SYSTEM ISSUES � ITEM b.�������������������� ����������������������� May 29-30, 2003


Montana State University

Tuition Budget Submission: FY04/05



Executive Overview


The attached worksheets and narratives reflect the biennial budgets that Montana State University proposes to implement on July 1, 2003.� The following bullets provide the Board of Regents a summary of our challenges and strategies:


       The funding level provided by the Legislature for FY04/05 for the Montana State University System is $4.6 million below the FY02/03 biennial budget.


       Nearly $20 million is needed to cover additional fixed costs and other current services increases.� Coupled with the reduced appropriation from the 2003 Legislature, reductions of this magnitude would be impossible to absorb without a direct impact on cost, access, and/or the quality of programs that we have promised our students.�


       Each campus of MSU is extremely proud of its high level of instructional quality, efficiency and effectiveness.� We are providing every one of our students with a high quality education, for an extremely low overall cost of instruction.� Montana�s appropriated level of state funding, per student, is just 48% of the average and last in the region.� And yet, Montana�s per capita income is only slightly less than the average (93%). �As to be expected, the low level in state funding results in higher than average (116%) tuition.� But overall, our effectiveness results in total expenditures per student that is only 64% of the average.�


       A $500,000 pool of Sustainability Grant funding has been established from the Bozeman campus and will be available to the affiliate campuses for specific campus investments that will help them enhance their financial stability for the future.


       One time funding of $54,000 will be provided to MSU-Great Falls COT to bridge the gap created by the proposed relocation of the College of Nursing program.


       The affiliate campuses will also be relieved of approximately $100,000 of shared central service costs, which will be fully absorbed by MSU-Bozeman.


       MSU-Bozeman will provide $295,000 of additional funding for Native American fee waivers to Billings, Northern, and Great Falls.


       $3.4 million of budget reductions will be achieved through costs savings from increased efficiencies in academic and student services areas; delayed hiring of faculty, administrators, and staff; elimination of positions; reduced operational expenditures; and deferral of maintenance issues.


       Adhering to Regents� guidance regarding access and affordability, we propose FY04 tuition increases of $40 (12.25%) for Bozeman, $165 (12%) for Billings, $90 (10.8%) for Billings COT; $54 (12%) for Northern Upper Division,� and $19.30 (12%) for Great Falls.� Northern will actually reflect a $13 decrease in Lower Division student billings.


       In all cases, the proposed tuition rate increases essentially generate just that revenue necessary to maintain each campus� current level of basic services � and most importantly, to sustain our high level of instructional quality.


       The Student Senate of each MSU campus has endorsed the proposed tuition rate increases in order that we have the funding necessary to maintain a high quality education.