Thank you, Cas. It is a both a pleasure and an honor to be here. Thirty-four years ago I first set foot in Maryland with a newly minted Ph.D. in mathematics from Rutgers and began a long and rewarding career, I would even say an impassioned love affair, with the state of Maryland and the University of Maryland. As I prepare to depart to assume the presidency of Ohio State University, I greatly appreciate the opportunity Cas has afforded me to offer some observations on Maryland, higher education, and the business sector.

Before I do so, I ask that you indulge me a few moments and let me mention three things I am extremely proud of as I look back over almost ten years as president of the University of Maryland.

1. The quality of the undergraduate program and the caliber of students the University now attracts. Ten years ago, College Park was considered a "safety school," a place good students wouldn't mind attending and would if they didn't get into one of their "top" choices. Those days are gone forever. As a recent article in the Washingtonian points out, bright students are choosing to come to College Park over the University of Virginia, the University of North Carolina, and even Ivy League schools. The Honors Program has been ranked as one of the nine best in the U.S. and the average SAT of the 4,000 entering class of students has risen to 1200, 200 points higher than 10 years ago. Admissions to College Park is now as competitive as to the University of North Carolina and other leading public universities. College Park is also now listed as one of the universities that attracts the largest number of National Merit Scholars. And all this has been accomplished while simultaneously increasing the diversity of the student population. Not only are we keeping larger numbers of our most talented high school graduates in state, we are drawing talented students from other states as well. This is extremely important for Maryland's economy because it is well known that students are highly likely to take their first job within a fifty mile radius of where they graduate from college.

2. The high national ranking of various graduate programs. The National Research Council recently published its once-a-decade ranking of the best graduate programs in the U.S. The University of Maryland had seven programs ranked among the twenty best at universities in the U.S. That's good news. Even better news is the programs that are highly ranked. They are the programs that are so relevant to building the technology-based economy of the state: computer science, mathematics, physics, electrical engineering, aerospace engineering, oceanography, and economics.

U.S. News and World Report also recently ranked the university's colleges of engineering and business as being among the top 25 in the nation. On the entire eastern seaboard, only two other universities had both their engineering and business schools in the top twenty five: MIT and Cornell.

3. The University's increased role in economic development. Through its incubator program, Maryland Industrial Partnership Program, statewide system of technology assistance centers, and Michael Dingman Center for Entrepreneurship, the University is having a significant impact on the development of the Maryland technology economy. Twenty companies have graduated from the incubator and are operating in the Maryland economy; hundreds of companies across the state have benefitted from collaboration with our faculty through the Maryland Industrial Partnership Program; and, in addition to its impressive support of entrepreneurial activities in the state, the Dingman Center is now operating the state's small business development center, with a focus on developing start-up technology businesses. The university's role in building Maryland's economy is a success story that is too little known around the state.

Actually, I want to talk this morning about two things: a vision for the future of Maryland's economy that is dependent on higher education; and some issues about Maryland's system of higher education that need to be addressed if that vision is to become a reality.

It is increasingly clear that the primary driver of the nation's economy for at least the next several decades will be information technology. The U.S. Bureau of Labor Statistics estimates that by the year 2005, IT-related jobs in the U.S. will almost double, a rate of job growth probably unmatched by any other business sector at any time in our nation's history. Companies that store, retrieve, or disseminate information will be our nation's dominant businesses, and rapid access to vast pools of knowledge will be our nation's most important product.

Competition for global leadership in the IT-based economy will be fierce among our nation's major metropolitan regions because it offers the holy grail of economic development. It's environmentally clean, labor intensive and totally dependent on a highly skilled workforce. Only regions with certain intrinsic advantages have a chance to achieve a leadership role in this economy. Fortunately, the Baltimore Washington corridor is one of these regions. Let me tell you why.

First, our region is a world leader in data base development and management. The information people want is, to a large extent, located within 15 miles of the Baltimore-Washington corridor. From the Library of Congress in Washington, to the National Archives in College Park, to the National Library of Medicine in Bethesda, to the Human Genome Project database at Johns Hopkins, our region is the world repository of an overwhelming amount of data and information.

