Dear Faculty, Staff and Students:

On March 14, Governor Bill Haslam presented his proposed 2012 budget to the General Assembly. During this legislative session, our State representatives will propose amendments to the Governor’s budget, particularly from the education and finance committees of the House and Senate. The Tennessee Board of Regents (TBR) met last week to discuss the budget implications for the University of Memphis and other higher education institutions. Below are some of the main points from Governor Haslam’s proposed budget and from TBR. In addition to this brief e-mail communication, we will have two open forum sessions, April 25^th at 2:00 p.m. in the Fogelman Classroom Building, Room 125 and April 26^th at 9:00 a.m. in the University Center, Room 340 - the Memphis Room, to discuss our responses to the budget concerns.

The challenge for the University of Memphis in 2012 is to make the 2% budget reductions that the Governor is requiring. Given the uncertainty of the tax revenue collections, he has proposed a very conservative budget.

In spite of the overall budget reductions, there were some proposed increases. Salary increases, which remain our highest priority, were addressed by the Governor with an increase of 1.6%, the first increase in four years. He also proposed continuing the monthly $50 match for 401(k) retirement plans. For students, there is a proposal to adjust the Hope Lottery scholarship funds to allow funds to be used for summer school and to cap the number of hours at 120.

While the Governor and the Legislature do not set tuition, TBR will set the tuition costs after the end of the legislative session when it is known exactly how much revenue is available. We are being asked to prepare several different tuition increase scenarios.

Additional funds also are proposed for campus maintenance with $5.6M for roof replacements on several buildings, but there are no funds for capital construction of new buildings. We were pleased to receive $10M for the Memphis Research Consortium for projects at the University of Memphis and the University of Tennessee Health Science Center in conjunction with St. Jude, Bioworks, area hospitals and the medical device industry.

The question we must ask is what can we do to enhance our position in relationship to the new budget and to the formula for higher education. As we have discussed in previous campus meetings, the new funding formula will be based mostly on retention and graduation rates. We must continue to aggressively pursue increased student retention and graduation while we also grow in enrollment.

Looking forward to the next academic year 2011-2012, our strategic priorities will remain the same: keeping students on track for graduation; focusing on student recruitment and retention; and maximizing growth in areas of Nursing, Public Health and Distance Learning. We will continue to work to keep our productive research programs funded and seize opportunities in areas that lead to both funded research and enrollment growth.

For a more complete view of the planning steps and budget deadlines, please go to the Financial Planning Website at http://bf.memphis.edu/finance/budget/guidelines.php. An update of theProcess Improvement Initiatives can be found athttp://www.memphis.edu/processimprovement/.

We are very fortunate at the University of Memphis to have dedicated faculty and staff members who have been vigilant in performing their roles, even during these dire budget adjustments. I am grateful for your commitment to providing a quality education for our students. Thank you for your perseverance and dedication.

Sincerely,

Shirley C. Raines, President