Forsee primes UM curators for tuition hikes

Friday, September 24, 2010 | 5:04 p.m. CDT

SPRINGFIELD — A tuition increase for the University of Missouri System moved from rumor to inevitability as the president addressed the school’s governing board Friday.

“Without question we will have to come to the board to increase tuition,” UM System President Gary Forsee told the Board of Curators, adding the caveat that “we’re going to have to wait to see what the governor’s recommendation (for cuts to higher education) is going to be.”

Forsee said he expects higher education to receive a 10 percent reduction in funding from Jefferson City. That means the in-state tuition freeze agreement between Gov. Jay Nixon and the university likely will not continue into a third consecutive year.

“We’re planning as if we know that that number is in that 10 percent range,” Forsee said. “If it’s less than that, then we will have planned accordingly, and if it’s more than that, we will continue to have work to do.”

According to Missouri law, the UM System may not increase tuition beyond the state’s rate of inflation. Raising tuition beyond that rate would require a waiver application from the board that would be subject to approval by the Department of Higher Education. 

The board will discuss the matter again in December and will set tuition for 2011-12 early next year.

Meanwhile, the system will look into the needs of each campus when determining tuition rates, Forsee said. He said campus and system leaders are currently working to develop cost-saving measures.

At the meeting, Curator David Wasinger asked Laura Confer, the student representative to the board, to seek out student opinions and concerns related to potential tuition increases. Forsee also called on campus leaders to take student interests into account.

“Missouri has continued to err on the side of students,” Forsee said. “I expect each chancellor, and therefore their student financial aid organizations and budget planning organizations, to be sure to hear their perspective.”

New projects and cost-cutting measures

Also during the meeting, the system asked for the board’s approval to borrow $190 million for several proposed projects, which total $250 million in value.

The board had already approved the borrowing of $110 million for four other projects.

Forsee said the system’s recent acceptance into the federal New Markets Tax Credit Program could provide up to a 30 percent discount for the funding of some of the projects, particularly nonacademic buildings.

Several curators expressed apprehension about proposals for buildings that don’t generate revenue, which Curator Doug Russell said account for $138 million of the projects.

Forsee said: “While we sized a potential $300 million bond issue, we haven’t figured out how can we find a (new) revenue stream as opposed to taking from existing revenue streams. If we can’t figure out how to do that, then we likely won’t be able to bring some of those projects forward.”

Despite budget crunches, university representatives and curators expressed the desire to expand facilities to accommodate greater enrollment.

MU Chancellor Brady Deaton said MU could move toward an enrollment of 35,000 students but stressed the university must be innovative with its space planning.

“Classroom space is becoming critical,” he said.

John Carney III, Missouri University of Science and Technology chancellor, echoed a concern of several curators and fellow chancellors.

“We have to maintain the quality of our facilities,” Carney said. “But we can’t do that without the finances.”

He said there was no doubt in his mind that Missouri S&T has to raise tuition.

Although Forsee acknowledged tuition hikes would be necessary, he said the system was looking for other ways to improve its financial standing.

For example, he said the four universities could save money by sharing services such as accounting and payroll.

Additionally, he said the high volume of financial transactions throughout the system results in high processing costs and could be streamlined to reduce expenses. He also suggested the UM System could better use its information technology capabilities.

“The question is: Do we have opportunities for cost improvement without cutting service?” Forsee said.

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