Chancellor William E. Kirwan's Annual Report to the
University System of Maryland Board of Regents
Wednesday, June 22, 2005

I am pleased to provide my third Annual Report to the University System of Maryland Board of Regents. As we come together today, we find ourselves at a time of transition. Not only are three regents completing their tenure on the Board after exemplary service -with new regents soon to take their place-we also will elect a new Board Chair today and soon begin the process of finding two new presidents to replace two exceptional leaders.

This will be the final Board meeting for Regents Jeremy Horine, Adela Acosta, and Joseph Tydings. We will have more to say about each of these individuals later, but I would like to thank them "up front" for the outstanding service they have given to the University System of Maryland.

This will also be the last Board meeting of Cliff Kendall's tenure as Chair. Again, we will acknowledge Cliff's contributions later, but I want to thank him now for his exceptional leadership. So many vital efforts have been spearheaded during his chairmanship, and the University System of Maryland is stronger for it.

Additionally, both University of Maryland University College President Jerry Heeger and Frostburg State University President Catherine Gira have announced that they will be leaving USM. Both leave with incredible records of accomplishment. We will, of course, have the opportunity to thank them both for their service in other forums prior to their departures, but I would like to take this opportunity to acknowledge all they have done for their respective institutions and the entire USM.

Let me now turn to my annual report. Rather than highlighting the events of the past year chronologically, I thought it might be more effective to talk about this past year in terms of our strategic plan. After more than 18 months of effort, we unveiled the new USM strategic plan a little over a year ago. This was more than an "updating" of the previous plan; it was an entire reworking of our mission, our goals, and our vision for the University System in 2010. Presidents, Vice Presidents, Provosts, and many other members of our campus communities worked with the Board and System staff throughout the process. The new plan is a guiding document that, while aspirational, provides us with a standard of measurement for our progress. It represents a systematic approach to how we intend to operate as a system.

The specific themes articulated in the plan provide the lens through which this report looks back over the past year-the concrete steps we have taken, the results we have achieved, and the progress we have made. I begin with the first theme:





We are all well aware of the enrollment challenges we face over the next decade, with a significant surge projected for lower-income and minority populations. Our ability to accommodate these potential students will set the tone for the system's success.

Fortunately, we have taken steps to meet this challenge head on. By educating the decision-makers in Annapolis about this complex issue, we have elevated the issues of "access" and "affordability" to a top priority. In fact, the single most important impact of the funding increase proposed by Governor Ehrlich and approved by the legislature was that it enabled us to keep tuition increases below 6 percent. Without it, we would have needed to increase tuition by well over 10 percent simply to meet our mandatory cost increases. On behalf of the students we serve and their families, I thank the Governor and the Legislature for their support.

USM set the tone in this area with the creation of two separate task forces. The Tuition Task Force stressed the need for modest, predictable tuition increases developed on a four-year basis. The Financial Aid Task Force focused on improving the balance between merit aid and need-based aid in order to target students who would otherwise not be able to afford college. Key among the provisions of the Financial Aid Task Force report is the goal of reducing the debt load for our neediest students to 25 percent less than the average for all students. This represents a significant improvement over the current figure for our neediest students of 25 percent above the average.

Our system-wide approach, combined with programs such as the University of Maryland, College Park's Pathways initiative, Towson University's 10% Scholars Program, and the Governor's well-articulated commitment to need-based aid, has the overall effect of making Maryland a national model for balancing need-based and merit-based aid.

Of course, the financial aspect of access is only part of the challenge. Simply in terms of sheer numbers, we are looking at an enormous jump in the number of students "coming through the door" at our institutions. This is another challenge we are aggressively addressing.

The academic elements of our Effectiveness and Efficiency Program (E&E) will play a significant role in accommodating the growth in enrollment. The key elements-increased workloads, emphasis on online and out-of-classroom learning, enrollment management-have all been approved by the Board and will help reduce time to degree for our students, thereby enabling us to accommodate additional students with no additional cost.

