Testimony of James B. Milliken - President, University of Nebraska
Appropriations Committee – March 19, 2013

Chairman Mello, members of the committee, I am J.B. Milliken, president of the University of Nebraska and I am pleased to join Regent Clare in support of the University’s budget request for 2013-15.

Higher education is more important today than at any time in our history. The connections between educational attainment, personal earning power and the economic competitiveness of a state or region are well documented and widely acknowledged. The Georgetown Center on Education and the Workforce has done state-by-state projections of jobs and education requirements through 2018; their report shows that 66% of Nebraska jobs will require education beyond high school – 7th highest in the nation – and that we will add 56,000 new jobs requiring post-secondary education and training over the next five years.

More recent studies by the same center reinforced that message, showing that unemployment for recent high school graduates is almost four times higher than for college graduates; and, that since the recent recession began, the number of jobs requiring a bachelor’s degree increased by 2.2 million, while those requiring an associate’s degree broke even and those requiring a high school diploma or less decreased by 5.8 million.

New data from the Bureau of Labor Statistics shows that workers with a bachelor’s degree earn, on average, 36% more than those with an associate’s degree and 63% more than those with a high school diploma – making a million-dollar difference over a lifetime.

Increasing educational attainment in the United States has become a high priority nationally. Last fall I joined some 500 presidents of colleges and universities in pledging to increase the number of college graduates by 3.8 million by 2025. Our own ambitious growth goals at the University – to increase enrollment by 10,000 students to 60,000 this decade and to increase graduation rates—are aligned with those priorities.

At the same time, there has never been greater scrutiny of higher education – from tuition and student debt to graduation and retention rates and student success—as well as increasing pressure on state funds. In addition, there have never been more challenges and opportunities presented by technology – online learning, MOOCs and other technological advances.

We would be the first to say that there are areas where we can improve. We have put metrics in place for each of the goals of our strategic framework that Regent Clare outlined; we report on our progress on those at every Board meeting and they are always on our website.

Affordable access has been the Board’s number one priority and we have been successful in keeping tuition well below the average of our campuses’ peers—resulting in a significant value for Nebraskans. We have also increased financial aid for those who need it most. This year we are encouraging a more dramatic statement about tuition at Nebraska—and I know you’re quite familiar with that.

  On a related note, student debt is a concern in Nebraska and nationally, but our story is better than many. Average debt at UNL averages $21,000, the lowest among its peer institutions, which average $25,000. We will continue to work with our students and their families on financial literacy, and continue to advocate for affordability and student financial aid. And our student loan default rates are the lowest in Nebraska.

Although we are not satisfied with graduation rates, on two of our three predominantly undergraduate campuses we exceed the average of our peer institutions; UNL lags the peer average by 3 percent but is gaining and does well in state and national comparisons. We want these rates to be higher and we are implementing a number of strategies to achieve this.

As one example, last year the Board approved a new university-wide policy capping the number of credit hours required for graduation at 120, to help ensure that students can graduate in four years. We have found great success with new strategies for student retention, including the Thompson Learning Communities and early warning systems.

We have ambitious plans for the future of the university and the state. To meet our enrollment goals, we will recruit more aggressively in Nebraska, outside the state, and internationally. We will continue to strengthen our online education programs at both the high school and college level, leveraging the power of technology to serve more Nebraskans and to expand nationally and globally. That growth will require investments in facilities, faculty and student support services – but it will help position Nebraska for success.

We now offer 1,500 courses and more than 130 programs online – including bachelor’s degrees, master’s degrees, PhDs and certificates. We have seen a 130 percent increase in online credit hours over the past five years, which tells us that we are meeting the needs of working adults and full-time students who need increased access and flexibility in order to reach their academic goals. We also have a fully accredited online high school, offering 100 courses, both foundational and advanced placement, to students in Nebraska (and globally) to supplement their high school courses or whose schedules prevent them from taking needed classes.

It’s tempting to say that the goal of all higher education should be to educate the greatest number of students for the lowest cost. And for certain kinds of institutions—small liberal arts colleges, regional universities, community colleges—that may be a very appropriate metric.

There are of course such institutions in Nebraska that spend less per student than we spend at the University of Nebraska. Their missions, their responsibilities, and their cost structures are very different from ours. There is nothing new about this; one of the great strengths of American higher education is the diversity of institutions, serving different types of students with different educational needs and providing states with a wide range of educational resources and strategies.

