03/05/2019 President Bounds’ Appropriations Committee Testimony
Appropriations Committee
Testimony of NU President Hank Bounds
March 4, 2019

Chairman Stinner and members of the Appropriations Committee, my name is Hank Bounds (H-A-N-K B-O-U-N-D-S) and I am president of the University of Nebraska. Thank you for the opportunity to speak to you in support of the two-year budget request for the University and the Nebraska College of Technical Agriculture approved by the Board of Regents.

I’ve spent a lot of time thinking about my remarks to you today, and how I might best make the case for your investment in 52,000 University students who represent the future of our state.

As I’ve thought about how to share the University of Nebraska’s story with you, and how to describe the work that has been done across our campuses in the past few years, Paul Harvey keeps coming to mind.

For every point of pride and hope the Chancellors and I feel when we come to work – and there are many – there is also the realism of “the rest of the story.”

We are a University on the move, fresh off our 150th anniversary, reflective of our past and unified in our goal to make an even greater impact on Nebraskans’ lives. The rest of the story is that we are mindful that three rounds of state funding cuts in the last biennium have limited our ability to grow and meet the workforce needs of the business leaders sitting behind me.

We are at the table as never before in conversations about how to solve the world’s most urgent challenges. The Department of Defense has us on speed dial in the fight against terrorism. When the government needs a place to monitor a potential Ebola patient, they call on the University of Nebraska. Innovations coming out of the Institute of Agriculture and Natural Resources will help feed 9.6 billion people by 2050.

Here’s the rest of the story: Limited resources mean we are not as competitive as we could or should be. Cuts that prevent us from investing in talent are akin to putting a “for sale” sign in the yards of the very faculty who have built the University of Nebraska’s national and international reputation.

We are proud of the tireless work our employees have done to find $22 million in administrative cuts through our Budget Response Team process. If not for these reductions, tuition increases would have been higher and academic programs would have suffered more. The changes have yielded new efficiencies and collaborations between campuses that did not exist before.

But not a day goes by when I don’t think of the more than 100 jobs that have been lost because of this effort. These are real people, real public servants, with real families and livelihoods.

Moreover, we have looked under every rock for administrative cuts, some twice. I worry about the impact that further reductions in state funding would have on the quality and breadth of the institution. Academic programs can only be protected for so long.

And we are grateful to Nebraska policymakers for their long tradition of support of higher education. Chairman Stinner, Vice Chairwoman Bolz and this Committee in particular have shown great leadership and vision in advocating for affordable, accessible, quality higher education for current and future generations of Nebraskans.

Your decision last year to spare us and all of public higher education from what would have been devastating budget cuts is, I think, a key reason why I can sit here today and truthfully tell you that the University of Nebraska’s next 150 years can be even better than our last.

For the biennium ahead, I am grateful that the Committee and the Governor have recommended funding the University’s salaries and health insurance. This is the best starting position the University has been in for some time and I thank you for your leadership particularly during times of fiscal stress.

The rest of the story is that this is not a growth budget. It does not cover all our needs, including utilities, which have not been funded for several years, or our rising inflationary costs. It will not meaningfully move the needle on the urgent workforce and talent crisis facing the state of Nebraska.

Senators, we have been through a period of extraordinary challenge. One year ago, I sat in this chair and told you I had put my fireman’s hat on almost immediately upon arriving in Nebraska and not taken it off since. I told you that it was difficult to see over the horizon when we were managing one cut after another. Mr. Chairman, in this way we have a lot in common. You certainly know what it’s like to wear the fireman’s gear.

I can’t tell you I’ve put my fireman’s hat away. But I can tell you that in spite of our challenges, in the face of cuts that could have crippled our momentum, the faculty, staff and students, and especially our leadership teams, have resisted the urge to hunker down. We have kept our focus on the future.

Today, I am asking you to do the same.

The opportunities for your University to help you build the economy of the future are as great as they have ever been. The needs of our workforce are urgent and growing, starting with the 35,000 annual openings in high-skill, high-demand, high-wage jobs that Nebraska will have in the years ahead. Every day that we don’t invest in the recruitment and retention of talent is another opportunity for promising young people, skilled workers and successful companies to go elsewhere. The testifiers who will follow me will tell you more about that.

Your University is ready to run faster, to be more nimble, to be bigger and bolder and more creative about producing the workforce, the research and the economic activity you need to grow this state.

We need your partnership to do it.

