UI’s fiscal 2020 budget: Tuition up, but tuition revenue down

The UI will have more money in its general-fund budget in fiscal 2020, but tuition revenue will comprise a slightly smaller share of the funding sources.

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UI’s fiscal 2020 budget: Tuition up, but tuition revenue down

University of Iowa President Bruce Herald speaks in front of the Board of Regents on Thursday, April 18th, 2019. (Tate Hildyard/ The Daily Iowan).

University of Iowa President Bruce Herald speaks in front of the Board of Regents on Thursday, April 18th, 2019. (Tate Hildyard/ The Daily Iowan).

University of Iowa President Bruce Herald speaks in front of the Board of Regents on Thursday, April 18th, 2019. (Tate Hildyard/ The Daily Iowan).

University of Iowa President Bruce Herald speaks in front of the Board of Regents on Thursday, April 18th, 2019. (Tate Hildyard/ The Daily Iowan).

Kelsey Harrell & Marissa Payne

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The state Board of Regents on Aug. 1 approved the University of Iowa’s $746 million general-fund budget for fiscal 2020 — a $1 million boost from fiscal 2019 thanks in part to a bump in state support.

That increased budget comes after two-consecutive years of funding cuts, to which the UI responded by halting construction, closing centers and institutes, and ending certain scholarship programs.

To compensate for reduced state appropriations, the UI has increasingly turned to tuition revenue to fill in the funding gaps. For fiscal 2020, tuition revenue comprises 64 percent of this general-fund budget — just 0.8 percent less than the previous fiscal year.

RELATED: Iowa regent universities to evenly split $12 million increase in state support

While resident undergraduates face 3.9 percent higher tuition rates for the 2019-20 academic year, the UI reported in regents’ documents “gross tuition revenue is budgeted to decline by $5.1 million” this fiscal year despite a larger freshman class because of the Summer Hawk Tuition Grant program’s elimination and other projected enrollment changes.

“We’re very creatively looking to make sure we have adequate space for all the students that we’re seeing coming in,” UI President Bruce Harreld said about the enrollment spike.

RELATED: Regents discuss decrease in university enrollment, future of higher education

A February report to the regents on the residence systems at Iowa’s three public universities projects UI residence-hall occupancy to hover around 91 percent annually through fiscal 2024, meaning there are open beds on campus housing facilities.

That compares with some past years, as recently as the 2016-17 academic year, when the UI used residence-hall lounges to house all the students who opted to live on-campus.

The preliminary residence-hall budget of $78.7 million will increase by $2.3 million because of a projected increase in hall occupancy and lower operating costs. In the fall, the residence halls will be occupied by 6,200 students.

Mostly first-year students choose to live in the residence halls, but the UI has actively marketed campus housing to more returning students as recent incoming freshman class sizes have shrunk and the opening of Catlett Hall has provided more housing space.

RELATED: UI Housing seeking to market residence halls to returning students

Although enrollment is expected to rise in the upcoming academic year, the UI is focused on increasing retention and graduation rates, Harreld said, because they are not where they should be. He discussed the importance of filling the funding gap in the university’s strategic plan in increasing the student retention rate, four-year graduation rate, and research and scholarship.

“The UI expects to fund one-third of its strategic plan through cost takeout and realignment of various activities on-going on campus,” Harreld said. “This process started several years ago. Please know that this is not merely a one-time effort, as we will always explore opportunities to improve our efficiency.”