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President Kaler proposes freezing undergraduate tuition through renewed partnership with the state

Legislative proposal also includes initiatives to reduce student debt and fuel the state economy

September 14, 2012

University of Minnesota President Eric Kaler proposed his first biennial budget request, for fiscal years 2014-2015, during the Board of Regents meeting this morning.

The request to the state Legislature — accompanied by policy options for state legislators to consider — represents a new partnership with the State of Minnesota to hold the line on tuition for Minnesota undergraduate students, reduce student debt, and spark innovation and discovery to solve Minnesota’s toughest problems and advance the economy.

“We need to invest in talented Minnesota students and leverage the university’s research expertise to strengthen Minnesota’s economy,” Kaler said. “This bold request achieves those goals and builds the foundation for a prosperous future.”

Kaler’s proposal invests in students to transform the state’s economy by:

1.    Reforming how we fund higher education — Renewing the historic partnership between the state and university to freeze undergraduate tuition for the biennium. Specifically, if the state commits $14.2 million in each year of the biennium, the U will hold resident base undergraduate tuition at current levels for all campuses during those years. Over four years, this tuition freeze will save an undergraduate student on the Twin Cities campus $2,565. The university will do its part by reallocating 5 percent of its annual state appropriation ($28.5 million) as part of its commitment to achieving greater operational excellence. Finally, Kaler is committing to performance and accountability measures, which, if achieved, would earn an additional $11.5 million from the state. The measures include increasing financial aid and the number of degrees awarded, improving graduation rates and increasing research and technology commercialization activity.

2.    Reforming how we invest in research and innovation — Establishing MnDRIVE (Minnesota Discovery, Research and InnoVation Economy) funding program. This ongoing state-university partnership would invest in research that advances Minnesota’s economy, leverages opportunities, improves the health and well-being of Minnesotans and advances existing and emerging industries. In 2014-15, the program would provide $18 million for research in four areas:

  • Supporting robotics, sensors and advanced manufacturing
  • Securing the global food supply
  • Advancing industry and conserving our environment
  • Advancing discoveries and treatments for brain conditions

3.    Reforming how Minnesota students and families pay for higher education — Creating a loan forgiveness program, which would provide $1.5 million in 2015 to partially forgive student loans if students become health care professionals in underserved Minnesota communities. In addition to the biennial budget request, Kaler proposes tax options that would help students and families pay for education at any non-profit public or private four-year institution. The options include:

  • Tax reforms, such as tax credits that essentially discount undergraduate tuition, offset student loans if graduates live or work in Minnesota and eliminate taxes on undergraduate student scholarships that exceed tuition and fee costs.
  • New or enhanced tax credits to encourage more private philanthropy to support student scholarships at Minnesota non-profit colleges and universities.

University of Minnesota state appropriations dropped by an average of 35 percent between 2000 and 2010 compared to 20 percent on average nationally. If fully funded, this legislative package would bring the university’s state appropriation to levels last seen in 2001, without accounting for inflation.

Pending board action in October, the university’s request to the state Legislature will be pursued during the 2013 legislative session, which begins in January.

Delivering on the U’s mission of education, research and public engagement

Provost Karen Hanson and Robert Jones, senior vice president for Academic Administration, University of Minnesota System, presented the “2012 University Plan, Performance and Accountability Report.” It was first published in 2001.

“The annual accountability report confirms the compact between the university and the citizens of Minnesota,” Hanson said. “It gives the Board of Regents important data to help inform governance decisions, and it conveys to the broader public a wealth of information about our activities, accomplishments and goals.”

According to the report:

  • The university’s graduation rate continues to improve. Twin Cities’ four-year graduation rate for the most recent class will be above 57 percent compared to just less than 29 percent in 1998. On every U of M campus, more than 50 percent of students graduate in five years.
  • Students have access to small classes. Thirty-eight percent of undergraduate classes on the Twin Cities campus have fewer than 20 students, 19 percent have more than 50 students and fewer than 13 percent have more than 100 students.
  • Students are guaranteed access to the classes they need to graduate in four years — or the U will pay tuition for courses students cannot get into. However, that payment has never been necessary. Academic advisors work closely with students to plan their schedules, and their feedback helps shape departmental course offerings and schedules.
  • The U of M is diverse. Across all campuses, enrollment is 15 percent students of color and another 9 percent are international students. The Duluth and Morris campuses have particularly strong traditions of serving Native American students.
  • The U is becoming increasingly efficient through the Operational Excellence initiative. For example, the Twin Cities campus has saved more than $4.6 million in annual energy costs and reduced its carbon footprint by more than 50,000 tons through energy conservation. Meanwhile, decommissioning buildings that were underutilized has reduced annual operating costs by more than $1.3 million and avoided more than $48 million in building repairs.

The final version of the report, which will be published following board action in October, provides information about all five university campuses in the areas of extraordinary education, research, outreach and service, faculty and staff, and organization.

The Thursday and Friday board meetings also included:

  • Community University Health Care Clinic: The Facilities Committee reviewed a nearly $2.7 million proposal to renovate the 1960s-era clinic in South Minneapolis. The board is expected to take action in October on the proposal. Most of the improvement costs will be paid for by a U.S. Department of Health and Human Services grant.
  • Kaler formally introduced Pamela Wheelock. Wheelock began work as the university’s vice president for university services on Aug. 15.
  • Hanson formally introduced Dr. Leon Assael, dean of the School of Dentistry. He was appointed in May.

The next Board of Regents meetings will occur Oct. 11-12, 2012. For more information, go to

Twin Cities Campus: