Regents look at 8 percent increase in UT budget

Proposal would add 30 faculty, end hiring freeze at main campus

By Sharon Jayson
Thursday, August 7, 2003

SAN ANTONIO -- University of Texas System regents today are expected to approve a $7.8 billion budget for 2004, which includes a proposal to add 30 faculty positions at UT-Austin and to lift a hiring freeze imposed last year there.

Overall, the UT System budget will increase nearly 8 percent. UT-Austin's budget will be $1.4 billion, a 5.1 percent, or $70 million, increase over this year.

The budget represents system Chancellor Mark Yudof's first stab at creating a leaner 15-campus system. During the legislative session, the system was criticized by lawmakers for its top-heavy structure and highly paid administrators.

UT-Austin also plans to give its faculty and staff 3 percent merit pay raises that had been delayed, said Kevin Hegarty, UT's chief financial officer. The pay increases, typically offered at the start of the budget year in September, are expected to go to faculty and staff in January.

Yudof, who just completed his first year on the job, plans to tell regents at the second day of their meeting in San Antonio today that he tried hard to cut administrative expenses. Yudof proposes cutting 27 administration positions -- out of a total of 553 -- a move he said will save $1.8 million.

"Optimally, you want fewer people but really good people," he said Wednesday.

"We get a lot of criticism about the administration's size," UT System Controller Randy Wallace said. "But as a percentage of our overall budgeted expenditures, our budget is declining."

Wallace said more than half the system's administration employees work in departments that charge fees that pay for their salaries, such as the Office of Facilities Planning and Construction, which charges for the work it does for the system's campuses.

A separate proposal, also expected to be approved today, would add the market value of a half-time housekeeper to the base salaries of all the system's university presidents. In addition, the current $8,400 car allowance, which had been calculated separately, would be included in the base salaries. Housing allowances would remain separate. The changes would be phased in, said Kerry Kennedy, UT System executive vice chancellor for business affairs.

The 2004 budget does not factor in what is expected to be increased revenue from systemwide tuition increases effective in January. The Legislature relinquished its tuition-setting authority this year, and UT officials have not yet said what the tuition rate will be.

The state's $9.9 billion budget shortfall meant $101 million less in state appropriations for the UT System for 2004 and $5.9 million less for the UT-Austin campus, Wallace said.

The money woes aren't expected to stop regents from approving a systemwide capital improvement program today for 2004-09. The program includes 166 projects totaling $4.6 billion. Two major projects will be at UT-Austin: a $25 million biomedical engineering building and an $18 million Institute for Geophysics and Advanced Computing Center. Both would be located at the J.J. Pickle Research Campus in Northwest Austin.

Yudof said he will continue to trim his staff.

"You know you can't just decimate a place, so what I've tried to do is methodically do it one office at a time," he said. "Thus far, I haven't eliminated whole offices. I've sort of done it more across-the-board, but we are looking at some reorganizations that might do that."; 445-3620

UT's investment arm

University of Texas System regents on Wednesday in San Antonio considered an array of issues concerning the University of Texas Investment Management Co., which manages investments on behalf of the University of Texas and Texas A&M University systems. Final action is expected today.

Among the proposals the regents will consider:

* Stating that the UT Board of Regents retains policy-setting authority and that the chancellor is authorized to provide primary oversight and management to UTIMCO.

* Creating a title -- vice chairman for policy -- which will be held by the UT System chancellor. The chancellor already serves on the UTIMCO board.

* Naming Craig Hester, an Austin investment management professional, to the UTIMCO board.