University of Nebraska President Ted Carter announced on Friday via email and followed by a news conference that the university system will face $43 million in permanent spending cuts to be spread over the next three years.
To minimize the impact, the cuts will be spread out; 0.2% of the cuts will occur in 2020-21, 1.6% in 2021-22 and 2.6% in 2022-23, according to a news release. NU’s Central Administration office will endure a 10% cut to its budget, and each NU campus chancellor will lead campus-specific budget reductions.
NU’s 2020-21 operating budget will go before the Board of Regents on Friday, June 26 for approval, which includes cuts at each of NU’s campuses, with the exception of the Nebraska College of Technical Agriculture.
“In short, COVID-19 has ushered in a transformational period for higher education,” Carter said in the email. “Like most colleges and universities, we’re facing fiscal challenges, enrollment unpredictability and all the uncertainties associated with a global event that has upended many of our lives.”
Carter said difficult decisions are ahead and many of the cuts on campuses are due to reductions in nonresident and international student enrollments, including a 5.5% expected decrease at the University of Nebraska-Lincoln due to a higher percentage of out-of-state and international students.
Despite challenges with out-of-state enrollment, Carter said in-state enrollment has remained steady with previous year’s enrollment. The number of applications now, he said, is higher than they were this time last year.
In regard to faculty salaries, non-unionized faculty will not receive any salary increases for the next fiscal year but will see respective 1.5% and 3% increases the next two years. Faculty who are part of unions will receive their increases per state law, according to Carter.
Carter said he wants unionized and non-unionized faculty to eventually receive similar salaries and increases. He also acknowledged that faculty at UNL and the University of Nebraska Medical Center are still below their averages at peer institutions, so he would prioritize those faculty.
“Cuts are not easy, particularly when they come on the heels of multiple rounds of reductions in recent years,” Carter said. “But consider what our shortfall might be if we had not been proactive in launching strategies to avoid becoming part of the national rhetoric predicting steep declines in enrollment.”
Among the goals in the plan, Carter said he and the chancellors have agreed to invest $20 million in the next biennium, beginning with fiscal year 2021-22, in shared priorities. These priorities include student access and success, faculty salaries, diversity and inclusion and facility renewal and repair.
In addition, Carter announced he would send $200,000 in August to UNL, the University of Nebraska Omaha and the University of Nebraska Kearney to assist students who are part of the Nebraska Promise.
Carter said the funds would go toward a combination of hiring employees to manage Nebraska Promise students and toward mentoring and tutoring programs to ensure those students’ success. The $200,000 is part of the $20 million investment, he said.
“Challenging as this period is, it will end — and when it does, the needs of our state and world will be as great as ever,” Carter said.
On Thursday, Nebraska football coach Scott Frost and men’s basketball coach Fred Hoiberg announced they plan to donate a portion of their salaries back to the Nebraska athletic department.
Carter also said he has asked the Board of Regents that he not receive any of his merit-based salary at the end of the year, which could be up to 15% of his base salary of $934,600. He said he has not asked the chancellors to do the same and has left the judgments up to them.
UNL Chancellor Ronnie Green released an update on Friday to faculty and staff about UNL’s budget.
Green stated that the COVID-19 Budget Advisory Committee has been examining possible university-wide reductions to begin offsetting the total shortfall. Additionally, Green said UNL units have submitted proposals for how the university can effectively balance the budget as it moves through this challenging time.
As UNL continues to work to balance its budget, there will be town hall meetings where faculty and staff can discuss their opinions and ask questions. UNL will face a shortfall of $38 million, or 8.2% of UNL’s current $465 million state-aided budget due to a combination of decreased enrollment and other COVID-19 related losses, according to Green.
“UNL stands in a considerably stronger position than many of our colleagues in other institutions of higher education which are facing much more severe budget impacts,” Green said in the release. “Our continued relatively good position will rest on several things, including strong and robust enrollment.”
Carter challenged everyone in the NU system to add “recruiter” to their job title and encourage others to join the university.
“We should all be proud that we have made affordability and accessibility our North Star during a challenging time,” Carter said. “Now we must finish the task and get those students enrolled.”
Carter said that beginning on April 17 with the announcement of the Nebraska Promise and followed by reductions in online tuition rates and a two-year tuition freeze beginning with the Fall 2021 semester, NU began minimizing its impact due to COVID-19.
“If you look across the nation, many of the colleges and universities are planning on a 15% enrollment drop,” Carter said. “Had we not taken the actions that we did start on April 17, our modeling suggests that we would be north of $25 to $30 million of additional cuts.”
Tuition for the 2020-21 academic year will increase by about 2.75% for all NU in-state students and 3.75% for all NU out-of-state students, which was approved by the Board of Regents in June 2019.
Following the increase, tuition will not change through academic years 2021-22 and 2022-23.
For the next biennium, NU has also planned to ask for a 2% annual increase in state support, according to the news release. The Board of Regents will consider NU’s 2021-23 biennium budget request to the State of Nebraska at its meeting on Aug. 14.
Carter said he remains cautiously optimistic about NU and its budget despite the financial uncertainty brought on by the coronavirus.
“Because of the way we have approached this, because of the decision making, because of the planning for success and not being frozen in inaction,” Carter said, “I’m confident that we will be in a position of strength. And when we come to the other side of COVID-19 and its results, we will be poised for growth and we will be continued to be a great partner for the state of Nebraska.”
Haley Elder contributed to the reporting of this story.