Gov. Walker Calls For Another Tuition Freeze At UW System

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Gov. Walker Calls For Another Tuition Freeze At UW System

Premiere Date: 
April 18, 2014

UW-La Crosse Chancellor Joe Gow on the proposal to freeze tuition for two more years.

 

Episode Transcript: 

Frederica Freyberg:

At his campaign stops across the state, Governor Walker is touting a tuition freeze for the University of Wisconsin system. Now he is calling for that freeze to be extended another two years, in response to a report that shows projected budget balances of more than $1 billion. This week, we have reaction to that tuition freeze proposal from students on the University of Wisconsin-Madison campus.

Alex Masserjah:

College is really expensive right now, and it's really hard for us to deal with it. So in my mind, I think it's a good move.

Mike Schostok:

A tuition freeze, yeah, you can say that there would be some money being withheld, maybe some-- I guess you can look at it as a budget cut, but I think the university's doing pretty well financially. I think we'll be okay.

Gwendolyn Omolabi:

I think that it seems like a great thing that it's going to help make college a lot more affordable to a lot of families. I'm just curious as to how he's offsetting the cost, and perhaps what this will mean in a few years when they start increasing tuition. Will it be like a drastic increase?

Frederica Freyberg:

Before the freeze, tuition had risen 5.6% or more every year for the past ten years, according to the UW System's budget plan. Students are just one side of the equation. On the other side are campus administrators, including UW-La Crosse Chancellor, Joe Gow, who has to do the math to figure out how to maintain a quality education on a reduced budget. Chancellor Gow joins us now from La Crosse and thanks very much for doing so.

Joe Gow:

Oh, my pleasure, Frederica.

Frederica Freyberg:

So when you heard the governor calling for another two-year tuition freeze, what was your reaction?

Joe Gow:

Well, you know, it's disappointing, because I think it's premised on the notion that we have a lot of cash on hand. When you take a deeper look at that, we may have some funds, but they're not readily movable into general operations. It's going to create some challenges as far as how we pay for the day to day things that we do on a campus like UW La Crosse.

Frederica Freyberg:

Well, when you do look at the balances of which you speak that are left on the books, we have this spread sheet and UW-La Crosse shows $118 million as the end of March, $114 million of it in the so-called unrestricted pot, so it appears from numbers on spreadsheets like campuses are kind of flush with money.

Joe Gow:

Well, a couple of things there. Yes, we are one of the campuses that is fortunate to have some money because our enrollment has gone up. We also have a differential tuition. When you get into what that money does, $24 million of that, we're setting aside to do renovations on a 100-year-old building. Another $14 million is a hedge against an enrollment decline, because we have about 200 employees who we pay on tuition completely. So, you know, the numbers are a little bit misleading in that regard. The other point I'd like to make is that not every campus has these kind of reserves. Madison has substantial monies, but there are other campuses that don't have much of anything at all. And this tuition freeze will impact everybody. So I think we're going to see some varying degree of ability to cope with this throughout the UW System.

Frederica Freyberg:

What about the idea, though, that in very tough economic times, tuition was going up year after year after year, more than 5%, and then it was discovered that there were these reserves or balances on the books? I mean, how do you respond to that?

Joe Gow:

Well, the one thing to remember, and people sort of overlook this, is the state support for the UW System has declined dramatically, and that hasn't been unique to any one administration. That's kind of a bipartisan thing. And tuition has nowhere near offset the big cuts in state funding. So that's something to keep in mind. The other thing is that we wouldn't really want to see tuition go up at all, but we have to pay for things like technology, deferred maintenance, healthcare costs for the people who work in the UW System. So it's very difficult to simplify this down to, you know, it's gone up more than inflation and it shouldn't have, because there's a lot more there to the story.

Frederica Freyberg:

Now, on the flip side and kind of devil's advocate, healthcare costs, you have been helped, as other public agencies have, right, by the "tools" of Act 10, whereby there are greater contributions on the part of employees?

Joe Gow:

Well, I think that, you know, that did help us in terms of, you know, the finances. But the thing that's been more pernicious has been the big cuts in state support. And then when you couple that with the tuition freeze, we have nowhere near the resources we had in the past. And that means we're not going to be able to keep providing the kind of quality experience we have given to our students.

Frederica Freyberg:

I want to get to that in a moment, but also ask, how have you been able to manage the current tuition freeze?

Joe Gow:

Well, the thing of it is, and this is not necessarily planned, but what has happened, and it's not unique to UW-La Crosse or even Wisconsin, as we've had these challenges, you find fewer and fewer full-time people and more part-time people who are paid at a lower rate. And then the other thing that is often overlooked, our folks have had a 1% pay plan over the past maybe five, six years. I mean, there hasn't been a lot of growth in salaries. That's what's kept this all afloat. That's simply not sustainable. I mean, would any of us want a job where our salary was static for that kind of period?

Frederica Freyberg:

So you were talking a little bit about trying to provide the ongoing quality education to your students there in the face of this. What kinds of things might suffer?

Joe Gow:

Well, for us at La Crosse, it's that 100-year-old building that we are hoping to put our College of Business Administration into and modernize what we offer to the students. That's a $24 million project that we have that money on hand. But if we have our resources cut again, we would have to tap those funds, and so we wouldn't be able to do that big project.

Frederica Freyberg:

And otherwise, staff cuts, or that kind of thing? Or is that what one of those pots of money is about, to try to maintain the staff that you've hired up?

Joe Gow:

Well, unique to us at UW-L, we have those 200 faculty and staff that are paid by tuition. So, we have about $14 million, that's a year of salary and benefits. We could draw that down a little bit. I'd get nervous, if we took it too far. The thing to remember is that our professional associations advise having about 25% held back just as a general reserve. You know, we're really not at that point across the UW System, and now the Regents are saying, well, let's do a 15% threshold. You know, that's going to change the way we do what we do. And the thing that I'd like to remind everybody is, we are a nonprofit entity, so that when we do collect a fee or tuition, we take that money and we put it back into the operation to make is even stronger than it has been. I often tell the students, our goal is that in 20 years when you're out there with your UW-La Crosse shirt, we want people to say, wow, that's a fantastic school, not that it used to be, and they let the buildings go downhill and all the faculty and staff left.

Frederica Freyberg:

Chancellor Joe Gow, thanks very much for joining us on this.

Joe Gow:

Thank you. It's been a pleasure, Frederica.

Frederica Freyberg:

The tuition freeze in place right now that was enacted by the state legislature is the first in the University of Wisconsin System's history. Republicans in control of both the Wisconsin Assembly and Senate say they support the governor's call for another tuition freeze, and will try to pass it in the upcoming legislative session. 


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