UNR Budget and Enrollment Update
This is an update to NFA’s eight-part series on the University of Nevada, Reno budget crisis published in January 2024. (Some of the original articles have been updated–most recently Part 3B. Growth of Executive Positions and Salaries).
Budget Shortfall for 2024–2025
At the April 30 UNR Campus Conversation, Vice President for Administration and Finance Andrew Clinger reported the “good news” that the previously projected shortfall of $31.7 million for FY2025 has been reduced to about $12 million. The stated reasons for a lower shortfall were the three-month delay in faculty COLAs, the 5% increase in student registration fees and tuition, and an improved enrollment outlook. VP Clinger clarified that the FY2024 budget cuts would remain in place, including 108 faculty and staff positions being held vacant and 5% cuts to department budgets. The administration has told the Faculty Senate Budget & Planning Committee they found additional commitments to be budgeted.
The UNR budget is not out of the woods: it is deep in the forest. Previous administrations would have considered a $12 million budget hole to be a crisis. No information was provided about how the $12 million shortfall will be addressed for the fiscal year beginning July 1, 2024, but it is equivalent to an additional 100+ faculty and staff positions being kept vacant or eliminated. The cumulative budget shortfalls of $25 million in FY2024 and $12 million in FY2025 represent over 10% of the state-allocated operating budgets at UNR.
Enrollment Status
UNR’s Spring 2024 FTE enrollment is up 5.5% overall from Spring 2023 and the headcount is up by 15.3%. However, that counts the huge growth in enrollment from non-degree seeking undergraduates (a 190% increase to 4,900 students), primarily high school students taking dual and concurrent enrollment classes. Concurrent enrollment fees are only $75 per course, compared with the $788 UNR undergraduates pay in registration fees for a three-credit course. Future credit for concurrent Weighted Student Credit Hours would apply to the budget in the next biennium. In the meantime, this program, part of the UNR instructional budget, requires UNR personnel, including pay for the high school instructors, coordinators for each subject, travel funds to visit high schools, and administrative oversight.
If we look at the enrollment of degree-seeking students, the headcount is down 1.3% from Spring 2022 to Spring 2023. At the most recent Campus Conversation, Provost Jeff Thompson reported that although new enrollment for Fall 2025 is down from this time a year ago, he did not have a percentage due to data-collection changes. In addition, continuing delays and errors in federal financial aid applications are impacting student recruitment and retention.
Possible Real-Estate Deals with Long-Term Consequences
At the April 30 Campus Conversation, President Sandoval talked about two potential real estate transactions, which were also announced at Faculty Senate meetings. First, the President is hoping to sell UNR land north of the Med School to the Department of Veterans Affairs as the site for a new VA hospital to replace the existing facility on Kirman Avenue. As reported to the faculty senate, the VA is considering the UNR location and one or two other potential sites to build the new hospital. Selling this land to the VA would rule out future northward growth for UNR and would displace lower-cost parking lots as well as several buildings. Proceeds from a land sale would be one-time money that could not be used for continuing budgets. Financial and other details of UNR’s offer to the VA were not disclosed.
Second, UNR is considering buying 18 parcels with homes and apartments south of I-80 between Lake and Evans streets, north of Sixth Street. To be dubbed “University Village,” the 49 or so residential units would provide faculty and graduate students with much-needed affordable housing in Reno’s expensive market. While we appreciate helping faculty and graduate students with housing, the projected price is $6.5 million plus an estimated $825,000 for improvements. The down payment would come from UNR’s property acquisition fund, while the rest would be financed with a loan from UNR’s Operating Fund assets (account reserves held at NSHE) and paid back through rent revenue.
In another budget circumstance, we would applaud this decision. However, the long-term debt on this acquisition would limit future capital improvement funding because it would be added to the Business Building 30-year lease and bonds for the new engineering building, student achievement center, wellness center, and other buildings still being paid for. Another question is whether the properties in that neighborhood would be attractive to new faculty or graduate students at the rents required to pay for the loan, maintenance, and management, and President Sandoval did not mention a market study or business plan. The President has requested feedback through the Faculty Senate; you can provide comments here about whether future faculty and graduate students would be interested in living there.
Outlook
Provost Thompson and VP Clinger professed “cautious optimism” about the 2025–26 and 2026–27 budgets in the next legislative session, but that does not help for FY2025. President Sandoval has proposed a new ⅛-cent Washoe County sales tax for UNR and TMCC infrastructure and capital improvements, which would require legislative, county commission, and possibly voter approval. New revenue to fund higher education is highly desirable, but this is apparently the first time since 1885 [1] that county taxpayers have been asked to fund the state university. As mentioned by a speaker at the Campus Conversation, sales taxes are regressive.
The Ad Hoc Committee on Higher Education Funding, which will make recommendations in July, is a wild card. NFA has been actively engaged with the funding formula committee, and the NFA state board has published a set of principles for funding higher education. Faculty feedback on the preliminary recommendations for funding formula changes by the committee’s consultant would be appreciated, especially from department chairs and others who administer state-supported instructional budgets.
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Our UNR budget analyses are based on public reports and records and interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.
Previous articles on the UNR budget crisis:
[1] In 1885, the Nevada Legislature directed Washoe County to issue $25,000 in bonds to fund the university’s move from Elko to Reno, to be paid by a property tax in Reno (1885 Statutes of Nevada, Chapter LXXI).