Testimony for Special Legislative Committee on Higher Education Affordability & Accessibility

Testimony for Special Legislative Committee on Higher Education Affordability & Accessibility
Freeman A. Hrabowski, III
President, UMBC
December 15, 2003
University Center Ballroom - UMBC

I appreciate the opportunity to address the members of the Special Committee on Higher Education Affordability and Access. As we think about the State's budget situation, particularly as it relates to public higher education, it is useful to provide context and perspective. Let me briefly quote the President of the University of California, who said,

"Unprecedented problems today confront the universities and colleges of America. But there also faces them unprecedented opportunity. It is a time for taking stock, for looking through new lenses .. and for critical evaluation of the university body in all its parts - tangibles and intangibles - and, above all, a firm conservatism against a shortsighted present and a sacrificed future."

The President was Robert Sproul, who wrote these words nearly 70 years ago, in 1934, in the midst of the Great Depression. We should remember that the 1970s, '80s, and '90s also began with recessions. The lesson is that higher education, in particular, and the State, in general, must weather the ups and downs of economic cycles. To do this, we will need strong leadership across the State.
While it is important to remember that the economy is cyclical, it also is useful to consider some important ways the State has changed over the past ten years. Maryland's budget totaled $12 billion in 1993 and has grown nearly 80 percent to $21.5 billion today. The median household income in the State has risen by more than 40 percent, from $54,000 to almost $77,000, though it's important to bear in mind that the greatest portion of the increase results from substantial increases at the upper levels, and that the vast majority of poor people continue to struggle. The State's population also has grown - nearly 10 percent - from just over five million to almost five-and-a-half million, and minorities now account for nearly 35 percent of the population compared to 30 percent a decade ago.
As we look at trends over the past ten years, it's important also to appreciate our growing strengths. Per capita, Maryland is the best educated state in the union, ranking first in the numbers of adults with bachelor's degrees and with Ph.D.s in biological and health sciences. We rank second in Ph.D.s in computer science and math and fourth in the physical sciences. Chancellor Kirwan often points out that Maryland's concentrated brainpower gives us an enormous advantage over most other states. He notes that Maryland is the most research-intensive state in the nation, attracting more federal R&D dollars on a per capita basis than any other state, and that other states are trying to accomplish what Maryland is already achieving. For example, Virginia Governor Mark Warner recently set the goal for his state of one billion dollars in academic R&D by 2010, while Maryland expects to exceed two billion dollars in academic R&D by 2005. We know about the success of the Johns Hopkins University in this area; equally significant, the USM campuses have already reached approximately $900 million in R&D funding.
We should be proud of Maryland.s status as the nation.s best educated state and our tremendous progress in building strong public higher education. Our challenge is to avoid losing momentum during these difficult times. It has taken years to build and successfully communicate the good news about our strong academic programs, and it would not take long for news of weakening that system to spread quickly - bad news travels fast.

"A Powerhouse in Baltimore"
In many ways, these are good times for many of us in higher education in the sense that large numbers of students want to be on our campuses. Families are looking to us to provide their children with a first-rate education. The State of Maryland has done a superb job of supporting UMBC, helping us to become a national model for mid-sized public research universities. In fact, in recent years, Newsweek has called UMBC a "powerhouse in Baltimore, offering a topnotch, rigorous education to scholars who don't want to pay for an Ivy" and one of the nation's "Hot Schools." It is an amazing story that we have come so far so fast, in less than 40 years. Investment in UMBC has generated a high return for the State.
At a recent legislative breakfast on our campus, two Senators talked about their positive relationships with UMBC. Senator Kittleman, from Howard County, wanted me to know that both of his children had graduated from UMBC: one is a lawyer, and the other developed and recently sold her successful IT company. Senate Jimeno, from Anne Arundel County, wanted me to know how pleased he and his family are with his daughter's freshman-year experience.
It is a recent phenomenon that such large numbers of Maryland residents are interested in sending their children - particularly those who are among the State's best prepared and highest achieving - to our public universities. As a result, UMBC's student body has never been larger, better prepared, or more diverse, and throughout the campus community, people are focused on helping students succeed. In just the past five years, our headcount enrollment has increased nearly 19 percent (10,100 to almost 12,000), while our FTE enrollment has grown 22% (7,450 to 9,100) and the number of students living on campus has increased 55% (2,200 to 3,400).
One key to our success is that we are very focused and realize that we cannot be all things to all people. We concentrate on selected areas of science, engineering, and policy at the graduate level, building on a modest, but lean, array of strong liberal arts programs for undergraduates. It is significant that almost 60 percent of our students plan to pursue careers in science, technology, and medicine. UMBC is an unusual place for high-achieving students who want a lot of attention. We combine the emphasis on teaching found at the best liberal arts colleges with the innovation of a research university, producing graduates who are strong thinkers and have substantive experience with cutting-edge technologies and issues. Almost all either go on to leading graduate and professional schools or immediately join the workforce.
The other keys to our success include our aggressive entrepreneurship, especially building many public and private partnerships, and our passion for engaging students in research, internships, and hands-on experiences. Our partnerships have benefited the campus enormously, enabling us to leverage State funds to (1) renovate biology and chemistry facilities with support from the National Science Foundation and the National Institutes of Health; (2) build first-rate biochemistry laboratories through partnerships with the Howard Hughes Medical Institute and Guilford Pharmaceuticals; (3) develop major new research centers with support from NASA (we rank 16th nationally among universities in NASA funding) and such companies as Northrop Grumman; (4) contribute in the policy arena in gerontology, the environment, health care, and teacher education with support from the Maryland's Department of Health and Mental Hygiene and Department of Education, and with federal support from NSF, the Department of Education, and other agencies; and (5) strengthen campus life by constructing impressive new residence halls with private support.
Our partnerships, entrepreneurial spirit, and can-do attitude - together with the following key institutional characteristics - have contributed also to economic development in Greater Baltimore and the State:

Clear institutional mission
Institutional capacity
Strategic location
Commitment to technology commercialization
Solid understanding of community needs
Strong relationships with the public and private sectors
Understanding that the environment is interdependent

Building on all of these characteristics, UMBC fosters economic development through (1) research and training-related contracts and grants; (2) technology development, including the activities of our technology center and research park (bwtech@umbc); (3) continuing education and business outreach; and (4) preparing our students for the workforce.
We also contribute to economic development in more general ways related to our rapid development as a major research university. We now employ 2,200 full- and part-time faculty and staff; have an operating budget of $292 million, including an annual payroll of $154 million and over $85 million annually in sponsored programs; and we have roughly 40,000 alumni, nearly three-quarters of whom live and work in Maryland and contribute to its economic vitality.
The campus's dramatic physical growth during the past decade also has had major economic benefits for the region and State, and it promises expanded activities and associated economic benefits in the future. In addition to the new or renovated facilities already cited, millions of dollars in public and private financing have made it possible to construct new buildings in physics, information technology/engineering, and public policy. We also are building out our research park and operating our technology center.

Persistent Challenges
Notwithstanding our successes and the contributions we are making, we face some serious challenges.

Helping Students Meet the Cost of Education
While we have absorbed millions of dollars in budget cuts in recent years, we continue to give our students top priority in terms of the instruction and services they receive. Our tuition is as high as it is largely because so many of our students are studying in science and engineering, which are expensive technology-intensive disciplines. We are committed, though, to helping students meet their cost of education. Some of our strategies include raising private funds to endow scholarships, successful grant-writing to national agencies to support students in high-demand areas (e.g., biomedical studies) and to encourage women and minorities to pursue research careers in science and technology, and working with corporations to place students in part-time internships. In fact, we believe it is critical that the State think about a model for coordinating the efforts of community colleges, universities, and the public and private sectors to build a workforce of college students (while they are in college) who can profit both experientially and financially while giving financial relief to their families and support to employers.

Funding Guidelines
We find ourselves in a disadvantaged position vis-à-vis the State's higher education funding guidelines. The Larsen Commission recommended funding USM campuses at the 75th percentile of peer institutions, based on State funding per student and tuition revenue. While this equated to approximately $15,600 per student at UMBC, recent budget cuts have lowered our General Funds to 64% of the guideline, placing us among the USM campuses furthest from the goal. Since fall of 2002, our General Fund support has been reduced by $15 million while our FTE enrollment has increased by more than 200 students. As the result of position eliminations, layoffs, and operating budget reductions, we are serving substantially more students with fewer staff and resources. This situation is especially serious because we have never fully recovered from the mandated budget cuts of the early 1990s. We remain thin in administrative staff and struggle daily to provide sufficient support for such crucial services as advising and grants accounting.

Building Research
Sufficient investment in faculty and staff is essential in order to continue building our research, which supports economic development. Ten years ago, our annual research funding totaled $16 million, and today we are attracting more than $85 million per year. While our research portfolio remains robust, we are concerned because our contract-and-grant revenue is flat for the first time in a decade, largely because we need to build the faculty and to expand our research-support infrastructure to keep pace with our substantial research growth. Our challenge is to provide faculty researchers with the staff support, space, and equipment necessary to apply for funding and conduct sponsored research. This is so critical because billions of dollars on the national level are being invested in science, health care, and defense-related research - and because of our science-and-technology focus and our research strengths, we are in an excellent position to help the State attract increasing resources from the federal sector in these areas. We are especially advantaged because of the strong support the State has provided for academic facilities and to recruit and support outstanding faculty and students. We have become a major resource - a center of brainpower - that can focus on the economic and social development of the State.

Retention of Faculty and Staff
The only way we can continue to offer a first-rate education to undergraduate and graduate students, while expanding our research activities, is by supporting faculty and staff and continuing to upgrade technology and facilities. We are already seeing a troublesome trend of both faculty and administrators being recruited by much larger public institutions and better endowed private institutions. In fact, we have lost several key administrators just this semester. Because our national reputation is growing, we find ourselves "ripe for the picking."

Conclusion
Although State general funds now account for only 22 percent of UMBC's total budget, they are more critical than ever. Roughly half of our instructional costs are supported by State funds, while the other half is supported by tuition. If State funding remains flat, higher tuition will likely be needed to address the gap. From a policy perspective, the question we face is clear - to what extent does the State think it should support students either directly or through General Funds appropriated to the universities?
The fact that record numbers of talented students and their families are selecting Maryland universities is a strong measure of support for the investment the State has made in public higher education. Maryland citizens appreciate the first-rate education available to them at the State's campuses, and they value degrees from our public universities more than ever. If UMBC and other institutions are to continue providing students with a first-rate education, while also serving as a first-rate partner with the public and private sectors, we will need the State's help in providing funds that can be leveraged to continue building our institutions.
I know that all of you believe in the power of higher education to transform lives. Most of us would not be here today had it not been for that opportunity. Our challenge is to make sure that Maryland's sons and daughters are as fortunate, and that public higher education remains affordable and accessible.

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