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The
University of Rhode Island
Remarks for Convocation, 2004
Robert L.
Carothers, President
Chairman Caprio and members
of the Rhode Island Board of Governors for
Higher Education, Commissioner Warner,
University of Rhode Island Foundation Pendergast,
Provost Swan and Vice Presidents Beagle, Dougan
and Weygand, Deans, Excellence Award recipients,
Faculty Senate Chair Faye Boudreaux-Bartels,
leaders of our unions, Student Senate President
Kevin Lopes and members of this distinguished
faculty, staff, students, alumni and
friends—Ladies and Gentlemen.
Well, here we are again,
right where we should be as autumn appears in
red and gold on the horizon, with the sounds of
students rising once again from the Quad and the
sound of construction machinery fading away even
as we speak—well, ok, it’s a long fade. We say
hello to the new students, faculty and staff
among us, and we say goodbye to the steam
geysers that have so often hidden East Hall in
the mist. I can confirm now that East Hall is a
real place and that we do have a physics
department, a very distinguished one in fact and
not merely the mythical population of a mystical
place.
Distinguished faculty and
staff are, in fact, a mainstay of the University
of Rhode Island on all four of our campuses. I
spend a lot of time with the people who have
graduated from this University over the past
seventy years. Often I ask those folks about
their experiences at URI and try to get them to
tell me their stories about their time in
Kingston, or Providence or Narragansett.
Inevitably, I will ask them what they studied at
URI and, when they tell me, I ask them a
question about their curriculum and what they
remembered from the courses they took. Oddly,
they can rarely remember anything about the
curriculum. But then I ask them to tell me
about their professors or about other people at
URI whom they remember. Now their faces light
up and without hesitation they will spin out
their stories of life changing experiences with
this professor or that, about people in Student
Affairs who got them through a difficult time or
who taught them the leadership skills which
carried them on to success in the careers and
personal lives.
This phenomenon is not
restricted to those who now recall the
University through the rosy haze of memory. You
can go outside to the Quad right now and ask our
students what is most important about the
University. Once you make it through their
complaints about parking, you will hear about
the faculty members who are still shaping their
lives. And you will hear about the programs in
Student Life that give them invaluable
experience in dealing with diverse populations
or in organizing people and events, who taught
them about sportsmanship and about leadership.
In the end, high quality education with
motivated students is grounded in these personal
relationships, and academic achievement can be
predicted by the amount of time students and
faculty members spent together, in and out of
class.
On the platform with us
today are four individuals who represent the
best of our faculty and staff. Two of the
faculty members have been with us for many
years, and they have literally generations of
graduates who are telling stories about them
even as we speak. They are both legends in their
own times and recognized nationally and
internationally for their work. The other
faculty member is, as you can see, much younger,
and yet it is she who will shortly receive the
award for distinguished teaching. Her
generations of graduates are only beginning, yet
she has already demonstrated the right
combination of scholarship and passion to which
her students so quickly respond. Valerie, your
stories are beginning to be repeated as well.
The fourth person up here today represents the
many, many excellent staff members who affect
not only students but all of us who work to help
URI manage the complexities of an ever changing
University of Rhode Island. Like many of her
colleagues, she would just as soon not be in the
limelight, because what she is so good at is
making others look good in their jobs and feel
good about themselves. These staff members are
the true servant leaders in our community. But
today, Joanne is on the stage, and we honor her
work.
The Excellence Awards are
presented by the University of Rhode Island
Foundation, the arm of the University
responsible for managing our non-governmental
assets (including intellectual properties) and
for growing our endowment through investment.
In that regard, they met every goal I gave them
for the past year, a really remarkable
achievement. The Foundation supports the
University in many ways, and the Excellence
Awards are one way to say how proud they are,
and all of us are, of the work of our faculty
and staff. I want to thank the executive
director of the Foundation, Robert Coleman, and
his board for their continuing support. The
Board is represented here today by its president
and cheerleader in chief, Dan Pendergast, who
will join Provost Swan and me in making these
presentations.
But first allow me to
introduce my long time partner and in this
enterprise, and my good friend, our Provost and
Vice President for Academic Affairs, Dr. M.
