UNR Budget: Misplaced Priorities and Diverted Resources

Underfunded COLAs for Classified and Professional Staff

Part 7 in our series on the University of Nevada, Reno, budget crisis. This installment reviews the funding of Cost of Living Adjustments for NSHE classified and professional employees.

The 12% + 11% Cost of Living Adjustments (COLAs) for state employees for 2023-2025 passed by the Legislature and signed by the Governor are historic. The NFA strongly advocated for the COLAs. We are grateful to the Regents for approving the full percentages for faculty and to student leaders for supporting the COLAs at the Board of Regents meeting on December 1. These COLAs will go a long way toward faculty retention, although the following chart shows that the COLAs still only bring take-home pay back to FY2020 levels after inflation. 

President Sandoval has attributed “freezing around 100 vacant positions on campus,  along with 5 percent budget reductions for each department on campus” to the Legislature underfunding faculty and staff COLAs. In this article, we counter the narrative that COLAs for faculty and staff are responsible for the budget shortfall. As described in our previous articles in this series, the new commitments of the current administration include athletics, executive positions and salary increases, and the Business Building project. Although the underfunded COLAs are a contributing factor, diversions of resources to the UNR administration’s priorities other than the core instructional mission have resulted in significantly larger budget impacts than the COLAs.

NSHE’s History of COLA Funding

When the state has funded COLAs, it has appropriated 80% of the budgetary cost [1], the premise being that less than 100% is needed due to regular employee turnover and vacancies. Eighty percent has averaged out in the past, as some agencies have been able to justify more funding than others. However, the procedures for justifying reimbursement are determined by the Governor’s Finance Office and have varied over time.

The following chart [2,3] shows how, in the three years prior to the Great Recession (FY2007–FY2009), NSHE was able to justify and was reimbursed for 93% to 100% of the required amounts, that is, more than the 80% appropriation to the Board of Examiners and essentially fully funding the COLAs.

No COLAs were provided for state employees from FY2010 to FY 2015, an era of furloughs and salary reductions. When COLAs were awarded from FY2016 to FY2019, the reimbursement rates to NSHE were variable, from 2% to 76%. That is, a COLA appropriation in the pay bill did not guarantee actual funding and the 80% appropriation appeared to be a cap on reimbursements to NSHE.

Before 2019, the 80% rule was applied to all NSHE personnel on the state-supported operating budgets, including the portion funded by student fees. Then, at the very end of the 2019 session, the appropriation for NSHE in the pay bill was only 64%, which reliable sources say was a math error, with 80% applied twice. Despite NSHE and NFA protests, the Legislature only appropriated the 64%. That percentage coincidentally approximately matched the fraction of the NSHE state-supported budget funded by state appropriations, the remainder being mostly student fees and tuition.  

In the 2021 legislative session, the Legislature created a new budget policy (AB493, Sec. 7.3) whereby COLAs for NSHE budgets would be funded only for the portion of the budgets funded by state appropriations, that is, about 63% for NSHE overall but varying for each institutional budget and the non-formula budgets. For the 1% COLA in FY2023, NSHE overall was reimbursed for only 29% of the amount appropriated in the 2021 pay bill, or roughly 18% of the overall cost.

The 2023 Legislature retained the policy of funding NSHE COLAs only for the state-funded portion of budgets (AB522, Sec. 7.7). The Legislature funded NSHE COLAs at 65%, despite revenue surpluses and a budget amendment submitted by the Governor’s Finance Office that would have restored the 80% policy. With the historic COLAs of 12% on July 1, 2023, and 11% on July 1, 2024, the budget shortfall is larger and more difficult to absorb through regular vacancies and turnover. 

This history shows that over the years the state has become increasingly stingier with funding COLAs for NSHE classified and professional staff, and now the state only funds COLAs for the state-funded portion of NSHE budgets. Since the only other source of COLA funding in the state-supported operating budget is revenue from student fees and tuition, that implies that the Legislature must expect COLAs to be proportionally funded by student revenue. 

UNR’s COLA Funding for 2023-2025

UNR has a lower proportion of state appropriation (about 61%)  than other NSHE institutions due in part to historically higher out-of-state student tuition (although revenue from non-resident students has decreased recently). For the state-supported UNR budgets, the difference between 100% funding of COLAs and the 61% funded for UNR by the Legislature in AB522 is $10.7 million in FY2024 and $21.7 million in FY2025, based on the data presented to the Board of Regents in June 2023 as updated by CFO Andrew Clinger to the Faculty Senate in November 2023. Roughly 85% of the COLA cost is for faculty and 15% for classified staff. 

