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State of the University Address
President Edward J. Ray
Jan. 18, 2012 – The Benson Hotel
In speaking to you today regarding the state of the university, I am mindful that our state and nation continue to struggle toward recovery from the Great Recession. The governor and Legislature are faced with difficult choices in managing the limited funding available to the state as a consequence of our economic challenges. In many states, university presidents are whining about the lack of appreciation and financial support for their universities from the people of their states. As some of you know, I don’t believe leaders have a right to whine. So, I want to talk to you about a number of current substantive accomplishments by Oregon State University and the actions we are initiating to advance economic development and social progress for the people of Oregon and this nation.
Last summer, as things were winding down for many campuses around the country, they were really heating up at OSU. Let me recount a few developments:
Finally, we closed the books on another fantastic year in research, garnering $261.7 million in contracts and awards. OSU continues to conduct more annual research than all of our sister campuses in the Oregon University System combined, and we were pleased that in a year in which many campuses nationally saw significant declines in funding, we lost only $1 million at the federal level, earning nearly $184 million in contracts and grants in the most competitive funding environment for research support. We’re well on our way to another outstanding year in funding for our scientific enterprise. In fact, in September we received $42 million in research grants and contracts, exceeding the old record by $8 million.
If you think this all sounds pretty exciting, I’d say you’re right.
What’s happening at OSU is, quite simply, remarkable. And it’s no accident. The university’s strategic growth and increase in quality are the result of the same qualities that typically beget success – great people, including our students, faculty, staff, researchers, alumni and donors; discipline in planning; and old-fashioned hard work. The result is simply this: OSU’s impact is growing profoundly, exponentially increasing opportunities for success for the people of Oregon by way of educational opportunities, service to our communities and scientific progress at a faster rate than ever before, and we are expanding that impact across the nation and world. I have perhaps the best opportunity of anyone to see that impact on a daily basis, and let me tell you, the view is pretty spectacular. So when I answer the question that is begged by the title of today’s address, I can say without hesitation that the state of the university is not just sound, but exceptional, and getting more so with each passing day.
On that note, I’m particularly glad that each of you is here today, as we discuss OSU’s economic impact in an exciting new way, thanks to a research project recently undertaken with the economic consulting firm, ECONorthwest. We asked them to calculate the university’s economic footprint in a holistic manner that would measure our impact in matters ranging from graduation of our students to spinoff business creation to direct financial effects on the statewide economy. And ECONorthwest learned something about OSU that is a first for OUS universities: Our total economic footprint now exceeds $2.06 billion. This overall figure comprises OSU’s gross statewide economic contributions and societal contributions of OSU research that extend around the world. This total is greater than any similar measure of benefit of Oregon’s other four-year colleges and universities.
In my comments today, I will share with you other new measures regarding Oregon State’s significant and diverse economic contributions across the state and the nation. And as we discuss ECONorthwest’s findings, please join me in recognizing the president of the firm, John Tapogna. Under John’s leadership, ECONorthwest has become one of the most respected economic consulting groups in this state, and John’s work with the Oregon Business Plan for Oregon Gov. John Kitzhaber, among many other efforts, is helping guide our state’s future. Thank you, John and ECONorthwest.
While this evaluation of OSU’s impact is certainly impressive, it may not come as a surprise to some. In surveys of Oregonians and of OSU alumni last year, a research firm discovered that strong majorities in both groups gave OSU higher marks than any other Oregon university for – quote – “making a positive impact on the Oregon economy through innovations and spinoff companies that create jobs.” The same survey ranked OSU higher than any other institution for – quote – “serving local communities through access to education and real-world problem-solving initiatives,” “practical research that solves global problems,” and “research and teaching that enhance sustainability.” The research findings and the results of our new economic study combine to paint a rich picture of a university serving a singular role as educator, as catalyst and as scientific leader. As Oregon’s Land Grant university, we particularly value that collective position, because it underscores that we’re not only living up to our historic mission to serve the people of this state, but that 150 years after federal legislation created the Land Grant system, we’re doing it in ways that are valued and valuable for those we serve today.
