Chancellor Martin: UW budget proposal a “promising first step”

Dear members of the UW–Madison community,

I am pleased to report that key state lawmakers, with input from UW–Madison and UW System, have reached a compromise that will help the campuses develop more effective ways of operating.

The agreement by members of the state Legislature’s budget-writing Joint Finance Committee begins to reform the business model under which Wisconsin public higher education has operated for 40 years.

The proposal offers varying degrees of administrative flexibilities, with the more significant gains in human resources, purchasing, travel and budget. These flexibilities – proposed for all UW System institutions – will allow us to be better stewards of our limited resources. In some areas, including human resources, the plan delegates authority directly to UW–Madison. Our campus will be granted considerable authority to design its own personnel system. At the end of the biennium, that system will be submitted through the Board of Regents on its way to the Legislature’s Joint Committee on Employment Relations. The right to supplemental pay plans will be effective immediately. Through UW System, we will receive our general purpose funds in the form of a block grant. Program revenue and segregated fees will be put in a separate fund, which offers somewhat more protection from being swept by the state and used for purposes never intended when the funds were collected. It appears that legislators have adopted a policy that will prevent sweeps at least through the upcoming biennium. The plan proposes that base tuition increases be capped at 5.5 percent for the next two years, plus differentials that are already in place, including the Madison Initiative for Undergraduates.

We are pleased that the deal struck by lawmakers, which includes a major study of how UW System is organized, acknowledges the need for change and adopts some of the principles we outlined in the original New Badger Partnership. That study will focus not only on structure and governance, but also on issues of access, affordability and quality.

During the past few months, we have sparked and contributed to a statewide conversation about the future of higher education in Wisconsin. We have begun the work that will strengthen our position as a world-class educational and research institution, offering opportunity, development, job creation and an economic engine for the citizens of the state of Wisconsin and beyond. The legislators’ proposal provides UW–Madison and other UW System campuses with a promising first step.

Given the challenges that threaten the nation’s great public research universities and higher education more generally, we know the journey is not over. UW–Madison and other campuses will need more flexibility and autonomy over time if we are to have the best chance to reach our fullest potential. It took years for the UW Hospital and Clinics to gain the status that has made it successful.

We will continue to pursue creative solutions to the problems we face. We look forward to participating in the study proposed by the Legislature to review higher education in Wisconsin.

As expected, the proposal also includes significant budget cuts. The university has absorbed budget cuts in four of the past five biennia. Under the proposal adopted by the committee, UW–Madison faces a $94 million reduction during the biennium. Although the budget cut is less than what was proposed as part of the shift to public authority status, it is still a significant obstacle going forward. Deans and directors have been engaged with you for months in discussions about how to approach different possible cut scenarios in a way that is strategic. We will continue to have broad discussions about how to operate more effectively and implement the cuts in ways that cause as little pain as possible.

The 2011-13 budget package headed for the Joint Finance Committee for approval is expected to go to the full Legislature later in June. Meanwhile, details about the budget process and how it will affect UW–Madison will be posted at our budget website.

The discussions across the state during the past several months have shown how essential UW–Madison is considered to be to higher education and to economic growth in the state. As the economy recovers, I believe the state will re-invest in higher education. The debates we have had will have shown many more people why that investment is so important, and I believe we will have increased support as we continue the work of advocacy for the university.

I am deeply appreciative of the opinions expressed on all sides of this issue by students, faculty, staff, alumni, supporters of the university and the broader community. The exchanges reflect your love of this university and the considerable investment you have in its mission and its future success.

As this conversation continues in coming months, I look forward to working with all of you to reach the best possible outcomes for the university and for the people of Wisconsin.

Thank you,

Chancellor Biddy Martin