MTU President Testifies Before House Subcommittee

Michigan Technological University President Glenn D. Mroz testified before the Michigan House Appropriations Subcommittee for Higher Education Thursday.

Among his topics were:

• The upward mobility of Michigan Tech graduates. “The chance of a student moving from the bottom 20 percent of household income to the top 20 percent of household income is 47 percent.”

• Tech’s 95 percent career placement rate. “Our graduates are where they want to be six months after commencement.”

• An average graduate’s starting salary is $63,800.

• The return on investment to the State of Michigan of a Michigan Tech education is high, both in dollars, in the value of the work itself and in the jobs our graduates’ work creates. “We appear to be a very good investment for the state.

• Michigan Tech’s leadership role in autonomous vehicle technologies, supporting the state’s effort to be a major player in this fast-developing technology.

• Underwater and under-ice research and technology development, monitoring the Straits of Mackinac pipelines and providing real-time, wintertime technological solutions to Great Lakes navigational challenges.

• Tech’s role in bringing research discoveries to the marketplace in Michigan.

• The University’s capital outlay request for new and renovated facilities to support the development of human-centered technologies such as therapeutic devices, instruments, sensors, preventive health strategies, secure record retention and retrieval, and health-related workforce development.  “These are where the economic puck is going to be in the future.” Governor Snyder has recommended this project be funded.

Here is the full text of his testimony:

Testimony from Michigan Technological University

Michigan House Appropriations Subcommittee for Higher Education

Glenn D. Mroz, President

Thank you Madame Chair, committee members, hard-working staffers, and university colleagues.

A recent study by Stanford economist Raj Chetty, based on millions of anonymous IRS records (spanning 1999 to 2013) from families of college- bound students and grads, gives a glimpse of what upward mobility looks like for 2,187 universities in the United States.  I won’t go through the results for all 2,187 universities this morning, but I will talk about our results at Michigan Tech.

Less than one percent of our students come from families in the top one percent of family income; 2.2 percent end up there later in life.  About 38 percent of our students come from families in the top 20 percent of family income; 61 percent of our students end up there later in life. Eighteen percent of students move up two or more income quintiles.  And the chance a student moving from the bottom 20 percent of household income, to the top 20 percent of household income is 47 percent.

This is why access to education is important.  This is why financial aid is important. Over 90 percent of our students receive financial aid in the form of merit and need-based support, and 26 percent – those students from the bottom 5^th of family income – benefit directly from Pell grants. In fact, seven percent of our first-year students this year had financial need. They had more need than their counterparts at 11 of the other Michigan public universities and at 13 of the state’s private colleges.

These are good, solid students from all 80 counties, which is why we’re rated as an A-plus school for B students by US News & World Report and a (great) school that you can actually get into by Time andMoney magazines.

At Michigan Tech, we explain to our students that if we accepted them, it’s because they have the potential to do the work. We tell them that their tuition does not reflect the cost of their education, and that the State and the University are going to invest in them because they are the kinds of people who will advance knowledge and enhance prosperity for everyone. We tell them that we will do our job, and if they do what we ask of them both in and outside the classroom, they’ll be in a very good position to be successful.

How you define success in life is an individual endeavor and, as you all know, everyone’s definitions of success change as life progresses.  We look at enabling students to move forward to the next “thing,” whatever that might be. In that regard, our career placement rate is 95 percent, meaning that graduates are where they want to be six months after commencement. And if a good early career salary is the goal, Michigan Tech delivers with an average that stands at $63,800.  (Note: you can find many more details on how we prepare students for careers in the Career Services Annual Report found in your packet).

During my time at Michigan Tech, we have worked to make sure our University is a good investment – for students, families, companies, alumni, philanthropists, and you. You’ve invested money from the people of the state of Michigan. You’ve invested your trust in Michigan Tech to do the right thing and make sure that Michigan Tech is working hard to benefit everyone in the state.

Some people like to talk about education being a private rather than a public good, but that isn’t really the case. Last year, an estimated 56% of our graduates were placed in a job within the state. That’s just under 1,000 students. True, last year was a record for us, graduating more bachelors, masters, and doctoral students than ever in our 132-year history.