Beverly Swan. Provost Swan
I want to begin my remarks
by giving my thanks, on behalf of the entire
University community, to Admissions Dean David
Taggart and all of his staff for bringing in
another wonderful freshman class. Each year
Dave helps make the connection between some of
the brightest young people in our region and the
extraordinary faculty of URI, represented by
three of our excellence award winners on the
stage today. As we have seen in each of the
last eight years, this class is a little better
than the last one--a little more academically
prepared, a little more diverse, a little more
widely talented in art, music, theater, science
and athletics. Similarly, over in the Graduate
School Office under Vice Provost Trubatch and
Associate Deans Harold Bibb and more recently
Lynn Pasquerella, we are continuing to grow our
graduate student enrollment, providing more
institutionally based graduate assistantships
each year and reaching more people seeking
graduate credits through WEB-CT offerings and
other contemporary learning systems.
In fact, if you take a look
at the 2004 report on the University’s progress
toward meeting the goals of our strategic plan,
you will see that we met our objectives on
student enrollment and retention. These are the
most important metrics in that plan, not only
because of the centrality of student performance
and achievement to our mission but because of
the growing share of our revenues that come from
student tuition and fees. There are some other
objectives achieved that are worth mentioning
here as well. The Advancement Division met all
its private fundraising goals, including total
gifts, annual giving, athletic giving, and the
Campaign for the Humanities; the University of
Rhode Island Foundation met all the goals for
which it is responsible—growth in total
endowment assets, return on investments, and
patent and license income. We have been hiring
new faculty members according to our schedule
for growth, we have invested significant new
funds in our libraries, we have had remarkable
increases in state and private research funding,
although we saw a slight decrease in federal
research funding, what we believe is an anomaly
in a decade long pattern of growth.
We are working our way
through the most ambitious capital improvement
program in the University’s history, and this
coming year will see us move from planning to
construction on some $80M in new projects. If
we are successful in securing voter approval for
our bond issues in November—and remember to vote
early and often, as they used to say in
Chicago, for Questions 5,
9, 10 and 13--we will have the funding for
another $90M in new facilities for science and
education on both Kingston and Narragansett Bay
campuses, improved student housing and space for
athletic training and rehabilitation, as well as
improvement to Meade Stadium. Measuring the
progress towards all of these goals and their
related metrics, I believe that it has been a
remarkable year. But, sadly, these measurements
are not everything. There is “the rest of the
story,” reflected in the lack of progress on
several of the goals aimed at the long term
financial health of our University.
The rest of the story is
being played out across America, as well as here
in Rhode Island. It is the story of a
fundamental shift, now nearly complete, in how
Americans and their federal and state
governments think about public higher
education. It is a shift away from a strong and
long held belief that public higher education
existed to serve the common good, to a current
belief that our colleges and universities exist
to provide private benefit to individual
students. Let’s take a step back in time. The
United States came out of World War II with a
great sense of the common good and, given the
sacrifices just made by so many for the common
good, public colleges and universities were
understood to be a vital part of rebuilding the
economy not just of America but of the world.
There were massive federal and state investments
in higher education infrastructure, and there
was the GI Bill and many other programs to make
higher education available to more and more
people. Sputnik, the Soviet satellite that shook
the nation in 1957, confirmed the belief that
the national good was dependant on knowledge and
the people graduating from our colleges and
universities.
But then came the Vietnam
years, and the public at large, and especially
government, began to distinguish between what
the majority perceived as the national interest
and what was happening at their universities.
While many of us believe that what happened
during that era served the public good in
important ways, the tone of the debate about
higher education began to change. This period
accelerated the development of large scale
student loan programs, shifting the burden for
financing a college education from the public
treasury to parent and student debt. And the
debt became massive. Today, more than 50%s of
all student tuition and fees paid to URI comes
from loans made to families and students and
nearly 80% comes from some form of financial
aid. In the Eighties, the so-called “me
generation” perpetuated that vision, and a
college education was now widely understood as
the ticket to wealth, a preparation for a career
of individual acquisition.
By the time we hit the near
depression of the early Nineties, the perception
of college as a benefit to the individual was
firmly entrenched. (Even today, we like to
point out the differences in lifetime earnings
between those with and without a college diploma
and we advocate for higher education on that
basis.) The credit union crisis in Rhode Island
at the beginning of the last decade made it even
worse here than in other places in America, as
Rhode Islanders’ cynicism about the motives of
others reached a new high, and trust in anything
that purported to be for the common good reached
a new low. And nothing I saw at the two
political conventions of the summer, neither in
the rhetoric the candidates, nor anything I have
heard in the Rhode Island political campaigns so
far suggest anything different.
