Committees drafting reports on raising rates, other proposals

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President William Powers Jr. speaks in the Avaya Auditorium in January. He called for increasing UT’s efficiency by cutting costs.

Photo Credit: Pu Ying Huang | Daily Texan Staff

Committees established by the University are set to deliver efficiency reports five months from now in response to proposals to restructure non-academic functions at UT.

In January, President William Powers Jr. released findings from an outside commission of industry leaders he appointed to examine ways the University could cut costs as state funding to UT declines. In its report, the Committee on Business Productivity claims that various changes to administrative functions, assets and commercialization practices could save the University $490 million over the next decade.

A task force headed by Kevin Hegarty, vice president and chief financial officer, has now developed several committees and subcommittees that will consult with staff members, students and industry professionals on ways to increase efficiency in University operations and address the proposals. Several options are available, including centralizing functions, raising rates or outsourcing labor in some services.

A number of student groups on campus have rallied against the proposals in multiple protests and meetings since January. Members of United Students Against Sweatshops, who met with Hegarty in May, have been especially concerned with the involvement of Accenture, a consulting company, in crafting the efficiency proposals.

The state terminated a contract with Accenture in 2008 after the company mishandled the management of Texas’ food stamps and children’s health care programs. Stephen Rohleder, a UT alumnus and executive at Accenture, chaired the Committee on Business Productivity.

Hegarty said the University had established a trustworthy relationship while working with Accenture, and the University had full control over the direction of the future implementation of proposals.

“You may have one opinion of the brand, but what matters is the people,” Hegarty said. “What we have found when working with Accenture are people we know now we like who have deep experience at institutions like ours, Berkeley and UNC.”

Mary Knight, associate vice president in the Office of the Chief Financial Officer, will head the committee on shared services, which will examine ways to centralize administrative services and business functions. 

A former managerial employee told The Daily Texan in February he believed he had been fired because the University did not want to pay his state benefits. Knight said these situations would be unlikely during future centralization efforts, which she said would rely on natural employee attrition.

“Although there might be isolated cases, I don’t know of any situations where decisions [on layoffs] have been made based on benefits,” Knight said. “A lot of the benefits are paid centrally anyways, so leadership is not looking at who costs more based on insurance coverage.”

One department facing changes is Parking and Transportation Services, which could either outsource some of its functions or raise rates by as much as nine or 10 percent a year for the next 15 years, said Bob Harkins, associate vice president for campus safety and security and chairman of the parking committee.

Harkins said the difficult choices between raising rates or outsourcing services echo patterns in other states where financial resources for higher education have tightened, such as Arizona and Ohio, and could pose some additional financial burden on students.

“I think quite frankly everybody is going through the whole outsourcing bit,” Harkins said. “How much more can we ask the students to pay until we price ourselves out of business, and how much can we afford to pay for the quality education that constitution of the state of Texas calls for?”