In the AB522 pay bill in 2023, the Legislature gave leeway to the Board of Regents to give faculty COLAs lower than the 12% in FY2024 and 11% in FY2025 that all other state employees are receiving. However, the Board of Regents approved the full 12% COLA for faculty in FY2024 at its June 30, 2023, meeting and approved COLAs for FY2025 at its December 1, 2023 meeting, with the following budget mitigations (Option A):

1) Delaying faculty’s 11% COLAs from July 1 to October 1, 2023, which is projected to save UNR $5.7 million in FY2025.

2) Raising student registration fees by 5% overall, with 15% of that amount being diverted to student access (financial aid) and 85% to the state operating budget, which is projected to raise $4.6 million for UNR in FY2025.

3) Suspending faculty performance pay increases for FY2025, which eliminates the 1% merit pool expense. Based on the FY2025 state-supported operating budget for UNR professional salaries of $144.9 million, that saves about $1.4 million.

In addition, only 11/12  of the faculty COLA increments and 23/24 of the classified COLA increments need to be paid in the first fiscal year because the final monthly or semimonthly pay period in June is paid in July of the next fiscal year. These budget savings were apparently not included in NSHE’s COLA calculations. Using the COLA figures from NSHE, this means the costs for professional and classified COLAs are $1.79 million and $1.83 million less than projected in FY2024 and FY2025, respectively.

After these mitigations and savings, the net cost of COLAs for UNR state-supported budgets is $8.9 million for FY2024 and $8.2 million for FY2025, including both faculty and classified staff. That is compared with the new continuing commitments by the UNR administration to other priorities such as athletics ($10+ million/year), executive positions and salary increases ($4.5 million/year), the Business Building project ($10.25 million/year), and iPads ($3.5 million/year). The diversion of resources to these uses are larger and prevent some unrestricted funds from being used for core academic programs. Thus, the narrative that underfunded COLAs are the only or primary driver for freezing 100 positions and the 5% budget cuts to departments is false.

The ongoing net underfunded cost of the COLAs for the UNR state operating budget is about $17 million per year (after the permanent 5% increase in student registration fees). COLAs are normally built into the salaries for the base budget for the next budget cycle but likely will only be funded by the state with the 65%/35% split between the general fund and student fees and tuition. Therefore, NSHE institutions must plan ahead for funding these and future COLAs in the budget development process. NSHE Committee on Higher Education Funding recommendations could alter future funding mechanisms—a policy for sharing the cost of operations between state funds and student revenue would be desirable. 

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The information in this series of analyses of the UNR budget is based on public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

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[1] 2007 Fiscal Report, Fiscal Analysis Division, Legislative Counsel Bureau, (p. 105).

[2] NSHE Accountability and Budget-to-Actual Reports: 2007, 2008, 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020, 2021, 2022, 2023.

[3] Pay bills: AB577 (2005). SB575 (2007), SB433 (2009), AB489 (2015), AB517(2017), SB368 (2017), AB542 (2019), AB493 (2021), AB522 (2023).

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update

 

UNR Budget: Misplaced Priorities and Diverted Resources

Mismanaged Budgets Based on Inflated Enrollment Projections

Part 6 in NFA’s series on the budget situation at the University of Nevada, Reno. This installment addresses the impact of lower-than-projected enrollment growth on budgets.

The UNR administration attributes budget shortfalls of $8.5 million in FY2024 and $10.0 million in FY2025 to “lower-than-projected enrollments.” That missing revenue—from the equivalent of 1,079 full-time undergraduates in FY2024 and 1,187 in FY2025—could have funded 85 to 100 new faculty hires [1]. UNR also budgeted for overly optimistic enrollment numbers and revenue in FY2022 and FY2023. The extra projected available revenue may have spurred the upper administration to divert monies from the core educational mission to non-instructional purposes such as athletics, new administrative positions, and the new business building, contributing to the 5% cuts now being made to departments serving students.

UNR Enrollment Trends

President Sandoval touted a 4% increase in student enrollment for Fall 2023, but that was a preliminary headcount, not Full-Time Equivalent (FTE) student enrollment. Revenue tracks FTE enrollment and student credit hours, not headcounts. The following chart shows that FTE student enrollments at UNR peaked in FY2018 and have declined since then. FTE enrollments did not revive after the pandemic-related declines in 2020. Preliminary Fall 2023 FTE enrollment increased by only 0.2% from Fall 2022—essentially flat. [Updated 1/25/2024: Final Fall 2023 FTE enrollment was up 0.6% from Fall 2022.]

