Looking into this academic school year, the challenge confronting the University of Minnesota administration boils down to one principle: doing more with less.

Administrators are faced with financing a public institution and remaining competitive amid another year of budget cuts.

âÄúState funding is very tight,âÄù Board of Regents Chairwoman Linda Cohen said. âÄúHow do you finance education and focus on excellence?âÄù

Amid criticism of administrative bloat, efficiency is high on President Eric KalerâÄòs priority list.

Making the University more efficient will be a long process, Kaler said, but students can expect to see some results a year from now.

âÄúWeâÄôll have a team come together and decide whether we need to have an external consultant to help us sort that out, or whether we have the talent and capacity internally to get that done,âÄù Kaler said. In the meantime, the Office of Human Resources is conducting a job classification program in order to identify duplications within the UniversityâÄôs administrative system.

Unexpected funding

In JulyâÄôs special legislative session, the University was allocated $50 million more than expected for the next two years. Kaler will lay out his plans to spend the money at FridayâÄôs regents meeting.

About $4 million of that money will go toward tuition relief in the spring, awarding an average of $310 to 13,400 low-and-middle income in-state U Promise Scholarship students, according to KalerâÄôs recommended amendments to the UniversityâÄôs budget.

âÄúRight now, since the yearâÄôs already started, we canâÄôt do much for fall, but weâÄôll do the appropriate part for spring, and then weâÄôll make some investments and things that we need to get done.âÄù

Kaler recommends using $8.3 million in 2013 to soften a planned undergraduate tuition hike âÄî cutting it from 5 percent to 3.5 percent âÄî according to a University press release.

âÄúWe donâÄôt want to raise tuition precipitously over and over,âÄù Cohen said.

Another $8 million of the money will go toward hiring new faculty and to the restoration of funding to health science programs like the Medical Education and Research Costs program, the School of Dentistry, the veterinary diagnostic program and the Undergraduate Research Opportunities Program.

Roughly $6.5 million will go toward doctoral dissertation fellowships and construction projects at the Morris and Crookston campuses, and $6.1 million will be used for investments and saved to prepare for any state cuts made in 2012.

âÄúIf theyâÄôve got another deficit, thereâÄôs a risk that âÄî in the spring legislative session âÄî the [University] could face cuts again,âÄù Chief Financial Officer Richard Pfutzenreuter said.

While the revised budget still is a 7.8 percent cut from the last biennium, having $50 million to patch the programs he cares about isnâÄôt a bad way for Kaler to start the first two years of his presidency, Pfutzenreuter said.

âÄúItâÄôs too bad when you feel good that the cut isnâÄôt as bad as it could have been,âÄù he said.

Research

Like his predecessor, former President Bob Bruininks, one of KalerâÄôs goals is to make the University one of the top three research institutions in the country. That means keeping its standards high in order to recruit and retain top-notch staff, he said.

âÄúGiven the fact that funding has been pretty much flat for several years, the [UniversityâÄôs] researchers have been very successful at winning grants,âÄù said John Merritt, spokesman for the Vice President of Research.

But the uncertainty of federal funding, from agencies like the National Institutes of Health and the National Science Foundation, is a major concern for the University, he added. Money from federal entities makes up roughly 70 percent of the UniversityâÄôs grant funds for research, Merritt said, and it has started to shrink. Additionally, the application process for federal research grants has become more competitive.

But more than the UniversityâÄôs national standing as a research institution is at stake, Merritt said. As American universities compete for federal funding, countries like China, South Korea and Taiwan have significantly increased the amount of government funding to research and development.

Facilities

Central to both research and faculty retention are facilities. The regents will focus on which projects to include in the UniversityâÄôs capital bonding request to the state Legislature in the coming months. Among the projects being considered are a new ambulatory care clinic, a makeover for Eddy Hall and renovations to the UniversityâÄôs utility plant building.

Framework

The UniversityâÄôs Board of Regents will follow a four-point work plan for the next two years as it faces the challenge of maintaining a high standard of quality: long and short-term financial operating models, strengthening the boardâÄôs relationship with the state, supporting the health sciences and improving how the board itself works.

That work plan, established at JulyâÄôs annual regentsâÄô retreat, will be at the heart of their first full meeting of the academic school year Friday, Cohen said.

âÄúOne of my own goals is to make sure weâÄôre utilizing the talent of each individual regent,âÄù she said.

Also on the regentsâÄô minds is the UniversityâÄôs relationship to the Minnesota State Colleges and Universities system, which competes with the University for state funding.

âÄúWhat are areas that the [University] does best and what does MNSCU do best?âÄù Cohen asked. âÄúWhat are areas where we should overlap and areas where we shouldnâÄôt?âÄù