2011-12 Executive Budget Testimony

2011-12 Executive Budget Testimony

Chancellor Nancy Zimpher's Testimony at the Joint Legislative Hearing of the Senate Finance and Assembly Ways & Means Committees
February 10, 2011

Introduction

Good morning and thank you for having us today. My name is Nancy Zimpher, and I am Chancellor of the State University of New York.

I want to thank Chairperson John DeFrancisco and Vice Chairperson Owen Johnson, Chairperson Denny Farrell, Chairperson Ken LaValle and Chairperson Deborah Glick, members of the Senate and Assembly, and legislative staff for this opportunity.

It is a privilege to come before you today on behalf of The State University of New York to comment on the 2011-2012 Executive Budget.

Who We Are

When I first arrived at SUNY in June 2009, I recognized SUNY’s potential to meet the demands of a changing state and a changing world.

We are the largest system of public higher education in the nation. We have 64 campuses with 468,000 students; a current workforce of 88,000, over 20,000 committed retirees; nearly 8,000 programs of study; and 3 million alumni.

We are an unparalleled network of teachers, students, scholars, and entrepreneurs that extends into each of New York’s 62 counties, within 30 miles of every New Yorker. We have 160,000 on-line enrollments and another 1.2 million students in continuing education; further, 18,000 students seek a SUNY degree from out-of-state, and another 19,000 students come to SUNY from around the globe.

The boost that SUNY provides New York in economic impact each year is remarkable. For every state dollar received, SUNY generates $8 in total spending. With a statewide economic impact in the billions, SUNY’s role stretches from a convener of the minds to one of the most significant economic engines of our time. We are not only the most comprehensive higher education system of its kind in the country; we are one of New York’s largest employers.

Of the many conclusions that will be made throughout this budget process, one to me is unwaveringly clear: the past, present, and future of New York State is uniquely tied to its State University. And that’s a partnership we stand willing and able to push to new heights.

What We Do

Any discussion of the budget and its potential effect on SUNY has to begin with what SUNY is doing now and what we’ve managed to achieve at a moment of such great fiscal challenge.

Without question, at the top of our list of accomplishments is our strategic plan.

After a 64-campus tour, 10 statewide town hall meetings, and input from more than 1,000 stakeholders from across the state, we’ve launched The Power of SUNY, our plan to revitalize the state’s economy and enhance the quality of life for all New Yorkers. The plan harnesses our areas of expertise to maximize our potential, enabling our students and faculty to strengthen SUNY’s impact on critical areas including entrepreneurship, student success, health, energy, and the expansion of our knowledge-based enterprise, both locally and globally.

To assist in these efforts, we have created a network of regional tech transfer hubs in partnership with the SUNY Research Foundation. These hubs are helping us translate SUNY research into marketable products and services, finding new ways to make our investment in brainpower return tangible benefits to the people of New York State.

We’re unlocking new treatments and vaccines for disease control, including the prevention of ear and lung infections; inventing geothermal technology under airport runways; developing a water purification system for communities around the world; and exploring technologies designed for New York to be a leader in clean energy.

We are also continuing our efforts to seal the leaking education pipeline. College and career success begins long before students arrive on our campuses. With support from the Gates Foundation, SUNY is creating eight Early College High Schools designed to increase college completion rates among disadvantaged students. We’ve also secured another $800,000 from the Lumina Foundation to aid adult degree completion along with paid work experiences. At the same time, our Educational Opportunity Program – long supported by this body and recognized as among the nation’s most successful paths to college graduation for low income, first generation students – is providing excellent opportunities for highly motivated students to succeed at SUNY.

Of course, it doesn’t stop here. Our faculty – along with many partners – brought to New York over a billion dollars in grants for sponsored research this year. Thousands of faculty and students are participating in these grants and putting New York back on the map as the center of innovation.

