Questions both 'practical' and 'philosophical' began Murray State's Quarterly Board of Regents meeting today, along with a tone of cautious optimism. In passing the budget for the 2016-17 fiscal year, university officials report being in a generally good financial position in terms of preparation for and managing state funding cuts.
Addressing the Board, MSU President Dr. Bob Davies gave an update on a statewide committee of university presidents, state legislators and a representative from Governor Matt Bevin's office now in the planning stages of developing a performance-based funding model.
Performance-Based Funding
Institutions will compete for 5% of state funding, which grows to 25% in 2020. The committee is tasked with determining the metrics to be used in evaluating performance. "Do you measure pure quantity, i.e. number of graduates or number of students admitted? Or do you measure more qualitative, more quality measures: retention rates, graduation rates?" Davies told WKMS. Davies says while larger universities may focus more on the numbers, Murray State is in the middle in terms of size and may have a greater focus than other institutions on measuring quality.
He says key components include retention (of freshmen), progression (sophomore to junior, senior to graduation, etc), graduation rates, STEM+H (health) and other factors including under-represented student populations. The competitive nature between universities is still being worked out (for example, if Murray State improves by 5% and another university improves by 6%, then do they get all or more of the money?). He says 'stay tuned' for an update from this committee as they further develop the model.
The committee includes presidents of public universities, the president of KCTCS, Democratic State Rep. Arnold Simpson, Republican Senator President Pro Tem David Givens, and a representative from Governor Matt Bevin's office. WKU President Gary Ransdell is presiding over the group. The state legislature will approve the criteria in a bill in the next session. Deadline is December 1. If there is no consensus, the legislature then determines the criteria, which members of today's meeting agreed would not be ideal. Davies says he believes there will be a compromise.
University Changes, Cuts, Increases
Higher education in Kentucky is being cut by 4.5% under the two-year budget. The Kentucky state legislature approved this measure earlier this year. Vice President for Finance and Administration Jackie Dudley said in preparation for and managing state funding cuts, a decline in enrollment and pension adjustments, "at this stage in the game, we are right where we want to be."
Davies echoed this sentiment to WKMS, adding in context, "Of course we would love to have additional resources and other things that we could be doing, but given the constraints and given the pressures... Steve Williams really said it well, Regent Williams, when he said 'you manage to the reality' and that's really what that reflects."
Among those realities are degrees and programs being phased-out, including a vote approving to not renew a cooperative program with University of Kentucky at the Paducah campus. Davies says the program started 15 years ago due to an excess capacity of MSU professors, where they would teach classes to UK students in Paducah towards a UK degree. Davies says this non-renewal is an unfortunate consequence of the budget reductions and performance-funding coming down the track.
"But it's also a reflection of the growth of our own educational programs here on campus. We're at a point where we need to have the capacity if you will, the professors, back here on campus working with Murray State students" he told WKMS.
Davies credited the growth of Murray State engineering program. He said UK knew this was coming.
Programs Cut
Programs approved for deletion by natural phase-out or budget assessment include:
- Bachelor of science and athletic training (the industry generally no longer hires bachelors degrees). The focus will instead go towards exercise science so students can seamlessly transition into masters programs.
- Bachelor in health information administration was an efficiencies decision, moving into a track rather than a major. The experience won't change, but some courses will merge. It was also mentioned that in this region it was difficult to find doctors giving up positions in the economy and moving into an academic position.
- Bachelor of science and interior design was cut as part of the budget review process. The program had 32 students within the engineering and physics department. It was a fairly expensive program and the students will be doing a teach-out to earn their degree (but not admitting new students).
- Bachelor of arts/science in philosophy. This is eliminated as a major and is being merged into a track within the English degree. Since the major was so small, there weren't enough students to take a faculty member to teach a higher level course and instead directed studies were offered. Philosophy faculty will be teaching university studies philosophy courses.
- Bachelor of arts/science in public administration. This program never got the enrollment expected. Instead, nonprofit leadership studies turned out to be quite successful. Masters in public administration still remains one of the highest enrolled programs.
- Master of science in watershed studies. This is getting streamlined by moving it into a concentration within biology and geosciences.
- Master of science in chemical manufacturing management. A relatively new degree, it was expected to be highly enrolled with interest from people already working in this industry. However, enrollment was only one student. That program will close when the student gets their degree.
New Minors: Exercise science, public and community health, actuarial science, mathematical biology, music theatre, applied statistics and juvenile justice.
