The University of Maine System board of trustees will consider a $559.5 million budget and look to set tuition rates for the coming year this week.
The current budget proposal includes a $5.6 million, or about 1 percent, unresolved budget gap, though officials noted that could change as the system works to navigate uncertainty brought on by the coronavirus pandemic.
“We don’t have a good view yet on how this all will play out through the summer and fall,” said Mark Gardner, vice chairman of the board of trustees and chairman of the board’s finance, facilities and technology committee.
“It’s everything from planning how many residents we can have on campus to where state appropriations wind up. So it’s going to be a challenging process but one we will work our way through.”
The committee will consider the proposed budget, including an average 2.5 percent tuition increase for in-state undergraduates, on Wednesday and vote on a recommendation to send to the full board, which meets Friday.
The current proposal represents a 1 percent decrease over last year’s operating budget of $566 million and a 3 percent decrease from the $578 million budget proposed before the pandemic.
It is built on an assumption of flat state funding at $198.1 million and a small drop in enrollment by credit hour.
While total revenue losses and new costs related to the pandemic and campuses’ plans for reopening are unknown, the budget does include an $8.1 million student safety allowance, which accounts for a loss of housing and dining revenue that reflects plans to reduce the occupancy of students on campus due to the coronavirus.
The university system has also committed to spending $2.56 million on technology upgrades to allow for more academic flexibility this fall and has budgeted for a $1.2 million, or 8 percent, loss of revenue from conferences and events.
University of Southern Maine junior Isabelle Collins walks past the student center on the Gorham campus on Tuesday. Collins, whose family lives in Australia, said she won’t be traveling to Canada for spring break, as she had planned. Ben McCanna/Staff Photographer
The $5.6 million budget gap comes after individual campuses applied more than $4 million in reserves to balance their budgets and after the system put $1 million of its budget stabilization fund toward offsetting shortfalls at the University of Maine at Farmington and the University of Maine School of Law.
Vice Chancellor for Administration and Finance Ryan Low said the system has also asked individual campuses to develop scenarios for how they would react if they see 5, 10 or 15 percent drops in either enrollment or state revenue.
While the board will look to approve a budget by the start of the fiscal year July 1, Low said it is likely it could come back to trustees for changes later this summer or in the fall.
“What we’re really thinking about here is putting a budget in front of trustees next week that represents the best information we know today,” he said Friday. “As those question marks become a little bit clearer, we fully expect to bring the budget back to trustees. As the enrollment picture clarifies and we get a better feel for that, that may reduce some of this gap.”
The current budget proposal projects credit hours to decrease by 4.9 percent from what was budgeted in 2019-2020 and by 2.1 percent from the 2019-2020 actuals.
Enrollment by headcount, though, is on track to meet last year’s numbers, with 20,154 students currently enrolled for 2020-2021 compared to 20,168 at this point last year. The system ended up enrolling about 29,700 students total this school year.
A student walk to the Einar E. Olsen Student Memorial Student Center building at the University of Maine at Farmington in 2018. Michael G. Seamans/Staff Photographer
The budget currently calls for a reduction in housing occupancy from 6,489 beds to 5,102 systemwide because of the pandemic, though what exactly that looks like will be released as part of campus-specific plans next month. It could include limits on double- or triple-occupancy rooms or the need to hold some rooms vacant for the purpose of quarantine.
The reduction in on-campus occupancy is expected to create revenue losses of about $4.1 million, or 13 percent, in dining services, and about $4 million, or 11 percent, from last year.
Trustees are looking at an average tuition increase of 2.5 percent – roughly equal to a cost-of-living increase – for in-state undergraduate students. That includes a 2.5 percent increase on every campus with the exception of the flagship University of Maine in Orono, where the increase would be 2.7 percent.
The average cost of mandatory fees would increase 3 percent while room and board costs would increase 3.5 percent.
That brings the average cost for tuition, room and board and mandatory fees for in-state undergraduates to $18,877, an increase of about $550, or 3 percent, from the current $18,321.
An average 3.1 percent tuition increase is proposed for out-of-state undergraduates.
Tuition rates for graduate students vary, but include a decrease in costs at the University of Maine at Farmington, which announced in April it would move to a single tuition rate for both in-state and out-of-state graduate students.
Tuition at the University of Maine School of Law is proposed to hold steady for all students.
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