FY20 University budget update

Board of Regents to discuss budget in special meeting next week 

May 3, 2019    During its special meeting May 9, the Board of Regents will discuss budget contingency planning efforts underway across the UA system amid uncertainty about the level of state funding UA will receive for its FY20 operating budget. The legislature is approaching its 121-day limit to pass a budget by May 15 without extending the legislative session. After the legislature transmits the budget, the governor has 20 days [Sundays excluded] to sign the bill or to reduce or veto portions of the funding plan. That means it could be late June before there is certainty about the university’s budget for the fiscal year that begins July 1.


Although the FY20 funding cuts proposed by the House and Senate are significantly less than the $134 million cut the governor proposed in February, a final legislative compromise has yet to be reached. Under the House's plan, the university would receive a $317 million UGF operating budget. This is a $10 million cut from the current level. The Senate has proposed $322 million UGF for the university, $5 million below this year’s level. Over the next several weeks, a conference committee will be appointed to negotiate a final legislative budget. The budget then goes to Governor Dunleavy who could exercise line item veto authority to make additional reductions. Overriding the governor’s veto would require the legislature to come back into session, and to then secure a ¾ vote (45 of 60).


As budget outcomes become clearer, the regents will discuss budget contingency plans and provide guidance on structural options for moving the university forward with less state support. Campuses are in the process of addressing student-faculty ratios, workloads and administrative structures as part of the budget planning process.


In the larger context, state revenues are down. The State of Alaska is forecasting a budget deficit of $1.6 billion in FY20. The university is the third largest item in the state budget. The university’s budget has been cut 4 out of the last 5 years, dropping from $378 million in FY14 to the current $327 million. University expenses have been reduced through a combination of reductions in personnel, programs and services as well as increases in efficiency.


A decline in enrollment and tuition revenue has compounded the challenges. Philanthropic support also could be negatively affected by the news of deep budget cuts. Furthermore, outside universities have recruited top faculty and researchers. The immediate threat of faculty migration and the potential loss of the programs they teach could be impactful.


While the funding pressures may result in downsizing, the university will consider its options as it looks to the future. Regents will discuss each university’s expertise and mission. Administration also will be reviewed to reduce duplication and complexity. Regents have said that in order to build the university of the future, decisions must be mindful and deliberate.


In the meantime supporters continue to promote the university throughout the state. A privately-funded advocacy campaign called UA Strong was launched to garner support for the university and lessen the damage that could be made through budget reductions. It is important that we do not stop advocating for university funding. Direct contact with lawmakers makes a difference. Please send your representatives an email or call their office and let them know why you support UA. Letters to the editor and Op-Eds help to tell the positive stories about the university and its life changing mission and importance to our state. We also can work to spare the university’s budget from reductions by veto. Each of us can play a role through our words and actions to represent all the best that the university brings to our state. Share good news, follow UA Strong on social media, and be engaged in the discussions and processes that truly will define the future of the university as we know it.


Stay informed! Follow the latest legislative news on Twitter @UA_GovRelations and in the Capitol Report, https://alaska.edu/govrelations/report/.


Watch the May 9 Board of Regents meeting live from 10 a.m. to 3 p.m. at https://www.alaska.edu/bor/live/.