Speaker is Russ White: Well, President Simon, summarize what you and the board did about tuition and the budget.
Speaker is President Lou Anna K. Simon: Well, this is an extraordinarily difficult circumstance for the state, for the country, for individual families, and the university is an example to that. What we've tried to do is sustain our commitment to being a great value, not simply for today but for the future for the people of Michigan, and for our faculty, staff and students, and to meet our obligation to provide a world-class education that is available across socio-economic class. So the budget today, is essentially one that recognizes there are a lot of competing values. And, what we've done is a two year budget to try to give some focus on our plan. We've increased financial aid to about 30 percent; tuition, approximately 10.1 percent over those two years, assuming the state appropriation is what we have predicted; and also on ourselves, impose a 10 percent budget reduction for about 50 million dollars for those two years on top of almost 80 million dollars we've already done - I'm sorry, 70 million dollars we've already done over the last nine years. And in addition to that, we're continuing our own reallocation of resources, really starting everyone's budget at 99 percent. So, it's a package that also, I think, any individual who looks at their part of the package might believe it was wrong, or could have been differently, but what we've tried to do is balance all these competing values and needs and sustain a quality minimum value.
White: Because, really, we have nothing without the value of the institution, you were saying, and it costs money to keep it that way.
Simon: Well, if you look at, it's easy to compare us - someone here was comparing us to a community college, but that community college hasn't already eliminated 70 million dollars over the last period of time, or the equivalent based budget reduction. Just try to struggle with this quality access component. We have to be compared within the class of institutions we are. And if you look at us within the Big Ten publics, we have the lowest dollars per student to work with. And it's a considerable gap - about 4,500 dollars between the top and bottom - which is just a ton of money when you multiple it across students. Had the state of Michigan simply provided inflation over this period of time, the budget would be 200 million dollars more. So, the question of tuition and base budget reductions simply would not be present. We also have to self fund for not receiving capital outway or for maintenance - a capital plan that is extensive and that's all built into this. So, the budget reduction of 10 percent over this period of time really is before the full effect of pulling out the stimulus money for the state's budget is known. And we know that FY13 and beyond will be even more difficult so we're trying to position ourselves with a balanced approach that the students and families are contributing to the quality and sustainability of Michigan State. At the same time, we're providing financial aid to contribute to the opportunity to be here across socio-economic class. The base budget reductions are our way of recognizing those challenges and then we're going to continue to try and be among the world's best.
White: These are very challenging times, as you said, but do you share Trustee McNamara's optimism? I sense that you do, while this is a big challenge, you're optimistic about MSU's future.
Simon: Well, I mean, what I think we're optimistic about is the power of team and we've used Team MSU, some would say as a PR issue, but it's a very important component as what we're trying to do as a community to use the talent, the passion, the inventiveness of everyone in the university community to figure out a way to approach problems differently, to reorganize ourselves and still, to sustain our fundamental values and our fundamental mission. And so, in that sense, I'm optimistic. The numbers are just bleak for the state and for the country. You know, today in the newspaper, it suggested that unemployment had dropped in some other states. People are projecting a turnaround the day before Michigan's went up. We're in a difficult state, but the other reality is that if people don't support higher education now for the future, and to support innovation‑ I mean, you could go to any meeting, whether it's at your community, at the state level, at a national summit, here or any place else actually in the world - everybody says the same thing: it's innovation and education that are going to lead the way and you've got to invest in innovation and education. So, there's some optimism that maybe the state will reorient its own priorities to recognize what everyone is saying in unison.
White: Just summarize then, what you'd like people to know about the budget and tuition actions today.
Simon: Well, they're part of an entire package for a sustainable Michigan State that continues to be among the world's best, which is owed to the people of Michigan. Based on the investment they made, it's owed to our graduates, based on the investment they made. And we're trying to do that with our own ingenuity and attitude that can't be spared. And if you're in any given space, it would be in very difficult economic times. And to the families, we could have avoided the base budget reduction by raising tuition more dramatically, that wasn't right. We could have avoided base budget reductions by limiting financial aid, that wasn't right. They could argue this is a difficult time, why raise tuition at all, but the fact is that we are a public institution. The state of Michigan needs to support us and they've reduced us by three percent. And they haven't funded inflation, so that's an effective reduction of probably seven percent, in terms of higher education index, or even inflation. And we've accommodated that seven percent reduction from the purchasing power of the state this year, by what is viewed nationally as a modest tuition increase. But more modest, by taking the stimulus money that is available and giving it back to resident undergraduate families, instead of using it to offset the base budget reduction.
White: Thank you, President Simon.
Simon: Thank you very much.
White: Michigan State University President, Lou Anna Simon. And there's much more information online at budget.msu.edu