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President Kaler responds to press allegations of U of M 'bloat'

Eric Kaler
MinnPost photo by John Noltner
"It is frustrating to focus on tuition without mentioning the just stunning decline of state support."

Just after Christmas the Grinch paid a visit to University of Minnesota President Eric Kaler. On the last Friday of the year, the Wall Street Journal carried a front-page story singling out the university as the nation’s worst example of “administrative bloat.”

For Kaler, the timing couldn’t have been worse. The state Legislature is set to begin crafting the budget for the next biennium within days. The U of M is asking for an increase in state funding in exchange for a series of accountability commitments, including a tuition freeze.

The Journal story, however, could easily be read as justification for the state funding cuts the institution, viewed by some lawmakers as a fiscal sinkhole, has sustained in recent years.

Between 2001 and 2011, the piece reported, the U of M added 1,000 administrators. During the same time period, tuition and fees for in-state students more than doubled to $13,524 a year, some $5,000 more than the average at four-year public colleges.

The story acknowledged at the outset that Kaler vowed to ferret out waste and redundancy when he took office 18 months ago, but went on to lay out a case that the president and some other members of Minnesota’s higher-ed sector assert is miscast.

Adding insult to injury, the Washington Post followed up with a commentary — reprinted in the Star Tribune — that insinuated the U of M administration was complacently fattening itself with student and taxpayer dollars.  

MinnPost asked Kaler to share his views on the ensuing controversy; an edited version of that conversation follows. But first, a little background is necessary to understand why he feels the Journal report missed the mark.

The U.S. Department of Education collects reams of statistics from colleges and universities, including data on hiring and spending. The paper’s analysis was based in large part on these statistics. But the agency’s reporting guidelines are so poor the numbers don’t compare apples to apples.

They do not, for example, spell out who is an administrator. That decision is left to the person completing the report. As a result, administrative head counts can fluctuate by hundreds of bodies from one report to another.

Ironically, Kaler attempted to explain this wrinkle in a presentation he delivered last fall to the Board of Regents illustrating how his administration is overhauling the way costs are tracked. The fifth page is a chart created using the relevant database.

MinnPost: Let’s talk about the Wall Street Journal, the Washington Post and the ensuing chatter.

Eric Kaler: I thought The Wall Street Journal piece was challenging. The reporter was here for a while, and I think got a fair view of the university but had a real hard time collapsing it into a 2,000-word article. So the bits and pieces that are some of the comparisons are challenging. Some start in different years than others, etc.

He also obviously wanted to make a story highlighting things that he thought would sell newspapers, and didn’t provide the context of the university around what was in the article.

So for example, you talk about increasing administrative hires. You’ve got to put that in the context of a 40 percent increase in our research grants and contracts over the last five years, 9,000 more students than in 2000, etc. etc. And you know he just didn’t seem to have space to provide that kind of balance. He needed to find the facts.

I think The Washington Post story was just — I’m trying to think of a polite word. It didn’t seem to be very well thought out, and I’ve written a letter to the Post and the Star Tribune. [His letter has since been published in both the Star Tribune and the Post.] I mean, characterizing UMore Park as a vast housing development, it’s just silly. He just didn’t do his homework.

MP: What do you think the Journal got right?

EK: Boy, that’s a good question. He at least pointed out that we think comparisons between institutions is very difficult. He then attempted to do some analysis of our data, which we’re looking into, let me say.

The inner comparison of data really is terrible. The data we report to the feds, the categories that describe administrative personnel, are interpreted very differently by different institutions. So you will see institutions that have wild year-to-year variations in the number of employees in those categories, presumably based on who filled the form out. He did get that right.

But it is frustrating to focus on tuition without mentioning the just stunning decline of state support. [The story] says in the beginning that based on the flow of state dollars this hiring took place. Well, there was no flow at the University of Minnesota. I mean we’re receiving $140 million to $150 million less than three years ago. It’s a stunning disinvestment, and that’s what’s driven tuition. It’s frustrating when instead of addressing that, we talk about administrative costs, which certainly we’re working every day to reduce.

You know we’re focused on minimizing any tuition increase that we ask for from students and families, but good grief.

MP: I wonder if this must rankle particularly because you came in with a stated mission of ferreting out redundancy and inefficiencies.

EK: It really does because we’ve made really good progress, but it’s only the start of a long journey. This change doesn’t come either easily or quickly, and we’re doing a lot.

The move to Google — we’re the first university to do that. This [saves] about $15 million in IT costs. Closing the system administration office, closing the bursar’s office — $2.2 million. We had the lowest tuition rate increase last year in 12 years of 3.5 percent. The centerpiece of our [budget] proposal for the state is a tuition freeze. So yes, I would’ve liked to have gotten a little more credit for that rather than reading about what happened before I got here.

MP: Can you return to the 40 percent increase in research and say why that might drive administrative hiring?

EK: Because when you get a research grant, you hire people to do the work. If we get a $50 million grant from the National Institutes of Health for the Clinical and Translational Science Institute, which we did, it requires us to hire people to manage that grant process. The regulations associated particularly with human and animal [research] subjects are just really almost unbelievable, and you need people to manage that, to help so the scientists aren’t spending all their time managing that.

And you expect to see growth in those kind of positions as you grow your research. We do so much that’s beyond classroom teaching. We have the land-grant mission of extension and the research and outreach centers across the state. We have clinical responsibilities. We have research responsibilities and so people who aren’t associated with the teaching mission are hired to do those kinds of missions.

I think also you’ve got to look at the student success. Our graduation rate has improved by two-thirds over the past 15 years or so, and that’s because not only of classroom instruction but having advisers and career counselors who can help students move expeditiously and appropriately through our curriculum. Those are people in student services who are classified as administrators and are very directly helping student outcomes.

Really, talking about the importance of the research mission of the university can’t be overestimated. The return on investment for the university is 13:1 for every state dollar that we get. As an economic engine for Minnesota, it’s an important institution. We’re dedicated to minimizing tuition increases, and we’re dedicated to moving the place to be as efficient and effective as it can be, and we’re making progress on those goals.

MP: The Wall Street Journal Piece noted that when you took office, you went looking for answers about spending and the system wasn’t set up to deliver them.

EK: We’ve been working on that steadily since I got here, and we reported to the Board of Regents at their last meeting, or the one before, how we can now track the cost of supporting the mission and administering effective leadership for the institution. That’s now very clear, and now we can keep an eye on it.

And again — I don’t mean to be critical about this — that’s because the way the system was set up 10 or 15 years ago; it wasn’t a priority for any institution to be able to answer questions like this. And we’re very decentralized. There wasn’t an institution-wide roll-up of that kind of data. And now there needs to be.

MP: If I were in your shoes with the Legislature poised to open, I’d be concerned about my budget proposal.

EK: I think we’ll have to have more conversations. The Legislature has already signaled that they want to look at our budget in more detail, and I’m proud to show them. If you look at what we’ve taken out of our operations already and with fund cuts that President [Bob] Bruininks made, too, there’s a good story to be seen there.

I think it’s very important for us to tell the story and have people listen and not read a 2,000-word article that’s hither and yon or the snipey piece out of the Washington Post.

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Comments (40)

Mumbo jumbo

I'm sorry but you were serious about these questions you would ask for numbers. "40%" doesn't tell you anything, that could be anything from 4 to 400 grants. And you don't hire people just to administer the grants, you hire people to do the work that's being granted, those are NOT administrative positions. If EK doesn't like the WP's numbers why isn't he providing his own? And if can't provide his own, then he can't dispute the WP's numbers. If EK has a problem with the way administrators are defined, why doesn't he give us HIS definition? And where the evidence that all or any of these positions are associated with grants? He's not even really bothering to connect the two he's just implying that there may be a connection.

Look, my wife works for the MN Health Dept. Her entire unit is funded by federal grants. NO ONE at the Health Dept. has a job just doing or administering those grants. Her boss writes the proposals in addition to all his other duties, and when they get the money it goes into the unit budget and they spend it according to grant specifications via state payroll and Human Resources. They've never hired anyone to do this or help with this. Why would someone at the U. have to hire someone specifically to administer grants?

Furthermore, does it really matter how this compares to other Universities? Whatever, according to their own definition the U.'s administration has increased by 40% while the number of students has only increased by 10%. That needs to be explained regardless.

My guess is that the U. has imported private sector corporate mentalities. What you see in the private sector is a proliferation of administrators who are actually doing the executive's jobs or providing a rationale for the existence of some executive position. Invariably by the time you figure out what all these administrators do you're left wondering what the executives get paid for?

