2008–09 MSU budget reinforces commitment to quality and value

06-13-2008

Today, the MSU Board of Trustees voted to approve budget guidelines for fiscal 2008–09 that represent a strategic and balanced approach to addressing current economic challenges while preserving the university’s ability to provide Michigan’s families with access to one of the top 100 research universities in the world.

The budget includes a tuition increase of $639, or 6.8 percent, for in-state, lower division undergraduates (freshmen and sophomores). Tuition for out-of-state undergraduate students and graduate students will increase approximately 7.1 percent, or $1,700, after restructuring. In addition, the budget reinforces Michigan State’s commitment to increasing financial aid to keep pace with rising tuition. Base financial aid will rise 11.6 percent, bringing total financial aid to $69.5 million. This includes funding to continue the Spartan Advantage program aimed at new students below the poverty level and additional support to offset the loss of $2 million in Federal Family Education Loan Program revenues.

The decision to raise tuition is not an easy one. Asking our students and their families to pay more is difficult under any circumstances but more so given the current economic climate in Michigan and across the nation. The long-term disinvestment in higher education by the state requires us to make hard decisions in order to ensure that quality is not sacrificed and value to our students is preserved. We are left with the choice to mortgage the future or put a down payment on it.

While state appropriations over the last decade have been in the lowest 20 percent nationally, MSU has reduced spending, reallocated resources, and taken an entrepreneurial approach to improving operations and efficiencies in order to sustain this university as a world-class institution. We have stretched every dollar, while still building quality, as the state has shortchanged the future of our students.

The value of Michigan State University lies at the nexus of cost and quality. The university has worked tirelessly over time to contain costs, improve operational efficiencies, and provide financial aid for students in need, all while maintaining world-class quality. MSU’s health care increases have been below the national average (for higher education and major industry) in five of the last seven years; the institution operates with the least amount of tuition/fees and appropriations per student in the Big Ten; and, MSU remains the leader in the Big Ten in the number of Pell-eligible students enrolled.

The budget guidelines also include implementation of an aggressive energy conservation program developed not only to respond to soaring energy costs—an anticipated 17.6 percent rise ($6.3 million) for this fiscal year alone—but also to significantly reduce MSU’s carbon footprint. Though we cannot mandate behavioral changes, we will encourage units across the university to adopt conservation behaviors that decrease energy use and improve campus sustainability over time. The positive spirit of Team MSU that I have seen create success in other critical endeavors gives me great confidence that we will achieve our goals in this area.

The 2008–09 budget builds upon the solid foundation laid over many years by further reducing and managing costs and by reallocating resources to priority areas that focus on the needs of Michigan and Michigan families, such as K–12 education, food production and safety, and alternative energy and the bioeconomy. Nearly 89 percent of MSU’s students come from Michigan. In addition, MSU Extension has offices in all 83 counties dedicated to working with business and community leaders to find solutions to the problems impeding local and regional prosperity. Michigan State University is an essential resource and asset for Michigan—its people and its future.

This budget highlights Michigan State’s continuous commitment to improve the university’s value for our students and their families. It also highlights the impact of long-term disinvestment in higher education by the state. Though the proposed 3 percent increase in state higher education appropriations for 2008–09 is encouraging and an extraordinary improvement over recent years, Michigan is still lagging every other state in the nation in funding for higher education. Over the last five years, Michigan has been dead last in its investment in higher education, and it is one of only four states to spend more money on prisons than on higher education.

If Michigan is to be globally competitive in the new knowledge economy, the state must invest more in higher education. The state’s world-class research universities are critical catalysts for prosperity and assets for our future. MSU is actively engaged in fueling the engine of innovation for Michigan’s future and ensuring American competitiveness for the 21st century. Our investment in Michigan and Michigan families is reflected in the budget approved by the MSU Board of Trustees, a budget that allows us to continue to provide education of the highest quality that is both accessible and affordable today and in the future.

I encourage you to visit www.budget.msu.edu for more detailed information about the budget.

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