And so the rest of the
story of this University’s strategic plan begins
with this sea change. I think that each of us
who works in higher education laments that
change and wishes we could go back to another
time. But we cannot, at least not in the
foreseeable future. For example, our financial
goals set forth in the Strategic Plan called for
appropriation increases from Rhode Island state
government of 4% a year. Our actual
appropriation increase this year is less than 1%
and when we take out specific earmarks, we
received a slight decrease in State funding.
Looking ahead at the State’s financial
projections over the next several years, now
exacerbated by the deficit in the state pension
fund and a new political will in Rhode Island
for tax cuts, now even level funding from the
State looks like a goal that will be difficult
to reach.
I think about all of this
each summer as we revise our budgets after the
Governor and General Assembly have completed
their work. I have to admit that even after
twenty-five years doing these budgets, summer is
still a discouraging time spent trying to figure
out how best to fulfill our public mission in
the face of continuing “disinvestment” by the
State in our operating budget.
My July starts like this:
After months of bickering about too high taxes,
too little revenue and government waste, and the
predicable over-ride of the Governor’s budget
veto, the state legislature finally adjourns
amidst finger pointing and rancor. The budget
they have passed is not as bad as it looked in
March, but the appropriation to higher education
is still well below what we asked for, and often
below the appropriation made the previous year.
Our Board is now called back into session to
set, very reluctantly, even higher tuition and
fees than the increases they had announced
earlier. The presidents and provosts start
making cuts in the budgets they had promised the
deans and face the angry parents and students
who have just been notified that their bills for
September will be several hundred dollars higher
than they thought they would be. Next comes the
annual letter from the state budget office
requiring that the following year’s budget
request be no more than 90% of this year’s
appropriation. By August, we are sitting in
small, hot conference rooms, listening to our
finance officers wailing in the growing
darkness, watching the rain come down outside,
the weeds growing with the only enthusiasm in
sight.
So what’s a University to
do? Each of us is too committed to URI, to this
wonderful institution, too committed to our
students and to the exploration of ideas to let
it all go slip sliding away. Universities have
persisted in recognizable form since the
fourteenth century, and this one will not go
south on our watch. But each age demands a new
vision, and ages these days have a much shorter
half-life than ever before.
My sense is that the new
model for public higher education will be a
different kind of public-private partnership,
one in which the state will fund a discounted
rate for state residents at public colleges,
while letting the overall level of tuition and
fee income float to market rates. The State
will also protect the investment in public
facilities on the campuses through enhanced
programs of asset protection for existing
buildings, minimally matching the required rate
of depreciation, and continue to make
commitments to new and replacement facilities.
Universities will be expected to generate a
significant portion of their operating revenue
through investments and endowment income, much
as independent colleges and universities must
do. In short, public universities like URI will
be asked to operate in much the same way that
schools like Boston College or Syracuse
University do now, independent institutions with
a public purpose. While not yet public
corporations, institutions like URI will be
expected to operate consistent with good
business practices with measurable results.
The latter view of
universities as public corporations is a natural
consequence of the “private benefit” philosophy
so firmly established today. For thirty years
now, I have listened to corporate leaders and
politicians opine that our institutions should
be run more like businesses, whatever that meant
to them at the moment. What I know about
successful businesses is that they bring ideas
and capital together and take calculated risks
based on a reasonable appraisal of the evolving
marketplace. They leverage whatever resources
they have, and they curse bureaucracies and
regulators of whatever origin. Today’s
businesses like to think of themselves as agile,
quick to respond to change, moving from mass
production to highly customized products and
services. And while colleges and universities
have survived for nearly a millennium using a
very different model, our corporate colleagues
seem to have the right vision for a very
different future.
Still, the question
remains: how do public colleges and universities
adapt to a model where they are expected to
supply more and more of their own operating
revenues while continuing to serve their states
and nation for the greater public good?
The first clue to the
puzzle lies in the fact that the states have
steadily increased their commitment to
new and rehabilitated buildings and laboratories
on our campuses. In New England, the fabled
UConn 2000 $1B investment and then the second
billion three years later have transformed that
institution, giving it the tools both to serve
Connecticut and to compete with some of the most
prestigious universities in the country for well
prepared students, grants and gifts. At the
University of Rhode Island, new residence halls,
wonderful new science and business facilities,
rehabilitated historic buildings and new
athletic venues have set us on the same path.
A second is the creation of
matching gift programs in many states, a
strategy to bring in private dollars to state
universities by demonstrating to potential but
skeptical donors that their gifts will leverage
state money, not replace it. These programs
have great potential for building public
university endowments that now lag far behind
those of our sister institutions in the
independent sector. Such a program was a big
factor in the success of the recent capital
campaign at the University of Massachusetts. In
Rhode Island a similar bill passed in the Senate
this year, but did not make it out of the
House. It is an initiative to which we will
return next year.
