Frequently Asked Questions

The University’s base funding comes from the state allocation and tuition dollars, and they are intended to cover operational expenses, such as payroll, utilities, repairs and maintenance. Unfortunately, the amount MSU receives from these two sources has not matched the University’s increasing operating costs for several years, and this structural imbalance has led to the University’s current budget deficit. 

Private dollars from donors, including individuals, corporations and foundations, help fund scholarships, research, program needs and other special projects; they are managed through the Minnesota State Mankato Foundation, a 501(c)3 that is overseen by the Foundation Board. These funds are not intended to fund base operations and must be used in accordance with donors’ intent. 

No. Minnesota State Mankato remains financially stable and continues to enroll more than 18,000 students each year. The University is not facing an immediate financial emergency or risk of closure. 

However, the University faces a structural imbalance between recurring revenues and expenses. Universities across the country face similar challenges. Responsible institutions are addressing those imbalances early, while options remain available, rather than waiting until circumstances become more severe. 

Minnesota State Mankato’s composite financial index (CFI), a nationally recognized measure of institutional financial health, currently is 1.44 and falls below the benchmark established by the Minnesota State system of 1.50. This indicates that corrective action is needed to ensure long-term sustainability. The University’s financial strategy is designed to restore that measure while protecting academic quality and student success. 

Minnesota State Mankato receives approximately two-thirds of its operating revenue from tuition and one-third from state support. As operational costs increase, so does the need for increased state allocation and tuition revenue to cover those costs. 

Although tuition has increased in recent years, those increases have not been sufficient to offset rising operating costs and declining state funding. As a result, additional tuition revenue has reduced the size of the budget gap but has not eliminated it.

The University recognizes that tuition increases directly affect students and families. That is why addressing the deficit requires a broader approach, including reducing expenses, improving operations and developing additional sources of revenue rather than relying on tuition alone.

Minnesota State Mankato’s enrollment has been relatively steady over time, which has helped avoid some of the more dire circumstances found at other institutions. Enrollment growth also helps, but it cannot fully solve the financial challenge on its own. Tuition does not cover the full cost of instruction, and state support has not kept pace with costs.

Enrollment growth is necessary but not sufficient for long-term sustainability. The University must pursue enrollment growth, enhanced state support and expense alignment simultaneously. 

Delaying action would require larger reductions in the future and erode the University’s flexibility to make strategic decisions. Acting now preserves options and helps protect students and academic quality.

Using savings to cover recurring expenses creates a larger problem in the future. If a family spends $5,000 more than it earns every year, using savings to cover the gap may delay the need for budgetary changes, but does not replace them. Universities operate the same way. 

Reserves are intended for: 

• Emergency preparedness 

• Cash flow management 

• Building maintenance 

• Technology replacement 

• Facility maintenance 

• Strategic investments 

• Compliance with Minnesota State Board policy 

Using reserves to cover recurring operating deficits does not solve underlying financial challenges. It delays them. Universities that rely on reserves to support ongoing operations eventually exhaust those resources and face even larger financial disruptions. 

We do. Our needs are represented at the legislature by the Minnesota State system, which makes a budget request on behalf of its 26 colleges and seven universities. Right now, the Minnesota State system, working with campuses and the Board of Trustees, is designing the budget request for the 2028–2029 biennium. It is important for all of us to support the Minnesota State system’s legislative request.

Like every area of the University, athletics is participating in budget reductions and operational efficiency efforts. Athletics serves nearly 700 students and plays a key role in retention, the overall student experience and community engagement. It also provides a strong recruitment pipeline for the University. Expanding roster opportunities allows us to attract additional students who otherwise may not have enrolled at Minnesota State Mankato. We have the capacity to add about 90 student-athletes across our athletic programs. The tuition generated by new student-athletes covers the costs of participation and will also produce a positive financial return to the institution. 

The University must address two responsibilities at the same time: restoring balance to its annual operating budget and maintaining the facilities students need for their education and campus experience.

Minnesota State Mankato has identified three critical infrastructure priorities that require full replacement: Armstrong Hall, Blakeslee Stadium and Carkoski Commons. These projects have funding and operating plans separate from the University’s structural budget deficit.