Assuming each of those grads makes the average Michigan Tech starting salary of $63,800 a year, this new class of knowledge-based-economy workers will earn a collective $60MM each year. Last year, Michigan Tech received $48MM in appropriations. What will the state receive in return for its investment? Somewhere around $2.5MM in income taxes from those career ready professionals in just one graduating class. That is about a 5.2 percent return from just one class.  That doesn’t take into account the value of their work, their creativity, and the jobs their work creates.

From our records, there are roughly 23,520 Michigan Tech alumni of working age (under 67) in the state – it is not unreasonable to believe that they are doing as well as this last class, and contributing just as much, and probably more on average, to Michigan’s economy.

On the face of it, we appear to be a very good investment for the State.  So when I think about the funding formula, I think about the State’s return on investment.

In the funding formula, Michigan Tech is compared to other R2 universities, or what are called “Higher Research Universities,” across the country. Seventy-four of these have undergraduate enrollment averaging over 14,000 students. These schools range from Texas State University at 31,000, down to 4,300 at the Colorado School of Mines – and we are the second smallest university by enrollment on the list (at 5,617). Which leads me to this point: Size matters in the formula. In fact, it matters a lot, because it’s actually incorporated twice.

First, the number of graduates are a measure of size.  You can’t graduate more students than you have, and if we graduated our entire undergraduate enrollment in a single year, we’d approach the 20 percent threshold, which is admittedly an absurd example.  But the point is that we will never get there for a lot of different reasons, mostly because of the kinds of degrees we offer. We are a technological university, and most of our technological peers are of approximately the same size. While it makes sense to use number of graduates in a formula – since the investment in a university is beneficial if it results in students receiving the education and credentials they seek – it is important to understand that small universities will produce small numbers of graduates, even if everyone who is accepted eventually graduates. And it is completely understandable that there is a factor in the formula that measures the number of graduates as a robust measure of enrollment. The State itself tracks workforce to that of other states, to attract and retain businesses, and there have been efforts to help citizens go from the “some college” category to the credential category. This all makes sense for Michigan business.

In addition to including numbers of graduates in the formula, in 2013-14 a second weighting scheme was added that counts Full Year Equated Students, which is another measure of enrollment. The Senate and House Fiscal Agencies FY 2016-17 Higher Education Appropriations Report explained that this was added to correlate funding with university size. No one would argue against linking base funding to enrollment; I only want to suggest here that counting it once is sufficient.

How did Michigan Tech get into the Higher Research category? This group is defined based on each university’s research productivity rather than enrollment.  And as a technological university, we punch above our weight class in dollars of research contracts and grants –  at twice the average for the other 75 universities, despite the fact that we are almost the smallest (number two, actually). You might logically ask, does funding Michigan Tech receives through the formula for research make up for the double counting of enrollment? The short answer is no, in part because research productivity is counted once in the formula, whereas size is counted twice.

Why do we do all this research? We do it because it benefits the students, and as the BLM eloquently explains, “Research conducted at public universities is often made available in the public domain and used to advance the state of knowledge and innovation.”  I’ll give a few examples of that.  (Note: we’ve also included our Research Report in your packet, which gives a glimpse of our overall effort. You might find the summary information on the inside of the back cover describing funding sources, major areas for funding, and invention disclosure agreements particularly useful.)

A great deal of our work is related to automotive industries, and about a third is military-related and sponsored by the Department of Defense.  The state of Michigan is in a race to be a major player in autonomous vehicle technologies, both for private use and in commercial markets, and Michigan Tech is heavily involved in that effort. As we sometimes say, we have reliably lousy weather for testing vehicle systems. But we also have the indoor facilities to use when we need to.

While working on our vehicle tracks allows us to represent mobility challenges in a well-defined or “structured” environment, we are also developing autonomous vehicle technology for unstructured environments. These technologies will be of particular value in ensuring the security of personnel in challenging environments, including troops engaged in conflicts around the world.  We have the capacity to realize mobility in unstructured environments – in space, through the atmosphere, on the ground, as well as underground and underwater.