I don't mean to be harsh and I don't want to see the U's budget cut, but EK is not really answering any questions here. The question is whether or not he just doesn't want to answer the questions or is he just not capable?

And another thing....

By the way I remind everyone that the INCREASE in grant money should in no way put upward pressure on tuition, in fact quite the opposite. The grants are supposed to be making the research self sustaining, they shouldn't be adding costs to the over-all budget, they are after all ADDITIONAL revenue for the U.

False

You demonstrate a clear lack of understanding. Research money is targeted for one thing: research. It CANNOT be used to offset tuition costs. How grant money is to be used is spelled out explicitly in the contracts. The University would be illegally breaking those contracts if they moved grant money to the general fund.

Whether or not Kaler is right, whether or not the Wall Street Journal or the Washington Post were right, I think you can definitely say one thing about this whole situation. The media, and therefore the general public, are completely, staggeringly, and probably intentionally misinformed about how higher education is funded.

No wonder everyone hates the U when the media does nothing but dump on them. I commend MinnPost for at least attempting to get the other side of the story.

Incorrect

Those grants are NOT to fund undergrad tuition. They're to fund research. In no way does a research grant fund tuition--each grant has very specific boundaries on what money can be spent on what. While the University requires researchers to fund their own lab space and specialty equipment use, most grants will not allow money to be spent on those things. So, if you want to pay for your cell culture room, you have to find a different funding source. Similarly, you can only spend so much on research assistants and little or none on administrators. And believe me, you DO need administrators to handle your grants or you would be busy figuring out which way is up rather than writing new grant applications and doing the actual research. Many researchers have MANY grants, all of which must be properly managed and spent on ONLY the correct projects. Heck, I still have to report my "progress" on a grant that I got 8 years ago just so that the program that's in-part funded by it can continue to get it renewed for other graduate and post-doctoral researchers. All the information must go through an administrator who manages the grant, as well as others, in the Orthopaedic Surgery program. She must do it correctly, frequently, and on-time. The two dozen or so researchers (profs, grad students, and grad students) that are supported by it count on her. Undergraduates benefit by having the opportunity to do work-study and sometimes independent research as a result, not a price break. Without those administrators, those grants would either be lost or new grants would stop coming in because no one has time to maintain them. And grad and undergrad students would suffer from loss of good research to learn from.

Ms. Kahler and the earlier commenter are correct

that the U cannot use grant money to buy down tuition.

Unfortunately the reverse process may be happening.

The problem is that much of the research done by the U is NOT completely paid for by the money supplied by granting agencies, including the overhead.

There is some legitimate argument to be made about the exact amount of money involved but it appears to be somewhere between twenty or thirty percent of the amount supplied by granting agencies.

So if one brings in a million dollar grant, then the university has to come up with about three hundred thousand dollars in additional funds. Where this comes from is less than clear.

What this means for the U's budget needs to be made much more transparent.

Those with an interest in this matter might wish to read:

On the Hidden Cost of Research
link: http://bit.ly/ehNG4D

Stop Using Students As ATMs
University of Minnesota Saps Education
to Achieve Top Three Goal
link: http://bit.ly/aWk50z

Dirty Little Secret Finally Acknowledged
Research Funding From Outside Federal Grants
Requires Additional Subsidy
link: http://bit.ly/cixYdD

The more people understand about the financial situation at the University of Minnesota, the better off we all will be in the long run.

The problem with grants

is that, at least for Federal ones, there is too MUCH accounting. Every dime must be accounted for and they can't be used for incidentals, like research/lab space, research animal housing/care, and the like (which, by the way, are not insubstantial or optional). Frequently, this money comes out of special grants, which often come from the University and some odd-ball sources. The point being is that having to account for too much is very expensive. The U has tried to skim off of these grants to help cover these costs, but they're probably getting squeezed by Federal granting agencies. What it boils down to is that the U and President Kaler are being somewhat unfairly pinned to the wall for things that can't be helped in a research institution of the U's size. Are there cuts that can be made? Oh, definitely. But the cost of a research institution is simply one you pay if you wish to have the benefits of a research institution.

The take-home: If you're going to harp on the costs of research grant administration, you're barking up the wrong tree. Get Congress to quit strangling research by forcing the bean counters to exist at every step of the granting process. You can only get so efficient before you get less efficient.

For what it's worth, the whole bean counting, grant-writing, soft money thing was one of the reasons I ran from academia after I got my PhD. I didn't want to spend the rest of my life justifying my existence to granting agencies and doing accounting (and finding the money to pay for the incidentals) in order to make sure my slave/grad students had something to do at the bench (that I wish *I* had time to do, but don't because I'm writing grant apps and doing accounting).

"Competitive" administrative salaries

I'm willing to accept Kaler's explanations of the hiring increase to a certain extent. The number of administrators isn't so much of a problem. The one single part of the WSJ story that concerns me, which Kaler does not address in this interview is this:

"Administrative employees make up an increasing share of the university's higher-paid people. The school employs 353 people earning more than $200,000 a year. That is up 57% from the inflation-adjusted pay equivalent in 2001. Among this $200,000-plus group, 81 today have administrative titles, versus 39 in 2001.

Administrators making over $300,000 in inflation-adjusted terms rose to 17 from seven."

If you're hiring more grant writers and academic advisers that's all fine and good but I guarantee that those are NOT the administrators who are making $200k-$300k+ a year. This has always been my problem with the U's budget: Vice Presidents, Presidents, and Provosts get raises to "stay competitive," while the faculty gets pay freezes, contract negotiations take a hardline against low-level office employee benefits, more and more classes are taught by graduate students and tuition gets raised. So what are those employees doing that is more valuable than faculty, office workers and actual professors teaching undergraduate courses that are affordable for anyone in the state to take without taking on massive debt?

Spot-on

Great comment. This is another question I wish Ms. Hawkins had asked Dr. Kaler.

Pretty tough to disagree with

Pretty tough to disagree with this.

Q-and-A

I was surprised at how weak the questions were in this Q-and-A. Here they are, in order:

-----

MinnPost: Let’s talk about the Wall Street Journal, the Washington Post and the ensuing chatter.

MP: What do you think the Journal got right?

MP: I wonder if this must rankle particularly because you came in with a stated mission of ferreting out redundancy and inefficiencies.

MP: Can you return to the 40 percent increase in research and say why that might drive administrative hiring?

MP: The Wall Street Journal Piece noted that when you took office, you went looking for answers about spending and the system wasn’t set up to deliver them.

MP: If I were in your shoes with the Legislature poised to open, I’d be concerned about my budget proposal.

-----

Of these 6 questions/statements, only one seems mildly probing ("What do you think the Journal got right?"). Of the other 5, only one is actually a question and essentially accepts Dr. Kaler's framing ("Can you return to the 40 percent increase in research and say why that might drive administrative hiring?"). The remaining 4 "questions" aren't actually questions so much as open-ended statements which could have been written by any p.r. person working for the U of M. These statements are not challenging at all and essentially allow Dr. Kaler to repeat his talking points.

This is all well and good as Dr. Kaler should be allowed to make his case when he and/or his p.r. staff is talking to the public. However, when I read an interview with him by a journalist, I expect some aggressive questions regarding the specifics of the Journal's story and/or the specifics of other research that has been done regarding the U's administrative bloat.

For instance, I would be very interested in how Dr. Kaler might respond to the following facts:

"In fiscal year 2012 the total cost of administration included $208,545,279 for administrative oversight compensation, $441,912,901 for administrative staff compensation, $131,590,95 for administrative supplies and services, $35,175,423 for equipment for administration, and an astounding $34,815,696 for consulting and professional services. So the total cost of administration consumed 28% of the $3 billion in total expenditures for the year. Even with a reduction in state appropriations, the U of M administration increased spending from $2 billion in fiscal year 2002 to $3 billion in fiscal year 2012. The fuel for this billion dollar explosion was skyrocketing tuition that soared from $293 million in fiscal year 2002 to $634 million in fiscal year 2011."

That was taken from the comments section of Dr. Kaler's op-ed in the Star Tribune. The author writes for a blog that has dealt extensively with the issue of the U's admin bloat. The particular research for this comment can be found in this post: http://bit.ly/VGlfFw

I hope if Ms. Hawkins gets another chance to interview Dr. Kaler that she uses the opportunity to more aggressively question his claims. I would genuinely be interested to know how he might respond to the above facts.

Richner and Stahls' insightful

statistical comments provide necessary facts that need to be common knowledge for anyone who is interested in our U/M. I cannot imagine many people donating money to an organization which, for instance, spends 28% of their expanses on administration.

