After the public and legislators were outraged at the discovery of nearly $650 million in reserve funds after increasing tuition rates for six years, the University of Wisconsin System Board of Regents approved a policy to keep reserve funds in check at each university in the system.

The policy establishes minimum and maximum reserve levels of unrestricted funds at 10 and 15 percent, with any balance more than 15 percent requiring justification from each university to the board.

According to the policy, unrestricted funds include dollars raised from tuition, auxiliary operations, general operations and other unrestricted program revenue, which would need to be justified if these funds reach more than 15 percent.

David Miller, UW System senior vice president, said at the board’s September meetings, the percentages serve as thresholds for what amount of reserve funds can be held to ensure the financial health of each institution.

At the September meeting of the Board of Regents, UW-Madison Chancellor Rebecca Blank said it is very likely universities will go to the board to ask for higher balances to be held.

The approval comes just under three months before the Legislature’s Jan. 1 deadline to create a financial transparency policy.

In addition to approving the new transparent procedure regarding reserve funds, the board also approved increased pay ranges for UW System senior officials.

According to the salary policy, outgoing System President Kevin Reilly’s successor will see a possible $598,000 salary, in addition to outgoing UW-Madison Provost Paul DeLuca’s successor seeing a more than $443,000 salary.

Current pay ranges for UW System executives fall between $125,000 to $440,000, which will increase to $145,000 to $600,000 under the new policy.

The pay ranges will also be assessed every two years to ensure pay is competitive between universities, according to the policy.

“All of these decisions are consistent with this Board’s commitment to competitive compensation for all faculty, staff and academic leaders,” Regent President Michael Falbo said. “We have given the Chancellors flexibility to reallocate existing resources, wherever possible, to address compensation equity and market gaps.”

The Board of Regents is unable to decide pay ranges or salaries for faculty and staff at each individual university, UW System spokesperson David Giroux said. The decisions about faculty pay are up to individual chancellors, he said. 

Giroux added the pay ranges will increase competitiveness between peer universities since UW System has 18 to 20 percent lower salaries than its peers.

Rep. Steve Nass, R-Whitewater, chair of the Assembly Committee on Colleges and Universities, said the board is “out-of-touch” for increasing pay ranges for its executives rather than lowering costs for Wisconsin residents.

“While Wisconsin families continue to struggle to pay their bills and contribute to college savings funds, the Board of Regents rolled-up their sleeves and made sure the UW System’s high level administrators will be able to easily afford an addition on their summer home or to pay cash for a new Lexus,” Nass said in a statement Friday.

Reilly also addressed the impact of the federal shutdown, which has had little impact on financial aid for students, but has already affected research funding.

The board also approved a football contract between UW-Madison and Louisiana State University, which will allow a football game to be held between the two schools in 2015 at the Green Bay Packers’ Lambeau Field.

The board will meet next on Dec. 5 and Dec. 6 in Madison.