One example is our work at the Straits of Mackinac. This is where Michigan Tech researchers and students have developed advanced underwater sensing capabilities, utilizing a fully autonomous underwater vehicle (AUV) that makes precise measurements of deep-water bottom changes around submerged pipelines crossing the Straits. This technology has now been transferred to the private sector and is routinely employed. The U.S. Department of Transportation requires pipeline operators to do these inspections every three years – this was once a difficult process, but with this new technology, it could conceivably be done every day.

This work is supported at the water’s surface with Michigan Tech’s network of Great Lakes coastal environmental monitoring buoys.  Buoy 45175 (if you’re a boater) is located in the Straits and reports weather and water measurements from the surface all the way to the bottom, including currents. 45175 reports all of this information every 10 minutes and it is made publicly available in near real-time on Tech’s website, greatlakesbuoys.org. We have used that data and our High Performance Computing Cluster at our Great Lakes Research Center to solve the particularly complex issue of modeling water currents between Lakes Michigan and Huron. An understanding of these currents would be critical to deploying clean-up resources if a problem with a pipeline ever occurred.

Our latest work in conjunction with NOAA is to develop underwater/ under-ice environmental sensing platforms, and we’re using the harsh environment of Lake Superior as a test bed for those. Successful completion of the work will provide technical solutions that can be used across the Great Lakes to give wintertime, real-time aids to navigation, ice breaking, and fisheries research in addition to enhancing our knowledge of water currents.

We also work to bring technology to the broader marketplace, investing money in ideas that become products, cures, businesses, and jobs. A good example is a novel approach to blood typing. Many people give blood, and current practice is for clinics to collect blood from willing donors, send it to the lab for separation into its components, and dispose of what they don’t need. Unfortunately, a significant amount of donated blood is the wrong type, or too much of one type is collected and then disposed of. The resources used in collecting, handling, and testing – and perhaps not getting what may be critically needed – all drive up healthcare costs. One of our chemical engineers and her students are bringing a rapid blood typing procedure to the market that can be used on the spot with one drop of blood and the push of a button. It will enable blood donation clinics to collect only the blood that they need, eliminating all the wasted time, effort, and money of both the donors and those collecting blood.

This brings me to my last point, and it relates to our five-year capital outlay plan. Michigan Tech’s work at the Straits and elsewhere was made possible only because of your support for the Great Lakes Research Center Project back in 2007. We thank you again for investing in us. You now have an abbreviated copy of our new plan in your folder. The picture on the cover has two lifesavers. One of them is a piece of candy. The other is a stent – a tiny tube that a doctor inserts to open up a blocked or narrowed artery. Stents are lifesavers at the time they are installed, but can cause problems later. The one you see is made of metal that disappears over time. It is bio-absorbed in the body so the “problems later” part disappears as well.

It’s these sorts of issues that many of our faculty, staff, and students are working on through the synergy of our collective expertise in science, technology, engineering, and mathematics, and it’s why we are asking the State to help us fund new and renovated facilities to support the development of human-centered technologies. As the medical care debate continues in Washington, we need to increase the efficiency of health care in our state and nation. We don’t need to necessarily spend more; rather, we need to spend on what works. We don’t want to have clinicians spend less time with patients, but we do want to make sure they have the best tools possible to make good decisions with the patients they care for. New tools currently under development at Michigan Tech include therapeutic devices, instruments, sensors, preventative strategies, and efficient and secure record retention and retrieval. These are all important for Michigan.  They are where the economic puck is going to be in the future. The Governor supported this project in his budget proposal after the Department of Technology Management and Budget, the State Budget Office, and the State Building Authority scoring evaluation gave it high marks for both (1) enhancing the core mission of the institution (37.8 points out of 40) and (2) supporting talent enhancement, job creation, and economic growth in the state (36.6 pts out of 40).

To be clear, Michigan Tech is not proposing a hospital.  We have colleagues across our state and nation, and we’ll continue to work with these colleagues going forward.  What we are planning is acomplementary facility that will allow scientists and engineers to continue to increase economic prosperity by developing technologies and preparing the technological workforce in areas related to human health.

We have not made a capital ask since our 2007 request that resulted in the Great Lakes Research Center. The frequency with which we make requests may or may not matter, but what does matter is that we believe in this project. We thank the Governor and the agencies for their support, and we respectfully ask you for your consideration. We would deeply appreciate your support for this project. This is good for Michigan.

Thank you.