After grappling with a rocky fiscal year, administrators of the institutions governed by the state Board of Regents are looking at the challenges looming in fiscal 2018.
The state Legislature took back $9.2 million earlier this year from the University of Iowa’s midyear budget, representing a reduction in appropriations of that amount each year in the future. The three regent institutions — the UI, Iowa State University, and the University of Northern Iowa — lost approximately $18 million during fiscal 2017 as the result of a $131 million state budget shortfall.
Administrators discussed progress, priorities, and concerns regarding the formation of the fiscal 2018 budget at the June 7 Investment and Finance Committee meeting in Cedar Falls. The regents will consider a large component of the budget on June 8 and again when the final fiscal 2018 budgets are presented in August, said Brad Berg, the regents’ policy and operations officer.
Rod Lehnertz, the UI vice president for Finance and Operations, said officials will bring a summary of the UI’s developing budget system to the regents in August; he said progress has been positive so far. But between fiscal 2017 and 2018, he said the cuts to appropriations — which amount to nearly $16 million, a reduction of roughly 6.7 percent to the general fund — have been large.
To counter the budget cuts, Lehnertz said, the campus-wide efforts to boost efficiency and reinvest in the UI’s core mission through the Transparent Inclusive Efficiency Review, as well as building efficiencies in the mixture of fuels that power the campus, have helped.
Despite these efforts, he said, UI President Bruce Harreld has voiced continued concern over maintaining competitive faculty salaries.
“This is a top priority and a top challenge for the University of Iowa,” Lehnertz said. “To maintain our excellence, the poaching of our top faculty and researchers must be stopped.”
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The regents will discuss plans to establish a tuition task force that will work throughout the summer to establish a five-year tuition plan to offer more predictability as students and families examine their finances when choosing colleges to attend. Lehnertz said the regents’ actions on June 8 regarding the task force will be critical.
“The partnership with our regents, with our students, with their families, will allow us to fix the loss of our top faculty, which is so impactful to student success and to institutional reputation,” he said. “It will allow us to pursue strategic initiatives, which will create critically needed improvements in excellence and student success, and it will ensure that current and future students at the University of Iowa succeed.”
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Miles Lackey, ISU’s chief financial officer, was frank about the difficulties the most recent legislative session posed for the universities.
“With respect to state appropriations, the 2017 legislative session was the toughest and perhaps one of the most disappointing sessions that we have had in recent history,” he said, noting the midyear reduction in appropriations led ISU to dip into its reserves.
UNI faces a funding situation unique from the other two regent institutions, which see higher enrollment from international students and nonresident students. The freshmen class at UNI comprises 92 percent resident students, according to the UNI senior vice president for Finance and Operations. This means a smaller portion of the school’s revenue comes from tuition and fees.
Regent Larry McKibben, who chairs the Investment and Finance Committee, said he is pleased with the regents’ plan to organize the task force, and he hopes those involved will be visionary throughout the process.