South Dakota Board of Regents
Fiscal Year 2017 Budget HearingJoint Appropriations CommitteeFebruary 2-3, 2016
Senator Deb PetersChair
Representative Justin CroninChair
Senator Larry TidemannVice Chair
Representative Dan DrydenVice Chair
Stewardship of Public Higher Education in South Dakota
John W. Bastian
Harvey C. Jewett
Kathryn Johnson Jim Morgan Joseph SchartzKevin Schieffer
Bob SuttonVice President
Terry BalounSecretary
Randy SchaeferPresident
2
Board of Regents’ Strategic Plan: Our vision and mission• Randy Schaefer, President
3
The 2020 Mission Statement• The South Dakota Board of Regents’ mission is to provide an
excellent, efficient, accessible, equitable, and affordable public university and special schools system
that improves South Dakota’s overall educational attainment and research productivity,
while enriching the intellectual, economic, civic, social, and cultural life of the state, its residents, and its communities.
4
65 Percent by 2025!• Goal is based on projections that roughly 65% of all jobs in our
state will require some level of postsecondary education by 2020. Data from Georgetown University Public Policy Institute’s Center on
Education and the Workforce.
5
65 Percent by 2025!• Regents seek statewide goal: 65% of South
Dakotans, age 25-34, holding some type of postsecondary credential by 2025.
• If agreed to, all postsecondary partners work together to deliver on 65% goal: public, private, technical and tribal.
• Adopted by the Workforce Development Council.
• Thank you, Gov. Daugaard, for your support! (State of the State message, Jan. 12, 2016)
6
Projected Revenues from Meeting 65% Goal
$107,600,000
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
State Revenues7
Source: NCHEMS; CLASP
(NCHEMS/CLASP)
Our Goals: Public Higher Education is Vital to South Dakota’s Prosperity
•Student SuccessGrow degree production to 7,450 per
year by 2020.
8
Our Goals: Public Higher Education is Vital to South Dakota’s Prosperity
•Academic Quality and PerformanceDocument that academic programs are
of the highest quality.
9
Our Goals: Public Higher Education is Vital to South Dakota’s Prosperity
•Research and Economic Development Increase annual research and contract
expenditures to $150 million by 2020.
10
• Advance knowledge• Enhance technology
transfer and commercialization
• Catalyze economic development
Our Goals: Public Higher Education is Vital to South Dakota’s Prosperity•Affordability and AccountabilityReduce South Dakota’s tuition and fee
ranking to regional average by 2020.Create and capitalize on efficiencies in
the Regental System.
11
Competition in the Region
12
Source: BOR Fact Books
$3,742
$5,382$5,663 $5,845 $5,849
$6,215
$7,544
$4,960
$6,107
$6,948
$8,475
$6,851
$7,886
$9,842
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
$10,000
WY MT ND SD NE IA MN
FY16 as compared to FY08 Undergraduate ResidentTuition and Requires Fees
FY08 FY16
55%52% 52% 51% 52%
49%
45%
45%
41%
38%39%
42%
44%45% 48% 48% 49% 48%
51%
55%55%
59%62% 61%
58% 56%
30%
35%
40%
45%
50%
55%
60%
65%
FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
Student Support
State Support
State Support Impacts Affordability• The 2014 tuition freeze, supported by the Governor and the
Legislature, improved affordability for SD students.
13
Source: BOR Fact Book FY 2016
State support of South Dakota public higher educationincreased from 38% to 44% over the past three years.
The state of public higher education in SD• Mike Rush, Executive Director & CEO
14
As an economic engine
15
• Attracts income• Generates income• Attracts business• Enhances individual wealth
16
Higher Education
Attracts Income• $299 million in federal money in FY14
• Compares to $194 million from General Fund
17
Source: SDBOR FY2016 Fact Book
Generates Income• SD’s public universities generate $1.97 billion per
year in long-run annual economic impact
• BHSU - $191 million• DSU - $110 million• NSU - $157 million• SDSMT - $148 million• SDSU - $766 million• USD - $522 million
18
Source: University of South Dakota, Government Research Bureau (2010)
Attracts Business
• Workforce• Family benefits• Social and
economic climate
19• Business expertise• Research partnerships
Milken Institute Study on Economic Development
20A Matter of Degrees:The Effect of Educational Attainment on
Regional Economic Prosperity
Milken Institute StudyA Matter of Degrees: The effect of educational attainment on
regional economic prosperity • Key Findings:
• Education increases regional prosperity• Better educated, bigger benefits.
