House Appropriations Committee

Education and Economic Development Subcommittee

February 13, 2008

Senate Budget and Taxation Committee

Health, Education, and Human Resources Subcommittee

February 18, 2008

University of Maryland Center for Environmental Science

FY 2009 Operating Budget

Testimony by

I am privileged once again to present for the General Assembly's consideration the Operating Budget request for the University of Maryland Center for Environmental Science.  In this written testimony, I briefly review how the Center is helping the State of Maryland in addressing the most vexing environmental challenges of today and tomorrow as well as offer specific comments on the Department of Legislative Services’ analysis of the budget request. 

Before I begin, I want to take a moment to thank the members of the Committee and indeed the General Assembly as a whole for interest in and support of the work we do.  Unlike any other organizational unit in Maryland’s public higher education system, the University of Maryland Center for Environmental Science has been given a very specific charge by the General Assembly in statutes extending back to 1941.  This charge is to conduct a comprehensive program of research, advisory services and education in environmental science in order to develop a predictive ecology for Maryland.  We do this through our three laboratories across the state, the Chesapeake Biological Laboratory in Solomons, the Horn Point Laboratory near Cambridge, and the Appalachian Laboratory in Frostburg; the Maryland Sea Grant College Program that we administer for the University System; and our collective efforts in Annapolis, Washington, and around the world. 

We have presented you with a preview copy of the Center’s 2007 Annual Report, so I will not spend time reviewing the full breadth of our activities and accomplishments; rather I want to direct your attention to just a few examples of how the Center is actively engaged in and leading efforts to serve the needs of Maryland for today and tomorrow. 

Leadership in Serving the State for Today and Tomorrow

Restoring the Chesapeake Bay, Finally

 

There is an understandably high level of frustration among members of the General Assembly and indeed among Maryland citizens at large about the recurring signs of the degraded health of the Chesapeake Bay and the disappointing progress in its recovery after 20 years of effort.  As you know, Governor O’Malley’s approach to accelerating progress in restoration is based on his BayStat program.  As President of UMCES, I represent the University System of Maryland on the leadership subcabinet for BayStat.  Filling this role of resident scientific advisor to the O’Malley Administration, I am able to tap expertise not only in my own Center but within the larger scientific community to help advance the BayStat approach of science-based process for increasing effectiveness and ensuring accountability in Chesapeake Bay restoration.  In addition, my colleagues in the Center provide the analyses that support the Current Health indicators used in BayStat, based on their geographically specific report card of water quality and biological conditions. 

 

Since its establishment just over a year ago, BayStat has set priorities for restoring the Bay, reviewed progress in the health of the Bay, actively tracked best management practice implementation, and vastly expanded communication and cooperation among the agencies and the University System of Maryland.  Consistent with its statutory charge, UMCES served as the liaison between the State and university community in addressing environmental problems affecting the waters of the Chesapeake Bay, consistently engaging the best experts to provide advice.  For example, UMCES and Maryland Department of Agriculture are leading an effort to develop targeting tools for agricultural best management practices that involve leading scientists in our universities, the U.S. Department of Agriculture, and the U.S. Environmental Protection Agency, among others.

 

At the same time, the Center’s scientists have intensified their efforts to advance our understanding of what limits recovery of the Bay ecosystem and how to overcome these obstacles.  For example, under a five-year, $2.3 million project supported by the National Science Foundation, my colleagues are investigating how the lack of oxygen experienced in the so-called “dead zone” in the deeper parts of the Bay regulates the recovery of the whole ecosystem.  When such hypoxic (very low oxygen levels) or anoxic (no oxygen) conditions prevail nitrogen and phosphorus are released into the water, adding more fuel to the fire in this overenriched ecosystem. However, if oxygen conditions improve, the nitrogen and phosphorus will be removed from the system.  This sets up a “tipping-point” phenomenon in which at some point rapid recovery of healthy function of the ecosystem will result.  This explains why the recovery of the Bay may not yet be apparent, but offers hope for more rapid improvement once the tipping point is reached.  So, developing leading indicators of the incipient recovery will be very important in guiding our efforts. 

 

But UMCES conducts its research not just in the Bay but within the Bay’s vast watershed.  There the degraded nature of the network of streams—effectively the veins of the watershed—is increasingly recognized as limiting recovery of the Bay.  My colleagues are identifying and helping to uncover buried streams in our suburban landscape and assessing cost-effective ways to restore the potential of streams that trap and remove nutrients from non-point source runoff.  In a recent study, it was found that when a channelized stream near Towson was reconnected with a portion of its floodplain, nitrogen flowing down the stream was reduced by 40%.

