LEXINGTON, Ky. (Feb. 4, 2005) -- University of Kentucky President Lee T. Todd Jr. says an aggressive reorganization effort in the last three years has generated more than $35 million in savings.
Those savings, Todd said, have enabled the university to continue educating more students and creating economic development opportunities for the state – a testament to faculty and staff who are “doing a lot more with a lot less.”
Specifics about the reorganization plan are contained in a white paper by Todd released this week, titled “Creating a More Efficient Campus.” The white paper is part of a series of essays – “Issues, Ideas and Ideologies” – that focus on challenging issues confronting higher education and the state.
Todd initiated the reorganization plan when he became UK president in 2001 as a way to generate savings to create “dreaming money” to focus on the state-mandated mission of becoming a top-20 public research institution.
However, with a recessionary economy and nearly $72 million in state funding cuts, the reorganization has “been necessary to reduce the impact of the cuts,” Todd said. “Without these aggressive efforts to become more efficient, the impact of the budget reductions would have been much more severe.”
Highlights of the reorganization plan include:
- $14.5 million in annual savings by restructuring the university’s administrative organization and merging several academic departments.
- $6.4 million in restraining health-care costs that meant that the cost of the university’s health benefits increased an average of 7.96 percent per year, compared to the national average of 11.27 percent.
- $4.7 million in savings by changing the university’s accounting system.
- The elimination of more than 300 positions and combining many departments and job duties.
Todd said those savings have allowed the university to educate even more students. Enrollment overall has grown by 7 percent in the last three years, and the freshman class has grown by 30 percent in the same time period.
At the same time, the quality of the student body has improved, Todd said. More than one-third of this year’s freshman class had a high school GPA of 3.8 or higher. And UK’s graduation rate within six years of 59.5 percent is the highest of any public university in the state.
Moreover, even though only 19 percent of UK’s budget comes from state assistance – down from 46 percent 20 years ago and 37 percent 10 years ago – faculty are stimulating more economic growth and research dollars for the state. Todd said for the third straight year UK researchers have exceeded $200 million in sponsored project awards with a record-breaking total of $238.3 million in external grants and contracts last year, a 7 percent increase over the previous fiscal year.
Meanwhile, the university’s endowment – the result of private giving – has more than doubled since 1998 to $535 million, an achievement that has allowed UK to add 64 endowed chairs and 159 endowed professorships.
“UK can be a mighty catalyst for building better lives all across Kentucky,” Todd said. “Working together we can eliminate the problems that hamper and harm our people, our businesses and our communities.
“Even though we have taken some bold and innovative steps to reduce costs and increase efficiency … we are still without our ‘dreaming money.’ But our dream is still alive.”
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