Calm down

I didn't say grant money could be used to offset tuition, I said grants shouldn't create any pressure to INCREASE tuition. Obviously grant money can only be spent on the grant activity. Duh. EK is trying to explain two things, the raise in tuition, AND the increase in administrators, and he's using the increased number of grants as partial explanation and it doesn't track. Your quarrel is with EK on this, not me.

This is not new information. Back in 2011Howard Bursis completed a financial analysis that amongst other things concluded that: "The furloughs and pay cuts recently instituted at the U were not financially necessary. They were merely a political gesture to show that the U was sharing in the state budget pain."

You can see his full presentation here: http://oncampus.mpr.org/2011/10/aaup-report-on-the-university-of-minneso...

In essence the report detailed the same conclusions the WP arrived at, that administrative costs were increasing while the U was cutting budgets for actual instruction and instructors. Furthermore THAT report concluded that the U is in much better financial condition than it pretends to be.

Look, you've got a president here that was clearly blindsided by a superficial two week examination of his organizations budget, this more than a year after he "promised" to reduce administrative costs and "ferret out" waste. The obvious question is whether or not this guy can recognize administrative "bloat" when he sees it? How can he be this unprepared to answer these questions after a full year on the job? Especially when this was supposed to be one of HIS priorities?

I love the U. and I want it to be well funded and accessible. But I don't want it's financial resources to be wasted on bloated administrators salaries and expenses. That money should be going to the instructed and instructors.

Mr. Gleason

According Mr. Gleason's scenario grant money "could" be creating upward pressure on tuition's because the grants don't cover the full cost of research. This idea raises it's own questions however. Are these additional costs being classified as: "administrative" costs? Wouldn't research activity record a deficit if this were the case? I'm not saying I don't buy the explanation but I'd like to see a few examples of how this works.

I am not really sure how to answer your question

Mr. Udstrand.

There certainly are "administrative costs" attached to grant writing and monitoring activities. These would, indeed, drive up the cost of administration.

Unfortunately the whole situation is a mess. As President Kaler pointed out, different institutions attribute administrative costs in different ways. This is part of the problem when trying to compare from one institution to another to try to see who is doing things efficiently.

But for years the administration at the U argued that bringing in new grants would help to pay for new buildings and new faculty. This has clearly proven to be fallacious as research actually COSTS the university money, rather than making any...

As is the case with football programs, I might add.

Ducks.

There are grants...

and there are grants. I'm not certain what President Kaler said exactly, but it would seem to me that there are grants that CAN pay for these things. Just not research grants. Well, research grants can help pay for new faculty, but not buildings or many other costs related to running a university.

Research grants can't pay for new buildings as you

note. They can only pay for new faculty for a limited amount of time and then only under unusual circumstances. After that the U is on the hook for paying for them

The buildings are the big problem. First the bonding from the State or the U, then debt service, upkeep and maintenance. You will often hear administrators say "The U can afford more debt service." Technically, they might be able to. But a debt service of $200 million a year is going to make budgeting difficult.

For some more information on these matters, please see:

If You Build It, Grants Will Come? Or, Could Someone at BigU Please Be Honest and Responsible About Expansion of Biomedical Research?
link: http://bit.ly/altCj9

Trees Do Not Grow to The Sky or, Why the State Legislature Should Not Write a Blank Check to BigU for Biomedical Research Buildings
link: http://bit.ly/a2UQ5L

Who's dismantling the Ivory Tower?
link: http://bit.ly/d6ihEz

Well that's silly

I think we can all agree that this comment thread has exceeded the story in terms of information. Thanks for you response Mr. Gleason.

"As is the case with football programs, I might add."

??? The football and basketball programs are the only 2 at the U that make more money than they spend. The total expenses for the football program include that of paying back the bonds for the stadium (despite its use by many other campus groups, students, and general fund contributions from gameday and other event parking which isn't part of the AD) and everything else. Revenues tied to football are higher than expenses.

We can debate how much an organization SHOULD spend and on the heels of a collegiate football game, but the complaint that they don't cover their expenses is unfounded. In fact, their profit is what allows other sports to exist in the first place (at least, without costing the U general fund any money). Again, one could argue the importance of sports to our country, but I would have a hard time believing many would truly feel that ridding our university systems of sports like Volleyball, Wrestling, Rowing, women's versions of rev sports (hockey, basketball), etc would be a positive to our society.

I understand that you have an issue with the AD not being fully self supporting. Yes, in 2011 the general fund contributed $2.3M to the athletic department as a whole, and with that value seen as a "revenue" the AD was revenue neutral. Keep in mind, however, the revenues brought to the University from parking (as I mentioned earlier) that would not have existed without intercollegiate sports. ~18 home games a year for basketball and hockey. 7 for football. Parking rates are at least $10 per car (oftentimes more for football). Let's assume 15,000 cars per game for football, 3,000 a game for MHockey and MBB. Without including ANY other sports where people pay to park, that is a revenue of $2.13M per year. Let's call it even and stop complaining.

No we are not going to call it even and stop complaining...

You do realize that students are charged a fee to pay off the bonds for the Stadium fiasco, don't you?

Even those who will never set foot in the stadium.

Do some research.

We're Number One -
In a Football Related Matter
(Really!)
link: http://bit.ly/ZszcFn

UNIVERSITY of MINNESOTA
Gophers Need to Stop the Insanity?
In Academics as Well As Football...
link: http://bit.ly/8ZPaOG

The NYT Makes It Clear Why Very Few Will Make Money on Big Time Football
(and why it is foolish to try…)
link: http://bit.ly/TLyVyd

More Trouble for Morrill Hall
ex-Gopher Football Players Speak Up
link: http://bit.ly/afKDmn

Should 'u' drop football?
Jay Weiner is correct
link: http://bit.ly/VLkbAc

note: Jay is Prez K's speechwriter. link: http://bit.ly/mwsB3U

One of the University of Minnesota's
New Goal Schools, North Carolina,
Struggles With Football...
link: http://bit.ly/fQJUJP

Good money- 3.5 million dollars - after bad?
link: http://bit.ly/XOlSjh
(poor ticket sales require 3.5 mil more in "investment")

And the pièce de résistance which makes me so sick, I have to quit...

EXPENSIVE ICING
link: http://bit.ly/rdTJk7

"The athletic department at the U of M continues to receive annual multi-million dollar subsidies from the general fund of the University (the Operations & Maintenance Fund). In fiscal year 2010 the subsidy was $8 million; in fiscal year 2011 the subsidy was $7.8 million."

Not even close, Mr. Cecchini. And certainly not cigar worthy.

Well..

if you and a few people in newspapers say so, then I guess the U really SHOULD drop sports, particularly football. I like that since because a UMN speechwriter and former football player say something is wrong that it must mean it is the 100% truth.

There's obviously a discrepancy between athletic department subsidies. You are reporting total UMN system subsidy for athletics ($7.8M) while my $2.3M value is in regards to the UMN-TC athletic budget subsidy, see: http://goo.gl/Vx9VR , http://goo.gl/0IKze . Obviously schools like UM-D have much lower revenue being mainly DII in sports with less following and ability to charge for tickets. The subsidy for many MAC (D-1) athletic programs is right around 50% of their operating budgets.

I was using the TC AD as an example of how a balanced budget is run, without detriment to the overall general fund (again, parking revenues from sporting events that go straight to the UMN general fund would cease to exist without the sports themselves). Whether you like it or not, sports are a shared cultural experience, and people across the nation at all levels have decided public funding of sports is important - on an individual level it promotes a more healthy lifestyle, on the societal level we enjoy following our HS, college, pro, Olympic, etc sports as a sense of civic pride and communal shared experience. You would have all collegiate sports erased from UMN school system simply because you think they're a waste of money? Especially when the amount of the total UMN operating budget devoted to supporting athletics is 2-3% of the total budget? And in the UMN-TC's case net zero (again, based on the parking revenue I cited earlier).

You blog cites the U should be without intercollegiate sports to join the shining example of an institution like University of Chicago. Ahem. Successful athletics and successful academics/research are NOT mutually exclusive. You did a good job cherry picking one school. How about... Stanford, UCLA, Michigan, USC, Northwestern, UC-Berkeley, Duke, Cornell, Rice, Notre Dame, Vanderbilt, Wisconsin, Virginia, UNC, Wake Forest, ... stop me when you find something wrong with this picture. Any number of those schools are all well-regarded for undergraduate and graduate/research academia with moderately to highly-regarded athletic programs (be they football, basketball, or otherwise). Even schools like Harvard, Princeton, and Yale still employ a full D-1 athletic department. Hell, Harvard has somewhere around 40 D-1 sports, more than UMN's 23. How can that be!!?!?!?

