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University of Wisconsin-Eau Claire

State Budget Update
News Bureau Schofield Hall 201 Eau Claire, WI 54702
phone: (715) 836-4741
fax: (715) 836-2900

The following information was shared by UW System

Questions and Answers about the UW Budget

March 26, 2002 

Q 1. Is the UW System able to cut over $100 million without affecting enrollments?

  • No. Either enrollment or quality will be affected by such a large cut.
  • Currently we are one of the most accessible university systems in the U.S. (fourth highest access rate in the nation). One-third of Wisconsin high school seniors enroll in UW institutions immediately upon graduation.
  • Since 1988-89 our state GPR (tax dollar support) has dropped $150 per student when adjusted for inflation.
  • In dollars not adjusted for inflation, the UW System has taken $55 million in base cuts since 1993-94, plus a $10 million cut this fiscal year.
  • As a result, Wisconsin educates students for $800 less per student than the national average.
  • Enrolling more students than we have staff to teach and serve them does students no favors because the quality of their educational experience will suffer. For example, they won't be able to get the courses they need in a timely fashion, affecting their ability to graduate in four years. Budget cuts of this size will affect the quality of education unless we admit and teach fewer students. That is why the Board of Regents temporarily suspended admissions.

Q 2. Can't you just take in more students to pay for additional instructors?

  • The tuition that each Wisconsin undergraduate student pays equals roughly one third (36%) of the cost of his/her education. State GPR dollars pick up the other two-thirds of the cost of instruction. Without an adequate level of GPR funding or tuition hikes, that 64% of the cost of educating each Wisconsin student is missing.

Q 3. Can't instructors just teach more?

  • We have 133,703 FTE students enrolled this fall. We are teaching 2,000 more students today than were taught in 1992 with 790 fewer faculty members to teach them.

Q 4. Can't you just cut more from administrative costs?

  • Administrative costs have been steadily reduced over many years. The administrative costs in the UW System are 5.8% compared to the national average for university systems of 10.3%. If the UW was at the national average for university systems, we would be spending an additional $115 million per year on administrative costs.
  • The UW System was created in 1971 to reduce duplication of programs and administrative costs (legal, budgeting, auditing, capital planning, etc.).
  • In 1992, the UW System administration employed 222 people; today it employs 182 -- an 18% reduction. Those 182 people manage the eighth largest university system in the nation with 160,000 students (full and part-time), 29,000 employees and a total annual budget of more than $3 billion.
  • Across the UW System there has been a 5% reduction in administrative positions over the past ten years.
  • Sixteen million dollars in base cuts are already being taken this year to meet required cuts last year.
  • Eighty-three percent of the cost of operating the university is in personnel - teachers, researchers, librarians, advisors, groundskeepers, clerical staff, computer support workers, etc. If funding is cut, these are the people affected. Without enough personnel, students cannot graduate on time, receive necessary course and career advising, or appropriate financial aid information.

Q 5. Why can't the university operate more efficiently?

  • Efficiency has been one of the highest goals of the UW Board of Regents. The board has a long-term commitment to efficiency and they have established benchmarks by which they measure both efficiency and effectiveness for the overall system and for individual campuses.
  • In recent years, the UW System has been meeting or exceeding its targets in many of these efficiency areas, including graduation rates, the number of credits that students must take to get their degrees, access, administrative costs and accessibility. To see the most recent Accountability Report, please go to

Q 6. The UW system has a $3 billion budget. Why can't you find $100 million?

  • Of the $3 billion budget, only $882 million is the GPR (state tax dollar) operating budget for the UW System. This state money is shared by 26 campuses and UW Extension. The rest of our budget comes from research grants and contracts, private gifts, and revenues received for public radio and television stations, residence halls and other "auxiliary services" not directly related to teaching students.
  • We can't use money that students pay for dorms or meal plans to pay for a faculty member or a librarian. We can't use a federal research grant to pay for a library book or a student computer lab.
  • The Regents do not have many options for managing the budget. The Governor and Legislature control state funding and have proposed capping tuition increases at 8 or 10%. In the last decade virtually all the money needed for new programs has been internally reallocated from existing programs. Enrollment and hiring are the only options left to the board of regents and president for controlling costs. Both are now frozen.

Q 7. Hasn't state support for the UW System continued to increase?

