Effectiveness and Efficiency Project Report to the House

Effectiveness and Efficiency Project Report to the House Appropriations Sub-Committee on Education and Economic Development January 25, 2005 1

Why an E & E Initiative? Maintain Affordability, Access and Quality Address fiscal pressures related to: • Tuition affordability • Projected enrollment increase of 30% over the next decade – “Baby boom echo” & “Thornton effect” • Escalating costs (including healthcare, energy, and technology) • Sustaining academic quality 2

E & E Legislative Report contains 16 Action Items: • Implementation under way • To be completed or substantially implemented over the next two years • Ensure accountability through internal and external reports • Savings directed at mitigating tuition increases and maintaining quality 3

E & E “Academic Action Items” Action items to mitigate tuition increases and build institutional capacity: • Faculty Workload - Increase teaching loads 10% across the USM • Time to Degree - Limit most baccalaureate programs to 120 credits • On-line and out-of-classroom learning - Students to complete 12 credits outside traditional classroom experience • Enrollment management - Maximize utilization of institutional capacity 4

E & E “Administrative Action Items” Action items to reduce costs, mitigate tuition increases and fund quality: • Review organizational structure of “special-purpose institutions” (UMUC, UB, UMBI, UMCES) • Procurement – Leverage USM’s buying power, e. g. , People. Soft, IT, Electricity RFP • Enrollment Management Services – Streamline student services functions to eliminate unnecessary duplication • Support and Administration: – Collaborate on “shared services” such as Finance and Human Resource Management 5

Anticipated Impact • Building Capacity: Academic initiatives will enable USM to serve an additional 2, 100 students over the next three years (FY 2006 – 2361 FTES) -20% - 25% of enrollment growth -no additional cost to the State • Reducing cost and funding quality: Administrative initiatives will enable USM to free up money for investment in quality and to mitigate tuition increases • FY 2006 fiscal impact: Academic Action Items: Administrative Action Items: Total Estimated E&E Value $9. 5 million $17. 1 million $26. 6 million 6

USM Financial Aid Task Force 7

Financial Aid Task Force Principles • Hold students with greatest financial need harmless • Emphasize grants over loans • Emphasize need-based aid • Work collaboratively (federal, state and institutional levels) • Redirect savings from efficiency efforts to financial aid 8

Financial Aid Task Force Recommendations • Improve balance of need-based versus non-needbased aid – Increase financial aid funding at all levels – Target the 75 th percentile of peers in average percent of need met – Allocate tuition increase revenue to need-based aid – Target fund-raising activities for need-sensitive scholarships – Increase community college transfer student access to financial aid – Modify graduate/professional financial aid to address faculty in workforce shortage areas 9

Financial Aid Task Force Recommendations (cont’d) • Decrease student debt burden by increasing grants – Educate students about debt management and alternative funding – Monitor student debt burden – Ensure that students with greatest need graduate with least amount of debt • Streamline administrative processes through E & E Initiative 10

Summary USM undergoing a system-wide reengineering – Effectiveness and Efficiency Program continuing – Financial Aid Task Force completed – Tuition Task Force completed – Enrollment Study under way – Strategic Plan Update completed USM is addressing affordability, capacity and quality 11