November 18, 2009

Dr. James R. RamseyPresident

GLITop Investors and

Executive Committee

Economists like pictures and graphsSome dots and a triangle…

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• Wind• Ice• Flood

• Neurosurgery• Personnel Issues

And of course, the worst economy since the Great Depression.

Last year was a … of a year!

3

We know that nationally times have been unprecedented… and who knows?

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GDP Declines During Postwar Recessions(peak-to-trough percent change; date is year of peak quarter)

1948 1953 1957 1960 1970 1973 1980 1981 1990 2001 2008 1st Qtr

2009

2nd Qtr

2009

3rd Qtr

2009

-6

-5

-4

-3

-2

-1

0

1

2

3

4

-1.8

-2.7

-3.7

-1.5-1.1

-3.1

-2.2

-3.8

-1.4

-0.2

-4.8

-5.7

-0.700000000000001

3.5

U. S. Job LossAre we out of the woods yet?

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Mar-0

8

Apr-08

May-0

8Jun-08

Jul-08

Aug-08

Sep-08

Oct-08

Nov-08

Dec-08

Jan-09

Feb-09

Mar-0

9

Apr-09

May-0

9Jun-09

Jul-09

Aug-09

Sep-09

Oct-09

-800

-700

-600

-500

-400

-300

-200

-100

0

Kentucky has not been immune to those impacts

Nonfarm employment in thousands

6Notes:

Employment 2009 < employment 1999

Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-101750.0

1770.0

1790.0

1810.0

1830.0

1850.0

1870.0

1890.0

1769.4

Dec. ’071872.4

Sep. ‘081845.0

Sep. ’091758.6

Employment loss – 4.7%

State General Fund loss – 4.0%

Kentucky Economy:Manufacturing – Our Bread and Butter

Manufacturing employment (in thousands)

p: preliminary

Sep. 2009208.9 (p)

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We (Kentucky) face challenges

• Big challenges

• Structural challenges

• We will struggle for a while – next biennium budget will be ugly

In the words of that great philosopher, Lily Tomlin,“It’s going to get a lot worse before it gets worse.”

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Some numbers…(Depressing, aren’t they)

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e – estimatea – actualr - revised

Year State General Fund (000,000)

FY 08 $8,664.0 (a)

FY09$9,005.7 (e-budget '08)

$8,548.4 (r-Nov. '08)$8,426.0 (a)

FY10$9,417.6 (e-budget)$8,295 (r-May ‘09)

$8,214.0 (r-Aug. ‘09)$8,135.0 (r-Oct. ’09)

FY11 $8,315.0 (Oct. ‘09)

FY12 $8,623.0 (Oct. ‘09)

What’s all this have to do with UofL?

We are expected to help improve economic opportunity and quality

of life for Kentuckians (HB1 – 1997)

Law has not changed.

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“U of L to be Premier Nationally Recognized Metropolitan Research University”

“Challenge for Excellence”(1998 – 2008)

“We met Challenge”

2020 Plan

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The weak economy has an impact on us too…

Kentucky Employment Losses

Cuts/Cuts/Cuts

9 for 9

State Individual Income Tax/Sales Tax

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But no one is… hanging it up

or calling it quitsjust because we are

challenged –

To the contrary…

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Our Students…

• Freshman class average ACT• 1998 – 21.4• 2009 – 24.5

• State avg. – 20.8 (19.4)

• National avg. – 21.1

• 24 National Merit Scholars

• More students from outside Jefferson County than inside

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1. Commitment to quality– Our Covenant

2. Affordable3. Small campus experience

– Freshman English classes are limited to 22 students– 19:1 student/faculty ratio– Active student advising

4. Engagement– 250 student organizations and growing– Campus

5. A “research” university6. Our Community– UofL named one of America's Top 25 'Best Neighbors' - #12

Why we are getting the best students…

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Our Graduates…

• 1998 – 1,734 degrees awarded• 2009 – 2,428 degrees awarded– 2020 Goal – 3,074

• Graduation rate – Increased from 30% in 1998 to 48.4% in 2009– 2020 Goal – 60%

• Doctoral Degrees– 1998 – 76– 2009 – 142– 2020 Goal - 350

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And while we like our athletic success…

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• 5th Men’s Basketball (‘08-’09 season)• 17th Men’s Baseball (‘08-’09 season)• 22nd Men’s Tennis (current)• 29th Men’s Swimming/Diving (current) • 40th Men’s Golf (current)

• 2nd Women’s Basketball (‘08-’09 season)• 11th Women’s Field Hockey (current) • 16th Women’s Golf (current) • 18th Women’s Rowing (current) • 22nd Women’s Swimming/Diving (current)• 22nd Women’s Indoor Track & Field (‘08-’09 season)

How ‘bout these rankings/numbers!

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• #1 World ranking for Cardinal Singers• 2nd Percent of growth in Federal Research funding 2001-08• 9.5% Increase in transfer students• 11th School of Dentistry Research rank• 12th Best “Community” Neighbor• 13th Medicaid managed healthcare plan• Top 15% Military Friendly School• 16th School of Business Graduate Entrepreneurship • 20th Entrepreneurship productivity• 20th Number of Fulbright Scholars• 20th University increase/jump in Business Week public ranking• 24 National Merit Scholars in Freshman class• Fast 50 – Jonathan Blue – Louisville’s fastest growing privately held

company

Our Research…

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Research Funding and NIH Funding

Total grants:

1998 - $42 M2009 - $140 M

2020 Goal - $400 M

“From mind to marketplace”

1998 2008 2020 Goal

Startup companies (cumulative) 1 22 34

Patents (cumulative)

Applications filed

151 710 1,064

License option agreements (cumulative)

17 73 110

Note: By 2008, 130 patents were issued, a 136% increase since 1998.

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And our research helps Kentucky...

• The Conn Center for Renewable Energy Research and Environmental Stewardship• Argonne National Laboratory

• Cancer Care/Drugs E.g. Gardasil

• Heart care/researchE.g. Adult Stem Cells to regenerate heart

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Our faculty is critical to Kentucky’s healthcare…

• State of the art medical care provided by 460 faculty physicians who are the best teachers and researchers

• James Graham Brown Cancer Center

• University Hospital Level I Trauma Center

• The safety net for the underinsured and the uninsured– ULH: 21% uninsured normal times; today => 30%

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We are driving the economy…New arena and other construction projects

ShelbyHurst

Louisville Arena

Haymarket

Center for Translational Research

23Since 2002 – over $800 million in capital construction

We have…

• Been challenged• Made progress• Have more to do

And despite challenges, we are focused andcommitted.

And we embrace “Idea City”Louisville will be the idea capital of the world, where

imaginations and individuals thrive

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Keeping the engines running…4 keys to Kentucky’s future

• Education

• Education

• Education

• Education

The fuel for an economic recovery is educating

Kentucky’s citizens.

Education PaysPer Capita Income in All 50 States v. Adults

with Bachelors Degrees or Higher Data for 2007

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

$55,000

15% 20% 25% 30% 35% 40%

2007

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Students or Inmates?

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2010 Legislative Priorities

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• Fund maintenance and operations for current buildings

• Increase base funding• Fund additional classroom space• Keep “Bucks for Brains” alive

Support CPE Recommendations

We need your support…

You are our messengers to the legislators!

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THANK YOU!

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