And speaking of students – ours are truly the envy of higher education. Not only are they bright, inquisitive, creative, and determined in the classroom, but they constantly strive to bring that passion to what they do outside the classroom. Whether it is providing assistance in Haiti, tutoring local high school students, volunteering at non-profits, or interning at local businesses – the impact of SUNY students reaches far and wide. And perhaps most impressive today is their courage and maturity in taking a stance on tuition. Their demand for a rational tuition policy should make us all confident in their ability to provide the next generation of leadership for New York and the world. Leading that charge is Julie Gondar, of East Greenbush, President of the SUNY Student Assembly. She’s one of our best and brightest and you’ll have the opportunity to hear from her today as well.

And for two last pieces of good news, 11 SUNY campuses were listed in the “Top 100 Best Values in Public Colleges,” as noted by Kiplinger’s Personal Finance. This is the highest number of campuses named from any state in the nation, let alone other systems. And six of our 4-year campuses have been recognized by the Education Trust as among the very best in the nation for graduating minority students at the same or even higher rates than the average graduation rates. When it comes to access and affordability for students, our State University is #1 – and that’s a title we have no intention of ever giving up.

Where We Stand

With all of the great things happening at SUNY, there are also back-breaking challenges we face daily. Just as Governor Andrew Cuomo characterized New York State, higher education also stands at a crossroads. Less public investment, greater public demand, and rapidly shifting economic sands require us to be increasingly agile.

The campuses in your districts and around the state continue to provide a top-notch education to thousands of students each year. Thanks to the leadership of our Board of Trustees and the keen expertise of all our campus presidents, we have managed more demands with significant decreases in funding through the implementation of creative solutions, hard work, and a true dedication to a greater cause. In the face of unprecedented fiscal hurdles, these efforts have kept SUNY strong.

SUNY is strong … but it is not invincible. With a negative impact of $1.1 billion over the past three years, and the potential for that figure to reach $1.5 billion with the enactment of this executive budget, SUNY’s ability to provide the breadth and quality of its programs and services is threatened. With a total percentage decrease in funding of nearly 35% over the past four years, we have already seen our capacity to deliver programs and services diminished on our campuses – including hiring freezes, increased reliance on adjunct faculty, reductions in course offerings, increases in class size, and already announced decisions to limit enrollments or otherwise restrict programs.

What We’ve Learned

Last year was not an easy one for the State University of New York. Not only did we bear an additional $442 million in cuts and unfunded mandatory costs, we also were unable to convince public policy makers to take steps toward critical reforms that we fought so hard to achieve.

Our agenda was not only ambitious; it was the right thing to do for our state. And in the end, we learned some hard lessons about an uphill climb and heavy lifting.

First, we learned how important it is to SUNY’s future that we develop comprehensive and thoughtful state policies to fuel our success.

Second, our success must be more effectively translated to our constituents and champions as a win for our students, parents and families, and the people of New York. We have to be much more forthright about our belief that as SUNY goes, so goes New York and vice versa.

Since we cannot carry this message alone, we need to work harder at building better advocacy among our faculty, students, staff, alumni and friends, and our elected officials.

We also learned that we are quite fortunate to have a new partner in Governor Andrew Cuomo, who we believe will be a staunch advocate for our great university system. We are excited about his leadership. He has recognized that SUNY plays a significant role in the revitalization of our economy, because we are the university for the State of New York.

SUNY produces the graduates who become employees and continued residents of New York. But we also help to create jobs for New Yorkers via business incubators and tech transfer. And in many communities, we are one of the largest employers. Recognizing us as an economic backbone and a driver of the knowledge economy validates everything we do and work to achieve.

And perhaps most importantly, we learned that SUNY must be far more vocal about what we know to be our unequivocal commitment to access and success. Specifically, we understand and embrace our role in delivering to the state a high quality education that is both accessible and affordable. And we just can’t ever de-couple SUNY’s commitment to access from our responsibility to graduate students in a timely fashion.

Access is perhaps the most important gateway to enhanced quality of life for our students and their families and the pathway to professional success.