 

Addressing Climate Change

 

While Chesapeake Bay restoration is challenging, reducing the amount of global climate change and adapting to its inevitable consequences is the biggest environmental challenge of this generation and the next.  UMCES scientists are at the forefront of understanding the likely effects of climate change on Maryland and the region.  Already a 2°F temperature increase in the average temperature of the Bay has been documented since 1950, both in Maryland and Virginia.  Sea level, which rose about one foot during the last century, is expected to rise at least two feet during this century, and maybe more depending on how fast the Greenland ice cap melts.  Climate change will affect our landscapes as various plants and animals shift northward.  The warmer, wetter climate will also affect how much carbon is retained in forests, i.e. whether those carbon credits one buys actually stay in the bank, as well as the fluxes of nitrogen to the Bay.  Our scientists are also evaluating the environmental tradeoffs of alternate energy sources, whether they are wind power in the Appalachian Mountains or crops grown to produce biofuels on the Eastern Shore. 

 

The University of Maryland Center for Environmental Science is also playing a leadership role in assisting the Maryland Commission on Climate Change, established last year by Governor O’Malley.  The Commission is charged with developing an action plan to address the causes of climate change, prepare for the likely consequences, and establish benchmarks and timetables for reducing our greenhouse gas emissions.  An important part of that plan will be a Comprehensive Climate Change Impact Assessment, being developed by a scientific working group that I chair, which includes numerous experts from throughout our universities. 

 

I am sure that you have heard Chancellor Brit Kirwan speak about his Environmental Sustainability Initiative in which we will strengthen, focus and coordinate our instructional and research programs and institute practices on all of our campuses in a way that help Maryland achieve a more sustainable future.  Once again, the Chancellor has asked UMCES to play a leadership role in advancing this initiative. 

 

Increasing the Scientific Competence of the Next Generation

 

The Legislative Analyst’s analysis showed that we have continued to make our marks for increasing participation by K-12 teachers served by our environmental science education program.  Related to this, UMCES recently received a highly competitive grant from the National Science Foundation to maintain a Center for Ocean Science Education Excellence (COSEE).  Working with its partners, the Maryland Department of Education, University of Delaware, Hampton University, and National Park Service, among others, the Center will seek to improve the basic science literacy needed for K-12 students to comprehend the myriad changes occurring in coastal environments.  Teams of scientists, teachers, and graduate and undergraduate students will be brought together to develop engaging lesson plans on coastal trends that will utilize innovative learning media.

 

Next Generation Vessel for Bay Science

 

A critical investment initiated by the General Assembly last year is the construction of a state-of-the-art research vessel for the Chesapeake Bay.  Now designed and under construction, the vessel will provide an outstanding scientific platform with advanced capabilities not now available in the Bay region and will be used by the broader community of scientists, from throughout the University System, in Virginia universities and in state and federal agencies and the private sector.  The 81-foot long research vessel is scheduled for completion before the end of 2008 and will be in service during the latter half of FY 2009.  It features low stack emissions needed for uncontaminated sampling, acoustically quiet operations, acoustic and optical sensing technology, and the ability to launch and retrieve data buoys and autonomous sampling vehicles.  I believe that this unique asset will transform Bay science and represent Maryland’s commitment to outstanding science for the restoration and protection of the Bay through the first half of the 21^st century. 

 

Diversifying Support

 

To be successful these days, leaders of higher education institutions, both public and private, must work hard to diversify their sources of support, particularly through increasing private philanthropy.  UMCES has identified its responsibility within the University System of Maryland Capital Campaign by setting a goal of raising $8 million by 2012.  We officially launched our campaign late last year, having already raised $3.7 million toward that goal.  Just before Christmas I received word that the France-Merrick Foundation had committed to a $750,000 challenge grant to fund an endowed professorship in Sustainable Ecosystem Restoration. This will be the Center’s first endowed chair and the gift represents the largest private philanthropic award in the Center's history.  We were also the beneficiary of a planned gift of $500,000 for graduate student fellowships at our Chesapeake Biological Laboratory, by a gentleman in Florida, who has fond memories of the University of Maryland and the Chesapeake Bay. 

 

 

 

The Operating Budget Request

 

Mandatory Costs

 

We are pleased and thankful that the Governor’s Allowance includes funds to meet most of our mandatory costs, including salary adjustments for merit, increased costs for health and retirement benefits, inflation for utility costs, and facilities renewal. 

 

 

The Department of Legislative Services Analysis

 

The analysis by the Department of Legislative Services lists several major trends and issues and asks that I comment on two of the issues. 

