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University heads to single system; outcome uncertain

August 6, 2019

University of Alaska president Jim Johnsen is locked into a course of merging the UA system into a single institution, hoping to achieve cost savings but also consolidating control of the statewide system and reducing the autonomy of Chancellors at the three campuses, University of Alaska Fairbanks; University of Alaska Anchorage and University of Alaska Southeast. Johnsen achieved support for that approach from the university’s Board of Regents in a lengthy and difficult Regents’ meeting last Tuesday, Juoy 30.

Three of the 11 Regents voted in opposition, citing concerns over loss of regional focus and preferring a more blended approach between the current system of three independent universities and a single system, which they felt might be too “top down” in management. Still, the overall sense of the board seemed to be that the cuts are too deep, even with Gov. Mike Dunleavy’s two-year “step down” than all in one year.

Johnsen argued vigorously for the single-university concept in the meeting: “The current (separate) structure lends itself to duplicate administration and competition,” for scarce resources among the three separate universities. “We have 30 years of data that show that maintaining three universities leads more to competition than collaboration.”
Dunleavy is in agreement that university administration needs to be reduced and has put forth his own ideas about how some of that could be accomplished, such as merging separate engineering, business and science programs.

Chancellors push back, but to no avail

The Chancellors of the three UA units, along with faculty, pushed back. In an earlier Regents’ meeting UAA Chancellor Cathy Sandeen said the regional UA managers know the system more than the top statewide administrators and know how best to cut costs with the least damage programs. Sandeen said UAA has already cut substantially at UAA since the early spring and can do more. “Just give us a number and we can meet it,” she told the Regents.

On a deeper level, there were concerns among the Regents about how quickly a major reorganization can be done into a single university system, what the short-term disruptive effects would be and whether there would really be significant cost savings.

University faculty uniformly opposed the wholesale reorganization and cited concerns over the time it will take to get accreditation of a new single university. Currently all three universities are accredited. UAA and UAS received reaffirmation of accreditation in 2019 and UAF is in the cycle for reaffirmation, the faculty alliance told the Regents last Tuesday. Independent accreditation of university programs is vital for students seeking employment with their degrees because it gives employers confidence in the quality of the education.

Also, students who transfer to out-of-state universities, either for continued undergraduate or graduate work, will find their Alaska transcripts not accepted unless the courses are taught by an accredited institution. In the rush toward major reorganization President Johnsen has downplayed this problem, UA faculty members said. Other disadvantages of a hasty switch to a single university system and management is that is risks local community buy-in and support for locally-managed institutions, which includes local donor and alumni support. However, the faculty acknowledged the downsides of even the perception of continued status quo. It could continue to pit regions against each other, for example.


Johnsen’s dramatic remarks: “House on fire!”

Dramatic remarks made at the meeting by President Johnsen, “This is a house of fire,” were widely publicized in the media and were obviously intended to communicate the severity and urgency of the situation, and possibly to forestall any foot-dragging from entrenched interests. Still, there is a feeling among some Regents and the faculty that the same goals can be reached by reorganizing from the existing structure into a consortium without the risks of a quick wholesale change. People may be taking advantage of a crisis to ram through long-sought goals.

As an alternative, the faculty suggested a consortium model among the three universities that centralizes many functions but preserves regional decision-making in crucial areas, particularly academic. The university’s own “Strategic Pathways” reorganization that began in 2005 and is now being implemented, and which was an initiative of President Johnsen’s, essentially follows the course preferred by the chancellors and the faculty.  Students prefer this also, Cachet Garrett, the new student Regent, told the board. Johnsen noted that the Strategic Pathways effort involved consultation with 230 faculty and discussions held at 130 work sites in the UA system.

Meanwhile, the governor appears to be backing down, at least a bit, from his earlier messaging of specific program directives to the university At the start of Tuesday’s meeting, Sen. Tom Begich, D-Anch., the Senate Minority Leader, told the Regents that the state Constitution gives the board sole authority to make program decisions subject only to an overall appropriation by the Legislature and a veto of that, or part of it, by the governor. “It is not the role of the governor to interfere in the decision-making by the Regents. We in the Legislature will support you in that,” Begich said. President Johnsen himself, early in the meeting, referred to UA’s “autonomy being threatened by prescriptive budgets,” put forth by the administration.

