreement on every budget item, I believe this budget reflects our values in balancing a complex public entity in challenging times. We have focused on academics 1st, 2nd and 3rd.

We’ve reinforced our belief in distributed decision making. We’ve paid strong attention to access by controlling expenses, holding tuition down, and increasing institutional financial aid — and the data are clear we’re succeeding in this complex area. We’re investing in people — not just salaries and benefits, but more tenure track faculty lines and improvements for our non-tenure track and female colleagues and expanded privileges for all employees through Commitment to Campus. Campus safety is not lost in this budget, nor is the academic success of the students we strive to enroll and keep safe while on our campus. Teaching, research, and engagement are all valued by this budget — just as they underpin the role and mission of our university.

To the extent this budget succeeds in moving CSU forward and reflecting our shared values as a community, it’s because of your active engagement with our budget processes. Thank you.

-tony

Dr. Tony Frank
President

P.S. The bonus for those of you who made it this far is this tip for next year: CSU’s Got Talent. I had the honor of being a judge for this last Friday night. The talent of our students who put themselves out there in front of a packed LSC Theater and 3 judges (2 of whom actually knew what they were doing and carried me along) was amazing. These are brilliantly talented young men and women, and you should grab every chance to see them perform in coming years!