Current Budget Update
Vice President of Finance and Administrative Services Jackie Dudley says Murray State has succeeded and even exceeded the summer 1 tuition goal. She says the university is "still short $2.3-2.5 million" on the balance but the number is better than anticipated.
Balance sheets are fluctuating due to work on the Breathitt Veterinary Center and Engineering and Physics building. They are paying bills to the contractors on those buildings, but the state hasn't sold all of the bonds yet, so there is some fluctuation in cash assets and money being used from reserves.
The planned 2% state appropriation this fiscal year accounts for about $960,500 dollars set up by the state in an escrow account. The depreciation is expected to be spread out over three payments.
Dudley says institutionally, the university is at about the same level as last year, considering pension adjustments. The education and general fund is the same as last year even with a decline in enrollment. This is "right where we want to be," Dudley said. Regent Vice Chair Stephen Williams credited actions already taken to overcoming a financial crisis. Regent Chair Harry Lee Waterfield II, added that Murray State is ahead of other universities that don't have a budget yet.
2016-2017 Budget
The board unanimously approved the budget for fiscal year 2016-17.
Davies thanked the university leadership team and community for participating in the process addressing budgetary pressures. He said the budget adheres to the university's strategic plan. The budget includes an across the board salary increase for faculty and staff of 1%. Individuals below the poverty line and at minimum wage levels will also be compensated at a higher level over a three-year plan.
The budget represents a decrease of approximately $1.5 million, a 1% overall decrease. Change to the general fund budget approximately $1.9 million, or 1.4% decrease. State appropriation reduction 4.5%. Tuition mandatory fee rates increase 4.5% about $168 dollars per semester for full-time students. 1% adjustment for employee raises. Dining rate up 4.5%, housing 5% (see below).
Reallocations to fund priority needs: new tuition and fees of $2.7 million. Savings, fringe benefits, healthcare, eliminations saved $800k. $600k from housing. Recaptured funds from vacancies. $4.4 million reallocated from units (president, academic affairs, student affairs, administrative services, university advancement). This approximately covers the total need of $8.6 million.
The budget accounts for the decline in enrollment, not projecting growth (so if there is a growth that would be in the university's benefit). Salary increase of 1% across the board totals approximately $730k. This is covered as part of the $4.4 million. Nonexempt compensation adjustment accounts for an increase of $250k in the next year, with a target of a $10.10 hourly rate as an institutional minimum. The budget factors in federal overtime legislation would mean an increase of $1.3 million (including benefits), which has to be implemented by December 1.
$2.5 million has been taken out of the salary pool for reallocation. FTE decreased by 47 positions. 12 positions have been filled. 31 vacant positions were eliminated.
Retirement increases: KRS has a mandated increase of $812k; percentage of pay now is 48% hourly (KTRS is about 16% per hour, hazardous duty is about 25%).
The budget does not expect increase in healthcare claim amounts. Contingency for vacant positions are built in. Utilities for new buildings are budgeted in and the exempt compensation study is built in. Showing the magnitude of human capital at Murray State, most of the total budget goes towards salaries: $73.4 million (not including benefits).
Housing, Dining, Tuition, Parking Increases
The board voted and approved a 5% increase to housing. This would bring in approximately $700,000, and accounts to about $109-150 for students. Concern for Murray State's affordability for some students was expressed. Davies said he is working to keep Murray State affordable, but "at the end of the day we need to pay the bills." Student Regent Clint Combs voted against this increase.
The board also approved a 4.5% increase to dining rates. This accounts for pay increases, hourly wages and the increasing cost of food. This would account for a $76 increase to the unlimited plan and a variable increase in the flex plan. Regent Susan Guess expressed concern about efforts to feed students in need. The Racers Helping Racers food pantry was mentioned, as well as partnerships with the community kitchen in Murray. Regent Combs voted against this increase.
The board approved eliminating a regional discount fee of $100 dollars. Under the new tuition model, this amount is incorporated into the regional discount.
The web course fee is going away and instead additional charges will occur for hours over 15. An increase of $65 per credit hour will apply to undergraduate courses.
In the existing course fees schedule some courses were charged by course, others charged by hour. The board approved a measure to change all courses to hourly rates for ease of processing and to more consistently communicate with students. Increases as a result of changing the escalation policy from formerly pairing with the Consumer Price Index (inflation) will generate approximately $109,000 dollars. In years where there is not a tuition increase, tuition will follow the CPI.
