Speaking before the main faculty governance body yesterday, the two University regents running for re-election and the candidates vying for their spots clashed over the best way to handle the University’s finances in the upcoming term.
Challengers Paul Brown (D–Ann Arbor) and Greg Stephens (D–Saline) discussed their plans to address tuition increases during the debate in front of Senate Assembly yesterday. Incumbent regents Andrew Richner (R–Grosse Pointe Park) and Andrea Fischer Newman (R–Ann Arbor) touted what they called track records of effectively handling the University’s finances. Libertarian Leslie Lazzerin also participated in the debate.
In his opening statement, Richner cited the University’s stable finances in light of the state’s economic downturn as a reason to keep him on the board. Newman took a similar tack, saying she wants to stay on the board to help the University sustain its resources.
Both Democratic candidates said they would focus on implementing new tuition plans if elected.
Lazzerin’s speech focused less on finances and instead on the atmosphere she would aim to create for students, if elected. Drawing on her experience doing service work with Detroit youth, Lazzarin said she would be able to effectively focus on students’ needs. She added that also would promote an environment that is supportive of free speech and creativity.
Stephens, who previously ran in 2002, said if elected, he would work to make the University more affordable and accessible for students. Asked about the most important challenges for the University in the upcoming years, Stephens spoke again about the importance of reducing tuition costs as well as the importance of increased faculty engagement.
Brown said he believes the University will meet many financial obstacles, which the regents and faculty can overcome by having more of a public presence and advocating for public funding. State legislators voted to cut funding for public universities by 2.8 percent last month.
Newman said that though the biggest challenge facing the regents in the upcoming term will be dealing with the University’s finances, the cost-cutting measures that officials have already started putting into place will help the University maintain its stable finances.
“I think that keeping costs manageable while at the same time developing perimeters, which we are starting to do in a lot of different ways, will be very helpful to defraying our costs,” Newman said.
Richner also focused on the University’s financial struggles, but added that the University must still work to maintain its prestigious academic reputation.
A question from a faculty member shifted the conversation from finances to diversity at the University. Addressing a question about the promotion of racial diversity in the future, all candidates agreed that diversity is an important part of the University experience.
“I feel we have almost a sacred obligation to truly have a racially diverse campus and truly give all students from all our neighborhoods in the state and around the country a chance to matriculate here,” Brown said.
Brown said he feels a change in the admissions policy would bring the needed diversity to campus. He added that the University should also work harder to recruit a more diverse faculty body.
Newman and Richner both claimed the University has done a good job promoting diversity thus far, despite the state-wide ban on using affirmative action in admissions.
“I think we’ve done a good job in dealing with Proposal 2 and taking a holistic approach towards admissions, and the record is improving and on the right track,” Richner said.
Stephens said he feels that while the University is doing a good job attracting minority students, the actual retention rates are very low. Though he said he feels this is a nationwide trend, reducing the cost of tuition should help increase retention rates, he said.
Slottow talks cost cutting measures
Tim Slottow, the University’s executive vice president and chief financial officer, told Senate Assembly members yesterday that officials are continuing to balance cost-cutting measures to reduce the University’s financial risk.
Slottow said officials are focusing on cost controls, diversifying revenue streams and continuing to invest in buildings on campus, while trying to evaluate the University’s internal workings.
“We’re both working from top-down and bottom-up to ensure that even the detailed financial transactions as well as the larger broad ones you may hear of have a continuous focus on continuous improvement in reducing the risk to protect both the financial and reputational risk of the University,” Slottow said.
Using a disciplined budget strategy, Slottow said the University is working to cut millions of dollars from its next operating budget. The cuts include rationalizing information technology services, condensing office duties and streamlining facilities maintenance.
Slottow added that these cuts, like with the custodial services, may take a while to be implemented, because the University does not want to disturb daily research and teaching activities.
“It will take us a while to get to a point where we can provide commodity-type basic services to folks in a less expensive way but also not have it affect your research or your ability to teach, hopefully to enhance it,” he said.
Looking at an overview of the University’s budget, Slottow said there is still a “healthy relationship” between total assets and total liabilities. But, he added that the amount of liabilities has recently increased due to a new $1.6 billion addition for post-retirement health care.
Other threats to the University’s budget include increased post-retirement benefits, increasing health care costs, the changing nature of capital markets and general building energy and maintenance, Slottow said.
To alleviate these threats, Slottow said the University recently finished a dependent eligibility health benefit audit, which removed 914 dependents from the University’s health care plan.
Slottow said he feels the University can gain more capital as it invests in campus buildings.
“We want to continue to renovate our existing buildings (and) invest in new strategic facilities as we have done on this campus and do it in a way that is thoughtful, sophisticated and continuing to reduce the deferred payments and invest in the strategic areas that we need to, to support the new types of research and academic programs,” he said.