21
Enhances Individual Income
• Some College – 13% higher• Associate degree – 26% higher• Bachelors degree – 72% higher
22
Return on Investment by Degree Level (2013)
$47,104 $94,208 $134,868 $195,858$310,188
$1,107,922$1,344,267
$3,312,883
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
Associate's Bachelor's Master's Doctoral
Cost of Degree Lifetime Earnings Bonus
23
Source: US Census Bureau, American Community Survey (PUMS), 2013
ROI7 to 1
ROI12 to 1
ROI10 to 1
ROI17 to 1
New US High-Paying Jobs by Degree Level
2,800
152
-39-500
500
1,500
2,500
3,500
Bachelor's Degree orHigher
Some College orAssociate's Degree
High School or Less 24
Source: Georgetown University Center on Education and the Workforce (2015). Good Jobs are Back: College Graduates are First in Line
2010-2014(in Thousands)
Impact of Education on Income
10%
15%
20%
25%
30%
35%
40%
45%
$15,000 $20,000 $25,000 $30,000 $35,000 $40,000
SD
25
Source: US Census Bureau, American Community Survey, 2013
States by Income and Education, 2013
Per Capita Income, 2013
Perc
ent w
ith B
ache
lor’s
Deg
ree
or H
ighe
r
Strengthening South DakotaEconomic, Social, and Human Capital
26
Source: The College Board (2013). Education Pays; Institute for Higher Education Policy (1998). Reaping the Benefits: Defining the Public and Private Good of Going to College
Accountability to our Students and Citizens
27
Measuring Our ProgressEnsuring Accountability & Transparency
• SDBOR Fact Book• www.sdbor.edu/mediapubs/factbook/index.htm
• SDBOR Interactive Dashboards• www.sdbor.edu/dashboards
• SDBOR Strategic Plan – 17 System Metrics• www.sdbor.edu/theboard/StrategicPlan
• Council of Higher Education Accountability Report
• Presidential Evaluations
28 28
Improving Student Preparation & Retention• Department of Education Collaborations
• Placement Aligned with State Assessments• High School Remediation Coursework
• Improving Remedial Performance• Bridge Programing - South Dakota Jumpstart• Co-requisite Remedial Courses
• First Year Targeted Interventions• Early-alert System (Starfish)• Intrusive & Professional Advising
29 29
Fostering On-Time Degree Completion
• Creating a Finish in 4 Year Mindset• Exploratory Studies • 15-to-Finish Models
• Targeted Policy • Credit-Hour Requirements – 128 to 120 • Student Success Collaborative (SDSU)
• Transfer & Non-Traditional Students• Articulation Agreement Expansion• General Studies Degree Expansion
30
Improving System Completion
5,599
5,858
6,355
6,172
6,346
5,200
5,400
5,600
5,800
6,000
6,200
6,400
6,600
FY11 FY12 FY13 FY14 FY15
13% Increase in Total Graduates Since FY11Total Graduates
31
Helping At-Risk Students Succeed
32
Year Low-Income Students
American Indian Students
Nontraditional Students
Underprepared Students
FY11 2,343 108 990 1,320
FY12 2,527 144 1,092 1,278
FY13 2,742 142 1,244 1,461
FY14 2,657 124 1,152 1,362
FY15 2,641 145 1,287 1,342
Change +13% +34% +30% +2%
Source: Regents Information Systems
Filling the Workforce Pipeline• Preparing South Dakotans for tomorrow’s workforce
33
Source: Regents’ Information Systems
1,699
1,124 1,036
552 535 535 486 307 284
2014-2015 Degreesfrom SD Public Universities
2020 Vision: The South Dakota Science and Innovation Strategy
1,376 1,424 1,559 1,630 1,693 1,734
-
500
1,000
1,500
2,000
FY10 FY11 FY12 FY13 FY14 FY15
STEM Graduates
• Graduate programs to foster new innovations
34
Source: Regents’ Information Systems
Responsive Academic Programming(Since 2011)
• Rigorous approval process for new programs• Rigorous annual and 7 year review of existing programs
35
2011-2015 ADDED TERMINATEDUndergraduate Majors 12 26Undergraduate Minors 50 18Undergraduate Certificates 27 8Undergraduate Specializations 7 24