 

The first issue concerns the decline in the volume of new awards for sponsored research that was experienced in FY 2007 and the impact on indirect cost recovery revenues.  Looking first at the total awards received by the Center in  FY 2007, the decline was considerable, about 30% below the average amount of awards received during the preceding three years.  In understanding the meaning and causes for this decline it must first be understood that UMCES has long been successful in competing for research support but has not been growing in terms of expansion of faculty and programs.  Thus, it is unrealistic to expect dramatic or even sustained growth in awards, which should be expected to fluctuate from year to year.  Still, the reversal is consequential and has merited our attention to its causes and to developing strategies to increase sponsored research.  The main internal factor causing the one-year decline is the loss of a few highly successful faculty members and their replacement by less established researchers.  We are currently assisting these new faculty members in building their research portfolios.  There are, however, many external factors that underpin the decline in funding from federal science agencies, our principal source of support, including tightening budgets and delayed appropriations; the tendency under these circumstances for federal agencies to cut extramural research support in lieu of reducing support of their internal researchers; and the impact of growing Congressional earmarks on the funding for competitive research programs. 

 

Recognizing this, we have set as our goal this fiscal year to return award levels in FY 2008 to the levels experienced during FY 2004 through FY 2006.  In fact, this goal is included in my annual performance agreement with the Chancellor and Board of Regents.  I am happy to report that we are well on track to meet this goal.  As the chart indicates, awards received through January are at the average level accomplished during the earlier reference period and well above the FY 2007 level.  The performance is encouraging because it was realized despite the fact that the federal government operated on continuing resolutions for all of FY 2007 and the FY 2008 appropriations were not enacted until December 2008.  Still, we are not complacent and are carefully monitoring progress and doing everything we can to maximize success of our grant proposals.  A particularly encouraging sign is several large awards that have been recently received or are anticipated.  Even more important, these awards will support our work on such important issues as hypoxia and science education, that I discussed earlier, and innovative treatment of ships’ ballast water to reduce the risk of introduction of invasive species to the Chesapeake Bay. 

 

Indirect cost recovery revenues can be expected to vary with the level of awards, but lag by a year or so.  Consequently, our realized indirect cost recoveries are down this year, making it very difficult to pay for the operating costs of our facilities this fiscal year.  This is why we continue to believe that it is ill-advised to include language expressing the intent of the General Assembly that the Center apply future increases in indirect cost recovery revenues associated with the new research vessel toward repayment of the loan for the vessel.  This would have unintended negative financial consequences for the Center.  Our indirect cost recovery rates are determined by federal cost principles which include the cost of operating our shore-based facilities.  These revenues go to meet our real expenses, such as energy costs and administrative and technical support of research, and are not “profits,” extra income, or otherwise uncommitted revenues.

 

The second issue on which I was requested to comment concerns the reduction in oyster production and the anticipated impact on the new setting facility at the Horn Point Laboratory.  As the analysis points out, production of oyster spat on shell was down in calendar year 2007 from the record-shattering volume achieved in 2006.  The reasons are several.  First, we should keep in mind that the production in 2006 was truly phenomenal and hard to reproduce year after year without the planned expansion of facilities.  Secondly, state and federal funding for oyster restoration activities declined in 2007 and thus there was less financial support for hatchery production.  Thirdly, very challenging water quality conditions were experienced in spring and early summer, causing mortality and poor growth of oyster larvae.  All evidence indicates that this was a result of toxic algal blooms and the poor food quality of algae that were prevalent in the Choptank River, yet another consequence of the nutrient overenrichment of the Chesapeake Bay.  This same problem was experienced by other oyster hatcheries in the Bay region as far as Virginia.  Earlier this month, we installed a state-of-the-art activated carbon and ozone treatment system that should neutralize the toxins from algae.  The algae cannot be simply filtered out of the water because their cells would likely break apart and release even more toxins.  While the vagaries of nature that affect year-to-year success are indeed humbling, we feel confident that we will be able to produce sufficient larvae to provide for the State’s new setting facility and pier once construction is completed.

 

While this is not reflected in the UMCES budget, I want to point out that the DLS proposal to cut $6.8 million in General Funds from the entire University System of Maryland appropriation would have serious consequences to the Center as if it is assigned its pro rata share of the reduction.  This is particularly difficult for us because of our very tight budget for FY 2009 and the fact that the Center will receive no revenue from the Higher Education Investment Fund or to offset tuition increases or enrollment growth.  Equally challenging will be the mandated 1% Effectiveness and Efficiency contribution.  Under the Board of Regents direction we have done this for several years now and there have been positive benefits in administrative efficiency.  But, there are limits to how long we can continue to do this without serious effects on our mission.  In my opinion, the Regents should be rewarded for their diligence and innovation with the trust to manage the continuing E&E process.

 

All of these concerns noted, I want to assure the Committee that the University of Maryland Center for Environmental Science stands ready in a leadership position within the University System as we turn the corner on the Chesapeake Bay restoration and concertedly address environmental sustainability and climate change in our time and for future generations to come.