Second, we have a wealth of federal installations operating on the cutting edge of information networking, storage, retrieval and dissemination. For example, NASA's Goddard Space Flight Center is the primary source of data about the earth's environment. The National Institute of Standards and Technology develops what are, in effect, international technological protocols. The National Security Agency operates perhaps the world's most advanced telecommunications network. The presence of such federal laboratories is attracting large numbers of "knowledge workers" and information technology businesses to our region.

Third, our region is already home to an impressive number of leading information technology companies such as Lockheed Martin, Tracor, SAIC, Bell Atlantic-Maryland, the Computer Sciences Corporation, Hughes Network Systems, and COMSAT. Northern Virginia is way ahead of us in attracting start-up companies in computer networking and Internet applications, something we need to work on, but Maryland has an impressive number of such companies too, firms like Timonium-based Riparius Ventures, an innovator in Internet telephone technology; Linthicum's Siena Corporation and its work to dramatically expand fiber optic data transmission; Digex in Beltsville, an Internet provider, and Yurie Systems in Lanham, founded by a Maryland graduate and featured recently on the cover of Business Week.

Finally, and this is vitally important, our region is blessed with outstanding academic programs in the disciplines that fuel the information age economy.

As I mentioned, the University of Maryland, College Park, has top rated programs in computer science, electrical engineering and telecommunications. The Johns Hopkins University and the University of Maryland, College Park have outstanding highly ranked engineering colleges. The University of Maryland, Baltimore, and Johns Hopkins are world leaders in telemedicine, an area certain to spawn considerable economic activity in the future. UMBC and Morgan State have rapidly developing programs in information technology, Towson University has a large undergraduate program in computer science, and we have a strong system of community colleges with a focus on training people for jobs in the IT industry.

With all these assets, it's possible to imagine the Baltimore Washington corridor becoming the equivalent of the Silicon Valley for the information age. Just imagine I-95 lined on both sides with info tech companies. It really could happen. But we are in a fiercely competitive race against other regions. Realizing our potential is far from certain. Success will require that, as a region and state, we take decisive steps soon.

First, we need to understand the opportunity we have. This is perhaps the most difficult of all our challenges. The State's Strategic Economic Development Plan, recently released by the Department of Business and Economic Development, is a big step in the right direction. It identifies many of Maryland's strengths in information technology and offers some cogent strategies for future economic growth. This document needs wider dispersion and broader support.

Second, we must build an information technology infrastructure that can support an information age economy. Maryland's infrastructure is falling further behind that of many other states. We need high-speed, fiber optic links connecting our counties and major communities and we need them now.

Through a remarkable public/private sector initiative called Smart Valley, the Silicon Valley region has created precisely the kind of advanced information infrastructure and connectivity we need. Virginia, too, has developed a fiber optic network linking all regions of the state. Maryland is only now developing a fiber optic connection along the Baltimore Washington corridor with, as far as I know, no plans to expand the network to the Eastern Shore and to Western Maryland. A comprehensive strategy for a statewide fiber optic backbone must be developed and funded, preferably through a public/private partnership.

If we're serious about trying to realize our potential in information technology, we also need a focused economic development strategy that targets support for information age technology companies. We need a marketing campaign that lets the world know the phenomenal assets we have, as well as our intention to become a Mecca for information technology companies.

And, we need to greatly expand our workforce for such jobs. A proposal recently developed jointly by the University of Maryland and Johns Hopkins promises to do just that. Entitled the Maryland Applied Information Technology Initiative or MAITI, this proposal commits our institutions to launching a collaborative effort among all Maryland universities and colleges that will double the number of information technology graduates by the year 2003. The proposal also commits the founding institutions to focused efforts in information technology with its incubators, applied research activities, and private sector partnerships. This proposal should be supported.

There is no time to waste. Many of our regional competitors have comprehensive statewide IT plans in place and are moving forward with implementation strategies. If we have the will and commit the resources, we can still be a winner in the national race for global leadership in the information age.

