To Adjust 
the Sails
2002 State of the University Address

Delivered August 19, 2002

Dr. Charles P. Ruch
President

Good morning and welcome to the 2002-2003 academic year of Boise State University.

Welcome back to those who have been away on study leave or sabbatical.  Welcome too, to those of you who spent the summer away from campus, at what I hope was a cooler environ.  Finally, greetings to those of you who were here this summer.  I hope all of you were able to find at least a few moments for rest and relaxation.

I am pleased to introduce and welcome new members of the academic and administrative leadership of the institution: 

New Deans

Dr. Michael Blankenship
Social Sciences and Public Affairs

Dr. James Girvan
Health Sciences

Other

Uwe Reischl
Director - Health Policy & Professor

Steve Swain
Director - Facilities Operations & Maintenance

Sabine Klahr
Director - International Programs

Gina Huntsinger
Director - Select-A-Seat

Gary Davis
Business Manager - Pavilion and Campus Recreation

Michael Mather 
Director of Finance - University Advancement

Ferd Schlapper
Executive Director – Health, Wellness & Counseling Service

Craig Thompson
Director – Student Housing

New Chairs

Michael Blain
Sociology

Patti Fredericksen
Political Science

Michael Heikken
Curriculum, Instruction 
and Foundational Studies

Mark Plew
Anthropology

Peter Lichtenstein
Economics

Vice Presidents

Dr. Daryl Jones
Provost and Vice President for Academic Affairs

Mr. Buster Neel
Vice President – Finance and Administration

Dr. Peg Blake
Vice President – Student Affairs

Dr. Richard Smith
Vice President – Institutional Advancement

Dr. John Owens
Vice President – Research

Constituent Leadership

Chris Mathias
President, Student Body

Connie Charlton
President, Classified Staff   

Dr. George Murgel
President, Faculty Senate

Ms. RuthAnn Benjamin
President, Professional Staff 

An introduction of our new colleagues appears in the HR Review and on the Internet at Boise State’s Home Page.  Please welcome our new colleagues at the University Picnic, tomorrow evening in Julia Davis Park.

This summer has been a long and busy one.  While the enrollment figures are yet to be finalized, it appears students elected to follow our advice and take summer courses to lessen the scheduling impact this fall.  Additionally, we piloted a revised summer work and class schedule.  By mid-summer there appeared to be strong support for the arrangement witnessed by the rapid exodus at 11:30 on Friday mornings.  Before we make such an arrangement for next summer,  I have asked that a brief survey of your reactions be conducted and an opportunity to identify any glitches in the schedule be provided.  Please feel free to respond to the survey when it appears on the Internet.

Our original reason for the schedule change was energy savings.  I have been advised that energy savings year to date exceed $l80K which includes bringing two new buildings on-line.  A full report of summer savings will be available this fall as we consider continuing this summer schedule.

Congratulations to all who helped make this summer successful.

I certainly hope you were able to get away for some rest and relaxation.  The Ruchs took advantage of a long weekend to camp in the Grand Tetons and then a week in the San Juan Islands.  Two of our grandchildren joined us for the trip.  Consequently, my usual reading was curtailed.  However, I was introduced to the world of  Harry Potter on audio tape – all 21 hours!  While I found the curriculum and conduct of Hogwarts School most interesting, and did not relish the challenges facing its leader, Professor Dumbledorf, I would love to have some of his “tools” for solving problems.  The vacation time did give me time to reflect on the past year and the challenges ahead. 

This past year can be characterized as one of successes, challenges, and opportunities. Among our many achievements this past year were:

In the final analysis, 2001-2002 will be remembered as the year of unparalleled change in our economic environment.  You will recall that at this presentation last year I reported on the most healthy university budget in recent memory.  Three months later we were discussing holdbacks and six months later we were in the throes of a recession, and serious downsizing was the order of the day.

We opened school this fall, having reduced our appropriated budget $10.2 million.  We replaced $4.7M through increased student fees, recognizing that students are paying a significant role in the financing of their education.  The remaining $4.9 million reduction resulted in the loss of 44 positions; 22 from the faculty, the balance from across the professional and support staff.  Additionally, we lost $600K in equipment dollars, an even greater loss given the power of those dollars to be matched.  Postponed was funding for the academic building on the west campus – classroom space we desperately needed to support our ever-growing enrollment.

Crafting such reductions to our budget is never an easy task.  I would like to congratulate Provost Jones, his colleague vice presidents, the members of the Executive Budget Committee, and all who supported us with this difficult task.  Daryl, congratulations on your leadership. 

All in all last year was one of successes, challenges, and opportunities both realized and lost.  What of the coming year?

