UW System Finishes Third Quarter with $1.7 Billion Cash on Hand

Van Hise Hall, Home to the Office of the Board of Regents

Walker Calls for Additional 2-Year Tuition Freeze

MacIver News Service | April 11, 2014

[Madison, Wisc…] The University of Wisconsin System finished the third quarter of fiscal year 2013-14 with $1.7 billion cash on hand, according to data released on Thursday. The UW System is expected to finish the fiscal year, which ends June 30th, with $1.1 billion in reserve.

Legislators and the Governor demanded answers from the UW System last April when the legislature’s CPA Caucus discovered a $1 billion hidden cash surplus. That led Gov. Scott Walker to call for a two-year tuition freeze on all UW campuses, which was included in the most recent state budget.

The surplus came as quite a surprise last year because UW officials raised tuition by 5.6 percent or more every year for the past decade claiming they needed more funding. In fact, the average tuition for a Wisconsin resident at the UW System increased from $3,041 in 2002-03 to $6,723 in 2012-13, a jump of more than 120 percent.

Along with freezing tuition for the 2013-14 and 2014-15 academic years, the budget also required the UW System to regulate how much cash-on-hand is appropriate for each campus. The regents passed a policy that would require schools to have between 10 and 15 percent of yearly expenditures in reserve, and prohibit them from using the surplus to request more state funding or tuition increases.

Former UW System President Kevin Reilly retired a few months after facing a barrage of questions about the surplus while testifying in front of the Joint Committee on Employment Relations. Ray Cross took over for Reilly in January and vowed to be more transparent with the UW System’s funds.

After the release about the third quarter surplus, Walker called for an additional two-year freeze on tuition.

“After years of tuition hikes, it is important to give our students and their families a break. Our proposed second two-year tuition freeze will go a long way to helping working families and students have access to higher education,” Walker said in a statement. “This freeze continues our commitment from the last budget to make college more affordable for working families and students across our state.”

Co-Chairs of the Joint Committee on Finance (JFC), Sen. Alberta Darling (R-River Hills) and Rep. John Nygren (R-Marinette), were happy to see more openness from the UW System and joined Walker in calling for an additional tuition freeze.

“We fully support Governor Walker’s call for another two-year freeze on tuition,” the JFC Co-Chairs said. “The freeze will help make our world-class university system more affordable.”

Assembly Speaker Robin Vos (R-Rochester) said he expects the legislature to include the tuition freeze in the next state budget.

“An additional two-year tuition freeze makes sense following the budget report from the UW System,” Vos said. “I expect that the Legislature will consider this option during the budget process next session while working with UW officials to maintain one of the finest university systems in the country.”

The projected fiscal year-end surplus is a decrease from last year’s reserve, but not as much as was predicted by UW System officials last summer.