The Board of Governors had its annual retreat last week. The main discussion topic for the first part of the retreat was the university’s financial model.

Our 2016-21 Long-Range Plan stated “among the most influential changes affecting higher education is the decreasing support at the state level.” In the last six months, Missouri State has sustained three significant reductions in state funding:

• FY17 withholding of approximately $6.7 million
• FY18 budget reduction of $6.5 million
• FY18 withholding of approximately $2.7 million

This is a pattern we expect to continue for the foreseeable future.

How should the university move forward to develop a sustainable financial model in this era of declining state support? We will continue to make the case for additional state funding, but Missouri State can no longer rely solely on state funding to support its goals. Accordingly, with the complete support of the Board of Governors, we have begun to develop a plan and will initiate a new direction in the coming year.

The proposed solution

The plan will stand on four pillars:

Pillar 1 – Affordability

The university must maintain its emphasis on affordability, recognizing that we can reduce costs for students without keeping tuition and fees flat. To accomplish this, we may pursue additional dual credit classes, expand accelerated masters programs, reduce the minimum number of hours to graduate, reduce the number of students who take developmental classes (through co-requisite models and other strategies), expand the availability of open access textbooks, create structured schedules and enhance advising to reduce the number of unnecessary courses taken by students.

Pillar 2 – Efficiency

While Missouri State has had a tremendous track record of efficiency over the past six years, the university must become even more efficient in all areas of operation including staffing structure, procurement, successful academic program selection, and the like. This will enable the university to reallocate funds from one area to another. This next level of efficiency will be challenging for us all.

Pillar 3 – Revenue growth (separate from tuition and fee increases)

The university must increase revenue in order to sustain excellence and thrive. Enrollment growth will continue to be a key factor through expanding high-demand programs, adding additional programs based on workforce demand and revamping existing programs to make them more competitive. Initiatives designed to increase retention and graduation rates will grow revenue while also improving student success. We will also continue to grow private giving and grant funding.

Pillar 4 – Revision of tuition, fee and scholarship policies

The university will evaluate differential tuition options along with the possibility of increasing tuition above CPI for the first time in a decade. Meanwhile, we will reevaluate our scholarship programs to ensure that needs-based scholarships are in place to support students from lower income families who are adversely affected.

The needs

The university will allocate revenue under this plan to ensure maintenance and expansion of quality programs and services:

New faculty lines

Missouri State’s student to faculty ratio has increased to 22:1 while its peers average 17:1 with a range of 15:1 to 19:1. We cannot allow this number to increase further and we must begin to bring it down. Staff positions in counseling, financial aid and other critical areas are also needed.

Compensation

Compensation of faculty, staff and administrators is below the average for universities of similar size (89-95 percentile of the midpoint depending on category). Missouri State is losing talented employees because the pay is better elsewhere.

New programs

Funding is required to add new programs to address the work force needs of the community, state and region. To add new programs or expand existing programs, the university will need additional faculty and staff, incremental operating budgets and in some cases new facilities.

Increased expenses

Deferred maintenance, infrastructure and other obligations continue to increase. We anticipate another major increase in contribution to the MOSERS pension fund in FY2019.

What Missouri State is experiencing is not unique; this paradigm shift is occurring across the nation. Missouri State will proactively determine its future as it has done in the past. Employees, the university’s most valuable asset, will drive the success in meeting the challenges. Missouri State University will not only survive, it will thrive. Working together, Missouri State will continue to be the most efficient, affordable and effective public university in Missouri.

Thanks for all you do for Missouri State!