It is difficult to grow when, for several years running, we’ve had to eat the costs every time even a roll of toilet paper gets more expensive. Before you say, “Bounds, you’re being dramatic,” let me tell you what some of our neighborsare doing. The University of Minnesota, our Big Ten peer, has asked legislators for $87 million more for operations in the next two years and $230 million for capital funding. Lawmakers on both sides of the aisle applauded the Minnesota President for, and I quote, his “prudent” request. Wisconsin legislators will consider a proposal to invest $150 million more in the University of Wisconsin System. The University of Illinois is asking for $722 million for deferred maintenance.

I am asking you to find a way to make the University of Nebraska a priority for the state.

I’m asking you to invest in one of the greatest change agents our state has to offer – the University – so that Nebraska can be the kind of place where Ava Vargas and every child like her will someday want to live, work and raise a family. By the way, congratulations, Senator Vargas.

I ask that you find a way to fully fund our budget request so that your University can be kept whole in the next two years. Short of that, treat our salary appropriation fairly compared to other state agencies.

Help us turn the corner so we can help you build a future that our children and grandchildren will be proud of.

I know you have no easy choices. I’m grateful for the work you do and I don’t envy your task. But I am convinced that the long-term prosperity and well-being of our state depends on a growing, accessible and competitive University of Nebraska.

Let me say a few words about the request we’ve brought to you.

First, it may be helpful to provide a refresher on how the University’s budget works.

You’ll often hear about the University’s $2.6 billion budget and you might conclude that we have flexibility when it comes to managing cuts. That’s not accurate. In fact, two-thirds of our budget can’t be touched.

Think of the budget as falling into three buckets. One bucket is self-supporting operations, like parking and housing. Another includes restricted funds like private gifts and research grants that can’t be directed elsewhere. There’s no doubt that private philanthropy has transformed the University, but donors don’t give to fix a leaky roof. In fact, more than 99 percent of gifts to the Foundation are designated toward a specific purpose.

And the third bucket is what you’d typically think of as the educational enterprise of the University – the teaching, research and outreach efforts that drive our daily activities. This is the portion of the budget that’s impacted by state funding cuts. And this portion is funded by two primary sources: State appropriations and tuition revenue. The history is quite clear on the relationship between these two. When state funding goes down, tuition goes up.

With that in mind, the Board of Regents, Chancellors and I had a lengthy discussion about what level of funding we felt was necessary to pay our employees and keep our buildings open while not raising tuition to a level that would price students and families out of a University education.

What you have before you is a minimal request, reflecting the fiscal challenges that you continue to face. It covers some – not all – of the basic needs of the University of Nebraska.

It does nothing to meaningfully close the salary gap between us and our peers even as we recruit faculty in the most competitive marketplace of our lifetimes.

It does nothing to address the $750 million in deferred maintenance needs that exist across our campuses.

It does not include investments for major strategic initiatives, like our No. 1 University-wide priority, engineering. This is a critical workforce and economic development issue for Nebraska. Yet we are not competitive in the Big Ten. We’ve outlined an ambitious and exciting plan for growth that will engage all campuses and private sector partners across the state – but it will require support from all fronts to provide the facilities, faculty and programs we need to be successful.

Our request does not improve our competitive position when it comes to facilities and financial aid. Other states provide significantly more in these areas. Iowa, for example, gets $90 million annually for facilities. On state-funded financial aid, Nebraska ranks in the bottom 10 nationally on a per-population basis. That doesn’t help when we’re trying to attract young people who will become the next generation of nurses, software developers, teachers, engineers and entrepreneurs.

Our request, even if fully funded, will require us to have a conversation with the Board about tuition. I don’t take that lightly. The combination of value and quality that the University of Nebraska offers is unrivaled almost anywhere else in the country. We have the lowest tuition in the Big Ten, and the lowest levels of student debt. Every time we are forced to consider a tuition increase, we test the principle that the University of Nebraska is an institution of access, founded to serve not just a privileged few, but the sons and daughters of farmers and ranchers who also deserve to share in the promise of higher education.

And since it does not cover all our needs, our request could require further reductions at the very time we should be growing in order to meet the needs of our state.

That these reductions will come on the heels of our efforts to climb out of a $55 million budget hole makes our work even more difficult. Many of the proposed cuts that I shared with you a year ago have come to fruition. Every one of them has hurt our goal to grow the workforce. When we cut a program, it hurts the workforce. When we delay hires, let jobs go unfilled and hold off on salary investments, it hurts the workforce.

