President Allan Gilmour

Wayne State University

House Appropriations Subcommittee on Higher Education

March 28, 2012

Mister Chairman, members of the subcommittee, good morning. I've been preceded by many of my colleagues, all of whom represent universities that play important and distinct roles within Michigan's higher education system - and all of whom share the same overall goal as you and I do. We all want a great higher education system. We may differ on whether we've already reached that goal, or how far we need to go to get there, or how we get there, but the end goal is the same for all of us.

I spent most of my career in business, and when we faced challenging questions, or had differing views, we tried as much as possible to rely on numbers, and facts. As a recovering financial executive, I find facts and numbers very helpful in these situations. They tell me if we're up or down, gaining or losing. There's both a comfort and a foundation in facts and numbers, and that's how I would like to approach today's testimony.

Last year when I appeared here, I spoke of our efforts to analyze the operations of the University - like a business. By looking at numbers and facts. We did, and continue to do so. Last year we cut $27 million from our expenses. We also began a separate initiative, with the help of outside experts, to analyze and overhaul many of our administrative processes and systems. We estimate the annual savings from this initiative to be approximately $20 million. We took on tough issues like retention and admissions requirements, and are seeing progress. This is a beginning, but we did what we said we were going to do - and we are moving ahead.

I could add much more, but today you asked us to respond to four specific questions, so I will address them right now.

Your first question concerned financial aid. Specifically, you asked that we describe our annual commitment to University-funded financial aid over the past four years, as well as some related follow-up questions.

Wayne State invested almost $62 million this academic year in University-funded scholarships and grants. The total amount committed over four years is approximately $227 million. The sources of this financial aid are the general fund, payout from the endowment, and direct private gifts.

We have increased general-fund financial aid by 32 percent over the past four years. That is 20 percent greater than the rate of tuition increases during the same period. The impact of this investment in financial aid is reflected in our graduates' overall debt levels, which are third lowest among Michigan's public universities.

In fall 2011, Wayne State enrolled 2,466 freshmen. Of this total, 1,013 received some type of University-funded, need-based aid. Another 933 received University-funded aid not based on need. In total, 77 percent of freshmen received University-funded aid.

Your second question inquired about our efforts to make our University more accessible and affordable to first-generation, minority, transfer, and nontraditional students.

To answer your question directly - yes, this is part of our strategy. It is probably more accurate to say it is part of our history, because for many years Wayne State has been a leader in meeting the educational needs of these students. Historically we have welcomed thousands of young people who were the first in their families to attend college. For well over a hundred years, families have come to Detroit looking for economic opportunity. And for so many who have sought higher education, Wayne State has been their destination.

We offer the advantages of learning in a research environment to more first-generation, minority, and nontraditional students than any other institution in Michigan.

More than 40 percent of our freshmen commute, and about 40 percent of our students overall are part time. Many have families. Many have jobs. Many have both.

We meet the needs of such nontraditional students in a variety of ways - with night classes, flexible schedules, personalized counseling and many other services.

And we meet their needs in other important ways, too.

First, we keep our tuition low. Wayne State is Michigan's most affordable research university. We are 13th lowest on a 12 credit hour basis - 9th lowest on a 15 credit hour basis.

Wayne State actively recruits minority, out-of-state, and international students. And we support them when they are here. We have the most diverse community among Michigan's public universities. Almost half our students are minorities.

We also have a special effort under way to recruit and support veterans. Currently WSU has more veterans enrolled than any other Michigan public university - 440 - and our goal is to quadruple this number over the next four years. In addition, the University has established a Student Veterans Resource Center, with a dedicated admissions counselor to ensure that returning veterans have a place they can call home for their continuing educational needs.

Wayne State is committed not only to providing affordable access for nontraditional students, but also to supporting their academic success and timely graduation. We have many initiatives to promote retention and success, and to shorten the time to a degree.

At Wayne State, we pride ourselves on being a university of opportunity. Our door is open wide to all who can succeed. But we are also a university of excellence - which means that not all students can succeed here. When I arrived at Wayne State a year and a half ago, our six-year graduation rate was weak. After a full analysis, the data showed that students leave for many reasons - financial, personal, and academic. Some students transfer to other universities or community colleges to continue their studies. And some students don't leave at all, but take longer than six years to graduate. We call them successful, even if it takes them longer to earn their degree.

But we also concluded that we needed to better understand the incoming profile of students who graduated. This would give a better picture of what it takes to be successful at Wayne State. And it would help us ensure that every student we admit - no matter their background - has a strong chance of success.

We are looking much more closely at students' unique backgrounds to try and understand their potential, and provide the appropriate path and support to help them succeed. Students with potential, but with gaps in their academic background, join the Academic Pathways to Excellence Program, or APEX. This program provides these students a structured transition from high school to university-level work.

APEX offers a number of services to both prepare and support students with promise, but perhaps insufficient preparation. The services include: proactive advising and tutoring, learning-community and peer support, and courses on academic success. APEX also includes a pre-college summer bridge program that stresses academic preparation and provides success coaching. Tuition, room and board for the summer bridge are free to the students.

Many of our students profit by our learning communities, which provide small, more manageable environments in which faculty, students, and peer-mentors learn together. Learning communities have proven particularly effective at boosting the success and persistence of all students, particularly those who are under-represented or who need assistance navigating post-secondary education. In the fall of 2006, 806 students belonged to learning communities. In the fall of 2011, there were 2,550. The freshman to sophomore retention rate of students in learning communities is 83 percent, versus 77 percent overall.