But winning in this race will require some hard decisions and resolute commitments. At the heart of any winning strategy is the development and maintenance of a strong system of higher education — public and private. Given the nature of the information age economy, where there are never enough knowledge workers and where brilliant innovations have a lifetime of about six months, leading research universities are essential. Just look at where the hotbeds of the technology economy are: the Silicon Valley, in the shadows of Stanford University and the University of California Berkeley; Austin, Texas, feeding off the University of Texas; and the Triangle area in the environs of Duke University and the University of North Carolina.

If we are to pursue a strategy of becoming a national leader in information technology, there are two questions we must answer: Does Maryland have the kind and quality of universities necessary to support this economy and, second, can it sustain these universities? The answer to the first question is: not quite yet but we're within striking distance. Unfortunately, a positive answer to the second question is far from certain in my mind.

I'd like to conclude with four issues that I think must be addressed by the state if the answers to both of these questions are to be unqualified yeses: funding for higher education, funding allocations related to institutional mission, management flexibility for higher education, and governance of higher education.

I. Funding for Higher Education

Historically, Maryland has not supported public higher education well in relation to other states, choosing instead to provide relatively high levels of state support to its fine system of private higher education. Indeed, an early state commission [Janney Commission; 1924] studying higher education emphasized that "the policy of this state is to depend largely upon privately managed colleges and universities for the education of its youth beyond the high school grades." The Commission went on to oppose the aspirations of the recently created (1920) University of Maryland to become "a great state university of the general type of the universities of certain Middle Western States." So it is not without a bit of irony that I am leaving Maryland some 70 plus years later for one of the Big Ten institutions in the Mid-West.

Although the quality of public education in Maryland is now of a level that would impress even Mr. Janney, the state has still not made public higher education a funding priority. One indication of this fact is the recent data from the Southern Regional Education Board (SREB), comparing the level of state commitment to higher education in the 15 states that make up the southeast quadrant of the U.S.

In response to criticism that a consolidated system would invariably fail to target funds to meet the flagship responsibilities of the University of Maryland, the 1988 Maryland legislature and Governor Schaefer included language in the plan calling on the state and the Regents to target operating and capital funds to College Park at the level of the nation's best funded public universities. This is still today the most specific statutorily-created institutional funding goal in the nation.

So where would Governor Glendening's four-year plan place College Park relative to its peers as called for in the ambitious 1988 goal? In its current form, the plan would allocate $36 million to College Park over the next four years. But as the next table shows, this is considerably short of the funding level called for in 1988.

**Adjusted to exclude AES, CES, and Veterinary Science.

Thus even at the end of the four-year period of the Governor's plan, and 14 years after the original call for parity in the flagship's funding relative to its peers, College Park would be behind its aspirational peers by $28 million. And that's in actual, not constant dollars, and assumes that these institutions have no future increases in their state funding. The University of Maryland, College Park's Board of Visitors, while very supportive of the Governor's plan, has requested of the Governor that he enrich his plan and add $28 million in constant dollars to the College Park portion of the plan in order to close this gap. I mention this not to exclude in any way the need for more funds at other institutions. Indeed, I urge that there be an expansion of the Governor's plan that will benefit all universities in the System in accordance with the 1988 aspirations. I mention College Park because it is the one institution where there is a specific funding mandate and where it is possible, therefore, to calibrate the impact of the Governor's plan.

One final word on increased funding. The higher education community should not expect enhanced funding with no strings. Quite the contrary. I'm a believer in holding people's feet to the fire. Those institutions that receive enhanced funding should be held accountable and the funding increments should be based on the institution's ability to meet agreed upon benchmarks of quality.

II. Funding according to institutional mission.

One the most discouraging and counterproductive things about higher education in Maryland is the amount of time and energy institutions and their leaders spend comparing and complaining about funding levels of the other institutions in the system. To compare funding levels at say, Salisbury State and College Park, is truly to compare apples and oranges. These institutions have quite different missions. Salisbury State focusses on — and delivers — high quality undergraduate education and masters level work. It also has important but limited outreach responsibilities. Its funding level should be benchmarked against other universities of its type. More about that in a moment. College Park, on the other hand, is a major national research university with extensive outreach responsibilities stemming from its land-grant charter. Assuming the state wants to have a top rank flagship university, College Park needs library resources and laboratories that will enable its faculty and students to do research on a par with the most distinguished research universities in the nation. College Park's funding should be benchmarked, as I just did, against other national research universities with a similar mission.

