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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:
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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