News Release

U of M finance leaders provide update and reiterate recommendations to address current fiscal year budget deficit

The University of Minnesota name appears in Gold letting against a Maroon backdrop on a black, wrought iron fence that welcomes visitors to the Twin Cities campus

In an update to the Board of Regents Finance & Operations Committee, University of Minnesota leaders discussed pandemic-related deficits in the current fiscal year and approaches that continue to help the University close budget gaps. Current projections suggest systemwide shortfalls totalling $172.5 million when the fiscal year ends on June 30, a relatively small change to the $166 million in projected deficits shared with the Board last December.

Senior Vice President for Finance and Operations Myron Frans and Associate Vice President and Budget Director Julie Tonneson outlined recommendations to address the budget shortfall, many of which were already approved by the Board and are currently in place. They include:

  • College- and unit-level budget cuts, coupled with the furlough/temporary pay reduction program. The University will end this program on June 30.
  • Accessing central reserves to specifically address COVID-19 financial issues.
  • Federal relief funds, which are entirely targeted for use to address budget challenges caused by the pandemic.
  • Long-term debt for operations, contingent on Board approval as required by Board of Regents Policy: Debt Transactions

In discussing the use of long-term debt, leaders noted the recommended total ($45 million) has been reduced from earlier estimates due to the availability of federal relief funds.

While the conversation focused on resolving current fiscal year deficits, the Board also considered how these financial impacts may affect budgeting for FY2022, as many pandemic-related expenses will cease but revenue losses such as tuition and income from parking and other auxiliary services may not immediately recover. University finance leaders will continue to monitor ongoing budget impacts in the months ahead and, specific to the FY2022 budget, will address them in the President’s recommended annual operating budget. The Board is scheduled to review the proposed budget in early June, with action expected at a special meeting in late June.

"Careful attention to budgeting and keen fiscal stewardship have been essential to navigating through this pandemic to this point," said Board Chair Ken Powell. "As we wrap up this budget and look toward finalizing our plans for our next fiscal year, the clear, forward-looking analysis we discussed gives us strong data with which to make informed, strategic budgeting decisions."

The Board also:

  • Recognized faculty, students, and staff who received prestigious awards and scholarships during the past year. A full list of these honorees is available on the Board’s website.
  • Reviewed University President Joan Gabel’s recommended Fiscal Year 2022 capital improvement budget, presented to the Board annually.
  • Discussed campus-level strategic planning with leadership from the University’s Crookston campus, the latest in a series of campus-level conversations.
  • Approved promotion, tenure and annual continuous appointment recommendations for faculty and academic staff systemwide.
  • Reviewed the potential sale of the Murphy Warehouse property at 701 24th Ave SE in Minneapolis.
  • Approved proposed amendments to Board of Regents Policy: American Indian Advisory Boards following a discussion at the Board’s March meeting with Dr. Michael Goh, the University’s vice president for equity and diversity, and Tadd Johnson, senior director of American Indian Tribal Nations relations. 

The Board of Regents is scheduled to meet next on June 10-11, 2021. Visit regents.umn.edu for more information.

Media Contacts

Jake Ricker

University Public Relations
612-625-7134
Fri, 05/14/2021 - 09:08
U of M finance leaders provide update and reiterate recommendations to address current fiscal year budget deficit
https://twin-cities.umn.edu/news-events/u-m-finance-leaders-provide-update-and-reiterate-recommendations-address-current-fiscal
University of Minnesota, Twin Cities