One of the gems of the University of Nebraska that’s earned well-deserved media attention recently is our research on the western bean cutworm at the West Central Research and Extension Center in North Platte. Senator Erdman, I know you got an opportunity to see this work in person a few months ago, and I have seen it as well. The work that one faculty member in Extension is doing to combat this pest is helping farmers increase their yields and save untold dollars. But cuts force us to scale back our work in rural Nebraska, and not only does that hurt agriculture, it hurts the workforce.

Senators, when your University isn’t growing, the state isn’t growing. That’s not good for our young people, it’s not good for business leaders who depend on us to provide a skilled workforce, and it’s not good for taxpayers who get a 7-to-1 return on every dollar they invest in the University of Nebraska. That figure is hot off the press, by the way.

But when we find ways to grow, great things happen.

I could ask every chancellor to come up and talk to you about the momentum and opportunity on their campus, and this red light would come on before they could scratch the surface.

I think they would tell you about the progress at Innovation Campus and the new collaborative facility that houses the UNL health center and UNMC Lincoln nursing college. I think they’d mention the planned expansion of UNO’s biomechanics program which is unlike any other in the nation. I think they would speak to the growth of UNK’s footprint, including a game-changing new STEM building and new early childhood center that will make Kearney a hub of economic and educational activity.

And I am quite sure they would invite you for a tour of UNMC so that you could experience the wonder of the Buffett Cancer Center – a place you helped build – and see and touch the technology that makes it possible for you to connect instantly with someone a world away.

We would all tell you about our new records in research, and our ranking among the world’s leading institutions in bringing faculty innovations to market. We’d talk about how proud we are that our student body is more diverse than it has ever been, because we know that we are better when we stand next to people who don’t look or think like us.

And we would agree that our work is just getting started.

The needs of the state are too great, to pressing, not to invest in the University of Nebraska, one of the primary drivers of individual and economic growth for the past century and a half. We have the opportunity now, together, to build the future we want for our state. I’d ask for your partnership in that work.

Before I conclude and invite your questions, I’d like to make a few technical points.

First, we are asking the Legislature to re-appropriate unspent cash funds from LB390, which provided for a pilot study of medical cannabidiol.

Second, because of a clerical error, the fiscal year 2020-21 capital reaffirmation for the Veterinary Diagnostic Center needs to be revised to $2,733,600.

Finally, we have discussed with the Governor’s office some proposed changes to the intent language for the Nebraska Talent Scholarships program to be more specific about what areas of study would be eligible for the scholarships and what data we would report to the State every year.

Thank you for your time and consideration. I’d be pleased to answer your questions.

