BANGOR — University of Maine System Chancellor James Page urged business leaders Thursday to help the system through its current financial problems by encouraging lawmakers to increase state funding.
“We have to go to the Legislature and have a dialogue about what is the value of higher education. What is the common good?” Page told about 100 people at a Bangor Regional Chamber of Commerce breakfast meeting.
“If we are doing our job of reducing costs and delivering value, … we need to ask the Legislature to really look hard at the level of appropriation,” he said.
Last year, the system got $179.5 million in state funds, down from a recent high of $185.7 million in 2008. Page said state funds used to cover about two-thirds of the cost of running the seven-campus system. Today, state money covers 34 percent, with tuition making up the bulk of the difference.
Together, tuition and state funding make up 88 percent of system revenue.
Businesses and Mainers in general benefit in many ways from the work of the university system, beyond its role in educating students, Page said.
“Hold us accountable, but we’ll need your support,” he said.
The system’s board of trustees approved a $529 million budget for 2014-15 that includes $11.4 million from emergency reserves and the elimination of about 157 positions. The deep cuts and reserve funds closed a $36 million deficit that officials said was caused by flat state funding, declining enrollment and tuition freezes.
The years of deep cuts in workforce and academic programs systemwide are in danger of “hitting sinew and bone” at this point, he said. This year, expenses were reduced about $24 million.
“We’ve done it through hard choices. You can’t do it without making terrible choices around your workforce,” he said, noting that more cuts are expected in the upcoming years.
A plan recently released by the trustees estimates the system needs to cut about $60 million through workforce reductions over the next five years as part of an effort to close a projected $69 million budget deficit by 2019.
Rebecca Wyke, vice chancellor for finance and administration, has said the system’s five-year budget projections presume that both state funding and tuition will increase each year at the rate of inflation, which now is slightly less than 2 percent.
Tim Brochu, a principal at Brewer-based CES Inc. structural engineering firm and a graduate of the University of Maine in Orono, said businesses need to support the university.
“I think it’s got to come down to more funding through government,” he said. “The university is critical to the state as a whole.”
Page also asked business leaders to support an upcoming $8 million bond measure for a diagnostics lab that would be used with Maine industries to combat plant and animal pests that threaten crops. He noted that the Cooperative Extension service has historically saved industry millions of dollars by working on strategies to deal with problems such as late blight onset in potatoes and a fruit fly that damages blueberries.
“The extension is a proven investment,” he said.
Sue Hunter, who will take office as the new president at the Orono flagship campus on July 7, noted that UMaine has many research and development projects that are a resource to the state, from a manufacturing center that regularly partners with businesses to stormwater research.
“In spite of challenges, there are wonderful things happening at UMaine and the sister campuses,” she said.