Graduate Degree Programs 22 5Graduate Certificates 12 1Graduate Specializations 8 2
Academic Programming for Economic Development
Programs related to Key IndustriesBioscienceBS, Applied Biological Sciences SDSM&TPhD, Biochemistry SDSU
Oil and GasMinor, Petroleum Systems SDSM&TMinor, Sustainable Energy Systems SDSU
Financial ServicesMinor, International Business NSUMA, Banking & Financial Services NSU
Shooting, Hunting, and Outdoors Minor, Conservation & Biodiversity USDMinor, Events & Facilities Admin SDSU
Professional Business ServicesMinor, Social Media Marketing USDMS, Analytics DSU
Value-Added Agriculture Minor, Precision Agriculture SDSUMS, Ag & Biosystems Engineering SDSU
36
Producing Graduates with Information-Age Skills and Knowledge Literacy and communication Critical thinking Collaborative problem solving
and decision making Numerical and scientific
reasoning Computer fluency and use of
technology Subject-matter proficiency Understanding social,
organizational, and technological systems
Individual and social responsibility
Self-management Integrity, teamwork Creativity, enthusiasm,
initiative Understanding ethics, values,
and how society, government, and business work
Coping with change; how to make things change
Being assertive to get concerns addressed
Taking charge of your own learning
37
Fact Check: What kind of graduates does a major South Dakota employer hire?• College majors of recently-hired graduates working for
Wells Fargo
Finance Accounting Business Administration,
Business Management, Business Marketing, Business Economics
Computer Science Education-Teaching,
Special Education Speech Communications Economics
Sociology Agricultural Science,
Agricultural Business/Economics
Communications-Public Relations
Banking and Finance Service Management Music Spanish Biology 38
Research is Economic Development
$105,072,927
$83,411,604
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
SDBOR Research ActivityFY00-FY15Awards Expenditures
39
Source: SDBOR Office of Academic and Research Affairs
Research is Job Development
• FY15 Job creation - Faculty research efforts (FTE): 610• Research innovations – FY07-FY15
• Invention disclosures – 456• Patent & intellectual property protections filed – 202• Patents/licenses issued – 116
40
Source: BOR system office
FY17 Budget Request
41
State HEFF Match - Year Four of Four
• Governor’s Recommendation: $3,274,464
• Safe, efficient and appropriate • 2% replacement value
FiscalYear
Replacement Value(in millions)
M&R Allocated(in millions)
% of Replacement Values
FY11 $ 945,224,939 $ 8,778,712 0.9%
FY12 $ 964,530,324 $13,372,636 0.9%
FY13 $1,093,628,653 $15,917,778 1.5%
FY14 $1,135,770,710 $18,590,650 1.6%
FY15 $1,184,230,289 $20,068,760 1.7%
FY16 $1,260,771,828 $22,563,326 1.8%
FY17 $1,291,889,484 $25,837,790 2.0%
42
LRC Budget Briefing Pages 4 & 6
Resident State-Support Tuition Freeze
• Governor recommends paying off Bonds and adding $324,020 in general funds
• Total redirected to tuition freeze is $3,228,710
• Reduce tuition proportion of cost
• Goal: 50/50 split between student support and state support
$0
$2,500
$5,000
$7,500
$10,000
$12,500
$15,000
$17,500
FY10 FY11 FY12 FY13 FY14 FY15
$5,6
53
$5,1
78
$4,9
53
$5,1
03
$5,4
55
$5,5
34
$7,6
77
$8,3
94
$8,8
24
$9,6
83
$9,5
94
$9,9
95
General Fund and Student Expendituresper FTE Student
General Fund Support Student Expenditures
Average Expenditure per FTE Student$13,330 $13,572 $13,777 $14,786 $15,049 $15,529
43BOR Strategic Goal 4: Affordability & Accountability
LRC Budget Briefing Page 7
44
Lower State Support Drives Higher Tuition
45
Source: SHEEO State Higher Education Finance (SHEF) Report, 2014(Note: SHEF data adjusted for enrollment mix and cost of living, so numbers will differ from BOR Fact Book.)
