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CU wants enterprise status

The University of Colorado has lost $223.9 million in state operating and capital construction support during the last three years. What business in this country, having lost that amount of funding, would not be granted the flexibility it needed to deal with the consequences?

We have shouldered two consecutive years of budget cuts and anticipate even larger cuts in 2003-2004. This year we had to make some very difficult decisions involving staff layoffs, program eliminations and major program funding reductions.

Because these cuts affect the very core of the university, I am considering a bold new idea for the financial management of CU – one that will sustain and even enhance our quality and competitiveness. I am referring to the designation of “enterprise status” for the University of Colorado.



Enterprise status means that CU would have the needed flexibility to run itself more like a business. If proposed 2004 budget cuts for public higher education pass, state support will make up only 9.9 percent of CU’s total budget, compared to 25 percent in 1990.

The 9.9 percent of state support makes us eligible under the Taxpayers Bill of Rights (TABOR) to pursue enterprise status. To fully take advantage of this status, we have requested that the legislature pass Senate Bill 264, which is designed to guarantee enterprise status for any eligible higher education institution, including CU.



Although the total state support CU receives is a small proportion of our entire budget, these funds are still incredibly vital to us. State funds support the very essence of the university – academic programs, faculty and staff compensation, and general university operations, all of which contribute directly to the student experience.

SB264 is critical because cuts to CU’s operating budget will reach $85.5 million over three years including the proposed cuts for 2004, placing us at 1995 state-funding levels.

These cuts are in addition to $120 million in capital construction cuts and an $18.5 million reduction in the Fitzsimons Trust Fund. When we are faced with educating nearly 8,000 more students than we had in 1995, but with the same current dollars we received from the state eight years ago, we simply cannot deliver the high quality education that has defined CU.

These cuts have been and will be taken from unrestricted funds that make up only 43 percent of our total budget.

The remaining 57 percent is composed of restricted funds for activities such as research. Restricted funds are not available for CU’s instructional programs or general operating expenses and they are not subject to state budget cuts.

When you consider that a third of our state support will be cut from 43 percent of our operating budget, we really start running into big numbers.

The intent of SB264 is to lift the constraints that limit our flexibility, enabling us to operate in a business-like fashion, while remaining an entity of the state.

Sustaining the quality and competitiveness of the University of Colorado through “enterprise status” simply makes sense in these fiscally challenging times.

Elizabeth Hoffman is president of the University of Colorado System.


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