The State Senate and House of Representatives will hold separate hearings to review Gov. Bredesen’s recommendations on UT’s budget for 2004-05.

The budget reflects some of our highest priorities, much-needed salary increases for faculty and staff and a breaking of building projects. We initially anticipated a cut of 5 percent in base funding during hearings in November. We asked the governor to spare higher education and his proposal for next year helps a great deal. The cut is less than 1 percent, although tuition units are expected to self-fund the portion of the salary increase that is not a one-time bonus. This equates to a cut of 3.1 percent, according to the governor’s budget document, but this is better than we expected last month.

The budget recommends pay raises for all higher education employees: a one-time bonus of 1 percent and a base pay increase of 2 percent. The state will fund the bonus.

After years of going without any capital outlay, the budget provides $38.5 million in capital maintenance funds for existing buildings and two-thirds of the cost to address two long-standing top priorities: the Glocker Business Administration Building renovation and $20.3 million expansion in Knoxville and the $28.5 million building of the College of Pharmacy in Memphis.

The governor has asked to use private funds to pay for the balance of the costs, something that is already well under way for the Glocker project. The same requirement was given to the Board of Regents.

We appreciate the Governor’s ability to address these priorities in a very challenging budget year.