CHE Budget Presentation
Over the past two years, Clemson University has made substantial investments in improving academic quality as we strive to become one of the nation's premiere research universities. Those investments are beginning to pay off.
- Our new Academic Support Center has increased retention of LIFE Scholarships. Among the general freshman class, 42 percent retain scholarships. Among students participating in ASC, the retention rate is more than 50 percent.
- We have raised our faculty recruiting to a new level of quality. We have targeted and hired 15 outstanding new faculty with credentials that rival any faculty at the nation's top 20 public universities. This practice will continue.
- We have significantly grown our external research support. We reached our 10-year goal of $100 million in research support after only three years. When we set that goal, we were generating $55 million a year, and our goal seemed ambitious. But our faculty responded to the challenge, and they have increased research support by almost 100% since 1999.
- The state's best students are responding to the increase in quality. The group of freshmen that arrived this week has an average SAT score of more than 1200. 47% were in the top 10 percent of their high school class. The class will include one-third of the state's Palmetto Fellows — more than any institution. Also of note is that in 1995 we accepted 80% of our applicants. This year we accepted 51% of our applicants. In short, this class is the finest class ever to enroll at a public university in SC. In fact, in every measure of student quality we already are a top 20 public university.
So these four numbers clearly show Clemson's accountable in our commitment to improve quality — $100M, 1200, 45% and 1/3.
However, these improvements have been made possible only through significant increases in tuition and equally significant increases in productivity of our faculty and staff. The state of South Carolina has reduced support for Clemson at the very time that we are positioned to move into the ranks of the nation's top universities. Last month, our Board of Trustees approved a budget in which state support accounts for less than a third of revenues. That's a historical low. 31% — this must be a wake up call for all of us in SC.
Through its mission resource requirement formula, the Commission on Higher Education estimates that Clemson's academic and operating programs should receive $188 million a year in state funding. Our appropriation for the year will be $103 million. That's a shortfall of $85 million — or 45 percent below this commission's recommendation.
It is important to note that the amount of state support, $103M, is actually less than the research support we generated. These curves have crossed.
As our base appropriations were being cut, the value of a LIFE Scholarship was being increased by more than 50 percent, and new scholarships were being created to encourage more and more South Carolina students to attend college. There is a basic disconnection in South Carolina. We are giving students the means to attend college, but we are not giving colleges the means to attend to those students. The trend of funding families, not institutions, continues.
The bottom line is that the gap between resources needed and resource provided is growing, despite unprecedented fee increases and unprecedented success in generating external funding. So let me state the obvious: First and foremost, our top budget request is to restore last year's budget cuts and stabilize base funding for higher education.
Even as I say that, I recognize that the worst may not be over. Economic forecasts suggest that it may be another year before state revenues improve. State budget analysts are already telling us to prepare for mid-year budget cuts. We read of political campaigns built around a platform of cutting taxes. It would be easy to find excuses for back away from our goals and settle for mediocrity. But at Clemson, that's not an option. Our goals are not negotiable. We are more committed than ever before to reach our goals, even in this challenging environment.
But if these current trends continue — if we are expected to provide an ever-increasing share of our own resources — we must have the flexibility to develop non-traditional sources of revenue. This leads me to our second budget request — regulatory relief. When we spend state dollars, we fully expect to adhere to all state regulations. But when we invest funds, which we have generated externally or through private partnerships, those same regulations can become impediments. Let me give you two examples.
If the state funds a new facility, we would unquestionably follow all state construction guidelines. But those guidelines often mean that a state facility can take years to build. Research is a space-intensive business, and we often need to add space quickly to respond to multi-million-dollar contract opportunities. If we could partner with private developers to build facilities on our property without requiring the private developers to follow state construction guidelines, we could add space more quickly. That allows us to act on opportunities. Instead, we sometimes turn down grants because we have no place to do the research. This must change.
There are many other situations where we find ourselves unable to make needed investments because of a state regulation. For example, we are limited in our ability to use state funds — even those we generate ourselves — to provide tuition relief for needy students. Exemption from this "2 percent waiver" camp would allow us to fund need-based grants such as community-service scholarships.
We also need for the state to recognize that our competition for top faculty is national, so our compensation packages need to be nationally competitive. State limits on salary and bonuses often limit our ability to recruit and retain world-class faculty.
Conceptually, as the percentage of our budget from state support declines below 31%, we must have proportional increase in relief from the state's regulation. This only seems fair. Help us make these changes so that we can better accomplish our mission.
Our third budget request is to recognize the unique economic contributions, and the unique funding needs, of research universities. Increasingly, we see research universities serving as drivers of their state's economies. If South Carolina is to thrive in the new, knowledge-based economy, it must invest in its research infrastructure. Our research universities have enormous potential to shape the economic future of South Carolina, particularly in areas where we can collaborate.
