Regents Approve $11.9 Billion Operating Budget for UT System

AUSTIN – The University of Texas System Board of Regents today (Aug. 20) approved a $11.9 billion operating budget for the 2010 Fiscal Year, which begins Sept. 1. The new budget represents a 3.9 percent increase, or $446 million, over the previous fiscal year.

“In developing this budget, the Chancellor’s Office articulated to System Administration executive staff and institution presidents the importance of fiscal conservatism and cost savings in the setting of an uncertain economic horizon. Salaries for the chancellor, executive vice chancellors, vice chancellors, and presidents were frozen for this upcoming fiscal year, in addition to a flexible hiring freeze at the System Administration.  This budget represents an investment that will pay dividends in a better future for all Texans, most importantly our students, faculty and staff,” said Francisco G. Cigarroa, M.D., UT System chancellor.

Significant areas of growth include instruction and academic support expenses (5.4 percent, $167 million), research (6.5 percent, $116 million) and operation and maintenance expenses (6 percent, $99 million).
Increases in instruction and hospital and clinical expenses are primarily associated with new faculty and staff positions needed for rising student enrollment and growing patient care. Growth in research expenses results from a continued commitment by UT System institutions to developing research activities and the majority of the increase results from the System’s health-related institutions.

Despite increases in tuition, income generated by tuition and fees continues to represent a decreasing percentage of the System’s income. In Fiscal Year 2006 tuition and fees were 11 percent of the System’s income. For 2010 they will be ($1.2 billion) 9.6 percent. Revenue from health care, sponsored programs, state appropriations and tuition and fees represent about 85 percent of budgeted revenues. State appropriations ($2.2 billion) represent 17.7 percent of the System’s budget, up from 16.9 percent in Fiscal Year 2009.

The UT System’s six health institutions account for just under two-thirds of the overall operating budget. At $2.85 billion, UT M. D. Anderson Cancer Center in Houston has the largest budget of the System’s 15 health and academic institutions. The institution with the second-largest budget is UT Austin ($2.06 billion), followed by UT Southwestern Medical Center at Dallas ($1.6 billion) and UT Medical Branch at Galveston ($1.49 billion).

For FY 2010, flexible tuition at academic institutions will generate about $61.6 million of new funding, which will be distributed in the following areas:

    * 40.4 percent for new and existing faculty
    * 28.3 percent toward grants, scholarships and financial aid
    * 14.7 percent for student support
    * 10.8 percent for existing staff merit and benefit increases
    * 5.8 percent for campus infrastructure

The portion of the budget that will fund the UT System’s general administration functions decreased 1.61 percent to $35.2 million for FY 2010. General administration is funded mostly from public endowment income generated by the Available University Fund. The decreases were achieved primarily through management decisions to eliminate vacant positions.

The Faculty Science and Technology Acquisition and Retention (STARs) Program is budgeted to increase $10 million; $15 million for System academic institutions and $15 million for health institutions in FY 2010. Program funds, which come from bond proceeds of the Permanent University Fund, are used to purchase state-of-the-art equipment and to renovate laboratory facilities to help attract or retain researchers in health, mathematics, computer sciences, biological sciences, physical sciences, engineering and liberal arts.

Launched in 2004, the STARs Program has aided in the recruitment and retention of top-flight faculty, who in turn have generated more than $267 million is sponsored research at UT institutions.  Since the program’s creation, the UT System has allocated roughly $154 million in grants to the institutions.

About The University of Texas System
The University of Texas System is one of the nation’s largest higher education systems, with nine academic campuses and six health institutions. The UT System has an annual operating budget of $11.9 billion (FY 2010) including $2.5 billion in sponsored programs funded by federal, state, local and private sources. Student enrollment exceeded 195,000 in the 2008 academic year. The UT System confers more than one-third of the state's undergraduate degrees and educates nearly three-fourths of the state's healthcare professionals annually. With more than 84,000 employees, the UT System is one of the largest employers in the state.