Johnsen was referring to a one-page memorandum sent to the university July 18 by the governor’s Office of Management and Budget. The document outlined Dunleavy’s proposal for a two-year rather than one-year step-down in the UA budget. The governor’s plan would cut $84 million in state funds in current FY 2020 and $38 million in FY 2021, or $132.8 million over two years, instead of $131 million in FY 2020. However, the OMB document contained specifics on achieving the targets with reductions specified in UAF and statewide university research, administration, mergers of major programs. It would defund (and essentially close) the University of Alaska Fairbanks’ Museum of the North and KUAC public radio and UAA’s Small Business Development Center.

OMB now taking a softer approach?

Mike Barnhill, policy director at the governor’s OMB, was at the meeting to explain the governor’s proposal. Regents pushed back hard. Barnhill backtracked, saying the proposal was not a “directive” and was intended to start the discussion between Dunleavy and the university. The Regents’ board chair, John Davies, was aggressive in pushing Barnhill: “I am troubled by the reckless suggestion that we zero out our research funding, Even if that was an achievable goal, we certainly cannot get there on five years. We are not going to hold bake sales to operate the Sikuliaq,” (the university-operated oceans research vessel), which is supported mostly but not totally by federal agencies.

Barnell appeared supportive in some ways. Regent Karen Perdue mentioned UAF’s heavy debt load, which is unique. The Fairbanks university has financed many of its facilties with debt including a new power plant, while the Anchorage campus benefited from large state cash appropriations for new construction. UAF pays $22 million a year in debt service, Perdue said, with $10 million of that for the new power plant that also heats the campus. UAA, in contrast, pays $5 million in annual debt payments. “Can the state help us with this?” she asked.  Barnhill appeared sympathetic and acknowleged there were unique cost-drivers for Fairbanks. “It’s an idea on a table,” he said.  Still, costs at UAF are very high, “and it’s more than just utilities,” he said. “We’re open to a discussion.”

The governor’s proposal to cut research prompted criticism: John Davies noted also that UAF’s work on volcano monitoring is important for public safety along with work on climate change. UAF’s Geophysical Institute is world-recognized for its northern atmospheric research, which has a national defense aspect. Research initiatives like the Mineral Industry Research Laboratory and Institute of Northern Engineering provide support for the private sector, he said. Also, some university research is mandated by state law, Davies said. Karen Perdue said the $20 million in state funds for UAF research targeted by the governor results in $100 million in federal funding for research done in Fairbanks. Governor Dunleavy spoke by phone to the Regents on Tuesday, assuring them that he recognizes the importance of research and restated his intent to, “work with the university to lower its overhead and improve its outcomes.”

OMB’s Barnhill made similar comments in person: “I welcome opportunities for further discussions.” Still, he stuck to Dunleavy’s message: “I believe there are opportunities  to look for funds elsewhere. It’s incumbent upon all those who receive state funds to look at new ways of doing things,” he said. In the end it’s about getting to the right number, not how it’s done. “There are infinite ways,” this can be done, he said.

What about smaller campuses?
  There was also discussion by the Regents of the status of the smaller satellite campuses in a reorganization and whether a separate structure of community colleges like the one in Alaska years ago, and that exist now in many states, should be recreated. President Johnsen said the satellite campuses are now structured as parts of the regional universities with support being provided by the regional institution. The support costs are borne by UAF, UAA or UAS. Of the $57 million budget for UAS and the community campuses (they are grouped in the FY 2020 budget) there are $12 million in support costs borne by UAA and UAF in their respective budgets, Johnsen said. Additionally, creating a separate community college system would only add to administrative costs. Also, where these exist in the Lower 48 they are often interconnected with local school systems and supported by local taxes in addition to state funds, he said. Small Alaska municipalities lack the resources to help support their local satellite campuses, although there are exceptions.

Now that the Regents have given him direction, President Johnsen will present a more detailed reorganization plan at the regular September Regents’ meeting. Davies, the board chair, also appointed a Regents’ subcommittee including six of the eight Regents to work with Johnsen on the plan. Regent Mary Hughes will chair the subcommittee with Regents Karen Perdue, John Bania, Andy Teuber, Cachet Garrett and Dale Anderson also on the panel.


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