You also gloss over that on the whole, UMN athletes graduate at a rate HIGHER than their non-athletic peers at the university (and overall, higher than the NCAA D-1 average). Many of these, well-qualified student-athletes may not have chosen the UMN as an option.

I'm confused at your frustration with a $25 a year fee to all FT students (only at UMN-TC). "Most of whom will never use it." Well, aside from the many intramural sports that take place there, there is also the marching band who is housed there. On-campus interviews, career fairs, robot shows, and any other number of events touch many students outside the football gridiron. Beyond that, what is the philosophical problem in a fee (or a tax, or anything else) for something that not everyone will use? There is a $19.00/semester transportation fee. I know plenty of people (vast majority) who never bought the U-Pass. The MSA fee imposed on everyone must tick off people who don't care about the MSA, huh? Or how about the $368 in fees every student has to pay for all these clubs, communities, groups, etc they may never join or possibly even have a moral opposition to!? http://onestop.umn.edu/finances/costs_and_tuition/fees/general_fees/stud... Give me a darn break. We are all charged for things we may never use. I personally don't use the MTA here in the TC but my taxes go to help pay for its operation anyway. I don't use any regional parks but I pay for them just the same. What exactly is your point?

I find it odd that you have such an opposition to the state funding for a state-run university's football stadium. Of the state's ~$140M investment, $50 went towards purchasing land from the university (which, has a monetary value, btw and the state can do whatever it pleases with, and the U still assumes all fiscal responsibility for cleanup or other tasks). How much more would the state and U had to pay to continue to lease through the Metrodome? Will TCF Bank serve no purpose to the general Minnesotan other then 7 home games per year (doubtful, as it served as an alternate site for the Vikings' home game in 2010, will serve the MSHSL for 2 years, maybe more, for Prep Bowl, serves to host things like FirstRobotics shows for young kids, camps for MN athletes of all kinds, need I go on)? What is the state/(city) investment for TCF compared to Target Field? The Vikings Stadium? Are you making a huge deal out of something compared with other, larger, blunders of public money in to FOR-PROFIT organizations. Also keep in mind, the stadium "fiasco" has been surrounding some of the most terrible football seasons the U has ever seen. 1-11 in 2007, 3-9 in 2010 and 2011. As a result, we've seen attendance numbers drop below numbers from the Metrodome, affecting both realized price per ticket and total revenue. Yet, it has STILL been an economic success for the UMN compared with the ALTERNATIVE of sharing concessions, no suite revenue, no parking, etc and higher rents that would have existed in the Dome. Look outside your box.

Bloat at the University

What we need from the President is not a list of reasons or things that are in the works, but a concrete plan to streamline University administration and operations to start lowering the cost of instruction to a point where students don't bankrupt themselves to complete their degrees. That means the goal shouldn't be to merely to slow tuition increases, but actually have no increase in inflation-adjusted instructional costs to make up for extravagant increases of the recent past.

If there is any place where we should be able to rely on having good data, it should be a University environment. The issue is probably that the University model involves adults evaluating students, and academics are not used to being really evaluated themselves.

It seems like the only place where there is meaningful measurement at the University is the athletic department, with its elaborate record keeping systems and clear system of pay for performance. Maybe on the academic side, if administrators don't have the ability to show the data to prove that their programs are both high quality and cost effective, they should be shown the door and fresh minds - starting at a lower pay grade - be asked to make improvements.

Bloat and executives

In large organizations like the U. I think this administrative bloat is invariably a result of an institution that's pursuing a mission in the absence of effective leadership. Or put another way, you have an institution that's pursuing it's mission despite it's leadership.

I don't know EK, and I've never worked at the U. but I'll be you one thing dollars to donuts: When EK made lowering administrative costs one of "his" top priorities, that meant he handed it off to someone else to deal with. I bet it was a committee, or a consultant, or a vice president, and after he handed it off it went nowhere, as it typically the case for a variety of reasons. Now he's trying to explain it and he can't because he didn't actually do anything and whoever was supposed to be doing something is still having a lot of meetings. It's kind of a form of internal outsourcing.

This kind of executive behavior is soooo typical and it circles back to the point here by others regarding the excessive salaries of these administrators. Within this internal outsourcing structure you end up with a lot of pseudo indispensability because the people who are supposed to be responsible are handing the work off, and the people being handed the work aren't getting it done, or worse, they're making bad decisions and creating new problems. Meanwhile the institution still has to function and continues to do so despite administration. You get this widening gap between administrators who see themselves and each other as indispensable (and more valuable than others) and everyone else who sees the administrators as increasingly irrelevant and redundant.

And then a newspaper somewhere publishes an article...

Indispensable?

Prove that they're not. You paint a picture with no numbers or data, just a lame story that we're supposed to believe. At least Mr. Gleason tries to compare data and numbers to prove a point (although to disagree with many of his posts using data, not all of them (some items I do not disagree with), would require a full blog of my own for which I do not have time to run.

Put it this way. What is the U's mission? http://www1.umn.edu/twincities/history-mission/index.html By all accounts, the second item, "Teaching and Learning," has been improves since 2002. Number of students attending the U has increased (by 10.2%, which is higher than the population growth rate of MN of 7.8%). Number of students living on campus has increased. Number of degree programs has increased. Graduation rate has increased at the U system while other state colleges remain much lower (and private schools in MN have stagnated) http://www.ohe.state.mn.us/mPg.cfm?pageID=754 . From 2003 to 2008, the U of MN system had the 6th highest gain in graduation rates among US public research institutions http://chronicle.com/article/Graduation-Rates-2010-/125587/ . Number of students per faculty member has dropped.

The University may have decided not to use academic "rankings" (from publications such as US News & World Report, Times Higher Education, QS World rankings, etc) to measure success. I agree with this on a fundamental level as each one places different weights on varying degrees of academic rigor and stats (and many have proven to have egregious errors like including a university in a sub-section ranking when they don't even have that department, placing a lot of weight on citations rather than teaching ability or research output, etc). But on the whole, we can use some sample points to show a relative increase in academic standing. By QS measure, the UM has increased its standing from 187th in the world in 2005 to 105 http://www.topuniversities.com/institution/university-minnesota . In the 3 years the THE has ranked the UM, it has increased its overall score each year, and increased its standing from 2010-2012 http://www.timeshighereducation.co.uk/world-university-rankings/2012-13/... .

What other metrics do I need to bring up to show improvement in nearly every category available? Would the increase in number of administrators and pay of said people not be correlated to increased quality of education and research??? Again, define "success" for a university? Will the job ever be done? In what ways, other than an increase in tuition, is the university failing its students? The state?

Can we please bring back in to the conversation the level of state funding and how it has (also) affected the rise in tuition? Kaler cannot truly point to a 29% reduction in state funding (inflation adjusted) as a major source of the tuition hikes as it is political and career suicide for him to be seen as a "whiner not focusing on the true problem." I would say that people complaining about bloat within the university and complaining the state has wasted money on the U should realize that the state turned its back on he U for funding and as a RESULT tuition has increased (not the other way around), all the while forgetting the increasing number of rules and regulations from the government that increase the cost of research. Forgetting the increasing cost to house and educate students (both with regard to what society is expecting and also keeping pace with other universities, public and private).

Here's a fun exercise: If you were to take away the state/fed funding (not including research grants) entirely from the U, and put that cost burden SOLELY on students, tuition and fees would rise by $8,483 per student, bringing tuition/fee total up to $21,545 for a MN resident (this is based on a straight average, not taking in to account weighted average of number of FT vs PT students, but my next comparison will show it is irrelevant anyway). The tuition/fees at other, local private colleges are as follows: CSB/SJU: $35k. St Thomas: $33,040. Carelton: $44,500. St Olaf: $39,560. St Kate's: $32,896. And at the end of the day, the quality of education, access to number of degree programs (and levels of degrees offered which requires more and higher qualified staff to instruct at a PHD level), access to research facilities, D-1 collegiate athletics, and much more is clearly at a much higher level at the U. Oh, and the U would still be an institution with a much larger community involvement across the state, much larger impact on research, and much more involvement with local businesses. (preference for size/location of school is a choice students make based on lifestyle, but the other hard facts would be hard to dispute). What exactly is my point? How bad can the "bloat" be if, with no state funding, it still outperforms other universities in the area (and I mean no disrespect to those universities, merely making a comparison of cost to attend per student in a situation with no state aid).