So I urge my colleagues and the leaders in Annapolis to stop these invidious intra-system comparisons. Let's fund all of our institutions appropriately according to their missions. Fortunately, an independent group, the Carnegie Foundation has developed a widely respected and accepted classification of institutions according to mission.

Funding comparisons should be done within these groupings, in other words, apples to apples, not apples to oranges.

III. Flexibility

Many of the states with distinguished higher education institutions, such as California and Michigan, grant their universities "constitutional autonomy," meaning that the state constitution mandates that the institutions are free to manage their affairs without some of the bureaucracy and constraints found in state government. These provisions are based in part on a recognition that the state contributes only a small share of a university's overall budget, and this share is getting smaller each year. This is certainly true in Maryland; for example, state tax dollars account for only about 30% of the University of Maryland College Park's overall budget. At the University of Maryland, Baltimore, the percentage is even much lower. In 1984 a state Commission on Flexibility made some important reforms in the state's management of its universities. But more could be done.

The issue is that the Maryland General Assembly appropriates all funds, regardless of funding source. So if one of our researchers wins a federal grant, these funds are considered "moneys of the state" and are subject to state rules and regulations on top of the federal requirements. It seems to me a more rational approach would be to look at the source of funds: if state taxpayer funds are being used in a particular program, then appropriate state rules and regulations should apply; but if federal or private funds are being used to support a university activity, then the rules of that funding source should apply. In other words, if the federal government is paying for research at a Maryland public university and is satisfied that the money is being expended according to federal rules, why should the state impose its own separate rules? Much of the administrative time, effort and dollars that is currently going to administering these programs could be devoted to more productive activity.

Lest you think this is an issue only in Maryland, I recently came across a report from a special business commission headed by the CEO of Time, Inc. that was looking at how the state of New York over-managed its public universities. The commission unearthed an amusing tale: apparently the state auditors were taking the medical school to task. The crime? The state university medical center had not followed a general 30-day bidding requirement and public notice when it harvested kidney organs for transplant surgery!

On a matter related to the issue of flexibility, I am delighted that Speaker Taylor and members of the House leadership have proposed legislation that would establish a technology development corporation to help take on the task of technology transfer for our colleges and universities. This is one area of university activity that calls out for private sector nimbleness and responsiveness and I applaud his vision.

IV. Governance in Maryland Higher Education.

Finally, let me turn to the issue of governance in higher education. This is obviously a very timely topic and one that I have given considerable thought to over the past 15 or 20 years. I want to offer three suggestions in the area of governance.

First, in my role as incoming president of Ohio State University I have already had the occasion to discuss campus matters with that university's Board of Trustees. Believe me; OSU is a complex institution, larger than College Park and with its own professional schools. It would be similar to College Park and the University of Maryland, Baltimore combined on a single campus. Yet what impressed me the most about my dealings with the Trustees at Ohio State is their very keen understanding of and advocacy for the needs of the institution.

Expecting a University System of Maryland Regent to brief the incoming College Park president at the same level of detail would be impossible. Don't get me wrong. This has nothing to do with the quality and dedication of the USM Regents, which is fully comparable to that of the Ohio State Trustees.

This is simply a reflection of the price we pay in Maryland for a consolidated governance system. No Regent in Maryland, or Ohio for that matter, could ever get his or her hands around the core issues involving 13 colleges and universities with disparate missions scattered across the state. My single greatest concern about the present system of governance is that it does not, indeed cannot, lead to a set of advocates who in their official capacities can passionately advocate for the needs and aspirations of individual institutions. I believe this absence of influential citizens with governance responsibilities, championing the needs of individual institutions is one reason funding continues to be an issue for public universities in Maryland. The next slide doesn't prove my point but it does provide some circumstantial evidence.