The University of Nebraska is a research university … the only public research university in the state. It includes a land-grant campus with all that mission implies for the state; a metropolitan campus engaged with extensive community outreach; a health science center with medical research and treatment that is second to none; a residential undergraduate campus that serves many students from greater Nebraska, with a majority being the first in their families to attend college; and a two-year school of technical agriculture focused on aspects of the ag workforce.

Without taking away anything from the other fine institutions in the state, it’s clear that the University of Nebraska’s mission, structure and operation are far more complex and multi-faceted than a small liberal arts college, or a community or state college.

The significant investments that we make in research in water, energy, early childhood, public health, engineering, cancer, national security and other fields create new knowledge, new jobs and new economic vitality for our state. This research has greatly improved the quality of life in Nebraska and has the potential, literally, to change the world.

Funds spent on research in agriculture alone have contributed enormously to the productivity and profitability of our crop and livestock enterprises – having an impact not just on Nebraska but on global food security. And funds spent on extension and outreach, in every county in Nebraska, have modernized agriculture, strengthened families and built successful new businesses. In our state, with many public and private institutions, these are activities unique to the University of Nebraska.

With regard to the work that is uniquely the mission of a research university, there could hardly be better examples of significant progress in recent years. Our recent selection by the Department of Defense as one of only 14 universities nationwide to host a university-affiliated research center, or UARC, provides tremendous opportunities for Nebraska. The UARC promises significantly higher federal investment in basic research, the opportunity to help keep our soldiers, citizens and allies safe, and a valuable step in significantly deepening the university’s ties to Stratcom.

The potential of Nebraska Innovation Campus is huge, and we very much appreciate the investment the state has made toward the renovation of the 4H building and the construction of a new research facility focused on food, fuel and water. The state investment, which we are leveraging many times over, provided a critical spark. It was a key factor in ConAgra’s decision late last year to become our first industry partner, and it will pay significant and long-term dividends for Nebraska.

Likewise, your commitment last year to the Building a Healthier Nebraska initiative will have far-reaching benefits for the state. Next month we will break ground on the first phase of the comprehensive cancer center in Omaha, which has the potential to transform the diagnosis and treatment of cancer in our state and region. Work will also begin soon on a new health sciences building in Kearney, to help address growing shortages in the rural healthcare workforce, especially in nursing. And we are making good progress on plans for the veterinary diagnostic lab, which is critical to our livestock industry and food safety.

We recognize the state’s partnership with the university in these endeavors is critical, and it happened during difficult budget years. We understand the causes that led to five years of flat operations funding for the university, and we have not been critical, although we have pointed out each year that it is not, in our view, sustainable.

The University budget has been prudently managed over those five years, making $31 million in reallocations to cover rising costs associated with teaching a growing number of students while reducing the number of FTE paid for by our state-aided budget, and conducting research on an unprecedented scale. But a renewed state investment is critical if we are to continue to provide affordable access to a high quality education – which is our highest priority.

Funding at the level requested would allow us to do something we haven’t done in nearly 25 years: offer our students no tuition increase for the next two years. I hear very positive reactions to this everywhere I go.

Our request also anticipates modest salary increases, to begin to close the gap between UNL and UNMC faculty and those at their peer institutions, as well as funding for our highest-impact academic and research programs—strategic investments that have led to recent successes and a tremendous ROI.

As you know, our budget request also includes the Nebraska College of Technical Agriculture in Curtis, which has seen a real resurgence in the past two years, with new facilities including a residence hall and education center, new programs focused on ag entrepreneurship, and recruiting a new dean.

The other component of our request is $17 million in one-time capital construction funding for a new facility for the College of Nursing’s Lincoln campus. This was part of the Building a Healthier Nebraska initiative and remains our number one capital priority. I would ask the Committee to again consider this project, which would replace an inadequate and ill-suited facility in downtown Lincoln and allow us to better meet the demand for nursing education to help address the growing shortage of nurses in Nebraska.

The Building a Healthier Nebraska initiative that was funded last year also included a new veterinary diagnostic lab, for which the legislature appropriated $50 million, to be matched with $5 million in private or other support. This appropriation was based on early estimates, which have now been revised and we have reduced the price down by almost $10 million, to $45.6 million. We have two requests in connection with this: first, that you reduce the required “private or other” match for vet diagnostics proportionately, from $5 million to $4.1 million. And, that the $9 million in state funds that will not be needed for the lab be redirected to a new College of Nursing facility in Lincoln.

I appreciate the committee’s consideration and would be pleased to respond to your questions.

