Regents approve Kaler’s $3.8 billion budget proposal

Tuition hikes and mental health funding are part of this year’s budget.

University President Eric Kaler and the Board of Regents talk before voting on the University's new budget at McNamara Alumni Center on the morning of Friday, June 10.

Zach Bielinski

University President Eric Kaler and the Board of Regents talk before voting on the University’s new budget at McNamara Alumni Center on the morning of Friday, June 10.

Kevin Beckman

The University of Minnesota’s Board of Regents approved University President Eric Kaler’s $3.8 billion budget proposal Friday, which included tuition hikes for some.

Kaler’s budget plan includes a 2.5 percent tuition increase for resident or reciprocity undergraduates and a 7.5 percent increase for nonresident, nonreciprocity undergraduates on the Twin Cities campus. Tuition will also increase for many graduate and professional students. 

The plan also provides increased funds for mental health services on the Twin Cities campus.

Regents say the increase in nonresident tuition was part of a move to position the University somewhere in the middle of the Big Ten with regard to tuition costs for out-of-state students.

Hikes in nonresident tuition were scaled back from a 9.9 percent increase proposed last month after opposition from students. At the Board meeting on Friday, 30 demonstrators showed up to protest the tuition increases, and six students were arrested.

Regents had mixed reactions to the budget, which was passed by a 10-2 vote. 

Regent Patricia Simmons said the budget was a well-thought-out agreement that takes into account a litany of complex factors. 

“The … thing about this budget that I appreciate is the respect that’s in it,” she said. “Respect for students and their families, respect for the faculty and the employees as we strive to improve our quality … in order to really fulfill our strategic objectives, fulfill our mission and to serve the needs of Minnesota.” 

Regent Thomas Devine said although he supported the budget, he was concerned about increased room and board costs. 

Under Kaler’s budget, room and board will increase by 1.2 percent on the Crookston campus, 3.5 percent on the Duluth campus, 1.4 percent on the Morris campus and 3.6 percent on the Twin Cities campus. The Rochester campus will experience no increase. 

“I don’t think we should be increasing room and board rates much beyond what is the perfunctory inflationary increases,” Devine said. “It’s a pretty significant increase overall in the cost of attendance.” 

He added that private housing complexes may follow the University’s move in increasing costs. 

 “When we raise our room and board rates that much, that allows the private markets to do the same thing,” Devine said. “They monitor what we do on our room and board rates very, very closely.” 

Regent Michael Hsu, who voted against the budget proposal, said he had serious concerns about what he called a “bloated” incremental budget. 

“We act like we’re poor, but we waste money all over the place,” he said. “We have waste in the system, but we don’t have the will at the board level to look at where the waste is and get it out.” 

Hsu said he would have liked to see the board have more discussions on areas where costs could be reduced, rather than consistently building on budgets from previous years. 

“We have opportunities to save money that we’re not looking at,” he said. “[The budget] goes up every year regardless of what the costs actually are.” 

The budget reallocates $27.5 million in internal costs, including $15 million in administrative expenses as part of Kaler’s pledge to reallocate $90 million in administrative costs over six years.  

Following concerns from students about insufficient funding for mental health resources in the original budget proposal, an additional $200,000 from discretionary office budgets in the next two years — on top of the $97,200 investment from student service fees — was included to address mental health.   

The total funding is enough to staff 6.5 full-time mental health clinicians and counselors who will work with students.

“Student mental health is a top public health issue across our system,” Kaler said in his report to the Board of Regents. “Our approach to addressing mental health issues on all of our campuses does not end here. We … are working closely with faculty governance to identify other steps we can take to address this as the comprehensive public health issue that it is.”