May 30, 2017
To the Faculty, Staff and Students of the University of Nebraska:
As you likely know, the Legislature has concluded its session after finalizing a two-year budget package for the state, including funding for the University of Nebraska. With our state appropriation known, we can move forward on other pieces of our budget, including tuition increases and the cost reduction efforts we began earlier this year.
The outcome of the legislative session is not what we had hoped for. Between reductions approved by the Legislature and additional cuts from Governor Ricketts’ vetoes – and when unavoidable cost increases like health insurance are factored in – we will face a recurring budget shortfall of $49 million by summer 2019.
While this is a challenging budget situation, your good work has helped ensure that our state funding was not reduced more deeply. Your efforts in serving as outstanding ambassadors for the university, in inspiring Nebraskans to speak out in our support, and in reminding the people of our state of the vital work we do in teaching, research and service have made a difference. We’re truly appreciative.
“We must view this challenge as an opportunity to think together about what kind of university we want to be in the future.”
Our budget situation and the increasingly competitive higher education landscape mean we will have to adapt quickly. We must do everything we can to emerge as a stronger university, even better positioned to join with our partners to grow Nebraska’s economy and quality of life.
Later today the University will release its proposed 2017-18 operating budget, including our plans for addressing our shortfall. The budget will go before the Board of Regents on June 1. Here are the key elements, in advance of their wider release:
We know students and parents are working hard to invest in a college education. The proposed budget sets tuition rates for the next two years to help students and families plan, and includes tuition increases. In 2017-18, most resident undergraduates would pay $10 to $12 more per credit hour. In 2018-19, a typical resident undergraduate would pay $6 to $7.50 more per credit hour. This is subject to change if our state funding is cut further.
We do not make this recommendation lightly. As you know, state funding and tuition are the major sources of revenue for university operations, and moderate increases in tuition will help us close our budget gap while maintaining the quality of education our students deserve. The increase preserves our affordability, especially considering that we will increase need-based aid at the same rate as tuition. Our campuses will remain a great value compared to similar institutions.
In January, we shared a university-wide process for re-imagining our operations. Our goal was to reduce spending, while also positioning us to deliver on our mission. This will help us as we face a future in which resources will continue to be limited.
Nearly 100 of our employees served on Budget Response Teams that recommended cuts in areas like finance, human resources, IT and travel. We are grateful for their hard work, and we will continue to engage stakeholders on cost reduction ideas as we analyze implementation options. Based on our conversations with team members, we project we could realize up to $30 million in savings over the next several years – savings that will help us protect our academic core.
Reducing our operating costs by this amount will be challenging. But with challenge comes opportunity – to be more collaborative, to become more productive, and to create the kind of university we want to be. We’re going to be totally focused on the future – engaging Nebraskans about what their university can do to continue to grow the economy, meet the needs of the workforce, improve lives as we have done for nearly 150 years.
Thank you for all you do for the University of Nebraska.
Hank M. Bounds, Ph.D.
President, University of Nebraska
Jeffrey Gold, M.D.
Chancellor, University of Nebraska Medical Center and Interim Chancellor, University of Nebraska at Omaha
Ronnie Green, Ph.D.
Chancellor, University of Nebraska-Lincoln
Doug Kristensen, J.D.
Chancellor, University of Nebraska at Kearney