Remarks from the Spring 2021 Faculty and Staff Meeting

Friday, February 5, 2021

Though Chancellor Everts does not traditionally speak at this meeting, she provided remarks about the COVID-19 pandemic, including vaccine storage, announced the addition of a first-of-its-kind online Licensed Veterinary Technicians program and shared updates about university priorities, initiatives and construction projects.

Good afternoon.

Thank you to Heather and the Agenda Committee for adding me to the agenda for today’s meeting. I know this is a change from the typical spring agenda and I appreciate your allotting time for me to speak this afternoon.

I am pleased to report that, even with the ongoing impact of and uncertainty around the COVID-19 pandemic, our Spring census numbers continue the trend of increases over last year. Providing access and educational opportunity, especially for students from our rural communities, is critical to our state’s workforce development and economic health. As we all know, enrollment is also critical to maintaining our position of financial strength throughout and beyond the pandemic. This upward trend is also particularly important in regard to budget implications, as you will hear shortly from Vice Chancellor for Business Affairs Paul Forte.

I know we all look forward to the time when COVID-19 vaccines are more widely available and the university can become a site for distributing them! I’m excited to report our cold storage units for COVID-19 vaccines arrived on Monday morning.  Our four mobile freezers have, collectively, the capacity to store more than one-hundred-sixteen-thousand vials of COVID-19 vaccines.

Our application to the North Carolina Department of Health and Human Services to be an open community site for vaccine distribution is still pending. We hope to soon be approved so that when vaccines are available, we may administer them not only to students, faculty and staff, but also to community members. 

The university has created a page on its coronavirus website with vaccine information and links to register, learn more about the distribution phases and the state's distribution plan.

Provided vaccine distribution goes well, we expect Fall 2021 semester to look more like Fall of 2019, with faculty and students back on campus, and face-to-face classes being the norm once again. 

UNC System President Hans has indicated four key operating budget priorities for 2021-2023: enrollment funding, the NC Promise program, building reserves and faculty and staff salaries. We are very appreciative of President Hans’ advocacy for these important initiatives. This time last year, Interim Provost and Executive Vice Chancellor Heather Norris provided you with an overview of annual legislative increases, the annual raise process and the campus salary adjustments that are under Chancellor authority. While we are hopeful we may see salary increases on the state level, institutionally, we are in a very different place than we were this time last year. Some of our staff are under furlough, although we have worked to reassign as many as possible, and we will continue to do so in order to avoid additional furloughs. Many of the reassigned staff have contributed to the university’s COVID response – assisting with testing, providing quarantine support and cleaning – and I know you all join me in thanking them for this important work.

We are following the financial and operational guidance provided by President Hans, limiting our non-essential spending, and we have developed a bridge strategic plan. This plan will guide the university through this time of financial and social uncertainty, and provide guidelines for the university's next five-year strategic plan. Dr. Lee Ball and Heather Langdon have been leading a working group to develop the plan, which is to be presented to the Board of Trustees in March. Thank you, Lee, Heather and the many others who have assisted in this vital work.

While we are focused on ensuring our financial position in the short term, we are looking to a post-COVID future. Exceeding 20,000 in enrollment this year was an important turning point that allowed us to work with the UNC System on assigning a new peer group for App State, so our reference institutions for resource allocations will be more relevant to the Appalachian of today.

In November, the UNC Board of Governors approved a new peer group for our university — a collection of similar institutions that can be used to facilitate objective and useful comparisons and benchmarking for constituent universities. The new group was determined by recommendations that were researched and presented by a dedicated working group from our campus in collaboration with a steering group from the system office. 

The Board of Governors has added three new institutions to our more competitive peer comparison group — all of which reported enrollments greater than 20,000 and significant research awards.  Both of these indicators – enrollment and research funding – should have positive implications for our university. In keeping with the Systems’ preference for assigning smaller peer groups, our peer group is now ten institutions rather than eighteen.

I’d like to thank our work group who, along with Provost Norris and Vice Chancellor Hank Foreman, identified and proposed the institutions for this new group:  Michael Behrent, Marie Huff, Heather Langdon, Paul Orkiszewski, Zack Murrell and Kelli Wilson — thank you for helping define the peer group that more accurately and appropriately reflects the quality of this institution.