Each of you will receive a copy of our OSU IMPACT 2012 report as you leave today, which provides a wealth of statistical detail and rich stories of OSU contributions to our state, the nation and the world. This is perhaps the most comprehensive document ever created on the university’s impact. But for our discussion, let me focus your attention on a few points that I hope will especially remain with you long after our time together today.
First, and perhaps most importantly, I would like to focus on our most important contribution – the now more than 4,600 graduates from OSU next June. Our graduates are our most important contribution to society and the future. Oregon State graduates are not only exceptionally well prepared to play an immediate and meaningful role in our work force, but they help make the 21st century economy, our environment and community livability far better in areas ranging from technology solutions to natural resources to human health. OSU is well represented in such major Oregon companies as Intel, PGE, Nike and more. An independent survey by the company PayScale last fall revealed an interesting fact regarding our graduates: They are more valuable in the workplace than their peers. At mid-career, our bachelor’s degree recipients earn more than those of any other Oregon university, and not by a small margin. OSU graduates’ average salary of $86,900 was nearly $6,000 more than that of the next Oregon public campus and was only slightly behind that of University of Washington graduates.
But for those of us who get to interact with our increasingly high-achieving student body, this is hardly a surprise. Take Alexandria Moseley, for instance, a senior from Newberg who last month was named one of the world’s 15 most promising college engineering students as part of National Engineers Week. Or Marty Ulrich, a computer science major who created the iPhone “Free Candle” app that became a global phenomenon at memorial services for Steve Jobs last November. Or Sam Bartlett, a senior in chemistry who co-discovered a method for synthesizing new molecules that he and his supervising professor published last fall in the Journal of Organic Chemistry. The innovation has already drawn the attention of pharmaceutical scientists and has potential in fields from nanotechnology to biochemistry. Our students today are not only the most academically high achieving in OSU history, they are contributing significantly as leaders in our state, nation and world.
And we are recruiting and attracting more exceptional students, as part of an institutional goal to build on the growing percentage of high-achieving students in our student body. As our academic deans and faculty will attest, as the quality of students increases, so does the quality of the university. So today, we announce a new effort to fuel that growth: the Presidential Scholars Initiative, which seeks to raise $10 million in endowed funds to ensure scholarships are always available for top-performing students, and to free other resources to be invested in ways that directly support their student experience and success. The awards are valued at $9,000 annually, and will be made available to incoming freshmen. Donations of $100,000 or more will be matched by the university throughout 2012, with up to $5 million from the Office of the President, and donors will not only be paired with a Presidential Scholar or Scholars, but will be able to monitor their progress. Their stories are unfailingly compelling: Of the students who currently receive presidential scholarships, more than 40 percent have financial need.
This effort is part of the Campaign for OSU, the first university-wide campaign in our history. And I am pleased to share that as a key component of the now $785 million we’ve raised toward our goal, $135 million has been for scholarships and fellowships. That’s the most ever raised by any Oregon institution for financial support of its students, and we’re gratified that donors surpassed our $100 million goal in the initial phase of the campaign, long before we ever raised our overall goal to $850 million.
Once these exceptional students enroll at OSU, they participate in excellent academic offerings, undergraduate research opportunities, work experience and mentorships, rich cultural experiences and valuable pathways to advanced master’s and doctoral degrees. Today, I am very pleased to announce that they also will be able to take advantage of another new initiative -- a “3+3 Program” with our partners at the Willamette University College of Law. Through this program, OSU students will be able to earn an undergraduate degree and a juris doctorate in six years, rather than the usual seven, saving students time and money, while facilitating an express path to a law degree from one of Oregon’s finest colleges. And that’s great news for our students, as OSU is already a leading feeder institution for the law college. We’re delighted to have with us today Dean Peter Letsou of the Willamette College of Law and three leaders of the law school administration. Peter, could you please stand? Please join me in giving our friends from Willamette a hand.
