President’s Report
Board of Trustees, October 23, 2009

Chairman Boyce, trustees, faculty, students, staff, alumni, and friends, good morning. I’d like to open with the closing words of my report at our May meeting: “to compete on the rapidly changing terrain of today’s world, we must be true to our academic values . . . And we must also be intent on execution and accountability as we ramp up, creatively and collaboratively, the work of focusing in every domain on quality, with special emphasis on the few areas in which we can without question be among the very best of the best.”

Today the “spires of excellence” transdisciplinary research initiative—which has elicited bids to participate in the proposal process from some 20% of all of the University’s tenured, tenure-track, and research faculty—is on track to bring to you for Board endorsement in May niche areas that we hope to designate as signatures of the focus and excel strategy essential to UVM’s continuing success. At the same time work is also under way to act on recommendations from the Transformational Change Working Group that Professor Robert Taylor chaired last spring, recommendations designed to enhance the first-year experience for undergraduates, to improve advising and counseling, to expand and strengthen UVM’s array of residential learning communities, and above all to develop through faculty governance processes a General Education Requirement that can also be brought to the Board for approval in May.

This year will therefore be one of intense attention to focused enhancement of the University’s strengths in research, scholarship, and creative activity and simultaneously to the improvement of our undergraduate educational program and the quality of the student experience. We embrace these projects with urgency born of the recognition that the challenges before us are intensifying and that we must be intentional, selective, bold, and smart if we are to build upon the strong position UVM has achieved over the course of this decade and not see our strength and quality erode. I would like to touch on a few of the ways in which UVM has shone brightly in recent months:

There is an old adage that nothing wilts faster than laurels when sat upon, and that is especially true in today’s challenging environment. The schools with which we compete are seeking the same high-quality, diverse students we must continue to enroll, and our public competitors in particular are increasingly looking to play the game of which UVM is the supreme past master, recruitment of non-resident students, which in our case is the key to sustaining a nationally competitive university for the benefit of Vermont and Vermonters. The competition is rising in the context of two exacerbating factors: the decline in the number of high school graduates in the Northeast and growing price sensitivity to the cost of higher education, which will almost certainly intensify in the next few years as continuing fall¬out of the recession.

The budget challenges facing UVM for this year and next have in fact been complicated by the significant effects of the recession on family budgets. As you know, we came into this fiscal year with a structural budget gap but with confidence that we would be able to eliminate it by way of a multi-year budget plan that includes addressing the FY 10 budget gap with the sum of that portion of our state appropriation that was funded by “one-time” money provided due to the federal economic stimulus plus the reserves that you authorized us to use. With this fall’s robust enrollment—gratifyingly an effect in large measure of improved un¬dergraduate retention in the junior and senior classes (that is, more sophomores returned as ju¬niors and more juniors returned as seniors)—we expect to generate a modest amount of unbudgeted tuition revenue. All well and good, but we have seen a sharp increase in student need for financial aid that was not fully predicted by our financial aid model. How much we find ourselves in uncharted waters is captured by this simple fact: for the first time ever, our returning students have lower expected family contribu¬tions toward the cost of education than they had the year before—much lower. We are still ana¬lyzing what must be done to adjust the financial aid model to make it a more accurate tool for predicting student need going forward. We are also still analyzing the projected financial aid costs beyond the 19% increase in aid for undergraduates that we budgeted. But it is already clear that as UVM has stretched to meet the needs of students and families produced by a recession of a magnitude unequaled since the Great Depression, our increased cost for student aid net of tui¬tion beyond what we budgeted will be about 1% of the general fund. Accordingly, I have asked Provost Knodell to take immediate measures to reducing spending in other areas by about 1%, not through an across-the-board cut but through targeted reductions designed to preserve the quality of instruc¬tional programs and of the student experience. By taking this measure now, we greatly strengthen the probability that our remaining work in preparing the FY 11 budget will be more manageable.

