Arizona universities present their latest budgets after millions in state cuts

Arizona's universities were projected to experience slower growth next year due to another round of state budget cuts.

The Arizona Board of Regents, the body that oversees the state's public university system, was scheduled to approve all three schools' 2024-25 budgets on Thursday.

This year's projections came after a turbulent time for the University of Arizona's finances. The discovery of a multimillion-dollar budget deficit at the UA prompted a closer look at the financial statements of all three universities.

Growth in the net financial position of Arizona State University and Northern Arizona University fell to 6% and 2%, respectively, according to board documents. Another loss was forecast for the University of Arizona, which fell from -7% to -9%. Net position is defined as the difference between assets and liabilities.

State funding accounts for about 13% of universities' total operating budgets. Other sources of income include tuition fees, grants and donations.

How do universities structure their budgets?

When planning a fiscal year, each university takes into account feedback from administrators, faculty and student leaders, according to board documents. Budgets are based on estimated revenues and costs and are projections of how the university would manage its finances.

In the budget signed by Governor Katie Hobbs on Tuesday, the Board of Regents and Arizona Colleges made $27.9 million in cuts.

The expected higher education budget cuts mean $11 million in cuts at ASU, $8 million at UA and $4.1 million at NAU. According to Thursday's agenda, universities will explain in the fall how they plan to deal with the additional cuts.

This year's budget included a one-time allocation of $46 million for Arizona Healthy Tomorrow, board members said. The initiative provides funding for a system-wide effort to strengthen the state's health infrastructure.

Tuition fee revenues remain stable; UA slows bleeding

Tuition revenue growth remained stable at all three universities, at 6% year-on-year, due to increases in enrollment and tuition fees.

The exception is the UA's controversial online counterpart, the University of Arizona Global Campus. The university has experienced enrollment losses for years, but UA officials say student numbers are stabilizing.

The UA would have ended its fiscal year with a $14.1 million increase in net assets, but when including the UAGC budget, the school ended up with a decrease of nearly $7 million.

While UA CFO John Arnold said two months ago that UAGC was expected to cease loss-making operations at the end of this fiscal year, current board documents indicate that this is not expected to happen until fiscal year 2026.

While all three universities are expected to end the year with less cash on hand than they began the year with, both ASU and NAU will remain within the board's recommended range.

The UA's expected cash-on-hand life will drop from 97 days to 67 days, but board members have cited this as evidence that the university is experiencing a “slower rate of decline.”

On site: Governor Katie Hobbs signs $16.1 billion budget that addresses Arizona's stubborn budget deficit

Helen Rummel covers higher education for The Arizona Republic. You can reach her at [email protected]. Follow her on X, formerly Twitter: @helenrummel.

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Arizona universities present their latest budgets after millions in state cuts

How do universities structure their budgets?

Tuition fee revenues remain stable; UA slows bleeding

Anna Harden

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How do universities structure their budgets?

Tuition fee revenues remain stable; UA slows bleeding

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