• Armstrong Hall is a major academic building that is rapidly deteriorating and no longer adequately supports contemporary teaching and learning. The University is asking the Minnesota Legislature to fund its replacement through a state bonding bill. Bonding funds are one-time capital funds designated for public infrastructure; they cannot be used for recurring expenses such as salaries or annual operations. Once completed, the replacement facility will operate using the same level of University resources that supports the current Armstrong Hall.
• Blakeslee Stadium supports student-athletes, campus traditions and community events. The University is seeking philanthropic and private support to replace the stadium and build out a community-focused facility. These are dedicated, one-time funds that cannot be repurposed.
• Carkoski Commons supports residential and student life by providing places where students access health care services and build community. Its replacement is part of The Future State project and is being privately fundraised.

The Future State initiative, including the programming associated with Blakeslee Stadium and Carkoski Commons, will be self-supporting and will not require state funding or ongoing support from the University’s general operating budget. Furthermore, it is designed to be revenue-generating, meaning it can help shield against future funding shortfalls. Gifts designated for these projects must also be used according to donors’ stated purposes and cannot be redirected to cover the operating deficit.

Pausing these projects would not make state bonding or donor-designated funding available for salaries or other operating expenses. It would delay needed improvements to facilities that play important roles in education, student life, recruitment and retention.

Addressing the current deficit and investing responsibly in the University’s future are not competing choices. Financial sustainability requires both: aligning recurring expenses with recurring revenue and pursuing separate, appropriate funding for critical long-term infrastructure.

Private funds support scholarships, research, program needs and other strategic priorities. These resources are managed through the Minnesota State Mankato Foundation, a 501(c)(3) organization governed by its Board of Directors. Most donor contributions are restricted and must be used in accordance with donor intent.

Eliminating positions is one of the most difficult decisions a university can make—and unfortunately, it is part of the current plan. University leaders reviewed programs, enrollment patterns, workforce demand, instructional needs and long-term sustainability while making these decisions. 

Whenever possible, the University has pursued alternatives such as attrition, reassignment, voluntary separation programs and operational efficiencies before considering retrenchment and layoffs. These decisions are driven by institutional sustainability rather than individual performance.

Yes, administrative positions are included in the University’s budget reductions along with faculty, staff, adjunct and fixed-term positions. Budget decisions are based on more than job classification. Many administrative positions perform federally or state-mandated functions related to legal compliance, student safety, financial management, human resources, information technology, student financial aid, Title IX compliance, accreditation, student support services and other essential overhead operations. No category of employment was excluded from review. Decisions were based on institutional need, required responsibilities and student impact rather than job title alone.

The University remains committed to ensuring that students can complete their degrees in a timely manner. 

When academic programs change, teach-out plans and advising support are provided to help students graduate successfully.

The University has a shared governance model where all employees, through their bargaining units, are invited to meet, discuss and offer comments, questions and ideas at monthly meetings. University leadership has presented the budget information and recommendations for discussion at all monthly Meet and Confer and Sub-Meet and Confer meetings throughout the academic year.  

Additionally, four virtual town hall meetings were held throughout the academic year for all employees where leadership presented the budget information and recommendations with a call for all employees to share their recommendations and ideas through an online survey. Academic Affairs also held a specific meeting to collaborate with employees in that division to generate ideas for efficiencies and reductions. 

All recommendations provided through these events and the survey were shared with the campus community for further discussion. Members of the President’s Cabinet vetted the ideas and incorporated them into the plan as appropriate.

Some changes are permanent adjustments to align resources with long-term trends. Others may evolve as enrollment, state support and workforce needs change over time.

There is never an ideal time to announce difficult budget decisions. The timing reflects the sequence of steps that had to occur before final decisions could be made. The University needed Board approval of tuition rates, budgets had to be finalized and posted and University leaders needed time to evaluate all available information before making final decisions. In addition, notification requirements in bargaining unit contracts affect when and how information is shared.

We also recognize that employees have been hearing about budget challenges for some time and were waiting for decisions. Once the necessary information was available and decisions were finalized, we believed it was important to communicate them as soon as possible. Announcing these decisions before the academic year begins provides greater clarity and gives faculty, staff and students time to understand the changes before the semester starts.

The University is committed to ensuring that Minnesota State Mankato remains strong and competitive for future generations. To do that, we will continue to advocate for legislative funding, make strong partnerships and programmatic alignments with industry needs, innovate revenue-generating initiatives and efficiently manage costs while keeping our mission to educate students at the forefront of all we do.