sealPurdue Letter from the President

December 2002

(A monthly letter from President Martin C. Jischke)

The Indiana General Assembly is entering another legislative session in which it faces awesome responsibilities and a daunting task. With a state budget deficit in the $1 billion range and an economy that still is struggling to recover from a persistent recession, our legislators' task may be even more difficult than it was during the 2002 short session.

That session ended with a remarkable legislative compromise that resolved the immediate budget crisis and corrected some of the flaws in our state's tax structure. However, even as they adjourned, members of the Senate and House recognized that they would have to deal with significant fiscal problems in 2003. The gap between revenue and spending remains the first hurdle on a difficult obstacle course, but finding ways to make more targeted investments in our state's future will – in the long run – be even more important. Until we revitalize the economy by improving the climate for business and increasing the number and diversity of jobs, we won't be in charge of our own future.

That recipe starts with education. A first-rate public school system and excellent colleges and universities that provide opportunities for a wide range of educational needs are essential. We also have to invest in the discovery of new knowledge that can support economic development. The 21st Century Research and Technology Fund has been an excellent start in this direction. The fund has the potential to jump-start key areas of the Indiana economy. It was stalled temporarily by the 2002 budget crunch, and we should not let that happen again.

By bringing together research universities, private business and government, the 21st Century Fund creates the kind of partnerships we will need to succeed in a global, knowledge-based economy. Indiana's natural economic strengths with the greatest potential for growth are the life sciences, advanced manufacturing, computer-related business and value-added agriculture. These fields are heavily represented among the projects supported by the 21st Century Fund. We have overwhelming evidence that the formula works. We need to find a way to increase our investment in it.

Purdue and Indiana University together absorbed more than $200 million in budget reductions and withheld appropriations in the last biennium. Other higher education institutions suffered as well. While we understand the state's need to reduce spending during a budget crisis, a continued erosion of our state funding base will have severe consequences for higher education and for the state itself. It is clear from all their actions that Indiana's leaders recognize this fact, but all of us continue to search for a way to make this crucial investment in tomorrow while struggling with the immediate problem of balancing the budget today.

In developing its five-year strategic plan, Purdue did not ask for significant funding increases from the state. We assumed that appropriations would keep up with inflationary costs and that the state would support the costs of operating new buildings constructed with gift funds. We also promised to ask for additional funding for new programs only in areas that would have an impact on state economic development.

Purdue's ability to support economic development is a proven commodity. The record includes numerous examples of technical assistance for business and agriculture; targeted education, such as the Statewide Technology program; new business startups through the Purdue Research Park; and many other initiatives. Each college or university contributes in its own way, but all depend on the state for the support that makes it possible for them to do their best for the people of Indiana.

During the next few months, our state's leaders will make decisions that will affect the quality of life for all of us and for future generations of Indiana citizens. Purdue is ready to work with them to find ways to meet these challenges.

• • •

Purdue's second straight trip to El Paso for the Sun Bowl was a great success in all respects. The Boilermakers' victory in a thrilling New Year's Eve game was the icing on the cake that included a wonderful turnout of fans, smooth travel, good weather and warm hospitality from the people of El Paso.

It was great way to end an eventful year!

Martin C. Jischke