The following article summarizes the original event which is listed below the summary.
Mike Volna gave a fact-filled and nuanced picture of the U’s finances
At UMRA’s first in-person forum of 2023, held at Midland Hills Country Club in Roseville, members of the Retirees Association heard an excellent presentation by Mike Volna, the University associate vice president for finance and assistant chief financial officer. He spoke to us about the University’s FY2024–25 biennial operating budget request (to the Minnesota Legislature), FY2023 state capital request, and MPACT investment request related to the proposed Sanford Health and Fairview Health Services merger. Volna was a last-minute substitute for Vice President and Budget Director Julie Tonneson and provided a fact-filled and nuanced picture of the U’s finances. He was a great pinch hitter!
View the slides from UMRA’s March 2023 Forum with Associate Vice President for Finance and Assistant Chief Financial Officer Mike Volna.
For context, Volna explained that the U’s budget and resources are about $4 billion annually. Approximately 15 percent ($622 million) comes from legislative appropriations and 25 percent ($1,050 million) from tuition. For many years, the amount of legislative appropriation has declined in relation to the U’s total budget; the income from tuition surpassed the state appropriation more than 10 years ago. This secular decline has caused the U to raise tuition, reallocate funds, and cut costs.
A unique year
Volna said that based on the forecasts, the latest of which was released in March, this was a unique year because the state announced a large surplus of $17.5 billion. A significant amount of that is a structural increase of about $6 billion, and the remainder is in one-time funds. This large surplus set off a scramble for funding from almost every conceivable quarter.
The University submitted an amended biennial budget request in March which totaled $302.5 for the two-year period. The original request covered:
· Core mission, $135 million
· Minnesota Resident Scholarship, $60 million
· Systemwide Safety and Security, $10 million
The amended request added:
· American Indian Scholars Program, $9 million
· Enrollment Driven Tuition Shortfall, $48 million
· Resident Undergraduate Tuition Freeze, $27 million
Based on information from the legislative targets for higher education that occurred the day before the forum, it seemed possible that the University would receive somewhere around $192 million. This is an 11 percent increase in the appropriation, which is higher than the University has received in many years.
Volna then described the U’s capital request of $371 million, which is usually paid for in state bonds. The request includes money for higher education asset preservation and renewal, and five specific capital projects. (See the slides.)
Finally, he spoke about the University’s health care vision—MPACT 2025—and request for one-time funds to support that vision. The point of the vision is primarily to maintain a world-class academic health system for Minnesotans and University governance and control over University flagship facilities.
To support the maintenance of University control of its health care facilities, and of its faculty, the University has asked for $300 million to reacquire the assets that were transferred to Fairview in the mid 1990s. The transfer required Fairview to assume about $87.5 million in debt and costs; there was no payment by Fairview to the University. The current request also includes $650 million for post-acquisition financial and operational support.
Volna took questions throughout his presentation and, as is his manner, answered comprehensively and factually. Many more answers will come in the next two months from the Legislature. The legislature is required by the Minnesota Constitution to adjourn sine die on the first Monday after the third Saturday in May.
—Bill Donohue, UMRA Program Committee
UMRA welcomes U of M Budget Director Julie Tonneson to March luncheon forum
Tue, March 28 2023, 11am
Julie Tonneson
VP and Budget Director
University of Minnesota
Midland Hills Country Club
2001 Fulham Street
Roseville, Minn. 55113
UMRA is pleased to welcome Julie Tonneson, vice president and budget director for the University, to speak at our March 28 Luncheon Forum about the University’s funding request for the next two years, which President Joan Gabel presented to the Minnesota House of Representatives Higher Education Finance and Policy Committee in early February.
The event will be our first in-person luncheon forum of the new year, and it will be held at a new location for UMRA: Midland Hills Country Club in Roseville.
Tonneson is one of the architects of the University’s biennial funding request, and will talk with us about its goals and its prospects for success. She will also address the University’s strategy and goals for obtaining funds from the state surpluses. This year is particularly important because the total of the structural surplus and one-time surplus was estimated, in November 2022, to be a record $17.6 billion. A new forecast will occur at the end of February or the beginning of March, so we will have current numbers before the forum.