In your dreams, Mr. Cecchini

"The tuition/fees at other, local private colleges are as follows: CSB/SJU: $35k. St Thomas: $33,040. Carelton: $44,500. St Olaf: $39,560. St Kate's: $32,896. And at the end of the day, the quality of education, access to number of degree programs (and levels of degrees offered which requires more and higher qualified staff to instruct at a PHD level), access to research facilities, D-1 collegiate athletics, and much more is clearly at a much higher level at the U. "

1. What is the average debt at graduation of students going to Macalester and Carleton? Hint: It is a heckuva lot less than at the U. For how many of the schools you mention is it LOWER than at the U?

2. If you think undergrads at Carleton and many of the other fine private schools in the state are shortchanged by not going to the U, you are delusional.

3. Access to D-1 athletics is worth exactly nothing. How many undergrads went to gopher football games last Fall? What percent of the student body is this?

You have a bad hand: Aces and eights.

(In addition to the U, I've taught at Carleton, St. Olaf, St. Kate's, and Auggie - all fine schools in their own distinctive ways. A loser's game to diss them.)

Selective Reading

1. http://projectonstudentdebt.org/state_by_state-view2012.php?area=MN , which pulls from voluntarily reported data (although http://goo.gl/MYjl4 shows the average undergrad debt is 19k, I'll use the higher values within one data set for comparison).

UMN System Weighted (by attendance) Avg Debt: $28,688
Bethany $28,391
Bethel $33,246
Carleton $19,341
Concordia-Moorhead $35,240
Concordia-St Paul $36,757
Hamline $34,599
Macalester $21,123
St Kate's $35,237
St Olaf $25,440
St Thomas $31,073
CSB/SJU does not list average debt

6/10 of the schools listed above show higher average student debt than the UMN system.

Even then, couple things to note:

a) The average income of families attending private schools in MN is shifted much higher than the UMN (TC location): http://goo.gl/Zw6O9 pg 4. Of total enrollment, 3% more students have family incomes below 50k at the UMN-TC ("other 4-year institutions includes UMD, UM-C, & UM-M where the discrepancy is even higher), 5% fewer have incomes above 150k. Incomes between 50-150k by % enrolled negligible. I would offer, without proof, that the higher ranked schools such as Carelton, St Olaf, and Macalester (by prestige and makeup of student body) have an even higher discrepancy in family adjusted gross income compared to UMN, but this data is unavailable to me. Furthermore, the share of students receiving Pell Grants at these 3 colleges is much lower than the UMN system average. This all points to one conclusion: student debt at these schools is, on average, lower because families are covering a large part of debt with their own money (or private loans not listed under the student's name). This would be supported by the fact that the % of students reporting debt at all is much lower at private schools, particularly Carelton, Macalester, and St Olaf.

b) As pointed out earlier, 4-year graduation rates at the UMN system are 41%, 6-year 65% (both of which are better than the national public institution average and the rate of increase at the U is higher than nearly every other public school). However, these private schools have rates of 65 and 75%, respectively. Kudos. This discrepancy between 4-and 6-year rates would explain the total average indebtedness as a larger share of students take an extra year or 2 to graduate than at the private equivalent. I wonder what will happen to the average debt as this number continues to drop. (I would also like to point out that I don't believe that the blame or accolades for a graduation rate rest solely with the institution - the students themselves, economic makeup of the families, and a host of other social factors play in to it.)

c) Maybe if the U did not also sustain massive budgets for research (yes, paying for people to manage grants, build buildings and labs and set up supply chains , perform non-granted research with local companies, etc) and community outreach (4-H, extension offices, continuing education, etc etc)that these private schools don't bother themselves with (or at least not nearly to the extent the U does), the UMN system would spend a larger portion of its budget and endowment on grants for students. As it stands, The U research, community involvement, etc with an arguably higher quality of education (when compared across the board to private schools), with a net average student debt lower than the state average and many (read:most) private schools in the state (all while serving a lower income student body with less access to cash)

2. I made a point NOT to diss each and every one of them. I stated I have nothing against them and that the choices people make in attending different schools is not purely academic or due to athletics being present. Campus location, size, style, architecture, proximity to family/friends (or lack thereof), local bar/entertainment scene, or a specifically strong program at that particular college relative to the rest of its offering or academics can all play in to a 17-18 yer old's decision to attend a particular school.

While I'm not in disagreement that these are all fine schools "in their distinctive ways," one would be hard pressed to claim the level of education across the board at Minnesota's private schools rival the breadth and depth of the University of Minnesota's. As stated earlier, I have no doubt that a journalism or poly sci program at Carelton, for example, may be better than at the UMN. But on the whole, UMN system draws more, better talent than the average of those private schools I listed (based on any metric you like.. ACT, SAT, class rank, etc). It is ranked higher than other institutions (on the whole) and also by program for most. Because of the research, hospitals, grad/PHD programs available you can make the argument that the faculty is (at least on paper) more qualified. Number of citations and publications per faculty member would certainly seem to support this. Again, different learning environments are suitable for different people.

3. Well, the football team had several games this season with all 8,000 student seats in attendance (in 2009 the student section was 10,000 and sold out. Even mediocre mason era years had student sections well above 10,000). Basketball and hockey fill up with 3,000+ students each. Is there overlap? Sure. Not 100%, though. I look at schools like Michigan, OSU, PSU, Wisconsin, Iowa, Nebraska and see student section sizes of 15,000 or more, full every game. Athletics is a big reason people care about or identify with their school, as well as develop a relationship with it and their peers. In any case, to answer your question, I would estimate that at least 10,000 students attended a major Gopher sporting event (if not more) in the last year. This represents 33% of the undergrad student body. Not terrible, I'd say, What is your metric for "success" in that regard? 100%?

Sigh....

I think a careful reading of what you have written above actually supports my points. One needs to understand that arguments are not won based on the volume of spin one can generate.

By the way, your statements about football attendance are un-factual. I call your attention to the fact that the sale of tickets at the U in general has been so bad that Prez K had to make an "emergency" appropriation of 3.5 million dollars to buck up those efforts.

Some more reading is in order, although based on previous responses I don't expect that it will make much difference to you. We do have some pretty sophisticated readers of these comments, I'll let them make up their own minds.

Football's still a tough sell at U
Star-Tribune link: http://bit.ly/PprHND

"with the team's first home game on Sept. 8 less than a month away, roughly 2,000 student season tickets have been sold for the $288 million on-campus stadium that was seen as a key to rekindling passion and attendance after almost three decades in the Metrodome."

Why is TCF Bank Stadium such a failure?
link: http://bit.ly/OLy9jY

Good Money - 3.5 Million Dollars - After Bad?
link: http://bit.ly/XOlSjh

I've read them all

The U was not supporting or putting forward the idea of "build it and they will come." In fact, they built a stadium that had FEWER overall seats and FEWER student section seats than were available in the Metrodome. They built it at basically the 5 year average attendance leading up to TCF's opening - clearly they were not expecting a new stadium by itself to drive immediate, sustained increase in attendance. They smartly recognized they needed to build demand by not having over-supply. UNFORTUNATELY, as I've stated before, the U has seen some of its worst seasons of all time in football recently. Coupled with a myriad of other factors, such as the U failing to create a very compelling gameday experience on campus (despite the idiot Strib writer who has clearly never attended a college football game outside MN in his life), the city had its part in holding back private tailgating, the epic downturn in the economy made attending sports a luxury many thought twice about (nationwide, not just here), a lack of any recent success (including vs our main rivals as well as even lower divisional opponents like NDSU, New Mexico St, etc), and lest we forget the pandering legislators stepping in and changing the terms of the stadium alcohol policy despite signing a bill where the U's alcohol strategy was clearly communicated - causing a drop in suite sales - have all contributed to a lack of interest and attendance in the program. Outside of very few collegiate football teams, the Cubs, and the Red Sox, this is not a unique experience - winning on a semi-regular basis and not having long stretches of horrendous play will bring fans in. For the country's most popular sport (NFL) with the nation's best running back, the Vikings also struggled to fill seats last year and this year. This is not a surprise. Unfortunately, because the U does not have a long-standing traditional football powerhouse (well, not since 1962 anyway), diehard fans that will weather the down years in full force are very hard to come by. Yes, there is also a lot of competition from local pro sports teams for student and casual fan attention and dollars. This is not an excuse for failure of the team nor is it something unique to the UMN (see: Washington, Miami, GaTech, Pittsburgh, etc) and certainly not grounds to disband 120+ years of football history.

That said, go ahead and look at attendance (tickets purchased) information from the 2009 season. 100% sold out, and 100% attended for many games. Even a blip in team performance this year, coupled with a night game vs Syracuse, allowed them to sell out the stadium (and it absolutely filled up for it).