  • When adjusted for inflation, funding for the UW System has been flat for a decade.
  • About 1/3 of the university operating budget money comes from the state and amounts to about 9% of all state expenditures.
  • In the 2001-2003 state budget the UW System received a $52.2 million (5%) increase. However, when fixed costs including fuel, utilities and debt service are subtracted, the base increased by only $22.6 million. And that $22.6 million increase was for specific legislatively approved new economic development programs. All of this economic stimulus package and more would be eliminated recent cuts approved by the state Assembly (now under negotiation).
  • Over the last ten years the average increase to the UW System has been less than 1% per year (less than the rate of inflation). Enrollments are the same as they were ten years ago but costs certainly haven't decreased (technology advances, science labs and high quality instructors)
  • As a share of the overall university budget, the state support for the UW System has declined from 50% in 1971 to less than 33% today.

Q 8. Why approve big salary increases in the middle of a recession? How can we afford these increases when others in the economy are facing tough times?

  • Failed searches for some university leaders and the luring of other top leaders away from the UW were trends that alarmed the board of regents. Both national and internal studies of peer institutions showed that faculty and university leadership was substantially out of market pay ranges. For example, UW System President Katharine C. Lyall's salary was $91,000 below the median of her peers before the board took action. Board members acted to raise the salaries of five of the university's top 35 leaders to counter these trends, despite recognition that the economy was weak and that it would be an unpopular move.
  • Top leaders are worth the money:
    o They ensure efficiency and the preservation of quality.
    o They bring in private gifts to help support the university ($400 million annually)
    o They help garner federal and private research funding ($554 million in 2000-2001)
    o They bring prestige to their institutions and help preserve the value of student degrees.
    o They attract high quality faculty, staff and students.

  • When added together, leadership salaries for the UW System amount to less than one-fifth of one percent of the university budget.

Q 9. Can't out of state tuition just be increased to earn more revenue?

  • Out-of-state undergraduate students already subsidize tuition for in-state students by $26 million a year.
  • Out-of-state undergrads pay 135% to 160% of the costs of instruction, depending on the campus they attend. At UW-Madison, for example, these students are already paying $15,796 in annual tuition, while in-state UW-Madison undergraduate students pay $3,568 a year in tuition. (Under the state Assembly proposal, out-of-state undergraduate students would pay $19,400 next fall.)
  • One-fifth of non-resident undergraduate students graduate and stay in Wisconsin, becoming state citizens and taxpayers. Others donate to the university once established in careers elsewhere. (Our state spends thousands of dollars a year to encourage tourism, while the UW is a magnet for out-of-state students who pay high tuition and enrich our economy.)

Q 10. Why should we spend money on educating students who move out of the state?

  • Eighty-two percent (82%) of resident students stay and work in Wisconsin upon graduation. Twenty percent of out-of- state students stay and work in Wisconsin.
  • The brain drain problem exists because the state of Wisconsin ranks last in the nation in attracting college-educated graduates to its workforce. The lure of out-of-state students to the UW helps counter that unfortunate trend.

Q 11. What is the UW contributing to the state economy?

  • UW degrees are awarded to 28,000 people each year.
  • The UW System supplies:
    o More than 90% of Wisconsin pharmacists;
    o 68% of the K-12 teachers;
    o 72% of recent nursing graduates applied for licenses in WI.
  • Wisconsin has a skilled labor shortage. The UW supplies high quality, educated grads to fill that demand. When demand is high, the state should not cut the budget to reduce the UW's ability to supply skilled labor.
  • More than 120 companies, nearly all in Wisconsin have been 'spun off" based on UW technology or intellectual property.
  • The Wisconsin Alumni Research Foundation holds 1,700 current patents and has 1,300 additional patent applications in process, all based on UW Research. More than $1 billion a year in sales are generated by WARF patents.
  • A 1997 economic impact study indicated that the UW system contributes at least $8 billion to the state economy.
  • Ninety-nine cents of every dollar the university receives from the state goes to the campuses and local communities where they are located. Just one cent is spent on administration.

Bottom Line: The UW is an economic engine for Wisconsin, and is a revenue-generator.
It is one of the most efficient and one of the highest quality systems of higher education in the U.S. It is known throughout the world for its academic excellence.

For more information and regular budget updates check: or call the UW System at 608-262-0766.

UW-Eau Claire Home  News Bureau

UW-Eau Claire News Bureau
Schofield 201
(715) 836-4741

Updated: March 26, 2002