NTF Issue Paper: edmonII-5.  1-07.





SLICE OF THE PIE.  Governor Heineman proposes a 1.1% increase in the budget for the University of Nebraska system in FY 2007-2008, smaller than recent average budget additions.  The university administration complains about the meagerness of this increase.  However, a close examination of their statistics demonstrates their mathematical subterfuge.  They state that in 1989, NU received 21.9% of total state spending, whereas, under the Heineman proposal, it would receive only 13.8% of the state budget in 2009.  This comparison makes it appear that the University system is receiving a cut in allocations.  Actually, in 1989, the U. received $214 million.  In the current fiscal year, it absorbed $495 million.  A 1.1% hike in dollars would bring this latter total to $500 million, a $5 million increase now, with $15 million promised over 2 fiscal years.  Moreover, student enrollment totaled 51,931 in the early 1990s.  In 2006, full-time student plus part-time enrollment at the 4 University campuses totaled about 42,000+, full time equivalent students numbering a bit under 39,000.  The university system gleans more money for fewer students.  In 1989, the allocation per student was about $4,100.  By 2008, the allocation would total about $11,900.  In addition, the UN-L faculty teaches an average of only about 4.5 credit hours per semester, bloating the faculty-to-student ratio.  Full-time faculty numbered 5,201 in 1997 but numbered 5,316 in 2006.1


NTF SUGGESTIONS.  If state senators uphold this gubernatorial budget proposal, it will provide appropriate timing for the University system to find ways to cut waste and inefficiencies.  The following are our NTF suggestions to both trim the budget and end institutionalized waste and inefficiencies, ideas taken from our master list of suggested budget cuts:



  1. The number of NE high school graduates will drop by 9.5% by 2012, according to the National Center for Education Statistics.  Therefore, we need not expend tax monies to accommodate unnecessary growth in the state university and college systems.  We should not expend tax money to recruit out of state students when so many Nebraska youth cannot afford expensive higher education tuition. Non-residents are less likely to remain here to work after graduation and pay taxes. 


  1. The university system complains about cuts in its budget, but it received a 4+% hike in FY 2006-07.  The 4-campus NU system consumes about 16% of the total state general fund budget (FY 2006-07).  State funding is about 1/3 of its total budget.  Under gubernatorial reductions, the NU system yearly budget still increased by 4.23% in FY 2001-2002 and 6.8% in FY 2002-2003.  The Legislature can reverse the unrestricted flow of cash to the University system by $20 million, the entire increase for FY 2002-2003.  The U. system received $415 million in the 2001 fiscal year (p.41 in the Blue Biennial Budget Book).  The legislature has increased the U. budget from $350 million in FY 1997-1998 to $571 million in FY 2006-07.  In the former fiscal year, 49,000 students attended the U. system; 45,122 attended in Fall 2004.  NU has won hikes in state spending for years, notwithstanding falling enrollment until 2002, when a 2.5% increase in students occurred.  From 1999 to 2003, taxpayers paid a $2,530 increase per student, from $7,143 to $9,673.  Yet, U.S. News & World Report in 2002 placed the NU system performance rating at between its 2nd and 3rd tier.  In 2006, NE spent more than every adjacent state except Wyoming in higher education appropriations per $1,000 of personal income and appropriations per capita.


  1. Lower the direct allocation expenditure from the General Fund to no more than $10,000 per enrolled full-time university student.


  1. A 3% across the board cut in university system departmental expenditures.


  1. Defund the University Diversity Initiative that spends tens of thousands of taxpayer dollars on events such as Gay & Lesbian Month, a regional feminist conference touting topics such as bisexuality, witches, and female oppression and a symposium on gay and lesbian issues, linked directly to a week of legislative lobbying on gay rights, and which included a bold attack on traditional values by a lesbian political activist keynote speaker, who returned home with several thousands of $$ in speaker fees. 


  1. End funding for a hate crimes coordinator at UNO.


  1. Defund the UNL diversity artist residency program.


  1. End the university commissions on women and minority issues. 


  1. There exist a few classes not crucial to a quality liberal arts education, with few students enrolled, like the Portuguese language program.  Eliminate these low priority programs.


  1. End the waste of millions on projects that have no connection to academic quality or research, like $3 million for a hydraulic indoor track at UNL. 


  1. Do not spend savings from administrative cost reductions elsewhere in the University system. 


  1. Cut the board of regents annual budget by 10%.


  1. Redesign the academic organization of the university, a centuries-old system that shows duplication in our multi-campus system.  Most of the university budget pays for personnel costs.  In colleges and hundreds of departments, many overlapping administrative positions and secretarial staff could face elimination.  Combining colleges across the 3 undergraduate NU campuses could eliminate many dean positions and department staff duplications. 


  1. NU personnel enjoy a lower cost of living than at most schools we use for comparison. Thus, salary level recommendations we should adjust when making comparisons.  UNL employees averaged 4.6% pay hikes, and Medical Center employees received 4% average wage hikes.  UNO faculty raises averaged 6%, and UNK faculty raises averaged 7%!!   These 2002 hikes rose above the increase in the state cost of living.  The number of NU employees who earn 6-figure salaries doubled from 256 in 1998 to 2002, the university payroll growing 22% during that time. 


  1. Remove from the NU health benefit package the coverage for contraceptives, which the board of regents approved in April, 2001.  Savings: between $1.5 - $2 million dollars.