Many see the 2023 legislative session as an opportunity for the state to fund some new initiatives, correct some underfunding, and provide relief to taxpayers. As you might expect, the situation has brought forth many proposals from lots of programs and engendered a good deal of competition.
Tonneson is just the right person to speak on these subjects. She was recruited from the Minnesota Department of Finance, by the late University CFO Richard Pfutzenreuter, to manage and enhance the budget process. Luckily for the University, she has been here for more than 25 years and has dealt with virtually every school, college, and administrative unit on the details of their budgets. She is well known as the master of all budget numbers and admired for her calm and cooperative manner in dealing with the tough questions of University finance. Indeed, most regard her as the brains of the fiscal operation. She has made many CFOs look good. As Pfutzenreuter said, “she is pretty damn smart.”
We look forward to hearing from Vice President Tonneson and thank her for bringing her experience and expertise to the UMRA Forum.
—Bill Donohue, UMRA Program Committee member
Upcoming Events
Silk Parachute, an anthology of essays and the 40th of 44 published books by author John McPhee, will be the topic of discussion when UMRA’s Fourth Friday Book Club meets via Zoom from 2 to 3:30 p.m. CDT on April 26.
We are fortunate to have UMRA member and former Minnesota Landscape Arboretum director Peter Moe to lead this approximately 3.7-mile hike at the Arboretum on Monday, May 6. Plan to have lunch together after the hike at the Eatery café inside the Oswald Visitor Center.
This session will continue the discussion begun in the May 8, 2023 session. See that article for details.
If you currently live in your own home or apartment, have you looked ahead to when you might want to consider a senior living option? Do you have any idea what those options might be? How much they cost? What they provide? UMRA’s May 14 workshop will provide an overview of the world of senior living and the basic information you need.
You’re invited to join the final Family History Interest Group meeting for 2023–24. This will be an opportunity to ask questions related to family history, share insights, talk about recent projects, and suggest topics for next year.
Stephanie Daily will lead the discussion of Fuzz: When Nature Breaks the Law by best-selling author Mary Roach when the UMRA Book Club meets via Zoom at 2 p.m. on Friday, May 17.
The May 20 hike will start at the Historic Lift Bridge in Stillwater and go along the river to the new bridge, cross over and then back on the Wisconsin side, a total of approximately 5 miles. Most of the route is paved. We will eat lunch after at Brian's Bar and Grill in Stillwater. Car pooling will be available.
Climatologist and meteorologist Mark Seeley joined the U of M faculty in 1978 and has been a weekly commentator on Minnesota Public Radio since 1992. We are honored to welcome him as our guest speaker for UMRA’s May Luncheon Forum and 2024 Annual Meeting. He is always entertaining and informative.
UMRA’s Fourth Friday Book Club welcomes back, for the second time, author Julie Schumacher, U of M Regents professor of creative writing and English, for a conversation about her novel The Shakespeare Requirement.
We are in for a treat on June 3! Lynn Anderson, will lead us on trails at two parks near her Monticello home. Bring a bag lunch and we will gather in Lynn's yard along the Mississippi River for eating and socializing after the hike.
Get out to the ballpark with fellow UMRA members for the annual U of M Day at Target Field as the Minnesota Twins take on the Oakland Athletics on June 14 at 7:10 p.m.
Please join us at 9:30 on June 17, 2024 for a walk around Lake Como in St. Paul before attending the UMRA Summer Social and Picnic starting at 11 at the Como Pavilion. A perfect opportunity to get in a walk before we gather to celebrate summer.
Picnic under the covered, open-air Como pavilion, gaze at the water, spy some birds, catch up with friends and former colleagues, and meet new members. We’ll have lunch with plenty of time for visiting and then compete in teams as we are challenged by our Quiz master(s)!
Healthy aging, mindfulness, fighting ageism, and more will be the focus of the third annual Age-Friendly University Day to be held on the U of M Twin Cities campus.