Higher education leaders in Wisconsin have been asking to be cut free from a range of state oversight strings for at least two decades.

Earlier this year, former UW-Madison Chancellor John Wiley told the Capital Times about a proposal that was pitched by UW System officials some 20 years ago. The university leaders believed they had struck a deal with then-Gov. Tommy Thompson and the Legislature to eliminate some burdensome red tape as long as the UW System agreed to meet a series of performance targets -- such as graduating a certain number of students and getting them through in a timely manner.

"The state said, ‘Wow, those are good ideas,'" recalled Wiley. "And then they imposed the mandate that we had to meet all these standards but didn't give us a single additional flexibility."

But after various overtures fell on deaf ears for years, the stars finally aligned just right on Friday night when the Legislature's Republican-led budget-writing committee awarded UW System campuses some long-sought freedoms from state oversight in areas like budgeting, personnel, construction and purchasing.

"It looks like a very important and good first step toward the forms of flexibility and autonomy we need in order to move forward," said UW-Madison Chancellor Biddy Martin.

"For decades, UW chancellors, UW System presidents, and Regents appointed by both Democratic and Republican governors have asserted that our universities and colleges could operate more efficiently if relieved of cumbersome state rules," UW System President Kevin Reilly said in a statement. "New voices have amplified that call for change, and we've engaged in robust conversations about the best ways to give all UW institutions more control over their operations. These flexibilities will help us cope with near-term challenges, and will position the UW System to better serve the state's evolving needs for decades to come."

As expected, the Joint Finance Committee did not back the provision in Gov. Scott Walker's budget, supported by Martin, that would have awarded UW-Madison these freedoms by granting it public authority status.  That plan would have split UW-Madison away from the rest of the UW System and allowed it to be governed by its own board of trustees.  The JFC voted along party lines 12-4 to reject that proposal.

"We felt that while there was merit in many of the governor's proposals, that's not the direction that we're going to go in," said Robin Vos, R-Rochester, a co-chair of the JFC. "It's not about giving flexibility to one campus. What we're proposing is to give additional flexibility to all campuses. I think that's where we really found common ground with members of both of our caucuses."

The full Legislature could begin debating the budget in mid-June. It still must pass through the Republican-controlled Senate and Assembly before Walker signs off. The budget takes effect July 1 and runs through the end of June, 2013.

"We're in a much better spot than we would have imagined just a couple months ago," said UW System spokesman David Giroux. "And I think that's good news. The challenge now is to make sure we hang onto these flexibilities as they move through the two houses and make sure the governor is supportive of this."

As explained to reporters by JFC co-chairs Vos and Sen. Alberta Darling, R-River Hills, some of the key freedoms being granted to state campuses include:

** Funding in the form of a block grant for campuses to use as they see fit. Previously, the UW System has received dollars earmarked for specific purposes. For example, a campus might get $3 million to spend on heating, cooling and electricity. But if that school saved money by implementing energy saving practices, those dollars went back to the state. Under the block grant and budgeting flexibilities, a campus would have the ability to keep those savings and use them in different ways on campus.

"This would empower them to find cost-saving ideas," said Vos.

** More control over personnel systems. Everything from university workers' job titles to pay plans have been controlled by the Office of State Employment Relations. The JFC has decided it makes sense to give campuses varying degrees of flexibility on setting pay plans, awarding raises and determining job classifications outside the typical state process.

"The flexibility in human resources and personnel policy seemed very strong and gave a lot of what we had originally sought," said Martin.

** Less oversight from the state on campus building projects. Previously, the Department of Administration managed the design and construction of buildings. The DOA also charges universities 4 percent of a building's construction costs for these services. UW-Madison has long argued it can do these projects on its own -- in a quicker time frame and for less money. However, this freedom will only be granted for projects that use 100 percent grant and gift dollars, something that is rare.

"I think in facilities, as far as I can tell from a quick look, there is less give there than we had ideally hoped to get," said Martin.

** More freedom to buy goods. Previously, universities had to follow state purchasing rules, which generally meant taking part in state contracts. Moving forward, there are instances when universities can avoid the state process to enter into deals for specialized, university-related goods.

"This plan is a great start at giving all of the campuses in the UW System the flexibilities they need and have been asking for," said Rep. Pat Strachota, R-West Bend. "It is the product of a lot of thoughtful discussion and compromise and sets the stage to continue the dialogue on allowing further flexibilities in the future."

Strachota and Sen. Sheila Harsdorf, R-River Falls, were the members of the Joint Finance Committee tasked with taking the lead on higher education issues.

