The financial woes facing higher education continue to spread, evidenced by several colleges and universities recently announcing they would be forced to cut their budgets to regain fiscal stability and in some cases to remain open.
The latest revelations come from both public and private colleges, small and large institutions, and they are occurring in several regions of the country, another indication that higher education’s financial precarity is not limited to any one kind of school.
Here is a sampling of the recent announcements.
Christian Brothers University, a Catholic institution in Memphis, announced that steadily declining enrollments has reduced its revenue to the point it was facing a deficit between $5-7 million by the end of 2024. As a result, it said it would be necessary to cut $4 million in its expenditures.
“We have reached a critical time for our university if we wish to continue this work for another 150 years,” the univesity said in an online statement. “We must restore our financial viability and reallocate our programs and resources to provide the promise of college that our mission requires, and act with determination and transparency to build a sustainable university for the future.”
After studying the current financial situation, and following consultation with various campus groups, CBC President David Archer has recommended, and the CBC’s Board has approved, a declaration of financial exigency, which will result in campus-wide budget cuts, including the likelihood of department and program closures and the retrenchment of faculty.
St. Norbert College in De Pere, Wisconsin, announced this week it had ended the employment of 29 staff, including seven faculty members. “As demographics produce fewer 18-22 year-olds, you have to sometimes adjust the size of your organization, and that’s what we’ve done,” said St. Norbert College president Laurie Joyner, according to a local press account.
The college plans to lay off an additional 12 staff members at the end of this academic year or by December 2024. Joyner said that the reductions represented an attempt to prevent a tuition increase. “Our number one priority is to make sure that this education is accessible and affordable to our students and families, and so what that means in this economy is really working hard to try to figure out how we can deliver on that same quality educational experience but in the most efficient and effective way possible.”
San Francisco State University, part of the California State University system, is facing a projected $9 million budget hole, due to steadily falling enrollments. According to local press reports, the cuts are likely to affect dozens of instructors who face reductions in their teaching schedules or even layoffs. Although the California State University system has approved a 6% annual tuition increase for each of the next five years, that likely won’t be enough to dry up SFSU’s red ink. It’s still looking to reduce its workforce by the equivalent of 80 full-time employees.
At Dickinson State University, a public university in North Dakota, President Stephen Easton announced his intent to ask the North Dakota State Board of Higher Education’s for approval to eliminate several degree programs, citing his desire to save $1 million in compensation costs. If approved, that move would result in cutting five tenured faculty positions plus some administrative positions. The following degree programs would also be eliminated: communication, music, math, math education, theater, political science and information analytics.
Easton’s proposals are viewed with skepticism on campus, in part because he’s moving forward with the cuts despite saying the institution is not facing a financial crisis at this time. But the larger concern is that he’s using the budget as an excuse to bust tenure. Earlier this year, Easton helped draft a controversial bill that would have given presidents at two of its public colleges – including Dickinson State – unprecedented discretion to review and dismiss tenured faculty.
That bill was ultimately narrowly defeated by the North Dakota Senate, and now some Dickinson State faculty believe Easton’s proposed cuts are his “Plan B” for weakening tenure. Eric Grabowsky, a tenured associate professor of communication at Dickinson State and an outspoken critic of some of the president’s actions, has decided to resign in the wake of the cuts, telling Inside Higher Education that the university’s direction “doesn’t look good” and that direction “is no longer a fit for me.” Grabowsky added, “people in the community and beyond need to start asking more tough questions of DSU and the university system—what’s happening, what’s going on.”
Delta State University President Daniel Ennis told his campus this week that it had to deal with an $11 million budget deficit, created in part by an enrollment decline of almost 50% over the past 16 years. Delta State, a public university in Cleveland, Mississippi, has a budget of about $51 million when, according to Ennis, it can afford to spend something more like $40 million.
In a refrain that might sound familiar to many college presidents, Ennis pointed to poor internal controls, overestimates of revenue, unexpected legal costs, and expenditures obligated but not accounted for in the university’s budget as some of the culprits.
Ennis warned that balancing the budget will require across-the-board cuts, including to salaries and positions. “Delta State has to exist,” Ennis said, according to Mississippi Today. “It must — for the Delta, for the region and for the state.”
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The sources of financial problems like these are now well-known – a decade-long period of sinking enrollments, a global pandemic, unpredictable state funding, a public increasingly skeptical of the value of a college degree, and the temptation at many schools to overbuild and overspend.
However, what’s been less appreciated is that if economically stressed institutions don’t change how they operate, they’re going to find their finances continuing to go downhill. As more college leaders are discovering, it’s time for a serious financial reckoning that accounts for what it actually costs to employ all its administrators and staff and offer all the academic programs, student support services, research projects, community outreach and nonacademic activities like athletics that most colleges provide. Then, and only then, will these institutions be in a position to determine – and pay for – their real priorities.
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