Regents will turn to creative funding to solve budget woes

by Patricia Drey

Regents will brainstorm alternative funding sources for the University when they meet Thursday.

The Board of Regents finance and operations committee will discuss funding possibilities with University chief financial officer Richard Pfutzenreuter.

Currently, the University’s three largest sources of revenue are state appropriations, grants and contracts, and student tuition and fees, according to material the regents received for the meeting.

But with budget cuts from the state and three consecutive years of double-digit tuition increases, regents said they will consider less common funding alternatives.

By planning ahead and having discussions early, regents can avoid having to rush to find money after legislative budget cuts, Board of Regents Chairman David Metzen said.

“This is a way we can look at it and talk about it in a creative way before we’re under the gun,” Metzen said.

In the past, the University’s main responses to state budget cuts have been to increase tuition and cut costs, Regent John Frobenius said. But he said this strategy would not last.

“I sense there is a great deal of concern among the board members about the continuing increase in tuition,” Frobenius said.

Frobenius said he will go to the meeting without preconceived thoughts about specific revenue sources.

Although budget cuts might have been a catalyst for the meeting, Frobenius said, it is important that every organization examine the routines by which it operates.

Regent Clyde Allen Jr., committee vice chairman, also said meetings such as this are important because it is easy to get absorbed in routine work and neglect brainstorming and innovation.

“The secret of success is setting time aside to do that kind of thing,” Allen said.

But budget cuts are not only affecting the University or the state.

Across the country, universities are trying to fill holes left by state funding cuts, said Clara Lovett, president and chief executive officer of the American Association for Higher Education, a Washington-based higher education advocacy group.

Universities have tried to increase incoming funds by raising tuition and increasing research revenues, Lovett said. Many universities – especially flagship universities – have tried to do more to get money from the government or corporations, she said.

In the same committee meeting, Pfutzenreuter and State Economist Tom Stinson will provide regents with information about the state’s economic forecast and its importance.

At the regents’ meeting Friday, student representatives to the board will recommend the University ensure that in contracts with outside businesses, contractors should respond to the school’s needs.