Office of the Vice President for Global Communications

Wednesday, February 27, 2013

Coleman stresses financial aid, careful cost cutting in budget testimony

President Mary Sue Coleman emphasized the importance of higher education to the future of Michigan during her budget testimony Tuesday before the House Higher Education Appropriations Subcommittee.

Coleman told state legislators that U-M remains affordable for state residents because of a three-pronged approach that emphasizes financial aid, aggressive cost control and philanthropy.


Read the full text of President Coleman's testimony.

In her testimony, Coleman said high-growth jobs of the future "will require higher-education degrees or specialized training. And a university is specifically designed to challenge young people, build their skills, and develop critical thinking so they can address the challenges and problems of the day.

"That is why we are working harder than ever to keep higher education affordable," she said, and state funding is a key component of affordability.

She reminded legislators that U-M is one of just a handful of public universities nationwide that maintains a long-standing commitment "to cover 100 percent of demonstrated need of resident students through financial aid."

She said state resident students automatically get a 67 percent discount on tuition compared with what out-of-state students pay and that 70 percent of undergraduates who are Michigan residents receive financial aid.

"Today, for many Michigan students, it costs less to attend U-M than it did four years ago. I wish I could share that fact with every parent and guidance counselor in our state."

In addition to increasing financial aid for students, the university has maintained a focus on cost containment for more than a decade.

"We trimmed $235 million in recurring costs from the general fund budget, and we are on track to save another $120 million by 2017."

But she made it clear the cost cutting on campus was strategic.

"We are very, very deliberate when targeting savings on campus — the kind of precision you might experience in an advanced course in nanoengineering or microsurgery. Our priority is to always protect the academic enterprise and the quality of a Michigan education," she said, adding that only financial aid, where investments have been increasing each year, was completely protected from cuts.

But U-M cannot keep higher education affordable on its own, Coleman said, emphasizing the increasing importance of philanthropy and partnerships.

"The University of Michigan enjoys some of the most dedicated alumni in the world," she said "They demonstrate their faith in us by investing in the academic enterprise. These are dollars that could go elsewhere, but instead they come to Michigan — the university and the state."

Coleman said the university was in the midst of preparations for a new fundraising campaign. While there are many details still to be decided the focus of that effort is set: financial aid for students.

"I know our donors will not let us down, because they want tomorrow's students to enjoy the same exceptional experience they did."

Coleman also reiterated a message from the state's top business leaders: Our state cannot afford an undereducated work force.

"The Business Leaders for Michigan is a consortium of CEOs, familiar to most of you, who see the problem firsthand, because their companies need college graduates to prosper."

Coleman urged state legislators to work hand-in-hand with the state's public universities "as we work together for a productive, prosperous future for our state."