Don't get me wrong. I'm not saying there should be a free-for-all each spring in Annapolis with the last school standing getting all the money. But, we must find a way for the individual needs of the universities to get an airing, so that informed, differential funding decisions can be made.

Second, related to the issue of advocacy, I believe it vital, no matter what the governance system is, to ensure regular dialogue among higher education, the business sector, and state government leaders. One of the first formal university/business programs I was involved in was the Prince Georges/Montgomery County CEO Roundtable, formed by Larrry Levitan, Larry Schulman and others. I recall the wonderful session at IBM headquarters in Montgomery County, and the involvement of Senate President Mike Miller, GBC President Don Hutchinson, and CEOs from across the state where we discussed the status of the flagship and ways to strengthen its role. This event was instrumental in spurring me to form a Board of Visitors for the University, which has given me invaluable private sector advice over the years.

I propose that a higher education/business roundtable be formed in Maryland that would bring together business, government, and education leaders for an on-going dialogue on matters such as workforce issues, university/private sector partnerships, and the sharing of intellectual property. Such a forum has been created in Northern Virginia, called the Northern Virginia Roundtable, and it has become a powerful force in promoting collaboration between universities and the private sector and in getting substantial funding increases for higher education.

Third, in our governance structure we need to recognize the diversity in mission and size of our institutions. College Park represents over 40% of the USM state budget, and has a statewide mandate to extend our research, service, and graduate programs. We provide over 80% of the Ph.D.s in the state and have offices and programs in each of the state's 24 political jurisdictions. In short, we are unique in the public sector.

But there is no structural way to provide a proportionate voice for College Park within the University System of Maryland. I sit as one of 13 presidents despite the wide variance of our size, mission, and role. If we had the same system in Annapolis, the Garrett County delegation would have the same voice and vote as the Montgomery County delegation. Some method of giving a more proportionate voice to the institutions in the affairs of the System should be considered. My guess is that this will be an important issue in trying to convince an outstanding person to become the next president at College Park.

V. Conclusion

The invitation to speak this morning caused me to reflect on the ways, many of them hidden or not greatly recognized, that the University of Maryland, College Park touches the lives of our state's citizens.

Sometime in May or June, Patty and I will close up the President's residence in College Park and begin our drive west to Ohio. I will pass first the Maryland Performing Arts Center, under construction on campus, with the steel just starting to come out of the ground. It will be, I believe, a crown jewel for the state in the performing arts and an attraction for multitudes of people ranging from elementary school kids to senior citizens. I will leave the campus, travel west on the Beltway, and pass the 1-270 technology corridor where the University's technology extension service and Maryland Industrial Partnerships program serves the high technology community and where the University offers its nationally ranked business and computer science courses at Shady Grove. I will go by the Hagerstown Fire Station where hanging from its rafters and hanging in firehouses all across Maryland are diplomas signifying that the firefighters have been certified by the University's Fire and Rescue Institute in the latest fire safety and rescue techniques. I will pass by the farms of Frederick and Washington counties where University agricultural agents ensure the state's agricultural industry is provided the newest and most sophisticated advice to reduce pollution and ensure a bountiful harvest. I will go west, on I-68, the National Freeway, which I call the Road that Cas built, and past Rocky Gap Conference Center, which I call the House that Cas built. I will go past Frostburg State University, where thanks to technological advances, students can now receive a fully-accredited engineering degree from the University of Maryland's nationally ranked College of Engineering without ever having to set foot in College Park.

All along the entire route I will go by homes filled with the hundreds of thousands of University alumni, students, faculty and staff, and just Marylanders, who devote part of their winter Saturday afternoons cheering the Maryland basketball team, and hopefully soon the Maryland football team, to victory.

I have thought a lot about that trip. No doubt this will be an especially emotional, even tearful journey as I leave behind so many dear friends and colleagues, many of whom are in this room. But please be assured that as I travel west, swinging gently from my car's ignition switch will be the same key chain that is proudly given at graduation each year to thousands of Marylanders as they troop across the stage at Cole Field House. It bears a simple inscription: "Terp for Life." And that is what I intend to remain.

Thank you.

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