Thank you.

Statement on the Appropriations Committee’s preliminary budget recommendations, Feb. 28, 2013

I am deeply disappointed in the Governor's proposed budget for the University of Nebraska. At a time when higher education is more important than ever for individual economic opportunity as well as state competitiveness, Nebraska risks taking a big step backwards.

The University's number one goal has been affordable access to a college education, and with the leadership of the Governor and the Legislature over the last two years, we have kept tuition increases at their lowest levels in years. The Governor and I have joined to advocate a significant increase in the state's college-going rate. But under this proposed budget, access and affordability for students and families would suffer.

I have high regard for Governor Heineman, and I have no doubt he believes the course he has recommended is good for Nebraska. But funding higher education at a level that would almost certainly restrict access and require a combination of significant tuition increases and major cuts to programs cannot be good for our state's future.

The key to Nebraska's future is to be successful in the competition for talent—by providing quality teaching, research and outreach for Nebraskans and by attracting new, talented people to our state. I believe Nebraskans understand that investing in higher education is essential to this goal.

U.S. Secretary of Education Margaret Spellings joined University of Nebraska President James B. Milliken for a Nebraska news media telephone conference from São Paulo, Brazil during their seven-day trip to Latin America.

Media conference [.mp3, 20.8 MB]

Milliken was one of eight university presidents chosen to accompany Spellings and other government officials late in August on a seven-day trip to Brazil and Chile. The delegation promoted international education and collaboration, including study abroad and student exchange programs, and encouraging Latin American students to study in the United States.

The group talked with university students, leaders in government and higher education, and participated in round table discussions in Santiago, Chile; and São Paulo and Brasilia in Brazil.

The Latin America delegation included: Spellings; U.S. Deputy Assistant Secretary of State Thomas Farrell; U.S. Under Secretary of Education Sara Martinez Tucker; U.S. Assistant Secretary of Education Lauren Maddox; U.S. Secretary of Education’s Senior Counselor Robin Gilchrist; Milliken; President Susan C. Aldridge, University of Maryland, University College; President Gregory Geoffroy, Iowa State University; President John Hennessy, Stanford University; Chancellor Sean O'Keefe, Louisiana State University; President Eduardo J. Padrón, Miami Dade College; Chancellor Mark S. Wrighton, Washington University in St. Louis; and Chancellor Henry Yang, University of California, Santa Barbara.

Free Expression of Ideas is Essential to a University

President Milliken: Time to capitalize on the University's momentum

By: James B. Milliken, president, University of Nebraska; Harvey Perlman, chancellor, University of Nebraska-Lincoln; John Christensen, chancellor, University of Nebraska at Omaha; Doug Kristensen, chancellor, University of Nebraska at Kearney; and Harold Maurer, chancellor, University of Nebraska Medical Center

In recent years, employer-provided benefits to partners of unmarried employees have become a more widely available part of competitive benefits plans. A growing number of public and private sector employers – including in Nebraska – have expanded benefits programs to include employees’ partners and their dependent children as a way to recruit and retain talented people, address the changing needs of employees, and promote workplace equality. We believe it is time for the University of Nebraska to do the same.

This week, the NU administration briefed the Board of Regents on a proposal to expand eligibility for participation in the University’s benefits program to include employees’ partners and their dependent children. The logic behind the proposal is clear: Every other Big Ten university provides partner benefits, as do a majority of the peers of the NU campuses and a number of leading private companies in Nebraska and across the country. We believe the University should provide similar benefits, not only to maintain our competitiveness in a marketplace for talented faculty and staff, but also because treating our employees equitably is the right thing to do. At a time when Nebraska must do all it can to attract and nurture human capital to grow the innovation economy in our state, not providing equitable benefits harms our ability to compete for talent. Most important, we believe we have an obligation to treat people fairly in the workplace.

Providing partner benefits would bring the University of Nebraska in line with the prevailing practices of comparable universities. More than 300 higher education institutions across the country offer partner benefits, including public universities in at least 30 states and most of the highly ranked research institutions. Furthermore, more than 80 percent of Fortune 100 companies and nearly 60 percent of Fortune 500 companies offer health insurance benefits to employees’ partners. In Nebraska, a number of major companies offer partner benefits, including ConAgra, Union Pacific, Mutual of Omaha, Ameritas, HDR and Baker’s Supermarkets.

