At Thursday’s meeting of the University of Michigan Board of Regents, board members approved the Ann Arbor campus’s Fiscal Year 2017-18 General Fund Operating Budget, Student Tuition and Fee Rates, which includes a 2.9 percent increase in tuition for in-state students and a 4.5 percent increase in tuition for out-of-state students.
The University also unveiled the Go Blue Guarantee. The program will go into effect for undergraduate students — new and already enrolled — in January 2018: in-state students with family incomes up to $65,000 will be able to receive free tuition for four years.
Tuition and budget
The 2018 fiscal year budget for the University is $2.053 billion, a 5.9 percent increase from 2017, and was approved by a vote of 7-1, with Regent Andrea Fischer Newman (R) voting no.
Interim Provost Paul Courant outlined the budget at the meeting. In his opening remarks, he said first, academic excellence is at the heart of everything the University does.
“Second, we are committed to making the benefits of a Michigan education broadly available, affordable and accessible to students who can benefit from the work here — independent of their financial circumstances,” he said. “Third, we practice fiscal discipline, enabling us to minimize the cost to those who pay to produce our excellence — students and their families, sponsors of research and taxpayers.”
Courant said the budget is designed to continue to deliver and improve upon the education that serves its students so well.
Courant noted the Foundational Course Initiative. Launching in FY 2018, the program will study introductory courses taken by undergraduate students, utilizing the University’s progress in learning analytics and data technology to improve performance. The budget will also support new majors and minors. Courant noted professional programs, such as the Public Health program, which will now be brought to the undergraduate level — enrolling undergraduates beginning in fall 2017. It will also go to further efforts in diversity, equity and inclusion, among others.
Courant then turned to accessibility and affordability, noting financial aid has been growing faster than tuition rates over the past ten years. The budget increases need-based aid by 9.5 percent.
“The effects of this have been good,” he said. “Students are graduating with less debt; they’re actually paying less than they were ten years ago in real terms, actually in nominal terms, for all students who are below $100,000 in income in-state, and below about $80,000 out-of-state.”
Still, Courant noted the University has a special commitment to residents of the state of Michigan. The University provides some financial aid to about 70 percent of in-state students, and it aspires to reaffirm such commitment: this is where the Go Blue Guarantee comes in, he explained.
Courant also said the University will continue to contain costs and seek sources of revenue that make its education affordable.
“We are spending $356 million dollars a year less than we would have if we had not implemented cost containment strategies across the University early in the 2000s,” he said.
He noted state appropriation is still important, but has been continuing to fall in real terms.
“Adjusting for inflation, it’s where it was 50-some years ago,” he said. “We lag behind most states in the provision of state appropriation per student. California, North Carolina and many others have much larger state appropriations.”
It’s a similar situation for financial aid. Courant said University of California’s institutions have a program similar to the Go Blue Guarantee, but it is funded by the state. The University of Michigan is using its own resources to fund its new initiative.
The University’s 2.9 percent increase in tuition for in-state students, Courant said, is to keep up with inflation. In an interview after the meeting, Courant noted the 2.9 percent increase is less than it has been over the past several years.
Regent Ron Weiser (R) said he felt the tuition levels could still be lower.
“I have been pleased that input from other Regents and from me has resulted in lower levels than initially proposed,” he said. “I still feel there are possible ways to reduce it further without impacting University strategies to continue to improve its academic excellence and research capacity.”
Weiser said he worries the introduction of the Go Blue Guarantee and the loss of public funding from the proposed federal budget weigh heavily on his decision to support the budget. He hopes future increases are mitigated.
Newman, who voted against the budget, said though she respects the work the board has put into the plan, tuition is too high.
“Even though the state and country’s economic picture may look a little brighter this year than in past years, that does not mean we can forget our responsibility to our students, families and taxpayers who expect us to be good stewards of their hard-earned money,” she said.
Newman expressed concern for middle-class families who will be priced out of the opportunity for education provided at the University.
“This spending plan still calls for a significant increase in the tuition burden on our students and families,” she said. “Michigan has the funding and the resources to do better. We all have to make choices and Michigan has to make them too. Michigan must remain accessible to Michigan kids from all backgrounds. Until we can take measures to address the spending side, I am voting no.”
In the past, Regent Denise Ilitch (D) has maintained a commitment to keeping tuition rates down, but this year she was strongly in favor of the tuition and the Go Blue Guarantee.
“You can’t raise every year, and it’s very difficult to vote no every year,” she said. “This is an inflation increase for in-state students, and what has really excited me is this Go Blue Guarantee.”
