The University of Nebraska will cut about 100 positions over the next two years in an effort to trim $30 million from its budget.
A tuition increase in each of the next two years will be implemented to close the remainder of a $49 million funding shortfall, NU President Hank Bounds said Tuesday.
According to the plan, NU students will pay 5.4 percent more in tuition next year, followed by a 3.2 percent increase in 2018-19.
The proposal amounts to a $9.75 per-credit hour increase next year for resident undergraduate students at the University of Nebraska at Kearney; $11 more per credit hour at the University of Nebraska at Omaha; and $12.25 more per credit hour at the University of Nebraska-Lincoln.
In the second year of tuition hikes, tuition would rise by another $6.25 at UNK; $7 at UNO; and $7.50 at UNL, although those figures could be adjusted if lawmakers again slash NU’s budget or enrollment growth does not meet expectations.
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Taken broadly, an in-state student at UNL enrolled in 30 credit hours would pay $367.50 more in tuition for the 2017-18 academic year. The following year, tuition increases would add another $225 in annual costs.
Non-Nebraskans enrolled at UNL would pay an additional $1,147.50 for 30 credit hours next year, according to the plan.
Bounds said even after the increases, NU would cost less than its peer institutions.
The NU Board of Regents will meet Thursday at 9 a.m. to consider the proposal, part of a $965 million operating budget for next year. Regents were briefed on the plans during recent committee meetings and in individual conversations with Bounds.
Regent Tim Clare of Lincoln said the proposal meets the board's framework of implementing tuition hikes that are affordable and predictable.
"Nobody likes to talk about tuition increases, but we're going to have to, given the difficult, challenging year the state has had with its budget," Clare said.
What Bounds called “relatively moderate increases†to tuition are expected to help NU balance its budget after lawmakers cut NU’s $583 million state appropriation earlier this year, setting its base funding at $570 million for 2017-18 and $580 million for 2018-19.
Together with the loss in state funding comes rising costs of health insurance premiums, higher salaries negotiated through collective bargaining, and increased utility costs that created the $49 million funding shortfall NU has addressed this year.
The operating budget includes a 1.75 percent increase in the salary pool for employees outside the collective bargaining units.
The university began searching for areas to cut in January when it convened 10 budget-response teams. Those teams identified more than 100 positionsÌý— out of 14,000 across the university systemÌý— in areas such as finance, information technology, human resources and procurement, that could be cut.
“This isn’t an easy find of $30 million,†Bounds said. “There have been thousands of hours put into finding these cuts and doing it in a way that doesn’t turn the university upside-down."
Bounds noted some of the teams' recommendations were “too disruptive†to implement immediately, adding the university may scale back positions in some areas over a longer period of time through attrition and other processes.
He indicated there were no plans for buyouts.
The same budget-response teams tasked with identifying areas where NU could trim its non-academic services have been rearranged to begin planning for the implementation of the budget cuts.
No specific cuts had been identified as of Tuesday, Bounds said, but NU expects to cut $5 million in positions and processes this year and an additional $17 million by the end of the biennium.
In the years after that, the savings will grow to $30 million, Bounds said, which will reshape the university.
“It will absolutely impact services, it will impact students, he said. “You don’t remove $30 million and expect to be the same organization you were before that happened. We are absolutely cutting into our ability to meet the need of faculty, staff and students.â€
Bounds said the areas that will be the focus of the cuts avoid academic offerings, which NU hopes will continue attracting students to its campuses, unlike cuts implemented in the early 2000s, which impacted enrollment for the better part of a decade.
“The most important thing that we can do for the future of the state is to make certain we protect academic quality,†he said.
Keeping students at NU is a big part of meeting the budget deficit. NU projects it could raise $15 million from the tuition hikes next year and an additional $9 million the year after that under a conservative enrollment growth estimate of 1 percent.
But like revenue at the state level, Bounds called enrollment estimates an “inexact science.â€
“We don’t know who’s going to show up on the first day of school,†he said. “It is an estimate at the end of the day.â€
NU projects pulling as much as $10 million from cash reserves to help in balancing its budget.
Bounds remains bullish on the university’s role in pushing the state forward.
“It is time for us to get focused on the future,†he said. “The state of Nebraska needs the University of Nebraska to be strong, to provide workforce. We’re in a great position to grow.â€