William Powers Jr., president of the University of Texas, sketched out a strategy Wednesday for next year's state legislative session that essentially amounts to two parts offense and one part defense.

The offense: Seek increased state appropriations and a modification of the top 10 percent admission law. The defense: Block efforts to strip tuition-setting power from public university boards of regents.

Powers described his legislative strategy during a state-of-the-university address that also took stock of UT's achievements and challenges. He spoke from the stage of the B. Iden Payne Theatre on campus two days after the 125th anniversary of the university's opening.

"UT's greatest obstacle today is that we're underfunded in comparison with our national peers," Powers said, echoing his own testimony in recent months to various legislative committees. "Minnesota has $6,000 more per student than UT. The University of North Carolina has $6,500 more. UCLA has $7,500 more per student.

"Since 1990, state support for UT's academic budget has actually declined by about 1 percent annually when adjusted for inflation. We need long-term, reliable, sustainable funding from our state Legislature, and I've been working with them to try to gain that support," Powers said.

Despite substantial increases in recent years, UT's tuition ranks in about the middle of a 12-member national comparison group of universities. In the absence of increased state support, the UT president said, it's essential that regents retain authority to set tuition. Some lawmakers want the Legislature to reassert the control it ceded to public university governing boards in 2003.

Powers described the need to modify the top 10 percent law as urgent. Under the law, any student graduating in the top 10 percent of his or her Texas high school class can attend any public university in the state. UT increasingly is the school of choice, with 81 percent of this year's freshmen admitted under the law.

"By this time next year, projections indicate that all Texas students enrolling in the fall will be admitted under this law, and some top 10 percent freshmen will be forced to enroll in the summer," Powers said.

His argument — that such a student body is one-dimensional, lacking the gifted musician, newspaper editor or class leader who didn't rank high enough — did not sway lawmakers last year. It's unclear how the issue will play out next year.

Turning to matters over which he enjoys more control, Powers said the university would step up efforts to increase financial support for faculty members and graduate students, two areas of weakness in national comparisons.

He said $2 million would be added to the budget for graduate student stipends, bringing the total to $19 million annually. And $2 million will be set aside to guarantee tenured faculty members and certain other faculty members $1,200 a year for travel to present scholarly papers.

Powers also touched on a major fundraising campaign that has been in the works for many months. Although other university officials previously have said the goal would be something between $2 billion and $4 billion, Powers declined to mention figures.

"There will be an announcement very soon," he said. "What I can tell you now is that the capital campaign will be big."

Looking back over the past year, Powers said he was pleased with the university's achievements, including the expansion of seminar-type "signature courses" for freshmen, the hiring of several prominent faculty members in history and English, the growth in research opportunities for undergraduates, the addition of 37 minority faculty members and a flurry of brick-and-mortar projects, from the expansion of Royal-Memorial Stadium's north end zone to the construction of an executive education and conference center whose official opening is today.

Perhaps in response to the growing emphasis in Texas and elsewhere on the role of universities as engines for economic development and technological innovation, Powers also spoke to what he sees as perhaps a higher calling.

"Our biggest contribution to innovation is when we do basic research," he said. "Our biggest contribution to leadership in our society, and our noblest endeavor, is when we engage our students in the great issues of human existence: in the lessons of Plato, Homer, Cervantes, Augustine, Dickinson and Buddha. Of Newton and Einstein. When we instill the thirst for inquiry into the humanities and the arts and the sciences."