Budget update: July 9, 2021

July 9, 2021

Tori Tragis

— Dan White, chancellor 

Last week, Gov. Dunleavy announced the details of the FY22 capital and operating budgets. The budget submitted to the governor by the Alaska State Legislature for the University of Alaska included an operating budget of $273 million in unrestricted general funding (UGF), which is a $4.3 million UGF cut from the current fiscal year, and a $31.6 million capital budget. 

The governor upheld the operating budget at $273 million, but vetoed the capital budget of $31.6 million. The veto will significantly impact critical deferred maintenance projects, including UAF’s major renovation of Moore and Bartlett halls. Modernizing the student experience is one of UAF’s strategic goals, and addressing critical plumbing and refurbishment in residence halls is just one way we plan to meet that goal. 

Another area of note is the funding for the Alaska Performance Scholarship and Alaska Education Grant programs. The funding for these programs is not currently in the budget but will be addressed in the August special session. President Pitney announced that the UA system will honor the commitment for these scholarships to the over 5,000 Alaskan students who are counting on this financial assistance.

The approval of the FY22 operating budget means a reduction of $4.3 million to UA, instead of a $20 million reduction. It is important to note that this is not “new money” but rather less of a reduction than we were anticipating. At UAF we still have $3 million remaining to cover from FY20 partial year reductions when we received the budget half-way through the year. In addition, $2 million will be directed to areas of critical need. The remaining relief will be allocated to vice chancellors to minimize, where possible, impacts to their units.

In addition to the FY22 reduction, UAF has had nearly $25 million in budget reductions over the last two fiscal years through the governor’s compact. This, of course, is compounded by millions in COVID-19 direct costs and lost revenue, only a portion of which has been recovered through relief aid.

We will continue to seek and appropriate COVID-19 relief funds, pursue federal mechanisms to fund improvements to infrastructure, and secure investment funds for initiatives that build enrollment and support critical infrastructure. Our efforts to increase enrollment are making a difference. With our recent change to return more tuition to units, enrollment is a key path to financial sustainability for academic departments. Providing financial stability while meeting our mission of providing education and research for Alaskans and students from around the world.

Thanks for choosing UAF.