Imagine a research university that has more than $350 million in external funding a year, covers all areas of economic development from technological to business to medical, that has a high degree of internal collaboration and a healthy dose of competition, that covers every geographic area of the state, that is engaged with every sector of the business community, and that has recently completed private fund-raising in excess of $1 billion. That's what you have with the combined strength of Clemson, USC and MUSC. Few states could match that horsepower. South Carolina needs to take advantage of this economic engine.
As Clemson builds its research program, the economy of South Carolina will benefit. Already, our research has played a role in creating 10 start-up companies, either through our incubator facilities or through licensing of our intellectual properties.
One of those companies, Poly-Med Inc., was launched by a faculty member to develop polymer products for the health-care industry. It currently employs 20 graduate students and is expected to double its workforce within two years.
Southern Sun BioSystems was launched five years ago to capitalize on technology developed at Clemson, which allows for rapid growth of ornamental, pharmaceutical, and food plants. Southern Sun now employs more than 40 people.
Clemson's research in fiber optics has led to the development of two start-up companies, and we expect more of the same as we expand into a new facility at the Clemson Research Park. More than 70 percent of the world's optical fiber is manufactured in a crescent stretching from Atlanta to Wilmington. Clemson is positioned — academically and geographically — to make the Upstate a research hub of this fiber optic industry.
Research universities increasingly are becoming key players in their state's economic development. This is how we will increase the wealth of individual citizens and create jobs in a new, knowledge-based economy.
The creation of lottery-funded endowed chairs was a great first step, but there is more that can be done to build a stronger research environment. Other critical needs, which could be supported through lottery funds, include graduate student stipends and health insurance, research facilities, and technology.
On average, every dollar invested in research universities returns five dollars to the state, according to a national study. That's a very good return on investment.
Finally, we have six requests for below-the-line funding for unique programs that fall outside the traditional appropriation formula.
Those priorities include the following:
$1.2 million for "Call Me Mister," the unique collaboration involving Clemson and three historically black colleges in an effort to place 200 African American men in our public school classrooms in SC. These funds will match private dollars and foundation support already provided.
$1.03 million to establish a DNA Learning Center, a science outreach program that will give K-12 teachers basic competencies in biotechnology and genetics, further public understanding of food biotechnology, and better prepare students to enter 21st century careers and make informed decisions about biotechnology.
$1 million to establish our second National Science Foundation engineering research center, focusing on wireless communication. The program will be modeled after our successful NSF center for advanced films and fibers, which has leveraged a $1 million state investment into an additional $8 million in private and external funding per year.
$310,000 for a Center for Safety Education and Research, which promotes a lifestyle for safety and health through educational initiatives and research.
$100,000 for campus-based Leadershape Programs, which is a nationwide effort to promote leadership skills among young people.
$326,550 for added homeland security costs placed on Clemson due to our remote location from existing state emergency resources, our proximity to the Oconee Nuclear Station, and our high-profile athletic events.
$120,000 to expand the National Coalition Building Institute Diversity Training Team's efforts to provide NCBI workshops in South Carolina. The Clemson team was established in Fall 1999 as the state's first NCBI college affiliate, and has since been instrumental in establishment of affiliated at Furman, Anderson College, Tri-County Technical College, and S.C. State.
Let me conclude by reiterating that Clemson is serious about improving quality. Over the past year, the vice presidents of academic affairs, research and public service met with the faculty of each academic department. That's 57/3 hour individual meetings for all three vice presidents. The intent was to help each department develop a five-year strategic plan and identify where they want to be in 2007. That represents a level of collaboration, listening, faculty involvement, and consensus building that is almost unprecedented in higher education. It is so unique that it led our SACS accreditation visiting team to give Clemson two commendations call these discussions "Clemson's ministry of listening."
The outcome of those meetings is a detailed academic plan built around well-defined areas of emphasis, strategic refilling of vacant faculty positions, and a renewed emphasis on the general education. This plan will help us achieve our vision of becoming one of the nation's top 20 public universities. It will require new resources. We will reallocate resources internally and generate much of our own funding through external and private sources. But we are not a private university. We cannot charge the fees that a private university charges. The state must be a partner in our efforts to improve the academic and research environment of South Carolina. In this work we have been guided by a simple principle — we will not whine but we will be aggressive and positive to reach our vision as a Top 20 Public University.
Our budget request is modest in some ways: restoration of budget cuts and stable base funding, regulatory relief, focused support for research universities, and specific below-the-line needs. But given our proven ability to leverage funding, even these modest investments can yield significant benefits — for our students, and our state. Thank you.