I once again thank Chairman Kendall, the Board, our Presidents, Vice Presidents, Provosts, Shared Governance Councils, and everyone who worked on our E&E initiative. This remarkable breakthrough simply could not have happened without a true team effort.

In addition, some of our institutions-including Salisbury and Towson-have taken the initiative to advance our goals even more by increasing the number of summer school courses offered. It is especially important to note that some of these additional offerings included the high-level required courses, thereby helping students further reduce time to degree.

Along with these E&E-driven efforts, the expansion of the University of Baltimore to include freshmen and sophomore years, the partnerships we have with community colleges streamlining the ability of students to move from a community college to a System institution, the expansion of offerings at UMUC, and the regional education centers at Shady Grove and Hagerstown, all play a vital role in addressing our enrollment and access challenges. I also note that USM at Hagerstown, which opened its doors earlier this year, was completed on time, under budget, and with enormous enthusiasm and support from the community. I am confident that this newest USM facility will become a hub of teaching, learning, and economic development that will have an enormously positive impact on Hagerstown, Washington County, and the State of Maryland. In fact, both our educational centers are incredibly powerful partnerships among the USM office, our institutions, the community colleges, and business and civic leaders.

An important part of our efforts to promote access and success is our work to implement the goals of the Office of Civil Rights agreement. We will submit the USM status report to the Maryland Higher Education Commission later this summer. We will then work with MHEC and our other partners to develop the final report from the state, which is due prior to the end of the year. We anticipate an evaluation of our progress toward meeting the OCR partnership agreement to follow soon after that.

Of course, as is often noted, access to mediocrity is of little value. As we strive to meet the challenges of enrollment and affordability, we must keep our legislative mandate of "National Eminence" in the forefront. This leads us to our second theme:




Despite the budget challenges of recent years, our member institutions continue to make remarkable progress toward this mandate. Just to cite a few examples: College Park has a total of 31 programs ranked in the top 10 nationally by U.S. News & World Report. Every professional school at the University of Maryland, Baltimore is highly ranked in U.S. News as well. Salisbury University is ranked in the Top 10 percent of all universities of its kind. Towson University ranked fifth in Top Public Universities - Master's (North). UMBC is ranked in the top tier of U.S. research universities by the Carnegie Foundation.

Along with academic recognitions, significant grants to USM institutions also demonstrate our position of national-and international-leadership in areas of the most vital concern.

In the realm of Homeland Security, both UMCP and UMB have been tapped by the Department of Homeland Security to advance efforts in the War on Terrorism. In the area of international health, the Institute for Human Virology at the University of Maryland Biotechnology Institute continues to lead the global fight against AIDS, including a major grant focusing on work in Nigeria.

It is common knowledge that funding is the life blood of the University System. Attracting and retaining the best presidents, deans, professors, scientists, and students all cost money. Offering cutting-edge research opportunities in our labs, state-of-the-art technology in our classrooms and thought-provoking scholarship and publications also comes with a price tag.

That is why this past legislative session represented a breakthrough of sorts, with higher education receiving near-universal support in Annapolis. The Governor proposed-and the Legislature fully supported-our first general-fund increase in several years. I once again thank Governor Ehrlich, the members of the General Assembly, the Regents and Presidents who testified, and the USM staff-especially our legislative team-who helped in the response to questions and preparation of testimony. I am hopeful that, as a result of our work together, this will be the first year of an upward trend for higher education and the USM, allowing us to further system-wide excellence.

I believe one of the key reasons why we received universal support can be found in our commitment to the third theme in our Strategic Plan:




In its recently released report, the Institute for Higher Education Policy demonstrated the linkage between investment in higher education by states and the economic and collective well-being of those states. Of course, this was hardly "news" to anyone who works every day in higher education, but I think the message is finally gaining widespread currency.

The impact USM has on Maryland's economic and social well-being-both directly and indirectly-is indisputable.