In April, we will again provide campus with budget information through budget presentations. 

Vice Chancellor Forte will now provide you with a few specifics about the UNC System operating budget priorities, an overview of our COVID-related expenses, and budget priorities and guidance from the UNC System.

Thank you Chancellor Everts.

I’d like to give you a little further information on the four priorities. As you can see, the system office put in for enrollment growth funding, and that is key and critical to our growth. NC Promise doesn’t really affect us. Building reserves would normally affect us, but we don’t have any new buildings coming on and we’re fully funded for the reserves from the buildings we have put online recently. And finally, faculty and staff salaries – the request there is equity with other state agencies, and we fully support that. For the enrollment growth piece, as you can see on the table, there was about $37 million distributed throughout the system, and our share of that was $3.5 million. That growth is critical to the development of our budget, and key to faculty promotion and tenure, as 80% of that funding goes to Academic Affairs. We have received about $15 million over the last five years from funding from this source, so it’s a critical component in our budget.

I want to update you a little bit on our COVID-related expenses. They are substantial, and this gives you a little detail. First of all, we were funded by federal and state legislation for certain COVID expenses at about $21.9 million. About $7.9 million of that was really a pass through. It came to us, and we passed it through directly to students for emergency student aid. The net from that was $14 million. Over and above those funded expenses, we had about $8.6 million in institutionally funded expenses for personnel, and emergency operating expenses: the special leave provisions that were given and testing expenses, personal protective equipment, and the like. So, the total COVID-related expenses were $22.6 million for the period thru December 31, 2020.

And what was unfunded on that piece? Well, we had about a $16.9 million loss in revenues, normalizing for the funding we got back from the federal funding for housing and dining. In addition to that net $16.9 million reduction, we had the $8.6 million I mentioned previously in expenses, so the total cumulative hit to the budget was $25.5 million. And you may ask, how do we make up $25.5 million? Well, we’re still under the emergency expense guidelines of the state and the system office. Because of that and other expense controls, we’ve been able to reduce expenses on an annual basis - a 12-month annual basis - (year-over-year, calendar-year basis) of about $12.5 million. So, significant reductions particularly in areas on the auxiliary side and Athletics have had the biggest hit.

That concludes my remarks on the budget. Thank you, Chancellor. 

Thank you, Paul.

2021 is the final year of reporting for the UNC System’s five-year strategic performance benchmarks as set in 2017. Based on data provided by the UNC System office in December 2020, we are on track to meet or exceed all of our goals. Among our prioritized goals, we are performing particularly well in rural and first-generation enrollments. Notably, our rural student enrollment exceeds the System’s strategic plan benchmark for this year by more than 300 students, and we are above our benchmark goals for low-income completions.

In areas designated for improvement:

We are above the benchmark goals for low-income enrollments.

We have surpassed our final target in undergraduate degree efficiency – a measure of enrollments per degrees awarded. 

To date, we can report $28 million in external funding from grants and contracts, which far surpasses the system's strategic goal of 18.3 million by 2022… AND

We have surpassed our goal to sustain our five-year graduation rate, which has reached 78.6% in the last year.

These are YOUR achievements, and you should be very proud of them. Congratulations!

Now, I am thrilled to announce a most significant vote of confidence from a new and exciting partner. We have entered into a multi-million-dollar sponsored contract with Banfield Pet Hospital to support the development of a four-year, online degree program for Licensed Veterinary Technicians. This program is the first of its kind, and will help meet shortages for skilled veterinary professionals in the rural areas of our region and beyond.

App State excels in developing visionary academic programs. This partnership with the leading pioneer in preventative health care for animals is synergistic and forward-thinking. With graduation and licensure achievement rates that far exceed national averages, our university is uniquely positioned to develop and deliver a signature program that will help advance the profession, elevate the role of the licensed veterinary technician and address the market demand for skilled, rural veterinary medicine practitioners.

The App State Online program will be housed in the university’s College of Arts & Sciences and will combine Bachelor’s of Science credentials with veterinary technician licensure. App State faculty will create the curriculum plan, program and courses. Heather has begun developing a team of faculty who will do this work and will share more details later this month. The program’s first class is expected to begin in Fall 2022. 

I’d like to thank Heather and her team who will bring this exciting program to fruition and allow us to meet the needs of our state and region with a quality online program.

