Board Chair and Chancellor Thank Gov. Ehrlich for his FY 2006 Higher Education Budget,

Also Ask Legislators to Set Aside HB 1188 Veto Discussion and Accept the Governor's Budget

ADELPHI, Md. (January 6, 2005) Maryland Governor Robert L.
Ehrlich, Jr. announced today that he will allocate $800 million
in state funds for the University System of Maryland (USM) when
he presents his fiscal year 2006 budget later this month. The
allocation is a 5.7 percent increase over the university system's
FY 2005 state funding of $757 million.
In making the announcement, Gov. Ehrlich reaffirmed his
commitment to provide excellent higher education opportunities to
a growing number of Maryland students.

"I am extremely pleased with Gov. Ehrlich's increased funding for
the University System of Maryland in a very difficult budget
climate," said USM Chancellor William E. Kirwan. "The Governor
and I first discussed funding for the system two years ago. At
that time, he promised to increase system funding if we
demonstrated a high degree of effective and efficient use of our
resources. Furthermore, Gov. Ehrlich has said that his commitment
to invest in higher education will continue as we advance our
effectiveness and efficiency efforts.

"Under the leadership of the USM Board of Regents, we are
streamlining our administrative and academic processes through
structural changes to our operations. These actions are enabling
us to redirect funds to our highest priorities: quality, access,
affordability, and accountability. I am delighted that the
Governor has recognized our accomplishments and is providing this
substantial boost."

The Board of Regents has used these prioritiesquality, access,
affordability, and accountabilityto guide its review of
proposals for increasing system funding and for moderating
tuition increases. "I am grateful and impressed by the Governor's
approach to the system's budget needs," said Board Chairman
Clifford M. Kendall. "Thanks to the Governor's actions, we will
be able to give our students and their families a substantial
break from the hefty tuition increases of the past few years.
Gov. Ehrlich has provided general funds for the system's FY 2006
budget that are essentially equivalent to the funds identified by
the Maryland General Assembly in House Bill 1188."

(Passed during the 2004 legislative session and vetoed by Gov.
Ehrlich, HB 1188 called for USM state funding increases of 3.4
percent in FY 2005 and of 5 percent in FY 2006 and in FY 2007,
funded by general funds and a corporate tax increase. The bill
also would impose a statutory cap of five percent on annual
tuition increases at USM campuses for the same period.)

Chairman Kendall also said, "The Governor's FY 2006 plan
preserves the board's authority to set tuition." The board plans
to vote on the fall 2005 tuition at a special meeting that will
be scheduled for late January. At that meeting, Chancellor Kirwan
plans to recommend a tuition increase for in-state undergraduate
students of no more than 5.9 percent.

"The past three years have been a period of great uncertainty and
apprehension for our students, their families, and our faculty
and staff," Chairman Kendall added. "The public debate about
higher education funding and tuition has been difficult and
sometimes divisive for the USM community and for the state.
Moreover, it is potentially harmful for the long term as the
university system seeks to serve the state, maintain its national
eminence, and provide affordable opportunities for Maryland

"Given all these factors, and with great appreciation for the
efforts of everyone involved in restoring funding to higher
education," Chairman Kendall concluded, "I respectfully suggest
that it is best for our students and Maryland higher education,
to set aside discussions of overriding the veto of HB 1188, and
for the General Assembly to adopt the Governor's FY 2006 higher
education budget."

Added Chancellor Kirwan: "Since I returned to Maryland in 2002, I
have worked with the board and the institutional presidents to
achieve a consensus among state leaders about the importance of
investing in higher education. From the beginning, it was clear
that USM and our state leaders share the goal of preserving and
expanding the university system's vital role as an economic
engine for the state.

"Gov. Ehrlich's budget proposal presents an opportunity to
achieve that consensus, which bodes well for our state's future.
Therefore I join Chairman Kendall in respectfully asking the
General Assembly to set aside discussion of HB 1188 and to
approve the Governor's FY 2006 budget for higher education."

Chancellor Kirwan also noted that the allocation for USM builds
on the Governor's and General Assembly's strong support of the
university system's capital budget, of legislation to give the
system more autonomy, and of increased investment in need-based
financial aid.

"I look forward to working with the legislature to adopt the
Governor's budget," said the chancellor. "Working together, we
can ensure that the University System of Marylandone of the
nation's leading higher education systemswill continue to be a
major engine for the state's economic growth and a vital force
for advancing the quality of life for all Marylanders."

Contact: Anne Moultrie