By Elizabeth A. Davis
Photos by Adam Brimer
The next four years for UT’s president start in January with a huge vote of confidence, optimism and a big challenge. He is taking on the university’s business model to take financial pressure off students and their families. And he’s committed to speaking out about the importance of quality education for all Tennesseans.
President Joe DiPietro “is a remarkable leader who has earned the trust and confidence of a wide spectrum of Tennesseans. He possesses the ‘right stuff’ not only to manage this complex and very important university but to lead it in a positive new direction going forward.”
That is the concluding assessment of an external advisor who conducted a comprehensive review of DiPietro’s performance by interviewing about 70 people across the state, from the governor to students. Stability and trust were the hallmarks of most of the confidential comments.
“This is the time for the University of Tennessee to step forward, speak up, flex our muscles and be leaders.”
Indeed, establishing stability was a goal when DiPietro took office in January 2011. He has done that on the heels of nearly a decade that saw three presidents and three interims steering the University of Tennessee System. In 2012, he introduced a strategic plan that clarified the definition of the UT System in its statewide entirety and the role of the UT System administration.
DiPietro righted the ship and guided it toward smoother waters. Now, he is charting a new course that is bound for ebbs and high tides, the risk of staring at a challenge and conquering it. But DiPietro believes it is the right thing to do.
Dwindling state appropriations and increasing tuition have become reality for UT and other universities around the country. In 2001, tuition and fees at UT made up 25 percent of unrestricted educational and general revenues, while state appropriations were 53 percent. In 2011, those two lines crossed on their divergent paths, with tuition and fees making up 47 percent and state appropriations 38 percent.
That trend continues today with tuition and fees at 49 percent and appropriations at 39 percent. Ask DiPietro about it, and he’s fired up, ready to tackle it.
“Our business model has to change. The challenge is how we are going to do that so we are ready and performing at a higher level,” he says in a matter-of-fact tone while sitting at his office meeting table. “It will be a work in progress. I don’t think we will ever figure it out completely. It is about changing the operational approach we take and rethinking how we truly operate as a business.
“I’m convinced that what we do in the next four years will serve the institution long into the future if we do it right and are successful.”
“We won’t ever stop doing this. In the past, we have relied heavily on tuition to fill the gap, but that is no longer as reasonable or doable or sustainable.”
It will require a monumental change in the way the university runs. It will make the university different, and it’s more than pinching pennies here and there. It’s the four E’s, as DiPietro puts it: effective, efficient, entrepreneurial and excellent.
How could the university change? Add more out-of-state students at higher tuition rates. Make the UT Foundation more independent. Maybe consider elimination of programs. There will be difficult conversations ahead, and they may not win friends.
“I’m convinced, if we want to emerge as a better institution, we have to go through that tough exercise. We want to do it with style, care and grace, and we want to have our employees involved, but we’re at a juncture where it is imperative to our future,” DiPietro says.
Major expansion of buildings and space, additions of campuses, huge increases in enrollment, key partnerships and political funding victories have characterized previous UT presidential legacies. DiPietro, with the backing of the Board of Trustees, has chosen a stickier legacy.
This road ahead does not look anything like coasting toward retirement. When confronted with that option, DiPietro easily pushed it aside.
“We could tread water and just hang on and be OK, but we won’t be where we need to be quality-wise,” DiPietro says.
“I have a terrible conviction about this. I’m convinced that what we do in the next four years will serve the institution long into the future if we do it right and are successful. If we don’t do it right, it’s still worth trying. But it should position us to be highly successful as a system that educates, discovers and connects.”
The impact on students is where DiPietro gets the most passionate. He draws from his own experience growing up in a rural town in Illinois and having the opportunity to attend the University of Illinois in Urbana to study veterinary medicine.
“I keep looking at the kind of tuition increases we’ve had, and I worry about access, affordability and a family’s ability to send a person to a public institution. In my life, it did great things for me. It would not be who I am if I didn’t get what I went to Illinois for, and that was a public education,” he says.
The business model dilemma has been brewing for several years, and the recession provided the university with American Recovery and Reinvestment Act funding that helped buoy it financially. That is gone, and economists disagree on whether another recession may happen sooner rather than later.
One of the topics at last winter’s meeting of the Association of Governing Boards—the national organization for higher education boards—was funding or the lack of funding and the difficulties facing universities across the country. From that moment, DiPietro has thought of little else.
“It became very apparent we had to do something,” DiPietro says.
In addition to revamping the business model, there is a question of where the university might get additional funding. Without a state income tax, Tennessee relies heavily on sales tax and franchise taxes for business.
Bill Fox, director of the Center for Business and Economic Research at UT Knoxville and a state economist who advises Gov. Bill Haslam, gave a presentation about state revenues to the board in August. He did not paint a positive picture for the university’s prospects to find extra funding.
“I will be the cheerleader and voice leading the charge for higher education and education in our state.”
So, if the university would like to have more funding from the state, where will it come from? It’s hard to know, and that is why the president also is committed to leading an advocacy initiative to put more focus on education in Tennessee and demonstrate the need for more support. He says it’s all education, from kindergarten through graduate school. With more prepared students coming to college, universities will be better able to graduate them on time.
This advocacy initiative continues to take shape, and more details will be discussed in 2015. Already, DiPietro has spoken out publicly, and he’s getting his megaphone ready.
“I will be the cheerleader and voice leading the charge for higher education and education in our state,” DiPietro told the Board of Trustees in October. “I will lead us through this challenge of reframing our business model and making tough decisions that have to be made. It’s what’s right and good for everyone.
“I will not stand idly by and watch our moment pass. This is the time for the University of Tennessee to step forward, speak up, flex our muscles and be leaders.”