Again, the U never said that if we build some stadium and do nothing else, magically we will have 50,000 faithful followers day in and out. They knew it was a piece in the puzzle to financial and team success in the long-term. It is on campus, which will go a long way towards creating a more inclusive and exciting campus atmosphere. It allows them to retain suite, concession, and parking revenue for games. It allows for a much better recruiting advantage than the Dome did.

That Strib article was a crack job of reporting. Good thing they never (nor did you) follow up on the Aspire Group's contract or performance. So far, they sold an additional 600 football season ticket packages. The goal for the group was $1.2M in new ticket revenues between football, basketball, and hockey for 2012-13, if that value was not met the U could opt out of the contract. If the Aspire Group could reach said level, they would be providing a positive ROI for a 3-year span. Again, you fail to compare to the alternative - hiring a bunch of people and running their own ad campaigns, interfacing with buyers, etc. Instead, they hired a company whose expertise is in selling sporting ticket packages (with a focus on college athletics and a history of doing it in Pro Sport dominated media markets), and a good clause to back out of a contract if they could not fulfill their promise. What exactly is the problem here?

The "failure" of TCF Bank Stadium is only in how you choose to define it - attendance vs the Dome years with the stadium being the only factor on actual levels. You're not willing to concede that the stadium has brought in far more revenue for the athletic department (and university through parking) than the exact same scenario but still at the Metrodome.

I'm not even sure why you focus your arguments on the revenue generating sports at the U as the source of a cost center. They're not. http://www.forbes.com/sites/sportsmoney/2011/01/30/how-the-big-ten-stack...

The football program brings in $14.9M more than it spends (yes, including gameday operations, travel, stadium debt, etc). This $14.9M (along with profits brought in by bball and hockey) goes toward funding the non-rev sports. The issue is not about the "folly" of a $288M stadium, or fan support for football (which, if increased would only further the profit margin for the sport), it is 100% about if we as a society believe that funding sports like women's hockey, basketball, rowing, soccer, wrestling, volleyball, etc etc is worth money out of the general fund. Nothing more or less. Whether that value is $2.3M, $7.8M or anything else, it is not near the value the football (or bball/hockey programs) net.

I'm also glad

You chose to completely ignore my points on increasing metrics of graduation rate, student/faculty ratio, research, school rankings, and any other factor. Helps prove my point that all you care about is one side of the equation: cost cost cost. Haven't taken a look at the other side of the equation that has resulted in a better student experience with higher rates of graduated college students from the UMN system.

Mr. Cecchini

Has an excellent point. I find his arguments on this topic, along with his numbers, compelling. I would ask that you answer your own questions. From my point of view, I would answer in the following manner (acknowledging that I am not going to take the time to hunt down numbers):
1. I don't know. However, student debt is not a measure of failure. I posit that many private colleges offer scholarships to offset higher tuition to the right students. I also posit that, on average, the family income of those going to private colleges is higher than public universities and thus, the debt burden is lower from the get-go.

2. It would seem he doesn't, since he said so directly (so, no, he didn't diss them). I also do not believe that anyone going to a private university is necessarily being shortchanged. But that doesn't mean that the opposite is true, either. I would assert that you get out of college what you put in. One of the reasons that tuition has gone up is because demand has gone up. It's not quality, but quantity that's the driving factor here. I also believe that a good portion of the demand is unjustified and misdirected.

3. This is pure opinion. One that I share. But opinions are like...um...well, everyone has an opinion. For some undergraduates, having a Big 10 experience is essential. The percentage is unimportant. Experience is what differentiates the comparably affordable NDSU or SDSU student from the U of M student. Equally good educations--for what each offers, at least--but the name recognition and big rah rah experience is far different between the former two and the latter. The amount of time and effort spent on big athletics IS a problem (in my opinion), however, it isn't worth "nothing." (For what it's worth, I find the graduation rate amongst athletes to be a red herring--athletes often have access to resources that most students don't and, especially for the male sports, are notorious for getting breaks from faculty and admin.)

Just a response to your

Just a response to your #3

Oftentimes the brunt of angst regarding collegiate athletics is focused toward large institutions. Even further the anger is seemingly focused on the high-profile, high-revenue sports (Men's Basketball, Football, here in MN Hockey). People often say, as you do, that we spend much too time and effort on them. I would say that (as you acknowledge) this is purely opinion. And at the very least, at schools like the U (who are in the bottom of the list for total revenue sport cash flow), the time/effort/money spent on football, basketball, and hockey provide a positive rate of return. While some out there throw out the idea of reducing the number of intercollegiate sports offered, I'm of the opinion that's a bad idea. Because something doesn't make money does not mean it is not a worthwhile endeavor. I could argue, then, that there are many, many departments at the University we should also nix based on their lack of revenue potential (in society and for the graduates themselves) such as philosophy, music education, music performance (MN Orchestra not making money could be an example), the list could go on. Those sports provide value to the university, the athletes, and the community, many of them intangible.

As far as the graduation rate red herring - perception bias in full effect there. You may be assuming that all student athletes require the help, blind eyes, etc that a football or basketball program does. keep in mind, those very sports are actually bringing down the graduation rate for the rest of the nearly 400 student-athletes on campus (through early professional sport departures, academic ineligibility, transfers, etc). It is certainly worth noting that I do believe revenue sport athletes (at least the starters) get quite a bit of help and attention, and many of them would not have been able to attain an education at a school like the U were it not for their field/court skills. I'm torn as to if this is a bad thing, considering the revenue they bring in (above their cots) helps pay for many other athletes to train and achieve their dreams as well. And, at a major school like the TC campus, all basically revenue neutral.

Since you are on the topic of football and college life,

I'd like to point out that Carleton has a better football team than Alabama:

http://bit.ly/U8OMpw

Also by the same logic they have a better team than Minnesota:

http://bit.ly/WFHjw4

My tongue-in-cheek point is that you way overvalue the contribution of D-1 football to college life. Many excellent small college teams in the state, excellent opportunities for students who want to play football to get that chance.

Another point. The state legislature has asked President Kaler to come up with an analysis of the situation at the U of M in depth. I look forward to the data this will provide in helping us to maximize the resources available for our students.

AND...

A study has just come out by the University of Minnesota itself that admits that the high tution - high aid model used by the U has been a failure.

Here's a link to get you started:

http://bit.ly/UKvJG2

And a final, unsolicited but friendly, comment. If you are really interested in helping at the U, please don't be so defensive. We have problems and they need fixed. If you are not willing to admit this, we really don't have much to say to one another.

This is analogous to the first step in alcoholic's anonymous, you have to admit you have a problem.

My best.

Yep, that's why

Carelton plays on national TV, has attendance more than 10,000, won a national championship, etc etc. On the gridiron and in terms of number of fans and impact on the local and state economy the Gophers program and Carelton's aren't comparable. I mean no disrespect to D-III, D-II, or D1-AA athletes or programs (my wife played softball at St Thomas). At all levels they inspire community support, pride in their alma mater, a unique and excellent experience for the athletes themselves.

I am not overstating anything regarding athletics. You asked me for numbers, I responded. Across the nation, many, many athletic programs have an extremely strong following of both students, alums, and local people unaffiliated with the university. Your personal opinion on the relative worth of college athletics (big or small) is just that - your own - in which you choose to spin numbers to paint a picture that big revenue college sports are draining money from their university general fund, which is simply unfounded, particularly at the U of M. The question is simply how many, and which, sports that don't generate revenue should the university support, and can anyone put a number to the value said sports represent to our state and its population?

I don't need a friendly lecture about being defensive when you repeatedly use derogatory language aimed directly at me. I've responded with numbers, facts, no spin whatsoever addressing nearly all of your points. You fail to respond to my arguments, such as relating increased overall cost to the obvious and indisputable increases in student and research performance, rationale based on data for a small number of private schools with student debt lower than the UMN ones, questioning the validity of an argument surrounding a $25/year stadium fee, your argument surrounding a boondoggle of a football stadium that has yielded positive financial returns, and so many more. I am not defensive, just sick of a person who is choosing to put blame around certain aspects of the U's spending without ONCE acknowledging the issue of vastly reduced state funding to our university system as a large source of the tuition hikes.

Yes, I am not surprised the U admitted that high-tuition, high aid is a failed mode of operation. It requires extensive donor relations and dips in to the endowment to lower the net cost of attendance back to levels pre-tuition hike. This effort, spend, and unfortunate rise in tuition in the first palce is not tracked back to administrative bloat, it is a direct result of the state repeatedly reducing the appropriations year over year, totaling a drop of 29%, in the first place.