The JFC also announced it is calling for a study to examine whether UW System campuses should be granted even more flexibilities from state red tape in the future. Darling said this analysis could look at whether granting UW-Madison public authority status makes sense down the road.

"I think this is an exciting period in our history because the System came into existence in the 1970s and it's time to look at the relationship," said Darling. "I think it's important for all of us to look at how can we do things better."

Added Darling: "We're not just going to be looking at what's happening in Wisconsin. We'll be looking at what's happening all over the country and the world so that we can come up with a hybrid that really works for Wisconsin."

Leaders within both UW-Madison and the UW System had hoped to gain the ability to set their own tuition rates -- and to use those dollars as they see fit. But that was not granted.

The worst news of the day for higher education advocates is that the JFC agreed with Walker's proposal to cut $250 million in state aid to the UW System over the next two years. Under Walker's original plan, UW-Madison was supposed to absorb half of that hit.  But since it wasn't granted public authority status, the Madison campus will now take a more proportional cut. The UW System's Board of Regents will ultimately decide how those cuts are divided.

This $250 million blow to the UW System isn't unprecedented, however, as former Democratic Gov. Jim Doyle slashed state aid to the UW System by that same amount while filling a projected $3.2 billion hole over the 2003-05 biennium. In an effort to make up for that funding shortfall, UW-Madison's tuition and mandatory fees were jacked up 32.5 percent over a two-year period -- skyrocketing from $4,426 for the 2002-03 academic year to $5,866 in 2004-05.

Both UW-Madison and UW System officials have promised they won't raise tuition anywhere near that much to make up for state funding cuts this time around, but tuition and mandatory fees for an in-state undergraduate at UW-Madison for the 2010-11 school year already were $8,987. Next year, those costs will jump north of $9,500.

The non-partisan http://legis.wisconsin.gov/lfb/2011-13%20Budget/Budget%20Papers/740.pdf"> Legislative Fiscal Bureau reports that the cuts in state aid mark the fourth time in the past five state budgets that the UW System has taken a hit in taxpayer support. The LFB notes that "if the proposed base budget reduction were approved, total GPR base reductions from 2001-03 through 2011-13 would total $351.4 million or 35 percent of the UW System's 2000-01 adjusted base budget." In 2010-11, the state funded just 17.6 percent of UW-Madison's budget -- a figure which will soon plummet again.

"We can't be happy about a $250 million cut," said Giroux. "But, on balance, I think we have to be happy with the long term prospects for our public university system. We've been given the flexibility to mitigate and manage some significant challenges and the flexibilities are designed in such a way that they will outlast the near-term financial challenge. So once we get past the next couple of years, and hopefully better economic times return, I think these are flexibilities which will serve students, our scientists, our professors and our communities very well."

Martin should be credited for jumpstarting the latest round of talks with state representatives about why such freedoms are so important. Since September, she has been making a strong public push for a new business relationship -- which she called the New Badger Partnership -- between the university and state. She persuasively argued that UW-Madison could run much more efficiently and effectively if it had more freedom to purchase its own goods, construct its own buildings, hire and pay workers outside of the state process, set its own tuition rates and use those funds as it sees fit.

Although leadership within the UW System has asked for similar leeway for years, controversy arose in mid-February when it came to light that Martin had been working behind closed doors with Walker on a plan to achieve her goals. The problem? This proposal included awarding UW-Madison http://www.secfac.wisc.edu/senate/2011/0404/2263.pdf">public authority status. This idea, which was tucked into Walker's budget proposal, would break Wisconsin's flagship away from the UW System and allow it to be governed by a board of trustees, instead of the UW System's Board of Regents.

The Regents were furious with Martin for agreeing to such a deal with Walker without their consent, and leaders within UW-Madison and the UW System spent the next three-plus months bickering about how best to move forward.

While Martin continued to push hard for the proposal in Walker's budget, UW System leadership -- and every other head at every other state campus -- opposed the idea. They argued all system schools desperately need these same freedoms. The UW System then proposed an alternative to Walker and Martin's plan called the http://www.wisconsin.edu/wip/">Wisconsin Idea Partnership that would keep UW-Madison under the UW System umbrella.

In the end, neither Martin nor UW System officials got everything they wanted. But it's a start.

"At the moment I feel really good about the fact that this is a significant first step toward the kinds of flexibility and autonomy that the university and these campuses need," said Martin. "I think the kind of debate we had -- as messy as it has seemed at times -- has really registered the concern we have about higher education and its value to the state of Wisconsin. And I think what we've done is build a platform for future advocacy on behalf of the university. And I hope when the state's economic situation is better that we've laid the groundwork for a reinvestment in higher education."

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