Because of your dedication across all disciplines and departments, we continue to be lauded nationally for our achievements academically and for the value and experience we offer our students. US News and World Report recently ranked App State THIRD among the best regional universities in the South for initiatives helping veterans and active-duty service members pay for their degrees. Sierra Magazine has also included App State among its top 50 “Coolest Schools” for 2020, and Money.com lists our university as one of "the best for your money."  We routinely receive accolades like these and each of you may take personal pride in this recognition.

Last week at the annual High Country Economic Kickoff event presented by the Boone and Blowing Rock Chambers of Commerce I was pleased to share just a few examples of how, in the midst of a coordinated response to a global pandemic, we remain focused on our academic mission and other important goals in 2021.

Each day, our faculty demonstrate their committed to excellence in teaching… and to ensuring our students’ research and learning goes beyond the classroom to serve our community and state. From the work of Dr. Kurt Michael, who is partnering with our local school systems on suicide prevention for teens, to Dr. Baker Perry, whose climate research takes place from Grandfather Mountain to Mount Everest, our faculty and academic leaders focus on making real and powerful differences for our local community and beyond. 

COVID-19 increased the caseload of our Small Business and Technology Development Center by four times its typical number of clients, as the center’s consultants helped our state’s small businesses pivot and respond to the pandemic.

As food insecurity becomes more prominent during this global health crisis, our Food Resource Hub continues to provide food and personal care items to Mountaineers in need.

I also have encouraging news from Facilities Management regarding the expansion of the university’s Child Development Center. Weather permitting, the major construction will be completed in August, and the center will be open for 40 - 50 additional children – on top of the nearly 70 they already serve – by October of this year!

I’d like to take a moment here to thank the Child Development Center staff for protecting our youngest Mountaineers throughout this pandemic. They have implemented a new mobile app to allow for more secure — and socially distanced — daily communication; all persons over five years old are required to wear masks; all of the students’ belongings are sanitized before they enter the facility; and the staff has created a new socially distanced check-in system that allows all parents and guardians to remain outside which helps limit the amount of foot traffic inside the facility.

From their support of the App Builds a Home initiative to the 40th year of their AppKids project, our staff continue to demonstrate their pride in our local community and longstanding commitment to serving it. To all our staff, your good will, selflessness and dedication are the very definition of ‘essential worker’ for our university.  Thank you. 

We remain focused on strengthening the culture of diversity and inclusion on our campus and in our community. Each year since my arrival at App State, we have steadily increased the racial diversity of our university population. Since 2014, we have seen a 97% increase in first-year underrepresented students.

As we become a more diverse campus, we are also broadening the ways we become a more inclusive community. Last summer, I established a Diversity and Inclusion Accountability Team, which champions our work toward inclusive excellence. We were very pleased to host implicit bias certification training for local law enforcement agencies in the fall, and I look forward to awarding our second annual Chancellor’s Awards for Inclusive Excellence on our campus and in the community very soon. I would like to thank Dr. Willie Fleming, our Chief Diversity Officer, for his leadership and his work in championing inclusive excellence throughout our campus culture. Thank you, Willie.

Our new Climate Action Plan is slated to be released early this year. It will provide an in-depth, practical analysis of the action steps and timeline for App State to reach carbon neutrality, with an ultimate goal of climate neutrality. One step in this plan includes continuing to explore renewable power options. New River Light and Power, the utility company owned by App State, will continue purchasing solar power on the open market for its residential and commercial customers, as well as for the university.

Our future plans include an Innovation District that will serve as an academic, economic and innovation hub for Western North Carolina. This will further our vibrant university and community partnership as we exchange and incubate ideas for the social and economic betterment of our region. 

Finally, I want to assure you my prognosis remains positive after my breast cancer surgery last month, and I have continued to work and advocate for the university during my recovery. I have received many messages of encouragement, donations in my honor, cards and gifts, and I am so appreciative of your support. We have all been tested these past months, but our university community is strong; we support one another…  and we excel at perseverance.

 As we move forward into what we all hope are more ‘normal’ times, your ideas and contributions will continue to be central to our decision-making processes. Thank you, again, for your continued commitment to the success of our students and our university, and thank you for this opportunity to speak with you today.