Share the blame?

You are being completely unfair.

I am on record many places as saying the U should receive more money from the state. My beef is the way it has been spent in the past. When it is being wasted, it is difficult to ask for more funding to buy down tuition. I just listened/watched President Kaler on KSTP and many of the changes that are/will be occurring are things that I have mentioned years ago.

Stop being so defensive and do a little more reading:

Whose Fault Is It That Many Students at
the University of Minnesota
Are Graduating With Crushing Debts?
link: http://bit.ly/YJntaR

"My friend Michael McNabb recently wrote concerning the above topic. This struck a strong chord with me because I believe that bad decisions have been made in the last ten years in allocations of resources. This has exacerbated the problem - for students - by putting unreasonable pressure on tuition, leading to excessive increases. Of course more state funding is needed, but the blame for tuition increases should be shared by the University of Minnesota administration."

ps

John Croman, political reporter for KSTP, just tweeted:

"U President Kaler concedes issues with admin costs began before he arrived, but says 'It's my job to fix it.' "

President Kaler gets it. Denial is not the answer.

The question is not

if administrative costs have increased. I have never, once, disputed that fact. The questions are:

1) In the last 10 years (relative to the WSJ report), has the U been successful in improving the quality of education, graduation rates, and student experience at the U? I can answer with 100% certainty in my head and heart that on all accounts these have improved across nearly every level at the university. The statistics (both raw data and relative to their peers) would support this argument.

2) To what degree have the increases in administrative costs been successful in improving the quality of education, graduation rates, and student experience at the U? I cannot say that 100% of every extra dollar spent has contributed to this increase no more than you can say 0% of evey extra dollar spent can be attributed to this increase. Is there any way to find out? I don't know. It is absolutely somewhere in the middle. My opinion is obviously that it is more towards the 100% mark. You differ. In either case, the gap between 100% and whatever % you or I choose is the gap we feel is "bloat," or unnecessary, that I am sure President Kaler would agree needs trimming.

3) Regarding rising student tuition, the obvious "problem statement" for everyone involved, how much can be attributed to factors outside the U's control? I can say state appropriations have had, at least in part, a large contribution to this rise in student cost. In 2012 dollars, the state funding level is $240M shy of what it was 10 years ago. By contrast, in 2012 dollars, "Administrative Costs" (which include Institutional Support, Public Service, Academic Support, and Student Services) have increased by $255M in that same time. I think you would be hard pressed to say that increasing student safety, academic counseling, enrollment handling, and many other functions that increase the student experience are not part of the "good side" of increased spend at the U. Since there are "bad costs" according to you in each of the 4 categories (marketing, deans, deanlets, president's office, etc etc), let's say 75% of that flat 2012 $ increase in administrative costs would be attributed entirely to "bloat." That's $191M in bloat increase vs $255M in reduced funding (assuming the state would have only kept with inflation since 2002). One has a higher magnitude than the other and I would argue that this is why my feelings of funding (vs costs) has had a higher impact on tuition hikes. That is my opinion based on the data I have seen.

Other, ancillary questions regarding budget, tuition,
4) Has the U's policy toward tuition increases benefited in-state students or harmed them relative to other state schools or out-of-state students at the U? I am on record as saying this has been a bad policy for MN residents/taxpayers and the students we send to our university. No doubt.

5) Has the increased football/basketball spend had a negative effect on learning at the U? Absolutely not. The revenue sports far exceed their costs (including the very high coach salaries, stadium costs, etc) and allow many other sports to exist in the first place through their profits. Their value to the university is one that can not be pinned down to a number as collegiate sports (whether football or rowing) have different values to everyone who experiences them (or chooses not to, for that matter). If you want to complain that a $25/year stadium fee imposed on all undergrads degrades their experience, I would point to the other $400 in fees that support various groups or student services they may never use as well. These very students also have the choice to not attend the Twin Cities campus and avoid said fee altogether.

I have never said there is absolutely no problem with costs, how the U has handled its tuition sources, or anything else. I also believe it would be a public relations nightmare for President Kaler to come out and say "there is no problem" when a media furor has ensued after an article like the WSJ. I am certain there are administrative costs that can be cut (what the consequences will be to the student experience I am not certain). I have focused on the larger problem (in my mind) based solely on the impact each has had on student tuition rising. So has Kaler when he proposed a tuition freeze in exchange for vastly increased state appropriations. Clearly he believes the 2 are related as well.

I am excited to see Kaler/the U's response by Feb-March regarding costs and where specifically they exist. Hopefully they can also attribute each department to a specific output metric to measure success of that spend. Example: Student Advising/Counseling spend by year relative to student satisfaction and graduation rate. I am sure some of your points will be validated, and I am also sure some of mine will be validated.

I will also note that, despite rising tuition, prospective students still choose to apply and attend. The U does not lie or misconstrue what financial situation students will be in upon graduation. This is not an excuse to charge whatever they want, but an increase in total student body above the increase in population growth would say that this high cost of education can at least be borne by the market. One could even make the argument that perhaps the people with high student loan debt that cannot pay it off should have evaluated the cost-benefit analysis of a degree relative to the ROI from a job paying average salary for a specific degree. Some of this is how the free job market has chosen to suppress wages relative to their own gains in productivity over the past 20-30 years. Some of this is the public's opinion of what certain careers are worth (in both salary and benefits, examples being teachers and other public servants). Factors well beyond the U's control or sphere of influence.

Indespensible administrators?

Mr. Checchini, regarding the despensibility of administrators, the numbers you're asking for regarding administrative costs are contained in the link to the independent audit I provided. If you don't like that one look at any other audit and you will see that the budget "support and management" i.e. administration is one of the few budget items to increase in recent years. The budgets for actual instruction and instructors have been cut.

Now, since the number of administrators has increased, as has the budget for administration, the burden falls on those who increased it to justify that expense and the utility of the additional administration. Your attempt to pretend that the burden is mine to prove that these administrators are NOT necessary is misguided.

As to whatever "metrics" you provide, your problem is you cannot demonstrate that whatever improvements you're alleging to were produced by a larger and more expensive administrative force, as if nothing else happened or was done by anyone else at the U. Not to mention the fact that some of these rankings are dubious in and of themselves for a variety of reasons, we know for instance that some colleges have been rigging their numbers to higher scores on some of these rankings. This is your claim, therefore it is your burden to demonstrate that a smaller and less expensive administrative forces could NOT have produced whatever improvements you claiming. By the way, you should take this argument of yours to the current President of the University because HE has concluded that administrative costs are too high and committed himself to lowering them every year. Perhaps he has the "proof" your asking for?

The problem with comparing tuition's as a metric is that we're in a tuition bubble created by the availability of low interest student loans. It does little good to compare tuition's amongst institutions because they ALL doubled and tripled their tuition's over the last couple of decades. These tuition hikes have nothing to do with an increased cost of actual instruction. It does not cost 100% to 200% more to sit in a chair and listen to an instructor. Just as the availability of mortgages drove up the price of houses the availability of student loans fueled tuition hikes. It doesn't really matter what the U's tuition looks like compared to Carlton, the question is why has the U. doubled its tuition?

You want to talk about decreased state funding? Great, let's talk. Explain to me why it is that given decreasing resources the U. should be devoting more it's dwindling resources to administration instead of elsewhere?

Finally, as to sports. Any examination of any of the audits reveals that the sports program is not a financial asset to the University. The sports programs cost more than they bring in, period. You argue about football if you want, but once that stadium debt got added to the mix you're out of luck. Now one can argue that the sport program provides some other kinds of assets to the University but that's a subjective landscape, not a data driven endeavor. All I can say is that if you look at the audits, those programs are huge, and those salaries are huge, and I for one don't see the necessity. The question is whether or not sports detracts from the educational mission, or degrades the University is some way. That's a question beyond the current discussion.

Response to Cecchini

I appreciate Alex Cecchini's lengthy response and would not dispute many of points. However two or three stand out:

"To what degree have the increases in administrative costs been successful in improving the quality of education, graduation rates, and student experience at the U? I cannot say that 100% of every extra dollar spent has contributed to this increase no more than you can say 0% of evey extra dollar spent can be attributed to this increase."

