Proposed U of M budget focuses on investing in its future against the challenges of rising costs
As the University’s fiscal year winds toward a close next month, the University of Minnesota Board of Regents will review President Joan Gabel’s recommended operating budget for the upcoming 2022-23 fiscal year. The budget proposal comes at a challenging time for budgets of all sizes, as tumultuous political, financial and public health conditions domestically and globally create uncertain, less predictable paths forward.
“Effective budgeting and financial management have been critical in recent years as we have had to assume, adjust and accept a variety of unknowns,” said Board Chair Ken Powell. “As a Board, we appreciate how much thought and effort goes into building a proposed operating budget in these circumstances. We will continue to make decisions in this uncertain environment that best position the University for long-term success. ”
The recommended operating budget anticipates approximately $ 4.2 billion in revenue for the upcoming year, balanced against approximately $ 4.1 billion in expenses. Compared to last year’s budget, and removing one-time financial inputs from the American Rescue Plan program, this proposed budget would be a 1.9 percent increase in revenue year-over-year, overshadowed by a 4.1 percent increase in expenses. The latter reflects widely observed economic pressures, including inflation and workforce availability, among others.
The budget emphasizes investments guided by the systemwide strategic plan, MPact 2025. Notably, the budget proposes merit-based increases for University employees systemwide, with local leaders distributing an average of 3.85 percent across their teams. President Gabel and her leadership team have made it a priority to invest in attracting and retaining talented faculty and staff necessary to achieve the plan’s goals.
The budget also recommends that cost increases be funded, in part, through internal reallocations, spending reductions and other operational changes that redeploy existing resources to better address current and future needs. Depending on each college’s or unit’s local budget, these reallocation targets will vary, but they will collectively amount to a significant incremental resource increase in next year’s budget — more than $ 28 million.
Also included is an increase to the University’s undergraduate tuition, with a 1.75 percent change recommended for the Crookston, Duluth and Morris campuses, and a 3.5 percent change for Rochester and the Twin Cities. These proposed numbers continue to hold tuition rate increases below the rate of inflation, an increasingly difficult proposition in an environment of flat support from state and other revenue sources, and potentially significant cost increases associated with inflation.
“We have worked across the system to build a budget that achieves strategic goals and advances the University’s excellence in the face of rising costs. This budget invests in supporting and building world-class staff, incorporating a responsible tuition and fee plan and challenging all units within the University to continuously prioritize and improve efficiency, ”said Gabel.
Public Forum on Recommended FY 2023 Annual Operating Budget
The Board will accept public comments on the President’s Recommended FY 2023 Annual Operating Budget as it considers action next month.
A public forum will take place at 8 am on Friday, May 13. Sign-up will take place beginning at 7:30 am in the West Committee Room, sixth floor, McNamara Alumni Center. Available speaking slots will be assigned on a first-come, first-served basis.
Written comments may also be submitted online. All written comments will become part of the public record.
As part of its May meetings, the Board is also expected to:
- Review and act on recommendations for promotion and tenure and other academic appointmentswhich will include three faculty members detailing their research, education and outreach activities.
- Recognize distinguished students, faculty and staffduring which individual honorees will be introduced and honored by the Board.
- Review Gabel’s recommended FY23 capital improvement budget.
- Review proposed changes to Board of Regents Policy: Student Conduct Code in a discussion with student affairs leadership from the Duluth and Twin Cities campuses.
- Act on proposed changes to Board of Regents Policy: Property and Facility Use.
- Review the annual workforce and human resources strategy report.
- Finish a three-part discussion on health science strategy with a discussion of clinical care.
- Conclude a series of discussions on diversity, equity and inclusion work on the University’s five campuseswith the Duluth campus scheduled to present.
For more information, including future meeting times, visit regents.umn.edu.