Third, the states have been
passing laws that allow university professors to
build companies that commercialize the fruits of
their research, with the universities themselves
(or their foundations) owning rights to
intellectual properties and sometimes holding
equity positions in those companies, creating
new revenue streams. And just as there are new
opportunities flowing from these revenue
streams, there are many other opportunities to
use our assets, intellectual and physical, to
generate revenue for the operation of the
universities.
Finally, Colorado is
experimenting with what amounts to a tuition
voucher system for its public colleges and
universities, making a major portion of what had
been the state appropriation made to the schools
directly to the students instead. Other states
have developed formulas that fund their public
colleges based on the number of resident
students enrolled, in effect allowing the
schools to offer tuition to resident students at
a discounted rate.
Taken together, it looks
like the beginning of a plan.
But while the states have
given us some new tools with which to toil in
this fallen world, they continue to prevent us
from functioning like modern business
enterprises by maintaining and even tightening
the bureaucratic controls left over from another
time. Some have said that we used to be state
supported institutions, then became state
assisted institutions and now state annoyed
institutions. It is hard to be agile when we
are tied to things like the archaic statewide
purchasing and personnel systems set up to
manage traditional state agencies, compensation
rules that ignore the realities of the higher
education marketplace, and financial control
systems well behind the contemporary realities
of rapidly changing accounting standards. More
problematic yet are state budget regulations
that often inhibit planning beyond the current
fiscal year and prevent the creation of the
reserves necessary to ride out years like the
past several or to save up for critical
investments. The University of New Hampshire
broke through this barrier several years ago,
allowing UNH to implement “responsibility
centered management” with great success. So
should we all.
How could this changed
paradigm work at URI? This year URI is
receiving just under $82M from the State of
Rhode Island for our operating budget, plus
another $4M for asset protection and $1.1M for
debt service on buildings funded with general
obligation bonds—all in all about $87M or
approximately 19% of our total budget of
$426M.
If the State were to agree
to pay the difference between the current
tuition costs for Rhode Islanders and the full
cost of educating a student for a year
(represented by the price we change students who
live outside Rhode Island), that discount would
amount to some $11,550 per student. About 7100
FTE (or about 8700 head count) of our 14,500
students come from Rhode Island, and so the
total subsidy to Rhode Island students would be
about $82M per year. If the State or the Board
of Governors wanted to do so, it could also
devise a formula that tied this number to
graduation rates, or to the number of low income
students enrolled and so forth on the basis of
public policy objectives.
In addition, let’s assume
that the State decided that the right amount it
should commit annually to protect its
substantial assets at URI was $10M and that
annual debt service for new capital projects was
$2M. And let’s say the State made a commitment,
much as they did twice in Connecticut, to give
URI $1B paid over ten years (twice as long as
the UConn plan) to go to an trust fund or
endowment. By the end of the decade, assuming
prudent investment, that fund should have grown
to $1.3B to $1.5B, generating thereafter an
income for the University of something like $90M
to $100M per year. Taken all together, this
plan would produce twice the public support the
University currently receives, and the
investment by the State--after the decade in
which the endowment was being built--would
actually be reduced from what is appropriated
today. I want to emphasize that these are only
very rough estimates and that many permutations
of such a plan are both possible and probable.
My hope is that we can put this and other
alternative and bold plan on the table for
discussion in the coming year. Trying to tinker
with the status quo will not solve this
structural problem.
So the reality, I believe,
is that today’s leaders in higher education,
including those here in Rhode Island, will have
to abandon, however grudgingly, the defense of
financial entitlement and instead shift our
efforts to gaining the financial and management
independence required to maintain the viability
of our institutions. In this campaign, we have
natural allies among our alumni and advisory
boards, who can grasp what, would happen to
their businesses if they were required to
operate as we do. We will also have to propose
and lobby for creative partnerships with the
states, aiming at a time of self-sufficiency. We
will have to maximize the use of all our
resources, including a major URI asset in land.
We will all continue to ask “where’s the
money?”, but we will also understand that it is
up to us to create it.
I thank all of you for your
commitment to this University and its students
and I look forward to working with you on the
challenges and opportunities ahead.
Robert L. Carothers
President
Green Hall, 35 Campus Avenue, Kingston, RI 02881-1303
Phone: 401-874-2444 Fax: 401-874-7149
E-Mail: MUSKRAT@URI.EDU |
