American Academy of Arts and Sciences Luncheon Remarks

American Academy of Arts and Sciences Luncheon
October 22, 2015, Knight Library Browsing Room, University of Oregon
Remarks by Scott Coltrane, Provost and Senior Vice President of the University of Oregon

I want to thank the American Academy of Arts and Sciences for its leadership and advocacy on behalf of public research universities. The Lincoln Project has helped focus national attention on the implications of state dis-investment in higher education. I encourage everyone to visit their website and download the reports – two so far and more to come.

Oregon was a leader in this trend of state disinvestment, not necessarily in a good way, but in a way that can be instructive to other universities for how to deal with issues of quality and access.

As recently as 1994, Oregon state appropriations accounted for 21% of UO expenditures. We are now at 6%, up from 5% in 2014.

State support for UO decreased from a high of $80M/yr in 2008 to a low of $45M/yr in 2012 and now sits at $58M after the state legislature made a significant reinvestment in higher education across the state (we are not back to pre-recession levels of funding in real dollars, let alone in inflation adjusted dollars).

Nationally UO receives among the lowest amounts per resident student from the state ($3,814 per fundable student in 2014-15). This is far below the actual costs of instruction, so we have sought other sources of revenue to cover those costs, including tuition and private giving.

Oregon spends more on its correctional system than on higher education.  As the last Lincoln Project report says: “eleven states spent more of their general funds on corrections than on higher education in 2013.” Oregon and Michigan have led the way on prison spending outstripping higher education spending.

During the 1990s UO turned to nonresident tuition as a source of revenue to address budgetary shortfalls, doubling the number of out-of-state students it enrolled, and again dramatically increasing nonresident undergraduate enrollment in the 2000s (2,654 in 1990, 4,219 in 2006, 5,459 in 2008, and 9,278 in 2014).

The other major funding source has been private support. We recently embarked on a $2 billion fundraising campaign to bolster our endowment and sustain our future.  This is more than double our last campaign goal. To date we have relied on annual giving and major gifts for current spending. However, if we want to stabilize our income streams to meet the needs of hiring faculty and researchers, we need to focus on fundraising to build endowments for long-term generation of capital for operating expenses. Like most public universities, we are turning toward the business models that have supported private universities in the past. Part of that model is reliance on private giving and we have benefitted from the generosity of some very successful Duck alums, including one - Phil Knight - who was recently elected as a member of the Academy for his contributions in the area of business, corporate and philanthropic leadership (Class V, Section 2 of AAAS).

To put the situation in perspective, in addition to having to rely on philanthropy, we are now in a situation where we subsidize the cost of instruction for Oregon residents by charging three times as much tuition from students who come from outside of Oregon.

We are not alone in this trend, as many other states have cut appropriations to higher education forcing their public universities to raise tuition and compete for a limited number of nonresident students who can afford the higher price (Colorado is one tail of the distribution here with even less state support than the UO).

Why does this matter? As we have heard, defunding public research universities slows local and regional economic development. Public universities have a long track record of fostering job creation and generating state and local revenue. The University of Oregon contributed 2.3 billion dollars to the state’s economy last year, over half of which was new economic activity (Tim Duy, UO Professor of Economics).

Public university research and development has demonstrated that it can drive innovation and spur incredible new discoveries to benefit the economy and society at large. Public universities have contributed to the development of antibiotics, ATMs, barcodes, smartphones, the internet, wetsuits and as we know well here in Oregon, running shoes and various outdoor and sports products.

Clusters of innovation and industry start-ups have grown around public research universities and their research parks: Great examples are UC Berkeley, UC San Diego, UNC Chapel Hill, University of Michigan, UT Austin, and University of Illinois. State universities attract creative thinkers and businesses through sponsoring research, providing research space, holding incubation competitions and providing start-up funding for new businesses based on university research.

In a similar way, Oregon and Eugene are magnets for creative exploration and discovery, typically with a green, healthy, environmental and sustainable focus. Undergraduates, graduate students, faculty, staff and researchers come here to reinvent the world and collaborate on new ways to understand their environment and save the planet. Many of the undergraduate students we attract to UO stay in Oregon and contribute to the state’s economy. Many of the graduate students we bring here help strengthen our industries and our communities. And the faculty we attract make Oregon their home. We are a magnet for talent that strengthens the economy improves quality of life for all Oregon.

The ongoing activities and contributions of public research universities advance the cultural vitality of the region and enrich the civic life of the community. In our particular region, the UO increases the ethnic and racial diversity of the state, as well as providing an enriching exposure to international populations and different cultural practices. In addition, the university brings accomplished performers and creative artists of all types to the region who thrive here. And the UO, like other public research universities, provides an academic and intellectual community that promotes exploration, discovery creative expression while building a strong civil society of engagement and debate. Public universities promote democratic processes and open dialog about the most pressing issues of the day. The University of Oregon definitely fulfills this mission for our state and for our region.

Thank you again to the Academy and to the important work you are doing on behalf of higher education in America.