February 14, 2003
Purdue University President Martin C. Jischke made these remarks Friday (2/14) during a meeting of the Purdue University Board of Trustees.
President Martin C. Jischke's comments to the board of trustees
Welcome to this Valentine's Day meeting of the Board of Trustees. You are showing your true love for Purdue University by faithfully attending these meetings.
We certainly appreciate all the work that you put into this university. And I believe your efforts are being reflected in the accomplishments we are seeing throughout our campuses.
Since we last met, I have appeared before various legislative groups, including the House Ways & Means Committee, to discuss our budgetary proposals. Once again this year, the governor and the General Assembly are faced with the difficult task of trying to balance a budget while at the same time investing in Indiana's future.
It appears that our state budget deficit is somewhere in the neighborhood of $900 million.
We understand that the gap between revenue and spending remains the first hurdle to be cleared. But finding ways to make targeted, strategic investments in our state's future will, in the long run, be even more important.
Until we revitalize our economy by improving the climate for business and increasing the number and diversity of jobs, we won't be in charge of our own destiny.
I believe the solutions begin with investments in education.
Our operating budget requests for the coming biennium are very modest. They adhere to guidelines recommended by the Higher Education Commission: a 2 percent increase for faculty and staff compensation; a 1 percent increase for supplies and expenses; and a 2 percent increase in student financial aid.
As Indiana's land-grant university, we have also proposed to the governor and the General Assembly Purdue initiatives that can impact our economy. These are proposals that will build our economy and help prevent future budget shortfalls.
One of these is the expansion of our biomedical engineering program.
Biomedical engineering is a growing industry in Indiana. There is a need for more graduates in this field. One in nine jobs in Indiana is already directly tied to health care. We have a world-class orthopedics cluster in Warsaw.
The U.S. Department of Labor estimates that 31.4 percent more biomedical engineers will be needed by 2010. That is double the rate for all other jobs combined. And it is only seven years away.
As we face the next two years, we are still dealing with the cuts of the current biennium. The impact on Purdue from the budget shortfalls this biennium is already $75 million. This does not include the shortfall in support from the 21st Century Research and Technology Fund.
To deal with these reductions, we have taken steps including the reallocation of resources, reduced maintenance, less-than-needed salary adjustments and an increase in student fees.
These cuts to our budget are very real and very significant. We must address them and the problems they produce.
For example, we are now deferring maintenance of our buildings. Of course, these repairs will have to be addressed at some later date ‹ and at a greater cost to the state.
Less than competitive salaries means we will lose good people we need to teach our students. Many of these outstanding professors also are top researchers whose work brings money to Indiana and attracts businesses and industries to the state.
Their discoveries can be spun off into companies creating jobs and revenue for Indiana. In the year 2000 alone, Purdue research created 11,000 jobs in our state.
If we lose these people to other universities, they will use their expertise for economic development in other states.
The impact of these cuts extends beyond Purdue to everyone in Indiana.
Purdue has a number of programs that are line items in the state budget. Last year each of these programs was subject to the 7 percent budget reduction imposed by the state's fiscal management plan.
At present, these programs have no alternative funding sources, so the reductions have an immediate and direct impact.
For example, the reductions mean we cannot fill two positions: a virologist and a pathologist at the Animal Disease Diagnostic Laboratory. The state budget reductions left these positions vacant at a time when West Nile virus and chronic wasting disease became concerns in Indiana.
Extension is also being severely impacted by the line-item reductions. Since March 28 of last year and continuing today, all vacancies that occur in county Extension positions remain unfilled.
Without the restoration of these funds, we cannot maintain the current base of professional staff in our county offices. We will have to restructure the county system, which will reduce the availability of our educational resources in a number of local communities.
Increases in Purdue student fees have not offset our losses from state budget cuts.
Likewise, we cannot raise private funds to offset these losses. In fact, state budget cuts make it more difficult for us to raise private funds.
And these are funds that are being used to strengthen Indiana's economy, such as through the private investments in Discovery Park.
This academic year we instituted a $1,000 fee increase for new students. This followed two years of work on strategic plans. The funds from the $1,000 fee increase are going toward specific strategic initiatives.
We determined exactly what we needed to accomplish to become a preeminent university. We determined exactly what we needed to spend in seven key investment areas to accomplish this. And we showed everyone how the money would be spent before the increase was approved.
Funds from the $1,000 student fee increase are going toward Purdue's strategic initiatives to increase faculty numbers and to increase experiential learning opportunities.
The funds are also going toward initiatives in the areas of diversity, faculty and staff salaries, information technology, and student access ‹ scholarships and financial aid.
Additionally, in our $1.3 billion Campaign for Purdue, we have targeted raising $200 million for student scholarships and financial aid.
We are hearing ‹ in Indiana and throughout the nation ‹ growing concerns about the cost of higher education. We join our students, their parents and Indiana state officials who are concerned about escalating costs.
But Purdue remains a bargain.
This year our resident undergraduate fees rank sixth among the 10 public universities in the Big Ten. Our resident undergraduate fees rank fifth among our 12 peer public institutions.
Moreover, while some universities have relatively high fees and low state support, and others have low fees and high state support, Purdue continues to have relatively low fees and low state support.
In the mid-1970s, higher education in Indiana received 18.4 percent of the state's general fund. That share has dwindled to 14.1 percent.
In 1989-90, the relationship between state appropriations and student fees and tuition was 64 percent state and 36 percent student fees and tuition. This year the numbers are 54 percent students fees and tuition and 46 percent state appropriations.
We agree with those who are concerned about the cost of higher education. We are also very concerned. This is an issue that must be addressed and resolved.
It will not be resolved by trying to place blame. It will only be resolved as everyone works together to accomplish our common goals.
The goal of Purdue and our state is to make top-quality higher education in Indiana affordable to everyone who is qualified for admission.
To that end, we pledge to work with the governor and General Assembly on a funding plan for higher education that is good for our state and its citizens, good for our students and affordable.
This is not going to be easy. But if everyone works together toward these ends, I believe we will be successful.
And the people of Indiana will be the big winners in all that we accomplish.
As we work on all this, our spring enrollment in West Lafayette is 35,905. This is on-track with our plans.
We are just 0.3 percent below the target we set a year and a half ago. And being below target is good as we work to manage enrollment.
For the fall semester, admissions are also on track.
Purdue is among the top 11 public universities in the nation in terms of the number of applications that we receive.
Our indicators are pointing upward for the fall, both in terms of student academic quality and diversity. We anticipate closing our programs sometime in the next four to six weeks.
The impact of our strategic plans continues to be very positive.