Individuals who enter the workforce with a 2- or 4-year degree have more successful careers and earn higher salaries than those who lack them. This is a fact, and it is why protecting access is central to our mission at SUNY.

But there is something equally as important as access – and that is completion. Let me repeat what I just said a moment ago: individuals who enter the workforce with a 2- or 4-year degree have more successful careers and earn higher salaries. The key word here is “degree” – they have completed their course work and graduated. If we admit students that we aren’t able to graduate in a timely manner – either because budget cuts have resulted in fewer programs and course sections or even fewer student advisors – then we are not only hurting our students in the long term, we are denying the state a qualified work force.
We must ensure access AND success. It is not only a matter of SUNY’s responsibility to create opportunities for individual students, or even of its ability to drive the economic future of this state. The quality of our teaching, research, and service must remain paramount if we are to realize positive outcomes or results.

The principle that guides our every action at SUNY is excellence in education. Our obligation as a state university is to maintain the academic quality that best serves the needs of our students, faculty, and all New Yorkers at the lowest possible cost. Our welcome mat must extend from Niagara Falls to Montauk Point. To achieve this in the midst of our economic crisis is a daunting task.

In a speech calling for the U.S. to once again lead the world in higher education, President Obama said education is "the economic issue of our times." He added, "It’s an economic issue when the unemployment rate for folks who’ve never gone to college is almost double what it is for those who have. It’s an economic issue when nearly eight in 10 new jobs will require workforce training or a higher education by the end of this decade. It’s an economic issue when we know beyond a shadow of a doubt that countries that out-educate us today will out-compete us tomorrow."

In summary of lessons learned, if I were to pick a theme for SUNY in this year’s legislative season, it would be “partnership”. We must work together to find ways in which the State University can thrive to its fullest potential. At the same time, we must protect the citizens of our state. I am certain we can achieve this goal if we can join together as partners this year and in years to come.

What We Need

I’ve told you about SUNY’s most recent accomplishments and lessons learned in last year’s budget process. Now I’d like to clearly articulate the going forward strategy for SUNY’s budget needs; in short, what we need to keep this great State University of New York continuously improving, better serving the people of New York, and leading New York’s economic revitalization.

We must cut the red tape that is strangling SUNY’s procurement of essential goods. If our hospitals cannot quickly purchase the life-saving tools they need … if our campuses cannot provide our students with the educational tools they need in a timely manner … then we simply cannot do our jobs efficiently. The hurdles we face in the procurement of goods force us to spend more tax-payer dollars and to fall behind on our promise of excellence to New Yorkers.

We must allow SUNY to enter into public-private partnerships with more cost-efficient and growth-oriented regulatory relief. We know that these reforms will advance our core mission and values and that they can at the same time protect collective-bargaining rights. It’s essential that we attract the interest of the private sector, while simultaneously protecting the interests of the public, allowing us to generate additional revenue and create the jobs our state so desperately needs. One only needs to look closely at the 100 acre Centennial Park at North Carolina State University to understand the power and impact that such a research park is having in that state; not unlike the extraordinary partnership that exists at UAlbany’s College of Nanoscale Science and Engineering with the private sector.

We have already been working with Senator LaValle and our union partners to come to agreement on procurement reforms. We hope to do the same with public-private partnerships. Of course, we greatly appreciate the Governor's support for these badly needed and long-overdue regulatory reforms and look forward to working with Assemblymember Glick and her colleagues to make these a reality. SUNY has brought these zero-cost solutions to the table at a time when New York must be open to ideas for fiscal stability.

While these reforms are essential, we also remain deeply concerned about our mounting fiscal challenges and how they will impact our ability to provide a quality experience for our students.

We must reach a mutually acceptable agreement on "maintenance of effort." We understand the seriousness of New York's financial crisis and agree that everyone must do his or her part for the good of all New Yorkers. Governor Cuomo has laid out an ambitious plan to address the root cause of our state's fiscal problems, and he deserves credit for his effort to make New York live within its means.