Whether earning a law degree from Willamette or completing any of OSU’s 200 undergraduate and graduate degree programs, our thousands of annual graduates are part of a larger picture of how Oregon State University contributes significantly to employment in this state. More than 14,900 individuals were employed by the university alone last year – 80 of them new faculty hired to meet the needs of our growing student body. OSU’s growing reputation, in fact, enabled us to hire outstanding faculty from Harvard, the London School of Economics, Cornell, Berkley, Wisconsin, MIT and other top institutions. These new colleagues are so impressive, they were featured nationally last week in the Chronicle of Higher Education. In addition to our own employees, the ECONorthwest analysis further documented that OSU is responsible for nearly 18,000 jobs in Linn and Benton counties and elsewhere around the state.
Those job-creating effects continue to increase in interesting and meaningful ways. For instance, NOAA opened its Pacific Marine Operations Center last year in Newport, a development that would not have been possible without the existing presence next door of our internationally recognized Hatfield Marine Sciences Center. The MOC-P, as it’s called, brought 175 jobs to Newport, along with an estimated $19-million annual stimulus for that coastal community. Consider Bend, as well. Our OSU-Cascades campus’ purchase of a major building in the heart of Bend will allow it to expand graduate and research programs, creating more jobs, and its brand-new partnership with the Bend Park and Recreation District to develop an 11-acre site next to that new building, puts it on course for further expansion and a stand-alone campus in a highly visible area. More opportunity for Central Oregon students, and more employment for that region, thanks to OSU.
But Oregon State’s impact doesn’t end there. The university enterprise now delivers an annual $1.1 billion in cash expenditures into Oregon’s economy. While those effects are most profound in the Willamette Valley near our main campus, they spread across the entire state, touching communities in each of Oregon’s 36 counties. Simply put, outside of state government, no other Oregon public university can claim that reach. Consider this: Of that $1.1 billion, $133 million was expended on capital projects, and of that, $100 million went to Portland engineering, architectural and construction firms and materials suppliers, giving a significant boost to this area’s economy. That work was poured into important, iconic new structures across campus, such as the $65-million Linus Pauling Science Center, opened last fall and home to the Linus Pauling Institute, a National Institutes of Health center of excellence; and the International Living and Learning Center, also opened last fall. This beautiful new residence hall pairs international and domestic students in shared living spaces within a complex that, like the Pauling Center, is designed to meet the most rigorous environmental standards through the LEED rating program.
Visitor spending offers another surprising dimension of our impact. In 2011, OSU programs of all kinds drew more than 535,000 visitors to the Corvallis area, where they spent nearly $32 million, affecting businesses and jobs throughout the region. And at nearly $251 million, student spending last year was an even more significant driver of that regional economy, as the student body being served by the Corvallis campus grew to 25,000. The most central components of our spending -- payroll and the purchase of goods and services -- have now grown to $461 million and $194 million, respectively, and at that level, represent sources of economic vitality in virtually every county of the state.
As interesting as the picture of impact painted by our spending is, however, it is the intersection of the university’s intellectual enterprise with business and society that tells perhaps the most valuable part of the OSU story. It is no secret that our research enterprise has grown remarkably, literally doubling in size over the past decade. As noted earlier, on the heels of last year’s strong performance, our faculty began this academic year by earning an incredible $42 million in research support in September alone. To put that in perspective, it was nearly $8 million more than the previous best month in university history, and that former record month included a single grant of $24.5 million.