Date Recipient
03/04/2019 2018 Presidential Calendar
2018 Presidential Calendar
Dec.
7
NSRI Board of Directors Meeting
TBD | LINCOLN, NE
Nov.
1
DWFI Board Meeting
TBD | LINCOLN, NE
Oct.
18
NU Foundation Board of Directors Dinner
TBD | LINCOLN, NE
Oct.
3
Breakfast with UNK Students and Faculty
TBD | Kearney, NE
July
10
UNL Health Center / UNMC College of Nursing Bldg. Opens
TBD | LINCOLN, NE
June
25
NICDC Board Meeting
TBD | LINCOLN, NE
May
21
Walter Scott/Peter Kiewit Awards Luncheon
TBD | LINCOLN, NE
May
1
ORCA/OTICA/IDEA Awards Luncheon
TBD | LINCOLN, NE
April
14
Spring Game
TBD | LINCOLN, NE
March
27
Women Investing In Nebraska
6:30 pm | LINCOLN, NE
March
22
Air Force Event
6:30 pm | LINCOLN, NE
March
6
Presidents Advisory Council
8:30 pm | LINCOLN, NE
Feb.
28
Legislative Dinner
5:30 pm | LINCOLN, NE
Feb.
6
UNK Diversity Events
TBD | LINCOLN, NE
Jan.
25
Board of Regents Meeting
6:30 pm | LINCOLN, NE
05/10/2018 2017 Presidential Calendar
2017 Presidential Calendar
Dec.
5
Board of Regents Meeting
10 a.m. | Lincoln, NE
Nov.
29
State Chamber Board Meeting
10 a.m. | La Vista, NE
Nov.
8
IANR Growing Nebraska Summit
8:30 a.m. | Lincoln, NE
Nov.
7
UNL Faculty Senate Meeting
2:30 p.m. | Lincoln, NE
Oct.
27
President’s Advisory Council Meeting
8:30 a.m. | Omaha, NE
MAY
18
Walter Scott and Peter Kiewit Awards Luncheon
11:30 AM | Omaha, NE
MAY
16
Maxwell Arboretum’s 50th Anniversary Celebration
2:30 PM | Lincoln, NE
MAY
5
UNK Commencement
10:00 AM | Kearney, NE
MAY
4
UNMC Nursing Kearney Division Commencement
7:00 PM | Kearney, NE
MAY
4
NCTA Commencement
1:30 PM | Curtis, NE
MAY
3
Buffett Early Childhood UNMC Community Chair Welcome Reception for David Dzewaltowski
4:00 PM | Omaha, NE
MAY
3
University-wide Teaching, Research and Engagement Awards Luncheon
NOON | Omaha, NE
APR
26
TeamMates Spring Graduation
9:30 AM | Lincoln, NE
APR
26
President’s Advisory Council meeting
8:30 AM | Lincoln, NE
APR
20
Lincoln Public Schools Foundation dinner
6:00 PM | Lincoln, NE
APR
11
Water for Food Global Conference
8:30 AM | Lincoln, NE
APR
8
Omicron Delta Kappa Banquet
5:30 PM | Lincoln, NE
APR
6
Installation of UNL Chancellor Ronnie Green
11:00 AM | Lincoln, NE
APR
3
Global Center for Advanced Interprofessional Learning groundbreaking
2:30 PM | Omaha, NE
MAR
22
Dinner in a Nebraska Home with UNL international students
6:00 PM | Lincoln, NE
MAR
6
University-wide Departmental Teaching Award Luncheon
12:00 PM | Lincoln, NE
MAR
4
Honorary membership induction into UNL Alpha Gammo Rho fraternity
12:45 PM | Lincoln, NE
MAR
3
UNL College of Education & Human Sciences Ambassadors meeting
7:30 AM | Lincoln, NE
FEB
10
UNO Mavericks hockey game reception
5:00 PM | Omaha, NE
FEB
2
WH Thompson Scholars Academic Achievement Reception
4:00 PM | Lincoln, NE
JAN
20
USSTRATCOM Strategic Leadership Fellows Program Kickoff
1:00 PM | Omaha, NE
JAN
19
Leadership Nebraska Class IX meeting
2:00 PM | Lincoln, NE
JAN
14
UNL Marching Band Annual Awards Banquet
5:30 PM | Lincoln, NE
JAN
13
Martin Luther King Jr Freedom Breakfast
Lincoln, NE
JAN
11
Agriculture Builders of Nebraska Annual Meeting
12:00 PM | Lincoln, NE
01/24/2019 New year brings new opportunities to strengthen Nebraska together
New year brings new opportunities to strengthen Nebraska together

Jan. 24, 2019

In the spirit of the New Year, I’ve been thinking a lot lately about where the University of Nebraska has been and where we’re headed next.

Many of us set resolutions this time of year. It’s appropriate, then, that when I think about the students, faculty and staff I have the privilege of serving with every day, a word that comes to mind is “resolve.”

It’s a word that captures the spirit of Nebraskans as a whole – people I’ve come to know as unafraid of a challenge and willing to work together toward a shared vision.

At times, we are tested. That has been the case at the University of Nebraska in recent years.

We’ve been through a period of fiscal stress, confronted with cuts that have impacted lives and the very structure of the organization. Like most universities, we have faced challenges related to enrollment, campus climate and student well-being. We’ve had limited resources for priorities that are increasingly urgent and complex: infectious disease, hunger, terrorism, educational access.

It would have been easy for our faculty, staff and students to hunker down and wait for challenges to pass.

Instead, we put our foot on the accelerator.

Challenges aren’t going away. But when I listen to what’s happening across our campuses, I hear pride, gratitude and excitement about the future and what we can achieve together.

I heard UNL Chancellor Ronnie Green deliver a State of the University address in which he honored the university’s 150-year history and outlined bold goals for the next chapter – acknowledging that while some goals might stretch us, it would be a disservice to Nebraskans not to think big.

I’ve heard UNO Chancellor Jeff Gold state that his goal is for every student on his campus to complete their academic journey. Why would we aim for anything less?

At UNMC, Chancellor Gold has helped stand up one of the leading cancer centers in the country. We continue to earn national headlines for our preparedness in monitoring and treating Ebola patients.

I’ve heard UNK Chancellor Doug Kristensen talk the talk about the life-changing power of higher education, and then walk the walk. The stories of first-generation UNK students who may not otherwise have had access to college are ones I’ll never forget.

I’ve heard all our chancellors agree that we are going to do everything possible to address Nebraska’s workforce crisis. That’s why we are unified in our goal to build a more vibrant, competitive engineering enterprise, and why we are working across campuses to expand our partnerships with small businesses and create academic programs that will strengthen the workforce pipeline.