Iowa Minnesota Montana Nebraska NorthDakota
SouthDakota Wyoming National
AverageAppropriations Fer FTE $5,335 $5,327 $4,939 $7,840 $7,888 $4,878 $15,561 $6,552Net Tuition Revenue Per FTE $8,118 $7,111 $5,505 $5,401 $6,752 $8,221 $2,761 $5,777
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
FY14 Public Postsecondary EducationEducational Appropriations and Net Tuition Revenue
Per FTE
National Guard, Teacher and State Employee Tuition Support
• Governor’s Recommendation:
• General Fund - $390,054
• Transfer $230,098 fromDepartment of Military
46
LRC Budget Briefing, page 7
SD BOR Strategic Goals 1 & 4: Student Success and Affordability & Accountability
National Guard, Teacher and State Employee Tuition Support
• Simplifies tuition and fees• Maximizes federal tuition assistance
for military personnel• Requires legislation to change HEFF
percentage from 20% to 11.5%
47
LRC Budget Briefing, Page 4, 13-14
SD BOR Strategic Goals 1 & 4: Student Success and Affordability & Accountability
South Dakota Opportunity Scholarship
• Governor’s Recommendation: $434,369
• Changes in 2016 to $1,300 for first 3 years and $2,600 for final year
• 1,100 new students each year• 2nd year of students to receive
increased funding
48
BOR Strategic Goal 1: Student Success – Grow undergraduate degrees awarded
LRC Budget Briefing, Page 10
Re-Establishing Value
26.0%
24.3%22.8%
21.4%
19.8%18.4%
17.6%16.5% 16.3%
15.5% 15.5%
20.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
22.0%
24.0%
26.0%
28.0%
2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
% OF TUITION
49
• $5,000 award equaled 26% of four-year tuition costs in 2004• Decreased in value to 15.5% in 2014-15• $6,500 award is 20% of the tuition and mandatory fees
Source: BOR Fact Book
LRC Budget Briefing, Page 10
REED Network Equipment Replacement
• Governor’s Recommendation:• $250,920 per year for five years
• Existing routers need replaced -$1,254,600
• The Research, Education and Economic Development (REED) Network has provided a robust and reliable network for higher education, SURF, and EROS
• Research collaboration with other states as well as within South Dakota
50
SD BOR Strategic Goal 3 – Research and Economic Development
LRC Budget Briefing Page 8
Center for the Prevention of Child Maltreatment
• Governor’s Recommendation:• $210,725 and 1 FTE
• Jolene’s Law Task Force• Educate and provide
assistance• State and local agencies and
regionally
51
LRC Budget Briefing Pages 4, 12-13
Need Based Scholarship Endowment
• Governor’s Recommendation:• $1.4 million in health insurance savings from tuition funds
transferred to Endowment• One-time General Fund appropriation of $2.1 million• Will grow the Endowment from $1.5 million to $5 million• Will produce from $100,000 (2%) to $200,000 (4%) in awards
each year
52
FY16 GB Amendment –SB 48 & SB 67
SD BOR Strategic Goals 1 & 4: Student Success and Affordability & Accountability
Need Based Scholarship Endowment
• 60% eligibility for PELL Grant funding• Currently, $12.80 per PELL eligible student• Affordability and accessibility continue to be hurdles for many academically
accomplished students
53
SD BOR Strategic Goals 1 & 4: Student Success and Affordability & Accountability
FY16 GB Amendment –SB 48 & SB 67
Need-Based Funding PELL Eligible StudentsNeed Funding per PELL
Eligible Student
South Dakota $200,000 15,629 $12.80
North Dakota $9,193,000 13,156 $698.77
Wyoming $167,000 7,849 $21.28
Colorado $67,332,000 102,266 $658.40
Iowa $48,854,000 152,554 $320.24
Minnesota $119,894,000 107,688 $1,113.35
Montana $5,288,000 16,857 $313.70
Nebraska $14,948,000 34,895 $428.37
Total/Average $265,876,000 450,894 $589.66
Public PerceptionThe Affordability Disconnect
Percent of US adults agreeing that higher education is:
54
100%
60%
40%
20%
0%
80%
Important? Available? Affordable?
96%
61%
21%
The ObstaclesCompletion Rates by Income
Baccalaureate Degree Attainment by Age 24
55
Source: Postsecondary Education Opportunity, 245 (November 2012)
71%
10%
0%
20%
40%
60%
80%
Highest Income Quartile Lowest Income Quartile
The ObstaclesAbility to Pay for Higher Education
Percent of families with school-age children by annual family income:
56
42% 44%
28%
19%
0%
10%
20%
30%
40%
50%
United States South DakotaUnder $50,000 $100,000 or more
Animal Disease Research and Diagnostic Laboratory Design Study
• Governor’s recommendation: $1,575,000 from the Livestock Disease Emergency Fund
• Total planning costs - $2,742,000• $535,000 spent to date from ADR&DL funds• $635,000 available from ADR&DL funds if needed
57
HB 1080
SD BOR Strategic Goal 3: Research and Economic Development
Mission• Protect the SD livestock industry,
• the health of animals, and • the welfare of society
58
35%
59
60