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Higher Ed Board approves universities' budgets, reviews PSU strategic report

Di Saunders – Cell: 971-219-6869 (today and over weekend); Office: 503-725-5714

PORTLAND, September 7, 2007 – The State Board of Higher Education (the “Board”) met today at Oregon State University – Cascades Campus in Bend to hear about Portland State University’s (PSU) mission, programs, and plans; review and approve university budget allocations; and hear about the University of Oregon arena plans, among other items considered by the Board.

PSU Strategic Plan

Portland State University leadership – including Michael Reardon, interim president, Roy Koch, provost, and Lindsay Desrochers, vice president for finance and administration – presented the university’s “portfolio" of assets, successes, and challenges, the 7th of 8 OUS institutional reviews being completed this year. The speakers noted that PSU emphasizes engagement through its over 400 partnerships locally, its diversity, and its focus on sustainability and internationalization. PSU’s population is made up of the “new majority” student: older, more ethnically diverse, taking longer to complete a degree, working while in school, and students who amass their higher education by attending multiple institutions. Enrollment has increased about 50-60% in the last 10 years to 25,000 students, with about a 3% increase expected this fall. PSU now graduates about 4,500 students each year, with 2/3rd undergraduate and 1/3rd graduate degrees.

The university is deeply committed to engagement with educational institutions, the city, and other partners. PSU’s internationalization commitment includes increasing the number of international students on campus and its own students who go overseas, as well as expanding dimensions of students’ international and cultural experiences on campus, expanding offerings of PSU courses overseas, and increasing collaborative research with foreign colleagues and universities. Establishing professional development programs around vital issues, such as sustainability and management, is another key effort at PSU, and deepening their portfolio of programs, expanding academic programs that are focused on engagement, growing research and collaborations with other OUS institutions (such as the Oregon Nanoscience and Microtechnologies Institute with OSU and UO), and ensuring flexible delivery of programs that work for today’s students. PSU is working hard to map its program offerings to meet the occupational needs of business clusters. Graduate programs are appropriate to metro region needs in employment, such as its master’s degrees in social work, public health and business. PSU’s faculty has accomplished significant scholarship, including that focused on regional issues, creative work in the humanities, fine arts, education, and in Asian and cultural studies, and public history, among other areas. Collaborative programs have increased at PSU, including co-admission agreements with numerous community colleges, other OUS institutions and Oregon Health & Science University, providing effective ways for students to complete degrees. PSU plays many roles in Portland, from a major employer to a key community partner, and had an economic contribution of over $1 billion in 2005. Ties with the city and the Portland Development Commission include work on urban development and renewal, including transportation, retail, and university district, and economic development overall.

Among PSU’s top goals are to focus on increasing undergraduate student retention and the number of under-represented students, to continue to develop nationally and internationally recognized academic and research programs in selected areas important to the metropolitan region, and building their national leadership in engagement and service learning. Challenges faced by the campus include student retention and completion; increasing the number of full-time, tenured faculty; facility and space issues; support staffing such as in student services; and deepening community support for higher education in the Portland area.
OUS Biennial Budget

Jay Kenton, OUS vice chancellor for finance and administration, described the OUS 2007-2009 biennial budget allocations for each campus and the proposed fiscal year 2007-08 operating budget allocations. Kenton noted that the campus allocations were based on several guiding principles, including compliance with legislative expectations and representations; reinforcement of Board expectations and goals; equitable basis for distribution of state General Fund; creative incentives to serve more Oregonians, improve retention, reduce time to degree and improve graduation rates, and attain sustainable finances at the regional campuses; and begin to normalize the Resource Allocation Model (RAM), which provides funding based on student enrollments. Kenton said that the renormalizing of the RAM, which has not been utilized in recent years due to lack of state funding for enrollment, has negative implications for some campuses and positive for others. The plan going forward, based on available funding, is to phase in funding for enrollment growth, with 50% in 2007-2009 and 50% in 2009-2011 (dependent on adequate State funding in 2009-2011). Overall, increases in 2007-2009 General Fund allocations for operations to the universities increased 16.9% over 2005-2007 (EOU: +19.8%; OIT: +24.4%; OSU: +19.5%; OSU-Cascades: +29.6%; PSU: +18%; SOU: +15.6%; UO: +12.4%; WOU: +15.7%).