Increasingly, our research is applied in the form of innovations – new technologies, improved processes and product creation. We now have more than 100 active licenses of university innovations with a wide variety of commercial enterprises, many of them based on the 227 patents awarded to OSU discoveries over the past 25 years. According to ECONorthwest analysis, this again is more than double the patent activity of our public university peers. Some of those licenses are particularly well known and important to our state’s economy, such as two varieties of wheat developed by OSU scientists that now are the top two such crops planted throughout the Pacific Northwest and one of Oregon’s leading exports. By both value and volume, wheat is the leading export from the Port of Portland. Other licenses are used by startup companies, 35 of which have emanated from the university over the past 30 years, with the lion’s share of them thriving, employing literally hundreds of Oregonians. And consider this news, from our Office of Commercialization and Corporate Development: An additional nine companies are currently emerging from the use of OSU intellectual property.
That patent, license and spinoff activity, more than that of Oregon’s other public campuses combined, is a major factor in explaining why Corvallis was recognized in late 2010 as America’s most innovative city in a study from researchers at the Los Alamos National Laboratory. Not the most innovative city among similarly small cities, but the most innovative in a head-to-head analysis alongside such places as Seattle, San Jose, Boston, New York and others. The intellectual and innovation stimulus provided by OSU, as well as Hewlett-Packard, CH2M HILL and others, in fact, have made the Corvallis economy the most durable and healthy in Oregon, with the state’s lowest unemployment rate and highest quality of life.
Recognizing the growing impact and influence of our research enterprise, we are interested in being the most effective partner possible for economic development across the state. OSU’s academic and research strengths align closely with the majority of the “industry clusters” defined by the Oregon Business Plan and the City of Portland’s economic development strategy: Activewear & Outdoor Gear Industries, Natural Resource Industries, Advanced Manufacturing Industries, High Tech Industries and Clean/Green Technology Industries. We are already well-represented in some of those areas. For instance, more than 11,000 of our Design and Human Environment graduates are employed in apparel businesses in the Portland area, and the chair of that department, Dr. Leslie Burns, is on the board for the Portland Center for Design and Innovation, a “catalytic initiative” in the City of Portland’s Economic Development Strategy. As companies like Nike, Columbia Sportswear, Adidas North America and other growing enterprises make this an ever more important part of the economy of our state’s most important metro area, OSU is playing a singular role among academic institutions in addressing the sector’s employment and R&D needs.
ECONorthwest’s study quantifies that benefit in a most impressive way: Industries that partner with a research university, such as Oregon State, have a 25 percent higher success rate than those not similarly partnered. In a still precarious economy, that level of success provides a critical advantage and opportunity for prosperity that can mean the difference between red ink and black. In our agricultural and timber industries, that impact has been felt for generations, and it manifests in increasing ways today in engineering and high-tech concerns, business and financial services, health-related enterprises and more.
And as we move forward, the OSU brand stands for enhanced opportunity for prosperity for Oregonians throughout this wonderful state. So in conclusion, today we also announce five key commitments for 2012.
I invite you to be part of that work, in whatever way works for you. Whether spreading word of our success and commitments to your colleagues, supporting the university financially, participating in the Alumni Association, engaging us online or in your community or sending a student to OSU, you are a valuable member of Beaver Nation. With your help, we’ll report on a state of the university next year that shows even greater evidence of OSU realizing its long-standing goal of becoming one of America’s leading land grant universities.
Good leaders understand that whatever the challenge they face, they never accomplish anything of enduring value alone and must serve a purpose larger than themselves. As a land grant university, Oregon State University understands that basic truth and is committed to work with the governor and legislative leaders, along with partners at every level of the education continuum from pre-school to graduate degrees, to provide Oregonians with the skills they need to compete with anyone anywhere in the global economy and to understand that each of us must serve our wider communities. Together with our partners in higher education we continue to strive to create a virtual mega-university for Oregon that can match the ability of any state system of higher education in this country to be an engine of economic development and social progress.
That is our commitment, and I thank you for being here to learn more about it today. Through your presence, you reaffirm your interest in and support of our success, and for that, Oregon State is tremendously grateful. Thank you.