We help produce one of the best-educated, most highly-skilled workforces in the nation. We are also part of a University-based R & D community that supports more than 50,000 jobs statewide-the equivalent of four Northrop Grummans. We have research & technology parks growing and/or expanding at UMBC, UMCP, and UMB. The Maryland Industrial Partnerships program, a system-wide effort run out of the Maryland Technology Enterprise Institute at UMCP, received the "Best Practice" award for technology transfer programs from the Small Business Administration.

USM is also a key player in the next "big thing," which will actually be very, very small: nano-biotechnology. Small Times magazine recently placed Maryland 8th in their ranking of nano-bio and micro-bio states (up from 11th in 2004). With the University of Maryland Biotechnology Institute and UMCP recently announcing a partnership for education and research in nano-biotechnology and molecular bioprocessing, the reputation of our state will be further enhanced.

Along with our impressive economic impact, USM institutions also remain active and involved members of the communities they serve. They are not merely IN these communities, but rather are PART OF these communities.

  • Consider the impact of FSU's Community Outreach Partnership Center, recently named a "Place of Promise" by the American Association of State Colleges and Universities.
  • Similarly, Salisbury's Partners for Progress will enhance and strengthen "town and gown" relationships.
  • Look at what Coppin achieved in their partnership with Rosemont Elementary, lifting it from a "failing school" to a top 10% Baltimore City school last year.
  • At UMB, faculty, staff and students provide more than two million hours of community service across the state every year.
  • And the University of Maryland Center for Environmental Science is performing the most important work being done to clean and protect the Chesapeake Bay.

ALL our institutions are involved in every aspect of life in Maryland, for the betterment of the entire state and our fellow citizens.

Another way we are meeting this mandate of state service is found in our fourth theme:





As I mentioned earlier, our educational centers and UMUC represent a formidable "one-two" punch in the arena of workforce development.

Partnering with community colleges, local government, and businesses, our centers at Shady Grove and Hagerstown are educating both the "new economy" workforce in the life sciences and information technology, as well as the "traditional" workforce in areas such as nursing and education. I also note a key policy under consideration by the board stipulating that IF a USM institution cannot offer a necessary program at a regional education center, we will issue an RFP to get that program up and running.

UMUC-the worldwide leader in online education-is taking advantage of its ability to adjust and adapt to add new degree and certificate programs as needed, meeting workforce needs that may have been unforeseen just a few years ago. The new undergraduate program in Gerontology and graduate program in Homeland Security Management are perfect examples.

Other institutional efforts are under way as well to meet critical workforce needs.

  • Bowie State University and Coppin have each been awarded a grant from the National Science Foundation to increase the number of underrepresented minorities in science, technology, engineering and mathematics (STEM) and their respective institutions.
  • At UMB, the School of Nursing is creating the Institute for Nurse Educators-with federal support-to help address both the nursing shortage as well as the nurse faculty shortage.
  • The University of Maryland Eastern Shore, thanks to a $3-million gift from Richard Hazel, is enhancing its teacher education program, reaching out to students who might otherwise not have attended college, let alone pursue careers as educators.

We are also pursuing this need at the System level, working in tandem with our partners. We have established an Associate Arts of Teaching that establishes one set of standards to move from two-year to four-year institutions with no further review. This seamless path for Teacher Education helps meet one of our most critical workforce needs.

In addition, a new Bio-Science program brings together the entire spectrum in a perfect example of what is possible. This is a four-year Bachelor of Science degree in biological sciences. The first two years are at Montgomery College, the final two years at our Shady Grove location, with the degree issued by University of Maryland, College Park. This is the type of innovative, creative partnership we must continue to explore.

We are also partnering with the K-12 community to improve science education, enhance student achievement, boost teacher quality, and increase teacher retention, especially in Montgomery County, Prince George's County and Baltimore City. These three large school systems educate many of the students who will attend our institutions; improving their academic experience is not just the "right" thing to do, it is also in our best interest.