For the past several years, I have been noting several environmental trends that influence the conduct of our affairs.  They continue and are not lessening; rather they are accelerating.  Consider the following:

Competition continues  

You need only listen or look around the Treasure Valley to see the growing number of higher education programs.  George Fox and University of Phoenix now have buildings; NNU is opening a business-oriented degree completion program in downtown Boise; and our sister institutions have announced a program to build a downtown center.  Clearly, some of these programs directly or indirectly compete with our offerings, some may challenge our expansion, and others we welcome as needed addition to educational opportunities in Treasure Valley.

Given the growth in the valley and the ever-changing economy to an information base, the importance of higher education to the community will grow, and we can expect additional higher education programs to come to the valley.  Competition for students, dollars, and prestige will continue to grow in coming years.

Enrollment Pressures 

Enrollment pressures are a second trend of growing impact on our institution.  Through the turn of the decade, we enjoyed a solid 2% annual increase in enrollment.  At this rate we were able to acquire the needed resources and expand our infrastructure to maintain a desired level of excellence and service.  Last year our enrollment grew to 4% in the fall and near 6% in the spring.  Clearly this is at a rate we cannot maintain.  Yet, early projections suggest a banner registration this semester, even with a significant decline in faculty and staff.  We are very close to being “maxed out” and the evidence suggests we are now denying access to worthy students because of limited instructional space and personnel.  Future projections suggest this, too, is a trend not soon to diminish.

Declining Resources

The third trend is that of declining resources.  Appropriations follow tax revenues which are a direct product of a healthy, expanding economy.  Such is not the case at this moment in time.  Sunday I read a number of newspapers and observed a variety of opinions of the current state of the national economy.  Words like “flux,” “recession,” “slowdown,” “recovering,” and “on the mend” lead to little solid understanding of the current environment.  What is known is that for the just completed fiscal year (FY2002) 46 of 50 states ended the year with a budget shortfall.  In the 15 WICHE states, 12 reported shortfalls.  Moreover the shortfalls were five times greater than the shortfalls of the 1991-1992 period.¹

It would appear that these economic woes will continue into the current (FY2003) year.  Pressures for increased spending for Medicare, corrections, and K-12 education will compete with higher education’s needs in a year of slow growth economy.  These pressures will challenge budget writers in every state.

The companion trends of increased enrollment pressures, accompanied by decreasing revenue, presents a picture of higher education that the Association of Governing Boards (AGB) calls the “double whammy.”²  We are a classic example of this condition exacerbated further by our low-base funding as clearly demonstrated by the funding equity study approved by the SBOE last fall.

Idaho is part of this nationwide trend.  The most recent state economic forecast describes our state’s economy in “transition” with the observation that it should “pickup during the second half of this year.” ³  Since tax revenues are a lagging – not leading economic indicator – immediate recovery from these fiscal doldrums appears unlikely.

As you are aware, Idaho closed its recent FY2002 with a $124M shortfall which was covered by the use of available one-time funds.  The Governor pledged additional one-time funds from the millennium fund, budget stabilization fund and permanent building fund to assure that the current (FY2003) budget would begin the year in balance and avoid an immediate holdback.  I am grateful to the Governor and Legislature for this action. ⁴

However, by mid-year we will have a revised revenue forecast, experience with the rate of economic recovery, and a more informed fiscal position.  I advised the members of our President’s Cabinet in early July that “it would be wise to build a 4˝-5% contingency into our spending for this year.”  Last week, at the Board’s request, we reported on a plan to spend at a rate of 95% of our approved budget.

The prospects for the FY2004 budget are not much better at this time.  Last week the board directed that we prepare an MCO-only budget request.  The needed equity funding will be footnoted in the Board’s budget request with little likelihood of funds being available for appropriation to this critical need.  As you recall, CEC requests, my highest priority, are added in the governor’s budget.

On the capital side, the list of needed buildings not funded was carried over intact.  There was a brief discussion of a bonding strategy; a topic that needs to be continued. 

In sum, our fiscal environment will continue to challenge us for the next few years.  Of most concern is that we continue to tell our story of the importance of higher education and its impact on the economic, social, and cultural fabric and future of this community and state.  This will be one of my priority projects for the year.

Author William Arthur Ward noted:  “The pessimist complains about the wind; the optimist expects the wind to change; the realist adjusts the sails.”  Now is the time to take a realistic approach to our activities and priorities.  While it is clear that you can do “more with more; or less with less; it is equally clear that you can not do more with less.”⁵   This is a year for few new initiatives and probably all too often we will have to pass on worthwhile opportunities.  To guide us through the year, I recommend five “adjustments to our sails”:

First, we will need to continue to manage our fiscal affairs with a clear understanding of our current economic environment.  We will need to exercise care and caution in our spending.  We will need to be very selective in making major financial commitment.  We will need to be an active participant in the board-initiated study regarding the development of a policy defining the desired balance between student and state responsibilities for funding higher education.