Other budget allocations include: $10 million in faculty salary funding in the 2007-2009 budget, used to improve compensation for faculty involved in and funded from teaching, research, or public service activities and budgets; $6.9 million to reduce student/faculty ratios that are higher than “peer” university averages (OIT and Southern Oregon University will not receive this funding due to having lesser student/faculty ratios than peers); $9 million in support for regional campuses (Eastern Oregon University, Oregon Institute of Technology, Southern Oregon University, Western Oregon University, and Oregon State University – Cascades branch campus) to be used to increase retention, graduation, and other student success factors, provide a base amount to support sustainable operations, and provide transition funding needed by some campuses to execute Board approved retrenchment plans; funding to improve student retention and graduation, and shorten time-to-degree, with allocations dependent on submission of plans by campuses to reach goals in these areas; targeted programs such as engineering (through funding of the Engineering and Technology Industry Council programs), research, institutes, and programs, statewide public service programs through OSU ($15 million), central services for the System, and regional campus support. Among targeted programs are: the Rural Access initiative, a new pilot program funded at $580,000 and managed by EOU that will work to increase access to and enrollment of rural Oregon students in OUS institutions; and health professions programs funded at almost $7.4 million to increase programs and graduates in healthcare shortage areas, some through OIT. After discussion by the Board, the proposed budget allocations to OUS institutions for 2007-2009, and the proposed 2007-08 RAM allocations were approved by the Board.

In other action and discussion at the meetings, the Board and/or Committees:

  • Approved adoption of the resolution of necessity so that the University of Oregon may acquire the land parcels adjacent to the Williams Bakery property necessary to construct an arena at the site. The Board heard plans for the development and funding of the proposed arena project as well.
  • Accepted the Quarterly Management Report for June 30, 2007.
  • Heard a Progress Report on the OUS Internal Audits issued from May 2007 through August 2007.
  • Approved the proposed October sale of Certificates of Participation as described in the Board docket.
  • Approved entering into a preliminary services agreement with Valeo, LLC regarding development of the OIT housing project.
  • Authorized the Purchase and Sale Agreement between OIT and Clackamas Community College for the sale of OIT’s remaining interest in an approximately two-acre parcel of undeveloped land within the Metro Center Campus, proceeds to be used for repayment of existing bond debt service and to expand educational programs at OIT’s Amber Glen Campus.
  • Adopted a resolution regarding access to classified information related to the Department of Defense material.
  • Approved new academic programs, all effective fall 2007 – EOU: B.A. in Modern Language and Global Culture; OIT: B.S. in Allied Health Management; PSU: Ph.D. in Chemistry, M.M. in Jazz Studies, and B.A./B.S. in Film.
  • Authorized a ten-year Land Use Agreement between EOU and the Elgin School District for Head Start programs.
  • Approved resolutions recognizing the service of Dr. Gretchen Schuette, recently retired Board member, and Henry Lorenzen, current Board president who will complete his service on the Board at the end of September.
  • Adopted proposals related to retirement and tax-deferred investment plans’ conversion: expansion of the Tax-Deferred Investment 403(b) Plan to allow post-tax Roth accounts to be established among investment programs on or after November 1, 2007; discontinuation of the elective special section 403(b) service catch-up deferral on December 31, 2007 for all programs of the Tax-Deferred Investment 403(b); and adoption of the Committee Charter for the Retirement Committee of the Optional Retirement 401(a) Plan and Tax-Deferred Investment 403(b) Plan.
  • Adopted salary increases and extended contracts for OUS presidents at OSU, SOU (continues at current contract), UO, and WOU; and for the Chancellor of the Oregon University System.
  • Heard reports from the Interinstitutional Faculty Senate and the Oregon Student Association.

Oregon University System comprises seven distinguished public universities, reaching more than one million people each year through on-campus classes, statewide public services and lifelong learning. For additional information, go to www.ous.edu

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