Update on Key Issues
As the academic year moves to a close with our upcoming graduation, I want to communicate on several key issues.
The UT state budget allocation for next year (Fiscal 2015) has been passed into law by the legislature. It is identical to the current year’s budget allocation (Fiscal 2014, which ends June 30). The state’s budget shortfalls have prevented any increase in the UTHSC state allocation; thus the hoped-for one percent compensation increase for state and university employees has been eliminated. Fortunately, this budget did not require a reduction in our state allocation. However, our state or "orange" budget will be very tight this year since UTHSC has also promised to hold tuition at current levels. Tuition levels in all of our professional colleges are now at or slightly above the southeastern professional public school median such that further increases would create an unfair burden on our students and have implications for college accreditations.
However, UTHSC all-source income (clinical corporation revenue, sponsored programs revenue, state allocation, tuition, etc.), continues to grow. Our sponsored program revenue (all-source nonclinical grants and contracts) is the largest in the UT system. Our clinical revenue from all of our practice corporations is at all-time record levels for UTHSC. The overall result is a strong budget but one that percentagewise has a steadily shrinking “orange” component. This creates little flexibility on "orange" components of our budget. Our go-forward plan takes these issues into consideration.
In terms of accreditation our Southern Association of Colleges and School (SACS) application has been submitted and distributed for review. We await their deliberations. The SACS Commission on Colleges is the accrediting body that will accredit us as a university, independent of the former "Big Orange" -- which currently includes UTHSC, UTK, UTIA, UT Public Service, and the UT Space Institute.
The search for a permanent Vice Chancellor for Research will begin in earnest this summer led by UTHSC Executive Vice Chancellor Ken Brown and UT Executive Vice President David Milhorn. I will provide more details as the search progresses. Growing our research enterprise is our big go-forward challenge, especially in light of decreasing federal funding. We are making significant investments in this area with major facility upgrades, faculty hiring, and program development.
Construction and demolition was the subject of a recent communication, so I will not dwell on this except to say we are on schedule with the dramatic renovation and rebuilding of all of our campuses. These construction and renovation funds were previously awarded and were not influenced by the state's recent budget decision. Once awarded, construction and renovation funds can only be used for their intended purpose.
Our clinical practice corporations continue to perform well and we are in the final stages of our alignment with two of our partner teaching hospitals: Regional One Health in Memphis, and the Erlanger Medical Center in Chattanooga.
Our UTHSC Strategic Plan was presented and accepted by the UT Board of Trustees in February. We are now in the execution phase of the plan. I will be scheduling a town hall in the near future for the annual State of the University address, which will outline our status in much greater detail.
I want to thank everyone for their commitment to UTHSC and to our mission. We are now, because of your efforts, in a very strong go-forward position.
I look forward to seeing everyone at the graduation of the UTHSC class of 2014.
Steve J. Schwab, MD