I’ve heard our philanthropic partners say they recognize that the University is a uniquely powerful economic engine and want to invest accordingly. A new privately funded program to educate more outstanding teachers for Nebraska’s workforce is one recent example.

Similarly, I’ve heard business leaders say again and again that their top needs from the University are workforce, workforce and workforce. The 11,000 graduates we produce each year aren’t enough to meet Nebraska’s economic needs. We’re especially short on high-skill, high-wage, high-demand jobs – like those in engineering, IT and nursing – that are key to prosperity.

And as our hard-working policymakers begin another legislative session, I’ve heard them express strong support for the vital role the University of Nebraska plays in the long-term success of our state.

Nebraska has been a partner in ensuring affordable, excellent education at its University for almost 150 years. I have every reason to believe that will continue. On the heels of a difficult budget cycle, I appreciated that the budget proposal released by Governor Ricketts funds a significant portion of the University’s request and includes money for scholarships in high-need areas. The Governor’s budget is a positive basis for our conversations with policymakers in the months ahead, and we look forward to working with him and the Legislature on a path forward.

In this new year, I remain convinced that the best days for our University and state are ahead of us.

04/10/2018 An update on budget planning from President Bounds
An update on budget planning from President Bounds

April 10, 2018

To the Students, Faculty and Staff of the University of Nebraska:

I am writing with an update on our budget planning. As you may know, we got good news last week when Governor Ricketts signed the state budget package approved by the Legislature with no vetoes.

Considering the fiscal challenges the Governor and Legislature are grappling with – and the scale of the cuts we faced at the beginning of the legislative session – this final budget package puts us in a relatively positive position.

We would not have gotten to this outcome without the countless Nebraskans, starting with all of you, who have lifted up their voices for an affordable, competitive public University that transforms lives and grows the economy. The chancellors and I are grateful for this remarkable show of support for our 53,000 students and the vital role of higher education in Nebraska.

“With our state funding known, we’re in a better position to carefully consider cuts that have been proposed, campus feedback, and the long-term interests of our students, University and the state.”

Let me lay out where this budget puts us, both in terms of the work we have done to address our existing shortfall and next steps that the chancellors and I have begun to discuss.

Under the signed budget, the University’s funding will be reduced $11 million this year, and next year’s appropriation will be cut about $6 million. These reductions come on top of previous cuts in state funding which, combined with our rising costs, created a $46 million recurring shortfall.

We addressed that gap with a combination of spending cuts and tuition increases, including millions in operational reductions identified by the University-wide Budget Response Teams. The teams are continuing to make progress in implementing their strategies. Their work is not easy, and it will cause disruptions, but every dollar saved in operations is a dollar less we have to find in academic cuts or tuition increases.

The additional reductions in state funding – while smaller than what we originally faced – will add to our challenge significantly. We will manage this year’s one-time $11 million cut by using our dwindling cash and drawing on the prudence campuses have exercised in limiting hiring, purchasing and other spending.

The recurring $6 million cut beginning in 2018-19 is of much greater concern, particularly as we look ahead to the next biennium and the reality of Nebraska’s continuing fiscal issues. In February each campus rolled out proposed programmatic reductions in anticipation of reduced state funds. These were painful proposals, with real impacts on students, faculty and staff.

We will have no choice but to move forward with some cuts. Each campus’ process for making reductions looks a little different and it would be inappropriate for me to get ahead of any campus decisions. I can tell you that the chancellors and I – together with the Board of Regents, campus leadership teams and other stakeholders – will be working hard in the weeks and months ahead to finalize strategies for closing our shortfall and communicate our progress to you. With our budget cut known, we are in a better position to carefully consider what’s been proposed, the feedback campuses are receiving, and what choices will allow us to meet fiscal realities while also serving the long-term interests of our students, our University and the state.

The best news is that at this level of funding, we will not need to increase tuition across the board for 2018-19 beyond the 3.2 percent increase previously approved by the Board. We’re pleased that we will remain a great value for our students and families.

Even as we acknowledge the challenges before us, the chancellors and I share a great energy about where we’re headed as a University. We have real opportunities to work with our partners in business and agriculture, the Legislature and the Governor to advance our shared goal to grow this state. As we look to the University’s next 150 years, we’re convinced our best days are ahead of us.

That confidence is a result of the work you do every day. Thank you for your contributions to the University of Nebraska.

Hank Bounds
President, University of Nebraska

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