This is of course indisputable for the most part. However both sides of this coin can still muster some evidence. I point to the fact that much larger missions and accomplishments by organizations large and small have been accomplished throughout human history with far smaller and less expensive administrative forces. The U. has in the past enjoyed high rankings as a University with a much smaller and less expensive administrative force. What I'm not seeing from Mr. Cecchini is any real description or explanation as what exactly this larger and more expensive administrative force has actually DONE to produce the success he's describing. Furthermore we need to know that a smaller and less expensive administration could NOT have produced the same or better results. In it entirely possible, in fact I think probable, that these results were produced more despite administration than because of it. Nevertheless I'm willing to wait for more data. Recent experience with bloated administrative regimes has demonstrated that even when they do the right thing, they do it in the most ridiculous and inefficient way. Smaller and smarter administrative regimes with good leadership can typically produce the same result more efficiently.

"The revenue sports far exceed their costs (including the very high coach salaries, stadium costs, etc) and allow many other sports to exist in the first place through their profits"

This is simply not true. Several audits have revealed that the University sports program falls $6 to $8 million short on revenue every year and require additional funding to cover their costs. Mr. Gleason and I have both provided links to such audits.

As to the effect of state budget cuts. Certainly one would not expect that these cuts would no effect whatsoever on the U's finances, but it's not a forgone conclusion that higher tuition's and cuts, freezes, and furlogh's for instructors must result. In fact the audit I've already referred to concluded the exact opposite. In 2010 the U. had a $600 million cash reserve, more than twice the $285 million that the state had cut from its budget. This issue however circles back to our discussion about effective administration. The obvious question is why would an administration facing such cuts elect to INCREASE it's spending on administration, and dump millions of dollars into new buildings all over campus? Why not hunker down and protect tuition's and salaries until the political climate changed? Show me the money that actually went into the improvements the U made during this period and explain the cuts and hikes? How much do grade inflation, tighter admission requirements, and earlier graduation really cost?

Look, between 1979 and 2012 tuition at the U rose by over 2,000%. Explain that. Nothing, not even the top 1% of earners in this country saw that kind of rise or inflation. Even medical costs didn't experience that level of inflation. I've always been puzzled by this. You have a bunch of buildings with rooms that people sit around and talk in and the cost of this has risen 2,000%? I know the cost of instructors and professors and books hasn't risen 2,000%. Are grease boards and power point presentation THAT much more expensive than chalk boards?

Responses

"What I'm not seeing from Mr. Cecchini is any real description or explanation as what exactly this larger and more expensive administrative force has actually DONE to produce the success he's describing."

Sigh. I've described it multiple times. More career fairs. More student lounges. More student counselors. More career service counselors. More outreach with more companies in more states for co-op programs/job applications/on-campus interviews. More research grants. I guess I think you're choosing to not acknowledge that these things exist and also cost money to operate.

"Smaller and smarter administrative regimes with good leadership can typically produce the same result more efficiently."

I will put the burden on you to prove this. I again ask, to what are you comparing bloat in the public education sector? How many marketing and communication staffers does a company making $3B in sales need (when they are explicitly motivated to lower costs as much as possible to remain as profitable as possible)? How many managers per worker? How much do the CEOs, VPs, and Directors make with relation to the Pres/Provosts/high admins at the U? I'm sure a non-profit with a similar operating budget like the American Red Cross pays its top admins significantly less than the U or has significantly fewer employees than the U, right? (hint, they don't - 30,000 employees compared to the U's 19-20,000). I will also use this opportunity to once again ask: WHAT smaller (smarter?) higher education schools do what the U does "more efficiently?" I proved earlier that on average the private schools in MN have higher average student debt than the U (despite having parents with more money than U students), charge more than the U would with 0 state funding, and provide next to no research the way the U does. So how exactly can you quantify other organizations "do it better?"

"This is simply not true. Several audits have revealed that the University sports program falls $6 to $8 million short on revenue every year and require additional funding to cover their costs. Mr. Gleason and I have both provided links to such audits."

You continue to fail to recognize the difference between "revenue sports" and "ALL sports." I have noted that Mr. Gleason's blog and your own comments focus negative energy and comments on costs surrounding sports like Basketball and Football (where the majority of the expenses are). My point is that, despite the high costs including high coach salaries and stadium financing, these REVENUE sports PAY FOR THEMSELVES. The problem with athletics, from a budget perspective, is not football, men's basketball, or men's hockey. These sports bring in more than they cost, to the tune of tens of millions. The question is if sports like women's basketball, wrestling, rowing, etc are worth the $6 to $8M you cite the U spends on them (despite your lack of acknowledgment of the revenue to the general ledger from parking and other sources that the AD doesn't get credit for). The other question is how confident we are that a successful athletic program could ever become financially sustainable and actually devote money toward the general fund. This will likely not come on the backs of sports like rowing, but from a more successful football/bball program. You have yet to answer the question: how much are having these 20 non-rev sports worth to the state of Minnesota (and in general, the country at large to have an organization like the NCAA)?

"In 2010 the U. had a $600 million cash reserve, more than twice the $285 million that the state had cut from its budget. This issue however circles back to our discussion about effective administration. The obvious question is why would an administration facing such cuts elect to INCREASE it's spending on administration, and dump millions of dollars into new buildings all over campus?"

Because the public individual and private sector still expects the U to continue educating more students, performing more research, and doing things they (the private sector) aren't willing to do themselves (particularly in a bad 4-year economi environment. Because buildings don't stop deteriorating or needing maintenance just because the state cut funding from them. Because research costs and regulations didn't stop increasing just because the public mandates lower tuition rates without backing up the claim with funding increases.

Those reserves have clearly dipped in amount and in relation to total expenses, which indicates they ARE using them to help fund the budget shortfall (and yes, increased costs associated with all the improvements).

"Are grease boards and power point presentation THAT much more expensive than chalk boards?"

Take a stroll through the campus buildings of today. Ask yourself if the widespread wifi, computer labs, projectors, extra classrooms, video cameras to record lectures, etc etc are a trivial cost. You simplify the argument with a horrible example of the changing nature of education delivery.

Again, we will see what Kaler and his team's report shows in March timeframe. I have already admitted I am sure there are some areas where they have overspent while trying to improve the educational and research experience. I will bet that more than $0.50 on the dollar was spent wisely.

In a nutshell

I guess my point in a nutshell is this: Wouldn't a really good administrative regime have found a way to ride out the state budget cuts, protect tuition and instruction, AND improve the quality of student experience? Is that really too much to ask?

Without a lengthy response

Just like if I took a slight pay cut for 10 years straight, I would be able to continue to afford to eat the food I do, pay for my car, and live in my current home (all the while maintaining the existing stuff and also making new additions and improvements) while taking on new expenditures (like more kids or pets) without a single problem.

In a nutshell. I believe the answer is no. When downturns occur in the economy and sales and/or profits (typically sales) drop, most (nearly all) companies respond with cuts. Cuts in total labor force, freezes in salaries, cuts to benefits, extended hours for those remaining without overtime. Very few companies "ride out the storm" without taking these measures, and most of these downturns last a heck of a lot shorter than a 10 year cut in funding (repeated cuts in funding and an overall downward trend inflation adjusted). Many well-run companies (I'll judge well-run by both employee feedback and typical Wall Street measures) do this, each and every time they see a cut in their "funding" the way the U has for the past 10 years.

Thing is, when the state cut funding to the U (despite ever growing population, businesses, and therefore overall tax base), there was no expectation to reduce output the way a company does. They weren't allowed to stop partnering with local businesses, performing research, taking in students, running their buildings, or improving student life or graduation rates. For a company, it's acceptable to have a drop in sales and profit levels as long as dividend payouts remain constant or slightly increase. The U faced large funding cuts, to the tune of $240M a year compared to 10 years ago. We can debate what the right path is or should have been, but they chose an increase in tuition rates consistent with the rest of the country (and clearly at a level the market can bear if student population rose faster than our state's population did in the same time frame). At the same time, they made certain that an additional 10-15% of the people who paid that higher rate actually graduated (making it far easier to pay back said loans than if they had dropped out).

I will again cite that, inflation and student population-adjusted, the U spent a mere 3.4% more (overall operating expenses) in 2012 than in 2002. We can argue and nit-pick at individual spending choices, cuts, raises, hiring, etc. Some choices I agree with, some I don't disagree with. But at the end of the day the U has increased academic standing, student experience, research, and contribution to the local economy at a 3.4% increase in total cost. Are people really that concerned over this increase?

When Kaler's report is released, the most interesting thing I'll be looking for is what expenses were tied to what improvements. A "cut this and that will deteriorate or fail" list, line-by-line to understand exactly what was a necessary spend vs frivolous ones. It is certainly a pity that list doesn't exist today, and the public definitely deserves it. Funnily enough, I'm sure a task force to identify said costs will incur an administrative cost of its own. Hopefully the findings will provide a return on said investment. :)