The Minnesota State Mankato community has spent more than two years examining how to address its structural budget challenges while protecting the University’s academic mission and ability to serve students. Faculty, staff and students have all contributed ideas through the shared governance process, town halls, and divisional discussions. That input informed resource planning and played a significant role as campus leadership worked to address the budget shortfall.
These decisions are difficult because they affect valued colleagues, programs and services. They are necessary to bring ongoing expenses and available revenue into balance and preserve the University’s long-term ability to serve students and the state.
Steps Already Taken
In fiscal year 2026, the University took steps to begin addressing the biennial budget challenges and improve the efficiency of resources.
Those actions included:
- Received Board approval for a tuition increase of approximately 8%
- Conducted a comprehensive academic program review to align offerings with student demand and institutional priorities, resulting in a more focused, cohesive program portfolio
- Reduced instructional costs by implementing a strategy to reduce low-enrollment sections, increase section sizes and update course rotation plans
- Established an annual sabbatical budget to support more predictable costs for financial planning
- Redesigned several budget allocation models in Academic Affairs, redirecting more than $1 million annually to institutional priorities.
- Accepted 21 Board Early Separation Incentive (BESI) early retirement packages
- Held 16 vacant positions
- Eliminated 40 vacant faculty and staff positions
- Eliminated seven faculty positions in areas with lower staffing demand
Decisions for Fiscal Year 2027
For fiscal year 2027, the University will continue taking steps to address the biennial budget challenges. The Board of Trustees approved a 6.37% tuition increase, which is expected to generate an additional $6 million for the University. The plan to address the remaining deficit includes implementation of expense reductions, investment in revenue-generating initiatives and continued conversations to clarify responsibilities and reduce duplication across divisions while maintaining the critical work necessary to provide a high-quality, comprehensive education to students.
Revenue Generating Initiatives
Long-term sustainability requires more than cutting expenses. Financial health requires both responsible expense management and strategic initiatives that generate future growth.
Minnesota State University, Mankato is pursuing several initiatives to strengthen revenue, expand access and invest in areas of student and workforce demand, including:
- Charging credit card fees to eliminate the approximately $1.4 million cost the University has previously absorbed on credit card payments (tuition, tickets and other purchases)
- Expanding graduate programs and professional education offerings in areas of workforce need
- Increasing access for adult learners who have some college credits but have not completed a degree
- Growing online and hybrid programs that serve students in Minnesota and beyond
- Strengthening partnerships with employers and industry to develop customized educational pathways
- Increasing philanthropic support for scholarships to grow enrollment
- Expanding athletics rosters in select men’s and women’s programs to promote enrollment growth
- Identifying new auxiliary and entrepreneurial revenue opportunities that support the University’s mission
- Completing The Future State fundraising to launch this on-going revenue source
Non-Personnel Adjustments
The budget realignment plan for fiscal year 2027 includes many strategies to reduce non-personnel expenses, including:
- Non-salary expense reductions across all divisions
- Charging undergraduate course differentials to offset costs in specialized courses
- Reducing graduate assistant positions by 21 across all divisions
- Freezing professional development allocations for administrators
- Reducing institutional equipment purchases
- Ending the lease for space at the Hubbard Building
- Exploring cost savings through technology purchases
Personnel Adjustments
Because employee compensation represents about 75% of the budget targets in the general fund budget, the full shortfall cannot be addressed through non-personnel reductions alone. We understand that these actions carry consequences far beyond financial figures. They impact colleagues, families, departments and the daily life of the campus.
- Fully deploying the instructional cost reduction strategy started in fiscal year 2026
- Implementing a consistent compensation model among graduate program coordinators
- Coordinating resources and collaboration between MavPass and the Center for Academic Support to reduce costs and redundancies
- Pausing the first-year experience class in order to redesign and better support retention and student success
- Implementing vacant position holds, vacant position eliminations, early separation retirement packages, and a reduction in force of about 1.2% of the total workforce
Summary of Positions Impacted
| Bargaining Unit | Hold of Vacant/ Expected Vacant Position | Elimination of Vacant Position | BESIs Accepted* | Layoff/ Retrenchment |
Total |
|---|---|---|---|---|---|
| IFO | 6 | 4 | 2 | 4 | 16 |
| MSUAASF | 5 | 4 | 0 | 2 | 11 |
| AFCSME | 3 | 4 | 3 | 6 | 16 |
| MAPE | 6 | 1 | 3 | 3 | 13 |
| MMA | 0 | 1 | 0 | 0 | 1 |
| MNA | 0 | 0 | 0 | 0 | 0 |
| MGEC | 0 | 0 | 0 | 0 | 0 |
| NON-REP | 0 | 0 | 0 | 1 | 1 |
| ADMIN/MGR | 0 | 1 | 0 | 1 | 2 |
| Total: | 20 | 15 | 8 | 17 | 60 |
In accordance with bargaining unit agreements, these decisions were shared with bargaining unit leadership on August 4. Specific employees whose positions are affected will be notified the week of August 24. The collective bargaining agreements governing this process include provisions whereby the University is required to share advanced information such as number of positions, classification, employment condition, and/or department/program impacted.
Although positions have been identified for retrenchment/layoff within divisions as part of the budget reduction process, we are not publicly releasing position-specific information at this time. Employees who may be affected will be informed directly and personally once the advanced-notice provisions allow.
Additionally, the collective bargaining agreements governing this process include provisions that may change the ultimate impact on individual employees, including opportunities to move into other positions or accept vacancies. Because these contractual processes are still unfolding, releasing lists of positions could create confusion and lead to assumptions based on incomplete information. This approach respects affected employees and honors our contractual obligations.
Some of the staffing decisions may have implications for the future of certain academic programs. The University will continue to evaluate enrollment trends and program demand as part of its ongoing review process. Should any program closure decisions be made, current students will be supported and provided a clear pathway to complete their degrees.
Reorganization
Leadership is committed to continuing the conversations and critically evaluating the current University structure. Over the coming months, the campus community will be engaged in discussion on this topic, with the goal of finding innovative solutions to reduce unnecessary duplication, improve coordination across divisions and simplify processes.