Many of the efforts I just cited involved outside funding, either from the federal government or private donors. This leads to the final theme listed in our strategic plan:





First and foremost along these lines are our Efficiency and Effectiveness efforts. In fact, "exemplary stewardship" was the very reason behind the initiation of E&E. The Board of Regents has demonstrated national leadership in this area and our work has gone a long way toward elevating the level of support for higher education. We see the business community and leadership in Annapolis acknowledging the importance of this very serious effort. In essence, our E&E efforts are paying "double dividends," with the efforts themselves saving money while leading to increased funding in recognition of their impact.

As you know, as a system we have renegotiated system-wide with PeopleSoft, consolidating multiple contracts into one and establishing maintenance caps, safeguarding our institutions from excessive costs. All in all, this action will save us millions of dollars over the next 10 years, while gaining access to $10 million-worth of new software at no cost.

We are also using the leverage we have as a system to purchase electricity at more competitive prices, resulting in significant savings. While such efforts are certainly not new to USM, the impact has been welcome. Not only did Governor Ehrlich specifically cite our E&E efforts when he proposed our budget increase, but financing agencies have taken note as well, upgrading our long-term bond rating. Of course, E&E must remain an ongoing effort; it was not established as a set of goals to be met, but rather a continuous approach to improve operations.

We cannot, however, generate the additional funding we need to ensure access, affordability, and quality simply through cost cutting, cost avoidance, and better management. Yes, those are vital steps to take, but additional funds are also essential. As we seek to expand our federal funding portfolio, we are also looking to expand private giving. In fact, our Capital Campaign will soon be under way.

The recent spate of good fund-raising news for USM institutions gives us reason to hope for a very successful effort. I mentioned the $3 million gift from Richard Hazel for UMES to enhance teacher education. Also, Towson University recently received $10.2 million from the Robert M. Fisher Memorial Foundation-the largest gift ever received by Towson-for the College of Science and Mathematics. UMCP received not one, but two significant gifts: $30 million from A. James Clark, and $30 million from Robert H. Smith to support both quality and access.

If we can use these events as building blocks, I am confident our campaign will be a success! Vice Chancellor for Advancement and President/CEO of the USM Foundation Susan Schwab and Associate Vice Chancellor for Advancement David Balcom, working with our institutional leaders, will be spearheading our upcoming Capital Campaign. As the kick-off approaches, we will provide greater details.




As I move toward the end of my report, I would be remiss if I did not note that we face significant challenges: funding; tuition & student debt loads; enrollment; and rising mandatory costs. As we have since the very first days of my tenure, we will work together and meet these challenges with confidence, strength and innovation.

I am also committed to tackling the current zeitgeist hampering our progress: the switch in the body politic of the overall view of higher education. Whereas higher education was once widely recognized as a public good, it is now more and more being classified as a private benefit. Overcoming this perception-misperception, really-is critical, both for higher education and for our nation's common future. That is why the American Council on Education is leading an effort with other partners in higher education and elsewhere to enlighten the public as to the vital role of higher education as a true "public good." Stressing both education for its own sake, and the other numerous benefits of research, workforce development, and community service, we are endeavoring to reshape public opinion, stressing the universal value of higher education.

This is also an initiative I have embraced locally, in meetings with the business community-the Maryland Chamber of Commerce, the Maryland Economic Development Commission, the Greater Washington Board of Trade, the Governor's Workforce Investment Board, and the Greater Baltimore Committee; opinion leaders-the Daily Record, the Gazette, the Baltimore Sun, and the Annapolis Capital; and elected officials, most notably the Governor.

I do believe that they "get it." They understand that the future of the State of Maryland is inextricably linked to the future of the University System of Maryland, not just educationally, but economically, socially, and culturally. They also grasp the severity of the challenges we face and have expressed a commitment to work with us to overcome them. Together we can-and must-maintain this momentum, not just for the benefit of the University System of Maryland but for the future well being of our state.