Nothing is easy. We are deeply immersed in the fascination of the difficult. Scarcity makes resources more precious and at the same time instructs us that focus and excel—selective use of those precious resources to build enduring academic quality, distinction, and value for our students, our faculty, our staff, and the citizens of Vermont—is an ever-more-pressing imperative. Predictably, we will see some institutional resistance to the thirty-year project to create a general education requirement at UVM and, even more so, to the identification of spires of excellence, which are by design selective. Yet, as highly constructive discussions under way in the Gen Ed task force and the big turn-out of faculty volunteers for the “spires” working groups tell us once again, ripeness is all, and there is widespread rec¬ognition within the academic community that these are appropriate and indeed indispensable next steps in UVM’s advance. That recognition is also visible in the State of Vermont at large, and editorials in the Rutland Herald, the St. Alban’s Messenger, and the Burlington Free Press have all hailed the “spires” transdisciplinary research initiative as right for UVM and right for Vermont.

I am tremendously proud of this University, of its faculty, staff, students, and alumni, and of the leadership team that has produced so many outstanding outcomes and that is working with unremitting intensity and dedication to build quality at UVM. UVM today is undoubtedly a national and Vermont success story. Our success arises from many factors, but leadership does make a difference, and we now have in hand objective verification that we are managing well and are not excessive in administrative staffing, a question of considerable and appropriate concern for this Board and for the higher education community on this campus and nationally. You will have found at your places today copies of a study that benchmarks the size of the UVM administration against 260 private and public doctoral research institutions and against three subsets of that group: first, 168 public colleges and universities; second, 103 Re¬search Universities-High Activity, a higher education classification to which UVM belongs; and, third, UVM’s list of 21 public peers and aspirant institutions, including UVM. The study examines the size of the UVM senior ad¬ministration from three perspectives, all of which show that UVM is far from exces¬sive in its administrative staffing. First, the ratio of administrators to faculty members at UVM is at the 10th percentile (that is, in the bottom ten percent) of all 260 schools, at the 14th percentile of the set of public institutions, and no higher than the 22nd percentile of any of the comparison groups. Second, the study shows that the rate of growth of senior administration at UVM between 2003 and 2007 was below the rate of growth for three of the comparison groups and slightly above for one: in short, UVM does not depart significantly from the norm. And, third, using a more complex mathematical model, the study shows that the actual staffing levels for UVM administration are lower than the levels predicted by the model by 46 to 214 persons. In a separate analysis, we have determined that the aggregate salaries of the UVM senior administrators included in the staffing study fall modestly below aggregate weighted averages for the same set of positions at public doctoral research universities. I am well satisfied with the quality of the research and with the valid¬ity of the findings, and I am proud of what this administration has been able to accomplish with limited resources and personnel. I encourage all of you to read this bench¬marking study for additional details.

As we advance, we will be committed to objective benchmarking and to rigorous outcomes assessment: of academic quality and student learning, progress, success, and satisfac¬tion; of the visibility and impact of research, scholarship, and creative activity produced at UVM; and of our service to society, including UVM’s synergistic and essential relationships with the Vermont State Colleges and Vermont’s private colleges, with the public schools, with agricultural, busi¬ness, and industry in Vermont, with health care and social welfare providers, with the communities immediately around us and throughout the state, and with state government and non-profit agencies. We are developing dashboard indicators to give this Board standardized, regular, con¬sistent readings of key performance metrics. We had hoped to unveil those indicators today. It is now our plan, however, to share a complete draft of the proposed dashboard with the Board Governance Committee and the Executive Committee in the coming weeks and to have the launch of the indicators ready for the full Board at our February meeting.

I want, finally, to thank all of our trus¬tees and all of the members of the UVM family—faculty, staff, students, alumni, and friends—who have devoted so much hard work, talent, and dedication to our shared objective: the continuous creation of academic quality and distinction essential to sustaining UVM’s advance as we seek to focus and excel in an environment imbued with challenges but beckoning this great University with opportunity. If we have time, Ian, I will be happy to answer any questions. Thank you.