Chancellor Cox, President VanLuvanee, Members of the Board,

Once again it is a privilege to address you on behalf of IFS.

Much--I'm sure we would unanimously agree, too much--has changed since I last reported to you in July. Those changes have thrust on us all at once, whether we want it or not, the opportunity and the necessity of reassessing who we are as individuals and as parts of the families, the work groups, and other entities to which we routinely belong.

Of course, I mean this not merely in the obvious sense that the wrenching events of September 11 have forced us to ponder our security and the meaning of our citizenship. As Oregonians at the leading edge of the nationÕs economic travail exacerbated by the terrorism crisis, we are also confronted by unhappy realities close to home with which we are now bound by fate to deal. Governor Kitzhaber has made it clear that we in OUS as well as other state agencies must do this immediately and, apparently, with an especially cold eye. The seriousness of this matter can be swiftly characterized by the phrase `ten percent cut'.

This is all by way of context for the October meeting of IFS and the extraordinary session we held on Friday the fifth. IFS, at the urging of Chancellor Cox, held a discussion on higher education in the Oregon political culture, and why it has struggled to engage the imagination and support of Oregonians. On this topic a lively and informative conversation developed between the IFS senators and our invited guests, who included Representatives Phil Barnhart of Eugene and Kelly Wirth of Corvallis, Director Lussier, Vice Chancellor Vines, Grattan Kerans, the student body president of OSU, and Professor Emeritus Gordon Dodds of PSU, perhaps the foremost historian of Oregon, who set the tone of the discussion with a short talk on OregonÕs political values. I wonÕt trouble you with the details of this conversation, penetrating and serious though it was, although we will be sending on to all participants and Chancellor Cox a summary transcript which, perhaps, will be shared with you. I will say today that though none of the participants had discussed, to my knowledge, the substance of their individual opinions and attitudes, to any appreciable extent, what emerged was a uniform but chilling perspective on the situation of higher education today and for the long term. Let me give you a few of the striking bullet points from our discussions.

The State of Oregon has not historically supported higher education.

In the last 10 years, higher education has made some progress, but this progress simply made up for Measure 5 losses. · In an ideal world, the state would like to support higher education, but the immediate priorities are seniors and high schools--at least these groups are better lobbyists for themselves.._ (Also, our state is spending money for prisons at an approximate 250% increase in 10 years.)

The State of Oregon is in a financial crises that the legislature has been in denial about.

Don't expect support for higher education soon for these reasons:

-- The state does not have an adequate funding model (Since Measure 5, we have always struggled to make the minimum funding level.)________________

 -- It will take time for the state to realize how serious the situation of higher education truly is.

-- There are other State priorities right now.

-- The legislators don't understand our RAM model.

-- We have hidden from the legislators our financial problems.

-- We do a poor job communicating the benefits of a state supported higher education to Oregonians.

But, in any case, these notes also are, as Thomas Jefferson said of the Compromise of 1820, a `fire bell in the night,' and although they are deeply dispiriting, they should be taken as a bracing introduction to the arduous task of defending our most deeply felt ideals and enhancing these key institutions of our society, something that did not happen with the Missouri Compromise. For forty years the nation paid for its refusal to deal with the volatile issue staring it in the face--the slavery question--with escalating tensions and patchwork solutions until the ultimate crisis of the Civil War. If we face our own bad news squarely, we can instead begin the task of making our case more forcefully than we evidently previously have done to our constituents and making realistic choices about the future.

In this context, I want to end this report by asking you to consider carefully four important items that IFS has directed me to raise.

First, although there was some discussion of the problems of PEBB over the last several years, I must tell you that many faculty felt `blindsided' by the disappearance of the cash-back element of the health care package in this yearÕs enrollment. For many, especially younger, not particularly well remunerated persons, the loss of cash-back represented a significant pay cut. As a result, these people were not able to do realistic budget planning. This is an issue of communications, and I FS hopes that in the future, the volatility of the health care markets being what it is, as the inevitable adjustments in the benefits package surface, greater attention will be given by OUS to making all faculty aware in a timely fashion of the consequences of the changes, whatever they might be.

Second, the cash-back issue is obviously merely another harbinger of the decline of the total compensation for OUS faculty members. To the erosion of faculty salaries can now be added the wasting away of benefits. As this occurs, IFS wants to underscore today what has been said by occupants of this chair many times in the past: faculty are the lifeblood of each institution and of the total system. If OUS cannot properly compensate current faculty or attract the best new professors with the promise of an adequate salary, it will sink into mediocrity. In the context of expected budget cuts, it may be difficult to comprehend how the salary issue can be raised, but we believe this is a more urgent matter than ever before. I can assure you that faculty at every institution are concerned about the future staffing of their departments as well as how they will be able to subsidize their lives in their accustomed manner. We feel that the Board should make this one of its highest priorities.

Third, by the same token, as we enter these difficult fiscal times it is, in the view of IFS, a matter of the greatest urgency that the system and the institutions refrain from the temptation to once again resolve their financial problems on the backs of students. It would be a stinging irony if new tuition raises and new fees were to be levied at a time when students are making the choice of higher education to prepare themselves for jobs for which they arenÕt currently competitive without a degree, a well known strategy in tough times. This is not a time to make it difficult for those who want to learn to do so. The doors of the universities must swing open as wide as possible.

Fourth, IFS respectfully requests that the Board give the utmost consideration to a seat for an IFS member on the search committee for the new chancellor. There can be no more apt time nor occasion for a gesture of confidence in shared governance than this moment when we are poised to choose the individual who will lead us through what promises to be a rugged legislative session. Faculty must be fully invested in the choice and the best way to accomplish that will be to have direct input at the highest level.

We are living through a time freighted with ironies. The blazing colors of autumn form a backdrop to the most somber of moods. The public universities of Oregon face crippling blows at a time when they are most needed to uphold the highest values of our society, create new knowledge in the teeth of unnerving ambiguity, and prepare more young people better than ever for an uncertain future. Yet these are not insurmountable tasks and we can transcend the ironies of the day if we as leaders of the system and its teachers and scholars keep faith with one another and those who depend on us to provide excellent education. Let us begin to do that. Thank you.