Second, we need to continue to provide the highest quality of instruction, a hallmark of this institution.  We invest a considerable amount of the undergraduate curriculum to our core.  As a faculty we value this general education learning.  Our students, however, report a lack of understanding regarding the importance of these courses.  If each faculty who teaches a core course would spend some class time discussing not only the importance of the discipline, but also the relationships of the content to other core courses and to the goals of the core, these understandings could be bridged. 

Additional course instruction that actively involves each student, that brings faculty and students together to discuss course issues in settings beyond the lecture hall, and programs that stress learning through service learning, internships, or student research contribute to the “value added” dimension of Boise State degrees.

Third, we need to implement additional strategies to manage our enrollment.  I have approved for immediate implementation of the Enrollment Management Committees’ proposal to add a third category on our admission index, “possible candidate.”

The next step is to develop for piloting next summer a bridge program for such candidates.  Such a program would serve the dual purpose of assisting academically marginal students to make a smooth adjustment to the collegiate curriculum and spread out our resources over the summer.

Continued use of technology will assist in our enrollment management.  This is the third year for 'CoreOnline@Boisestate.edu', a project to build and deliver 30 core courses online this year.  Coupled with the ever-expanding use of BroncoWeb and e-mail, technology offers a way to free you from trivial functions so you can spend time with students.

Fourth, we need to review and plan for an expanded infrastructure to support our growing research enterprise.  Under the leadership of Vice President John Owens, we need to examine current policies and procedures (including some of the more sensitive ones, such as overhead distribution and intellectual property), needed support services, programmatic and fiscal reporting and current and needed space. 

Fifth, given our growth pattern, continued campus development must not stop, even in this period of economic stress.  This year our two-phase housing project should “come out of the ground.” Along with the student recreational center, these new facilities will make a dramatic impact on the student culture on campus.  Parking Deck II is in the bid phase; plans for the federally funded improvements to our shelter bus system are close behind.  The addition to the Children’s Center will expand support for students with very young children is about ready to start construction.

Further campus development will depend on an expanded advancement infrastructure.  This year we need to bring online needed computer support for advancement.  Additionally, a plan to hire additional advancement officers to serve the individual schools has been approved by our Foundation.

My personal goals for the year, beyond telling our story to our various public entities include:  finding alternative funding for the academic building on the Boise State West campus.  This is absolutely critical to solving our immediate classroom shortfall and to the future of this institution.  Second, to find private funds to support additional classroom buildings on this campus, with business and nursing/health services being the highest priority.

Even with our limited resources it will be a busy year: 

I am sure there will be additional events as the year unfolds.

I close on a personal note.  By next summer, I will be in my 10^th year as your president.  Most of the initiatives that were on my list of goals for my presidency will be realized or well under way.  Moreover, I will have passed that “hallmark” birthday.  Personally, Sally and I are anxious to begin another phase in our lives. 

I have advised the Board of my plans to retire from the presidency of Boise State University upon the arrival of my successor next summer.  I make this announcement now to permit the Board ample time to conduct a full-national search for my successor.  A smooth and orderly transition is critical to this institution and I have been assured that the Board concurs. 

This has not been an easy decision for Sally and me.  We love this institution.  It is an institution of great – although often unappreciated – contributions to this valley and state.  It is an institution of individuals who care about students, about service, and the very best of the intellectual quest.  It is an institution with its greatest accomplishments yet to be realized.

It is our great pleasure to be of service. 

Some will search for other reasons for this decision.  The simple fact is, next summer feels like the best time in the life of the University and the Ruchs to make this change. 

We appreciate your support.

That said:

I am pleased to declare the Fall 2002 Semester at Boise State University in session.  We are adjourned.

NOTE 

State of the University delivered from “notes” – August 19, 2002 / 830am. Notes transcribed into hard copy August 20, 2002.

ENDNOTES

1.       Longanecker, D.A. (August 2002).  “A Bumpy Ride,” WICHE Newscap. Boulder, CO, WICHE.

2.       Wellman, J.V.  (April 2002).  Weathering the Double Whammy:  How Governing Boards Can Negotiate A Volatile Economy and Shifting Enrollments.  Washington, DC., Association of Governing Boards of Universities and Colleges.  (Working paper for ABG National Conference on Trusteeship.)

3.       Division of Financial Management.  (July 2002).  Idaho Economic Forecast – 2002-2005.  Vol. XXIV, No. 3, page 5.  Boise, Idaho, State of Idaho.

4.       McLean, J.  (August 2002).  “State of Idaho:  General Fund Budget Summary.:  Presentation at Idaho State Board of Education meeting, Coeur d’Alene, Idaho.