Contacts: Di Saunders - Office: 503-725-5714; Cell: 503-807-5539

Board of Higher Ed Approves System Budget, PSU Property Purchase, and Hears Report on OIT's Strategic Direction from President Dow
 

PORTLAND, October 17 - The State Board of Higher Education (the "Board") today held its second regular meeting of the 2003-04 academic year. The Board's discussions covered issues related to property acquisition, changes in an approved tuition rate, update on the fiscal status of intercollegiate athletics, the Oregon University System 2004 Annual Budget, higher education policy in Oregon, and Oregon Institute of Technology's strategic directions. The Board met at OIT's Metro Campus in Portland. 

OUS Budget         After reviewing the proposed OUS Annual Operating Budget and campus allocations for 2003-04, the Board approved the $2.3 billion budget. Campus allocations from the State General Fund are: Eastern Oregon University = $12.4 million (total budget = $43.3 million); OIT = $15.2 million (total budget = $44.9 million); OSU-Corvallis = $78.9 million (total budget = $506.8 million); OSU-Cascades = $3.3 million (total budget = $4.4 million); PSU = $57.1 million (total budget = $343.9 million); SOU = $14.4 million (total budget = $96.3 million); UO = $60.7 million (total budget = $541.3 million); and Western Oregon University = $14.7 million (total budget = $90.9 million); the Chancellor's Office allocation is $10.3 million (total budget = $24 million).

Institutions' operating budgets also include funds from Other Funds Limited (primarily student tuition), Nonlimited Other Funds (fees from services, student incidental fees, gifts, investment income, and other revenues), and Lottery Funds. The total OUS budget also includes statewide public services (Agricultural Experiment Station, Extension Service, and Forest Research Laboratory = $129 million), debt service requirements ($59 million) and capital construction ($446 million).

PSU Issues          Portland State University received approval from the Board to authorize OUS to obtain Legislative Emergency Board (LEB) approval to complete the purchase of the Doubletree Hotel property for conversion to student housing, a conference facility, academic use and additional campus parking. Approval is needed by the LEB in order to increase OUS's bond limitation from $20 million to $25 million in order to complete the transaction. The property is being acquired by the Portland Development Commission, using its powers of eminent domain, and will be conveyed to PSU. The total purchase price is $22.3 million. Jay Kenton, PSU vice president for finance and administration, noted that PSU has an enrollment of more than 24,000 students, but only 1,500 housing units. The transaction is expected to close in January 2004.

The Board also approved PSU's request to slow down the phase in of the elimination of the tuition plateau. Rather than eliminating the plateau entirely in Winter 2004, this will occur over a two year period, allowing time for students to prepare for the change, and academic and administrative changes to take place. The plateau will be completely eliminated in 2004-05, with students then being charged per credit. Generally, a tuition plateau offers students taking between 12 and 18 credits the same full-time tuition rate.

Athletics Report        The Board accepted the report on the Fiscal Status of Intercollegiate Athletics at Oregon State University, PSU and University of Oregon as of June 30, 2003. Mike Green, controller for OUS, reported that OSU Athletics improved its working capital position, but did not meet its $1 million improvement target to reduce its deficit for this fiscal year. OSU management is taking actions to improve the monitoring of the operational budget and expenditures of OSU Athletics in response to the OUS internal audit, all of which will be implemented by the end of this year. PSU Athletics needs to work to eliminate its cash overdraft at fiscal year end, but remains in compliance with Board policies regarding deficits. UO is in compliance with the positive working capital requirement.

OIT Report       OIT president Martha Anne Dow was the first campus leader to report to the Board on the issues facing her institution over the next few years. Earlier this year the Board asked that each campus president report on their institutions' key challenges over the course of the next several months, one president reporting per Board meeting. President Dow noted that OIT has a $100 million economic impact statewide, and is a major employer in the Klamath Basin. OIT works hard to connect its programs and students directly with workforce needs, and has the highest employment and starting salary rates of any OUS institution. Challenges for OIT are finding new sources of revenue in order to stabilize its financial health with increased reserves, additional capital assets and lower long-term debt; and challenges in recruiting and retaining faculty during the two year freeze on state salaries. OIT made progress between 2002 and 2003 by improving the operating margins from a negative to a positive, reducing its overhead, increasing expenditures in instruction, research and academic support, and maintaining fee remissions for needy students.

Strategic Planning Discussion       The System Strategic Planning Committee of the Board discussed the key policy issues that they would address over the 2003-04 academic year. Members agreed to complete the work of developing Board statements on the major policy dimensions of quality, affordability and access, identifying the roles and responsibilities of the State, System and Institutions in those areas. They will also continue to develop a policy agenda for Pre-K - 16 working through the Joint Boards Working Group. During the year the SSP will conduct individual campus planning discussions and identify "gaps" and "overlaps" that need to be addressed in the System Strategic Plan, and overall System priorities.

In other action and discussion at today's meetings, the Board:

  • Ratified and voted on actions taken in Committee meetings.

  • Approved a PSU request to authorize OUS to request $1.6 million in Other Funds limitation from the Legislative Emergency Board to provide Bio-Safety Level 3 labs in the Oregon State Public Health Laboratory at PSU.

  • Affirmed the principles, procedures and criteria for selection of the EOU president established by the Board.

  • Approved the nominations of Jim James and Joel Nelson to the forest Research Laboratory Advisory Committee.

Oregon University System (OUS) comprises seven distinguished public universities, reaching more than one million people each year through on-campus classes, statewide public services and lifelong learning. The Oregon State Board of Higher Education, the statutory governing board of OUS, is composed of eleven members appointed by the Governor and confirmed by the Oregon State Senate. For additional information, go to www.ous.edu      

 

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