University system asks for reform to meet costs

Albany Democrat-Herald
By Hhasso Hering

Western Oregon University in Monmouth has to pay the state attorney general $5,000 a month for legal help in a dispute over a construction contract, and university President John Minahan says he could hire a lawyer on his own for less.

George Pernsteiner, chancellor of the Oregon University System, says fire insurance would cost $8 million a  year less if he could buy it without going through the state Department of Administrative Services.

Minahan and Pernsteiner cite these examples of how the university system could be run more efficiently.

The state Board of Higher Education is asking the 2011 legislature to approve reforms that would turn the system from a state agency into a “public university system.”

Minahan and the chancellor explained the proposal in an interview with the Democrat-Herald.

It calls for an end to line-item funding, to be replaced by block grants of the kind given to community colleges and public schools. The plan would give the university system greater ability to manage and control its own costs, including employee benefits.

As an example of the present unwieldy setup, Minahan says the budget for the Monmouth campus has 6,000 line items.

The 2011 legislature will get two bills to achieve the reforms, Pernsteiner and Minahan say. They say legislators they have contacted support the idea.

Among them is Sen. Frank Morse, R-Albany. He said he and most other  — he hopes all — members of an interim work group on higher education support the reform.

“We have micromanaged higher education to the point of diminishing returns,” Morse said.

One issue now: Tuition paid by students goes straight to the state treasury. When budget is cut, the university officials say, the colleges can’t meet the promises they made to the students who paid that money.

The colleges want the ability to keep and manage tuition revenue and get any earnings from investing it.

Minahan wants it understood that the colleges are not whining about money.

They will operate with whatever the legislature provides, he said, but they need the ability to control costs to meet their obligations to their students.


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