The proposal is consistent with the University’s existing goals. The University’s Strategic Framework includes several objectives related to ensuring competitive employment practices – including fringe benefits – to recruit and retain faculty and staff. The Board’s philosophy has been to strive for compensation that is at least at the midpoint of peer institutions. Since benefits can account for up to a quarter of an employee’s compensation, providing equitable benefits is, we believe, a key component to achieving the Board’s goal for competitive compensation. Further, in 2005, the Board of Regents adopted a nondiscrimination clause that includes sexual orientation and marital status.

We fully recognize that this change will not be supported by all Nebraskans. Nothing in the proposal would recognize civil unions or domestic partnerships in violation of the state’s constitution, and public universities in other states with “Defense of Marriage” amendments have adopted benefits plans such as the one that was proposed to the Board of Regents. Equitable benefits are a matter of fairness and competitiveness for the University – and, because the success of the state is so closely tied to the success of its only public university, this is a matter of economic competitiveness for Nebraska as well.

The faculty senates on all four campuses have formally asked that the university provide expanded benefits coverage, as have student governments in Omaha, Lincoln and Kearney. Our university-wide benefits committee also supports the proposal. It is our hope that the Board of Regents will adopt an equitable benefits program so that we can compete effectively for talent and do the right thing for our employees as we continue to fulfill our goal to serve Nebraska.

This editorial originally appeared in the Omaha World-Herald on Sunday, Oct. 30, 2011.

January 2012: The University of Nebraska is serving the state through affordable access to quality education

February 2012: ‘Building a Healthier Nebraska’ represents a good investment for the state

It is a long-standing goal of the Board of Regents to ensure that faculty and staff of the University of Nebraska are compensated at a level that is competitive with similar universities. Competitive salaries are an essential element in hiring and retaining excellent faculty and staff, which is key to maintaining the quality of the university.

The current economic climate and reduced state revenues resulted in a lower state appropriation than the University had requested for 2009-11. Since personnel costs represent about 80 percent of the state-aided budget, an impact on salaries is inevitable if we are to minimize the loss of jobs. Many faculty and staff have expressed a willingness to accept a reduction in pay or no increase if doing so would preserve jobs and programs.

Because of the way in which budgets have been managed, the state of Nebraska and the University of Nebraska are in a position of relative strength compared to many other states and universities. We have an opportunity to move the University forward, even in these difficult financial times, and to invest in our priorities, including affordable access for Nebraska families, high quality academic programs and additional need-based aid.

We also have an opportunity to increase our competitiveness through strategic personnel investments. This year we are allocating funds in the 2009-10 budget to establish a 1.5% competitiveness pool for faculty and staff salaries. These funds are to be used to address competitiveness on each campus, not for across-the-board increases.

We are also making two adjustments to employee benefits. The University will cover the increase in health insurance premiums expected to go into effect in January 2010, so that participating employees will pay no more for their health insurance coverage. This has a direct impact on the out of pocket costs for all employees who participate in the health insurance plan. In addition, we plan to increase the employees’ life insurance benefit to an amount equal one year’s base salary, up to a limit of $120,000.

Chancellors of the four campuses are responsible for allocating the salary pool pursuant to the guidelines I issued last week. And while they have flexibility on timing and allocation of the salary funds, they must be used for salaries, not to reduce budget cuts. At UNK, faculty salaries will be based on the collective bargaining agreements. At UNO, no faculty salary changes will be made until the resolution of the bargaining process.

We believe this approach will significantly limit the number of jobs lost in 2009-10, while allowing us to take advantage of a position of relative strength to support affordable access and enhance the quality of the university.

Statement on passage of the budget

Letter to All Faculty and Staff on the NU Budget

President Milliken on Governor's budget recommendations

A Message from President Milliken on the University's Budget

May 21, 2007

Lincoln, Neb. - University of Nebraska President James B. Milliken issued a statement Monday afternoon - following Gov. Dave Heineman's budget message - concerning the Nebraska State Legislature’s budget appropriation package.

Milliken said:

"I am very pleased that the Governor approved the budget for the University of Nebraska. I believe this action reflects the views of many Nebraskans who have weighed in, expressing their support for this investment in the University of Nebraska - which is truly an investment in Nebraska's future.

"The Appropriations Committee spent many hours carefully evaluating the budget, and we are especially grateful for that Committee's recommendation for the University, which the full Legislature and now the Governor have endorsed.

"While this budget does not meet all the University's needs, it is a fair compromise that will help keep tuition more affordable and will help ensure that the momentum the University has enjoyed can continue."