UPDATE: From a Legislative Fiscal Bureau memo confirming the existence of the massive UW Slush Fund:
The UW System had a tuition balance of $414.1 million as of June 30, 2012. By comparison, the UW System's tuition balance was $212.8 million as of June
30, 2009. During this time period, base resident undergraduate tuition increased by 5.5% annually.
It should be noted that the UW System's tuition balance increased significantly at the same time that the UW System has been subject to significant GPR funding reductions and lapses.
While the University of Wisconsin has been raising tuition and clamoring for more taxpayer support they have been stockpiling hundreds of millions of dollars in unspent tuition and federal grant monies.
Sources in Madison familiar with the discovery tell RightWisconsin that the total of non earmarked funds in the massive UW Slush Fund is at least $450 million.
News of the massive UW Slush Fund prompted a strong reaction from legislative Republicans.
Speaker Robin Vos (R-Rochester), Senate Majority Leader Scott Fitzgerald (R-Juneau), Joint Finance Co-Chairs Senator Alberta Darling (R-River Hills)and Rep. John Nygren (R-Marinette) and Assembly Majority Leader Scott Suder (R-Abbotsford) issued the following statement regarding the UW System’s surplus:
"We are outraged with the mishandling of taxpayer dollars and the pattern of incompetence shown by university system administrators. We want the citizens of this state to know that we will examine the gross mismanagement of the system’s finances. We will demand accountability and transparency.
"At a time when the UW System is asking for more flexibility and funding from the state, this situation clearly illustrates the need for strong legislative oversight. Our state deserves better from the institutions that are educating our students and future leaders. It is not only unfair to the students and their parents who keep getting hit with tuition hikes; it’s unfair to the taxpayers of Wisconsin.
"We want to assure the university students and their parents that, at a minimum, this budget will include a twoyear tuition freeze. We will work closely with Governor Walker to address this substantial accounting error and explore pursuing a comprehensive investigation into the management of UW System finances. "
The University has always had a carryover from budget to budget, but the amount has skyrocketed in recent years, resulting in the current massive UW Slush Fund.
The discovery of the massive UW Slush Fund comes as the legislature's budget writing Joint Committee on Finance prepares to review formal budget motions. The first votes are expected on April 25. The panel will continue work on the budget through the next several weeks.
The existence of the massive UW Slush Fund is particularly troubling when juxtaposed with comments UW officials have made in recent years about available 'resources.'
UW-Milwaukee Chancellor Michael Lovell said the cuts and decreased staff could make it more difficult for students to enroll in the classes they need to.
Lovell said 41 UWM faculty and staff have left the university since the initial cuts were announced.
"That number is much greater than I expected," Lovell said. "These are the top performers on our campuses that are being poached away from other universities in other parts of the country."
"Prominent businesspeople have stepped forward to assert that cutting the UW so disproportionately is bad for business in Wisconsin," Reilly said.
"To put this in another perspective, $46 million is equivalent to a full year's worth of state support for 11,360 UW students or 511 faculty and staff positions," Reilly wrote.
"President Reilly has asked all UW System employees to call or email your legislator and ask them in your own words to help the UW System in any way they can," reads the email from Rosemary Potter, governmental relations director for Colleges and Extension.
It was just four months ago that Gov. Scott Walker proclaimed Wisconsin's budget as "balanced" and the state on "a path to prosperity." Now, he is raising the specter of an additional $300 million in spending cuts over the next two years. The University of Wisconsin System, already reeling from $250 million in cuts from Walker's budget, would absorb roughly 38% of the new reductions - a draconian hit that is over five times greater than the UW System's share of the state budget.
This is not only unfair but bad public policy: Economic growth and job creation in Wisconsin require increased investment in education, certainly not the disinvestment proposed by Walker. This state has thrived historically with a public higher education system that has been the envy of the nation. The shortsighted budgetary policies of the Walker administration undermine that legacy and threaten to choke off prospects for future growth in the state.
Regent Regina Millner urged Board members to remember that belt-tightening cannot proceed indefinitely without compromising the quality of the product. "There is some point when you’re eliminating fat, you’re also eliminating muscle," she said.
"I’m already worried about degrading the quality of the educational experience for students," Lovell said. He pointed to already high ratios of students to providers of student services such as mental health counselors and academic advisers. He also noted that the availability of fewer class sections would lengthen students’ time to degree, thereby increasing their costs.