Wayne State University is increasingly a university of choice for transfer students, many of whom are also nontraditional, first-generation, and/or minority students. We actively recruit transfer students, and have a number of partnerships with area community colleges to prepare students for study at Wayne State.

In fall 2011, for the first time ever, more new transfer students than new first-year students enrolled at Wayne State - 2,522 transfers versus 2,466 freshmen. We have a number of activities to help us achieve this, including dual enrollment programs, reverse transfer initiatives, articulation agreements, joint advising, and designated scholarships. All of these promote seamless transfer for students and increase the likelihood of their academic success.

Your next question asked for our reaction to Governor Synder's proposal to use a performance-based metrics approach to distribute a 3 percent increase to universities.

First, as I mentioned, I'm a numbers guy. So I am very supportive of tracking ourselves and being accountable to measurable goals and objectives. And we are, of course, supportive of additional funding for higher education, and the distribution of that additional funding based on performance.

But we would also offer several recommendations that we feel would improve the effectiveness of this approach.

First, we agree that the metrics should be as simple as possible - easy to compile and easy to comprehend. But I also think we should take care not to make them too simplistic. Each of our universities has unique aspects and benefits that together serve the wide array of individual students and educational needs. Not every university is the same - and we don't want them to be. These aren't assembly lines. These are the institutions that are nurturing talent, educating students, discovering cures, and creating the leaders of tomorrow. One size doesn't fit all. And we need to remember that as we develop this approach.

For example, we accept that we will be measured with a six-year graduation rate. Yet we have many nontraditional students, and many successful - and sometimes vocal - alumni who took far longer than six years to earn their degree. If we wish to encourage admission of more nontraditional students, we may need to think about a more nuanced approach.

As proposed, the metrics do not adequately recognize the contributions of our major research universities. Wayne State and its University Research Corridor partners are helping drive the state's economic recovery. This should be factored into any measurement of institutional effectiveness.

We believe the metrics should weight graduate and professional education programs in addition to undergraduate education. Graduate and professional programs both cost more and contribute more. And they play an important role in Michigan's economic development, producing our engineering specialists, scientists, doctors, lawyers, pharmacists and others. Wayne State, for example, graduates more physicians per year than any other Michigan university. We believe this should count for more among the metrics.

The Governor's proposal requires that we compete with each other for funding. As I mentioned, I am a businessman at heart. I believe in competition and I'm happy to compete. However, I would rather compete - or be compared with - peer institutions in other states. And collaborate with Michigan universities to build the best higher education system possible. In Wayne State's case, that might mean comparison to other urban universities nationwide, or to our peers in the Carnegie Foundation's research rankings.

The metrics as proposed are based on past performance. In many ways, higher education is what we called in the automotive industry a "long lead" business. We'd like to see the process set some of the metrics based on future performance. Then start the clock, and measure the results down the road.

Affordability: While it is important that the state recognizes each university's number of low-income and Pell students, we should be concerned with out-of-pocket costs for all families. Another metric for consideration is average tuition minus the average financial aid package that each institution provides. This is a better measure of affordability than the number of Pell recipients.

We also feel that tuition restraint based on a percentage increase and not a dollar amount is inappropriate. Michigan families do not pay tuition with percentages - they pay with dollars. If a tuition restraint is imposed, we feel it should be based on total dollars rather than percentage.

The increased funding should be built into the base, rather than a one-time allocation. As you know, it is very difficult to budget and plan when funding is uncertain from year to year.

So, in principle, we support a metrics-based approach for the distribution of incremental funding. But we feel that this proposal has areas for improvement that ultimately would benefit all of Michigan's public universities, and therefore its students and our state. Many of the recommendations we expressed are included in the Business Leaders for Michigan proposal, which provides a more robust set of metrics designed to boost accountability while also recognizing the individual contributions of each university. I believe you are familiar with their position, so I won't reiterate it except to second their call for significantly increased state investment in higher education over time.

Your final question concerned section 245 of the legislation.

Wayne State University is committed to transparency and accountability. We believe the people of Michigan have a right to know how their public institutions spend taxpayer dollars. For this reason Wayne State's annual budget is posted every year on our budget office website. This site is accessible from the University's homepage, wayne.edu. Salaries will be posted on the budget website by the end of next month.

I began this talk by saying that we all shared the same goal, though we might differ with how to achieve it. I also volunteered that, as one who was fond of numbers, I wanted to approach today's discussion in a business-like manner - with facts, and data, rather than emotion. However, I have learned that higher education is more than numbers, and some things can't be measured - like curiosity, opportunity, and inspiration. And we must take care that, as you and your colleagues allocate resources, we don't damage some of our finest state assets.

I think we all agree that a prosperous future for Michigan depends greatly on its public universities. Accessibility and affordability must be priorities - even in an era of tight budgets. But we must also ensure we keep our universities strong, vigorous and forward-looking.



The Governor's proposed budget is a step in the right direction. The key is a balanced approach between accountability and basic support that takes advantage of both the unique strengths and collective value of our public universities.

Wayne State University is committed to working with the Legislature to provide the quality and availability of higher education that Michigan's citizens expect and deserve.

Thank you for the opportunity to appear this morning, and for your continued support of higher education in Michigan.