President Jay Rothman says it is up to the state to decide whether it can afford a “weakened” Universities of Wisconsin as he released third-party assessments of seven campuses’ finances.
“The old adage of ‘you get what you pay for’ comes into play if we don’t get the financial support moving forward,” Rothman told reporters in a virtual press call.
Rothman noted state support has declined to about 18% of the universities’ budget. He pointed to a 10-year tuition freeze, enrollment declines and inflation as challenges. Rothman said it would take an additional $440 million annually to get Wisconsin universities to the median level compared to national funding.
“There will be difficult decisions that will need to be made to return to a strong financial footing for our universities,” Rothman said.
Rothman noted the assessments include opportunities for growth, such as dual enrollment, which will also require investments.
“To retain students, to leverage dual enrollment and provide the programs and services our students deserve and parents expect, comes with a price tag. But it can make a difference in the lives and success of our students,” Rothman said.
The universities hired a third-party consultant more than a year ago to evaluate the universities’ financial statuses and possibilities for improvement amid structural deficits at 10 of 13 universities. The goal is to eliminate structural deficits by 2028.
Several universities have reduced staff to address budget challenges. That includes voluntary buyouts and layoffs at UW-Platteville, layoffs and furloughs at UW-Green Bay, and voluntary buyouts, layoffs and furloughs at UW-Oshkosh and UW-Parkside.
Meanwhile, three branch campuses have ended in-person classes, UW-Platteville Richland has closed and UW-Milwaukee Waukesha is set to close in spring 2025.
And the Board of Regents last week approved a 3.75% tuition hike in 2024-25 to bring in more revenue, which is expected to generate approximately $39 million.
Assessments were released Thursday for the Superior, Oshkosh, Platteville, River Falls, Parkside, Whitewater and Green Bay campuses. The remaining reports are set for release in the summer and fall, excluding UW-Madison, which does not have a structural deficit and has a healthy reserve of funds.
GOP university committee chairs Sen. Rob Hutton, R-Brookfield, and Rep. Dave Murphy, R-Greenville, weren’t immediately available for comment.
Rep. Katrina Shankland, D-Stevens Point, who serves on the Colleges and Universities Committee, in a lengthy statement said the universities’ financial challenges are the result of a “deliberate policy choice” by Republicans, noting the state has a $3 billion surplus.
“Right now, Wisconsin is competing with surrounding states to recruit and retain a talented workforce and high-quality employers,” she said. “By dramatically underfunding our public higher education institutions, one of the soundest workforce investments we can make, at a time when our state has a record surplus, our state is only hurting itself, as young people continue leaving our state for better opportunities elsewhere.”
Some of the takeaways for universities include:
*UW-Green Bay is facing a deficit that reached $7.2 million in fiscal year 2022-2023, which the assessment finds the university will likely struggle to resolve without more budget reductions and could lead to a depletion of the tuition fund by 2027. The assessment notes some possible strategies moving forward could include further leveraging dual enrollment and continuing education, considering discontinuing programs with low enrollment and strategically adding new programs.
*UW-Oshkosh has established a plan to reduce an estimated $18 million structural deficit, including cutting staff. The assessment said more savings will be necessary in the future. The university has identified opportunities including cost reductions, expanding experiential learning and improving dual enrollment.
*UW-Parkside’s tuition reserves are going down quickly, and the university had a $5.9 million tuition deficit in 2022-23. The funds are expected to be depleted in fiscal year 2024-25. Some proposed actions include innovating academic offerings and experience, expanding enrollment and boosting the university’s brand and message.
*UW-Platteville has less than a year of general program operations reserves in its coffers. The assessment notes the future of the institution is at risk “without significant and immediate change.” The university will seek to preserve key student-facing services and programming, aligning or eliminating redundant services, among other things.
*UW-River Falls is on “a trajectory of financial unsustainability” according to its assessment, which notes a $7.1 million tuition fund deficit in fiscal year 2022-23. The deficit is expected to continue with declining enrollment. The university is currently developing strategies aiming to boost enrollment and increase retention rates.
*UW-Superior faces an ongoing $1.5 million structural deficit that is projected to grow as pandemic relief funds are no longer available to fill budget gaps. The assessment says the university will struggle to resolve the deficit without changes, which could lead to depletion of the tuition fund by fiscal year 2027-28. Some steps the university plans to take include diversifying and strengthening the programs offered, and one-time budget investments in strategic areas.
*UW-Whitewater has a projected $1.8 million deficit for fiscal year 2023-24. The assessment notes without changes, the university could see limited tuition fund balances in the next three to four years due to enrollment declines and a shrinking pool of traditional college applicants. The university will seek to improve retention, diversify its enrollment strategy and leverage UW-Whitewater Rock County to help meet the main campus’ goals.
Rothman said he didn’t anticipate closing down any of the 13 campuses.
“I’m confident that all of our universities can get there. The question is what is the depth of those cuts going to have to be because we have a responsibility on the expense side of the ledger to run as efficiently as we possibly can be,” Rothman said.