An approval of new course fees will generate approximately $119,000 dollars. Regent Combs said while most students are aware of tuition increases, they can feel misled regarding course fees. He said he hopes this can become more transparent for students. Davies agreed with this suggestion. Acting Provost and Vice President for Academic Affairs Dr. Renae Duncan explained why there are fees in courses where it seems otherwise unlikely, for example in Humanities there is technology in the classroom being used, or a speaker who might read in a poetry series. Course fees take the edge off of paying for the technology or guest.
Parking will increase from $75 to $100 per year for standard permits. They are also providing the opportunity for 'further reaching lots' like the purple zone by the stadium to have a cheaper permit price. Paducah and Hopkinsville campuses will have parking fees of $2 per credit hour for face to face classes. Revenue will bring in about $150,000. Regent Combs voted against this increase. Faculty and staff in satellite campuses will be asked to buy a reduced-price permit.
Graduation, Enrollment
Davies praised university faculty and staff for 1,565 degrees awarded in the Spring commencement, one of the largest that walked across the stage. He also said he was proud of the collegiality and community spirit on campus in this period of relative uncertainty.
Enrollment was down slightly in the Spring of 2016 compared to the previous year, approximately 4%. Spring enrollment was 9,754 (10,175 in Spring 2015). However, preliminary numbers for summer enrollment have a slight increase. Due to an aggressive push in marketing, promoting, new admission requirements, a new scholarship model, and "boots on the ground" efforts, fall numbers look encouraging. Freshmen retention rate is also up slightly.
New Tagline, Logo, Wordmark Branding Campaign
Dr. Adrienne King presented the 2016-2022 marketing plan, with an effort to better convey a sense of 'university atmosphere' to prospective students. This includes the new messaging tagline "opportunity afforded." King says this presents a two-way meaning for students and will force the university to focus on outcomes.
She also presented a new shield logo and 'wordmark.' The shield embraces a traditional look with a modern update, in coordination with the university's 100th anniversary.
The wordmark emphasizes "Murray State," which King says is how many people naturally refer to the university. New elements will start appearing online and on social media beginning July 1 along with a promotional campaign centered around the new tagline.
King anticipates a full transition away from the old logo will be a two-year process.
More in University Advancement
Alumni affairs is seeking to grow membership to 1000, currently at 752, up 28% from the previous year. Tina Bernot is officially named the Executive Director of Development. From previous year numbers, donors increased by 12%, number of gifts increased by 16%. $5.7 million is the estimated final figure in gifts for the current fiscal year.
Goals for FY17 include $5 million for engineering and physics, STEM scholarships, endowed professorships, presidential lecture naming opportunity and honors scholarship and program support.
Renaming
Renaming measures approved that go into effect today include the "Marketing and Outreach" to "University Advancement," overseen by Dr. Adrienne King, and includes alumni, development, branding and marketing communications.
Another measure renames Murray State Community College the "Center for Academic Success." This center would still qualify for free community college education, should Kentucky adopt a model similar to Tennessee.
The Engineering and Physics building will have the Dr. William and Maxa Read Physics Office Suite.
The James Allan Roberts STEM Internship Scholarship Fund was also approved.
Regent and Officer Elections
Steve Williams was elected Regent Chair. Waterfield was congratulated for his time as regent for six years and as chair for two years. Williams said he was honored, privileged and humbled.
Susan Guess was elected Vice Chair.
Jill Hunt was approved to continue as Secretary. Jackie Dudley was approved to continue as Treasurer.
Note: Clint Combs continues as Student Regent. Katherine Farmer is the new Faculty Regent.
Other matters approved today
- A policy change where a spouse of a staff or faculty member can be considered an "internal candidate" for a position. After some debate (over fairness considering a long-time staff member, for example, in the same pool as someone relatively new and concerns regarding affirmative action compliance) this was approved. Staff Regent Schooley voted against this measure.
- The Men's Tennis team was formally cut, saving $145,000. This is the last elimination the university could make while staying in Division 1. Rifle is qualified so long as it's coed.
- Two assistant football coaches were appointed: Kevin Park and Corico Wright.
- Dr. Duane Bolin is approved to write the centennial history of Murray State.
- Regent Jerry Sue Thornton was approved to receive an honorary doctorate in education.
- Thornton and Regent Martin Jacobs were both honored for serving on their board as their positions end June 30.
- Retiring faculty and staff accounted for a combined 1,012 years of experience
- Meeting dates were set for the next year: July 29, September 9, December 9, February 24, June 9.
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