So while we certainly applaud the Governor for his courage to face our current budget crises, I have to say, for the record, that after years of significant cuts to SUNY’s operating budget, many are concerned, including students and faculty, about the University’s continuing ability to provide access to a quality education. Yet, the State’s economic reality cannot be ignored. So, in an effort to balance support for our critical mission against the economic realities of our time, we must, at the very least, begin a genuine and productive discussion regarding the State’s long term commitment to funding the State University of New York.

We must revisit support for the life-line in three of New York’s key communities through the public hospitals that serve our Academic Medical Centers and the patients of Syracuse, Brooklyn and Long Island. We are deeply troubled about the Governor’s proposal to eliminate state support for SUNY hospitals. This action will spell devastating consequences for these institutions and the communities they serve.

Our hospitals have already absorbed more than $479 million in cuts and unsupported mandatory costs imposed by the state over the past three years.

This year’s budget proposal completely eliminates what was left of their state support – $179 million. Factor in a $25 million increase in their state retirement system bill, and a yet-to-be-determined level of Medicaid cuts – conservatively estimated to be over $30 million – and we’re looking at an impact of approximately $209 million in the coming year, bringing the four-year impact on just three hospital facilities to over $700 million.

A cut of this magnitude will have a devastating impact on the hospitals’ ability to deliver critical care to over one million patients per year, educate New York’s future healthcare workforce, and continue to be major employers in their communities. I urge reconsideration of this approach to the SUNY hospital subsidy.

We must also take this opportunity to ask you to consider restoring at least some of the massive reduction of state aid to SUNY’s community colleges, and state operated institutions.

In the Governor’s budget, community colleges were cut by $226 per full-time equivalent student – $33 million in total – which is in addition to $56 million in cuts over the past three years. The community colleges have been grateful for the infusion of the federal stimulus funds in the last two budget cycles. However, from the very beginning, presidents and business officers were acutely aware that this was one-time funding and they began to think about the time for hard decisions that would be required once those funds were gone. That time is now.

The state-operated institutions were cut $150 million, added to $619 million already cut over the past three years. I do not make this request lightly. I understand full well the constraints on New York’s finances in this economic environment. However, I feel strongly that we owe it to all of our constituents, especially our students, faculty, and staff to advocate for this reinvestment.

And finally, we must address the issue of tuition. To its credit, New York has done an outstanding job of limiting reliance on tuition to support SUNY’s operations. At $4,970 per year at our state operated institutions, SUNY’s tuition is among the lowest in the nation. Thanks to the Tuition Assistance Program – TAP – any New York State resident who seeks a SUNY education will not be denied because of diminished financial means. However, the means by which we have achieved this tuition rate have been anything but fair.

Over the last 48 years SUNY has been allowed to raise tuition only 13 times. The smallest tuition increase was 7 percent ($310) in 2009-2010. The highest increase was 43 percent ($650) in 1991-1992. Seventeen times since 1963, a first-year student entered SUNY and during his or her college career never had to pay a tuition increase while others saw two or three increases.

SUNY needs a tuition policy that is fair, predictable, and responsible.

As Student Assembly President Julie Gondar said in her recent statement calling for a rational tuition plan, “We understand that the Governor is concerned about pricing students out by raising tuition but that won’t even be an issue if their program can’t be found in the SUNY system.”

So I ask all of you today to partner with SUNY in establishing a five-year tuition plan, similar to the successful cycle you have so wisely provided for our capital planning.

Thank You

I know we’ve put a lot out on the table today. It is no small task to run the nation’s largest State University, and it is no small responsibility for the state it serves. There will always be spirited discussion around the best way to move the university forward but in the end, everyone in this room wants the best possible system of public higher education for New York State. Everyone in this room wants to maintain access, keep SUNY affordable, and rejuvenate New York’s workforce with new jobs and a newly skilled citizenry. I know we can make this a reality by harnessing our collective passion for progress.

Thank you for giving us this time to lay out the vision of what we believe public higher education can do for the State of New York – and what together we can do to make that vision a reality.

We are happy to take your questions.

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