Echoing Courant’s statement, Regent Shauna Ryder Diggs (D) said the budget continues to challenge the University to cut costs, something many Regents seek to do each year.
E. Royster Harper, the vice president of student life, discussed University Residence Hall and Northwood Community Apartments rates.
On behalf of the student-led Residence Halls Association and the administration, Harper requested a three percent increase in the residence hall rate — one percent to support operations and two percent to continue making improvements in the renovations of residence halls.
Diggs commended the offices of student life and housing for their work to organize costs.
“It’s a one percent increase to operations,” she said. “That is way below inflation and it shows the kind of cost cutting that the executives are trying to do and I appreciate that, and I wanted to point that out in particular.”
Athletic Director Warde Manuel presented the athletic budget. The department expects to operate on a $2.4 million surplus from FY 2017, and they anticipate a $2 million surplus in FY 2018.
The surplus is the result of higher-than-expected revenues, in part due to the new apparel contract with Nike as well as an increase in preferred seating donations.
Additionally, the Regents approved the endowment of the head basketball coach position at the University.
Alums David and Meredith Kaplan have given $7.5 million dollars to provide funding for the University’s basketball coach position — officially titling it, “The David and Meredith Kaplan Men’s Basketball Head Coach” — and for improvements in athletic department facilities.
Jerry May, Vice President for Development, esteemed the donors for their contributions.
“This is the result of somebody who went to the University of Michigan and has contributed to this University for two decades,” May said. “(David Kaplan is) one of the most loyal alums I have ever known.”
May said David Kaplan has supported philanthropic efforts such as the Michigan-Israel Partnership for Research and Education and has provided scholarships at the Ross School of Business, among several others contributions.
“David and Meredith wanted you to know that they have really credited their experiences as students at the University of Michigan for providing them with some life lessons,” he said.
At the meeting, the Regents also approved Martin Philbert, dean of the School of Public Health, as provost and executive vice president for academic affairs, effective September 1. The provost serves as the chief academic officer and budgetary officer.
Former Provost Martha Pollack is now the President of Cornell University; she left the University at the end of winter term.
Jonathan T. Overpeck was appointed Samuel A. Graham Dean of the brand new School for Environment and Sustainability, effective August 14, as well as a professor of environment and sustainability in the school, with tenure. The school opens July 1 and will replace the School of Natural Resources and Environment.
Overpeck is an expert on climate change. He has published more than 200 works in climate and environmental science and served as an author for the Nobel Peace Prize-winning Intergovernmental Panel on Climate Change Fourth Assessment.
“The recommendation to appoint Jonathan Overpeck as dean will give our School of Environment and Sustainability a great start when it’s officially launched on July 1,” Schlissel said. “We created this new school back in December envisioning a school that will draw on faculty expertise from across the breadth of our University — while further advancing the University’s goal in sustainability and environmental research and education.”
Schlissel said he is proud the University is taking action to advance real-world challenges of climate change and sustainability.
Michael S. Barr, currently Roy F. and Jean Humphrey Proffitt Professor of Law and Professor of Public Policy, was appointed Joan and Sanford Weill Dean of Public Policy, effective August 1.
“Michael Barr is a first-rate legal and public policy scholar and practitioner,” Courant said. “His work combines large-scale empirical research and thoughtful analysis to generate insights into domestic and international financial regulation.”
Melody L. Racine, senior associate dean for academic, faculty and student affairs at the School of Music, Theatre & Dance, was appointed Interim Dean at the school.
Racine is a clinical associate professor of music at the SMTD and has served as the interim chair of the Department of Voice. She has overseen new degree programs, an $11 million scholarship budget for general and endowed financial aid and enrollment planning, among other efforts.
Mark D. Pearlman was also named Interim Chair of the Department of Obstetrics and Gynecology at the Medical School.
Central Student Government
Central Student Government President Anushka Sarkar addressed the Board on CSG projects and the budget that had been approved.
Sarkar said in the past couple of months, CSG has focused on voter registration; they seek to increase youth voter turnout and registration by working with peer institutions and stakeholders across campus. They are also concerned with affordable housing to ensure options available to students are well-documented in a housing guide that will be made available to students. CSG also plans to foster a stronger relationship with the Ann Arbor City Council.
With regard to the budget, Sarkar commended the Go Blue Guarantee program. She noted a report published by the Equality of Opportunity Project ranked the University last among peer institutions with regard to economic mobility.
“While this report was for many an eye-opening read, for too many students it was stating the obvious about what it is like to be a student from a low-income background on this campus,” she said. “I am optimistic the Go Blue Guarantee program will begin to address some of the socioeconomic burdens and barriers that put the University of Michigan in this position.”