  1. According to the state auditor, the University Foundation holds $1 billion in undesignated donations.  This money could have covered the entire UN-L system budget FY 2004-2005, freeing millions to erase the deficit and erase the need for a tuition hike.  The Foundation spent less than 9% of this largesse ($87.3 million) on university programs in 2006, although total gifts to the Foundation that year totaled over $127 million.  The Foundation in 2003 purchased country club memberships and 160 SUVs, Cadillac Escalades, and Oldsmobiles for almost a dozen top administrators and 100 coaches and their wives. The Foundation afforded Pres. Smith $700,000 in a discretionary fund to spend as he wished. 


  1. Require each college professor to instruct a full 15 credit hour class load during each semester, thus  reducing the number of teaching assistants and instructors/professors. 


  1. End the tenure system for university faculty members, making it easier to fire incompetents.


  1. Make university staff give a percentage of their consulting fees, earned because of their university positions, to the university.


  1. Top UNL administrators received 27% pay and benefit raises in FY 2001-2002.  Pres. Milliken gained a new salary for 2006 of $270,000, up from $254,800 in 2003.  Included in his stash is a country club membership, gas, service, and insurance for a vehicle, $2,000 per month for housing expenses, housekeeping services, and 11% of his total salary for deferred compensation. Provost Lee Jones received a 9.9% raise, to $188,000; his successor earned $200,000 in 2003.  Vice-pres. Richard Wood won a whopping 10.3% salary hike, to $150,000; he earned $156,000 in 2003.  UNL Chancellor Harvey Perlman earned $220,000, a 22% pay raise; in 2003, he garnered $228,800.  UNO Chancellor Nancy Belck earned $170,000, a 9.3% raise; in 2003, the figure rose to $176,800.  The UNK chancellor earned $162,000, a 9.5% hike; Doug Kristensen amassed $168,480 in 2003.  NU Athletic Director Bill Byrne received $229,472.  His and base salaries for other NU coaches do not include incentive bonuses, proceeds from clothing contracts, and radio and TV show deals.  Peg these raises instead to the rate of inflation.  Source: UNL.


  1. Randy Ferlic, chairman of the NU Board of Regents, wants to offer up to $600,000 annual salary to attract a new university president.  Eliminate this position and allow campus chancellors to manage the U.


  1. End the practice of university athletic department contract buyouts that cost $850,000 for 5 fired and retired UNL assistant football coaches.  Renegotiate raises given the new staff.  UNL hired a new athletic director in 12-02 for a beginning salary of $300,000 annually, over $70,000 more than that paid to his predecessor. 


  1. End the free maid service, country club membership, lawn care, snow shoveling, and $5,000 yearly expense account given the UNK Chancellor.


  1. Stop paying for country club memberships and golf outings for university officials. 


  1. Stop university bonuses.  Top administrators receive bonuses worth $850,000 for remaining in the system for 7 yrs.  In 2002, NU football coaches received $156,163 in bonuses.  Former Coach Frank Solich received $36,876, a bonus higher than some people earn in annual salaries.


  1. Defer agreed upon pay raises at every university and college campus until the Legislature completes its FY 2007-2008 budget cuts. 


  1. Stop negotiating university union contracts that guarantee specific salary rates of increase. 


  1. Cut the university bureaucracy.  Each campus need not have its own chancellor with staff.  Each dean at UN-Kearney need not have an associate dean.  This campus lost 4,000 students in 4 yrs., yet the number of administrators has mushroomed.


  1. End several NU public service functions, like public broadcasting, overseas cultural programs, and health services.


  1. End all career services at university campuses.


  1. End the $30,000 university recycling program.


  1. End the $41,283 university landscaping education program.


  1. End the $3 million project to build a storage facility for rarely-read volumes in the university library system.  Sell these books instead. 


  1. In our Internet information era, we do not require a 13% yearly increase in University library book purchasing spending. 


  1. Privatize the University Building, Grounds, & Custodial services and dormitory food services. 


  1. A 10% cut in university staff travel expenses would save the system about $500,000 annually.


  1. Forbid state agencies and departments, like the university system, from hiring and paying lobbyists to lobby the legislature for more funding. 


  1. End University of NE Medical College radio and TV advertising.


  1. Regionalize university programs in coordination with universities/colleges in neighboring states, like our veterinary students now attending college in Kansas.  Such endeavor might entice graduate students from neighboring states to permanently reside in Nebraska, adding to our educated work force and tax base.


  1. Save almost $1 million by terminating the postsecondary coordinating commission that oversees state colleges.  University staff can make its decisions.


  1. Consolidate the state college board of trustees with the NU board of regents to improve higher education cooperation and eliminate duplicative staff, as recommended by the Strauss Commission. 


  1. Merge the university system and state colleges to lower costs by teaching more classes long-distance and thus eliminating unnecessary classroom duplication.  The number of students taking classes by Internet and satellite doubled between 1998-99 and 2000-01.  All academic departments are developing long distance courses (NU Board of Regents meeting 7-02). 


  1. Cut the 5.5% pay raises given top administrators and faculty in the state college system.  End the $7,000-$14,000 housing allowances for these administrators.  Some of these colleges are smaller than Nebraska high schools. 


Research, documentation, and analysis for this issue paper done by NE Taxpayers for Freedom, with express prior permission granted for its use by Citizens for Local Control, Cherry County Taxpayers, and Dawes County Taxpayers.  1-07.  C

1 Data from UNCA HR Extract.