The 4% increase President Sandoval references is due to the expansion of low-credit dual and concurrent enrollment of high school students (1,917 in Fall 2023, according to the UNR Enrollment Dashboard ) Although concurrent enrollment counts toward Weighted Student Credit Hours (WSCH) in the state funding distribution formula, students pay only $75 for each three-credit course as compared to $788 in registration fees received from on-campus students. The hope is that the expansion of concurrent enrollment programs will result in student recruitment, but those students would not be taking the courses they took in high school and paying those registration fees. Despite requests from faculty senators, the administration has not provided data on whether the program, now in its third year, is boosting recruitment.

[Updated 1/125/2024: On 1/18/2024, Vice Provost Shintani reported to the Faculty Senate that there are 5000 unduplicated students enrolled in concurrent courses, and that 30% of the senior students in those courses have applied to UNR. It was unknown whether that is an increase from before the concurrent enrollment program.  The NSHE capture rate for dual enrollment students has historically been 57% or higher.]

[Updated 1/25/2024: The Final Fall 2023 Enrollment Report lists a headcount of 2337 non-degree-seeking undergraduate students at UNR, a 186% increase from 817 in Fall 2022. We are unsure how dual and concurrent enrollment high school students are categorized in these tables.]

The following chart shows the student-faculty ratio at UNR from 2013 to 2022, the same time period as the FTE student enrollment data in the previous chart. The student-faculty ratio declined from 2015 to 2020, but then ticked up from 2021 to 2022. Since FTE enrollment declined slightly from 2021-22 to 2022-23, that means there was a steeper decline in the number of instructional faculty--while the executive ranks have expanded.

Budget Impact of Inflated Enrollment

The overly optimistic projection of enrollments and resulting student fee revenue is a serious matter. The following chart shows the actual revenue minus budgeted revenue for UNR’s main instructional state-supported operating budget for fiscal years 2007 through 2023, from NSHE budget-to-actual reports [2]. Negative values mean actual revenues fell short of the budget. The blue bars show state appropriations, which were cut dramatically mid-biennium during the Great Recession (FY2009 and FY2010) and the pandemic budget crises (FY2020 and FY2021). The orange bars show other revenue, primarily student fees and tuition. 

Enrollments have sometimes fallen short of budgeted projections over the years, but that generally has been corrected in the next biennium. However, after the pandemic-related enrollment decline in FY2021, UNR budget managers projected a rebound in student-fee and tuition revenue for FY2022 and FY2023, leading to revenue losses relative to the budgeted enrollments exceeding the state budget cuts of the Great Recession. Drops in non-resident tuition accounted for a large fraction of the shortfalls, 79% in FY2022 and 66% in FY2023 [2].

It might have been reasonable to predict enrollments would bounce back from the pandemic-related declines in 2020. But when they did not in 2021–22 and 2022–23, UNR could have scaled back future enrollment and fee revenue projections for the 2023–25 budget cycle. Instead, lower-than-projected enrollments for this biennium have led to the continuing budget shortfalls. 

Lower enrollment not only reduces tuition and fee revenue: it also reduces the WSCH counted in the funding formula for the next state budget cycle. The 2023/2024 academic year is the “count year” for WSCH under the existing legislative funding formula for the 2025–27 biennial budget (unless NSHE Committee on Higher Education Funding results in a change to the formula).  

UNR received a one-time appropriation in AB494 of $1.65 million for the 2023–2025 biennium for WSCH for Sierra Nevada University students who transferred to UNR, but most of those students will have graduated by the next biennium. Zero UNR students signed up for the first semester-at-the-lake session, so future student fee revenue from Lake Tahoe campus operations is in doubt.

Flat enrollments do not generally mean existing instructional positions need to be cut, however, unless phantom enrollment growth has been used to justify diverting funds into priorities that are not part of the core mission of the university. UNR has placed resources into Athletics, executive positions and salary increases, the Business Building project, and iPads for new students. In the meantime, academic and student support programs are being cut by 5% in FY2024. 

Future Enrollment

The following chart shows that Nevada has a demographic advantage compared with other states in terms of the K–12 pipeline. The projected number of high school graduates peaks around 2026, but then plateaus in Nevada compared to significant declines on a national level and in other Western states. The WICHE projections [3] in this chart are pre-pandemic; the near-term pandemic declines in graduations were significant, and the future impact is uncertain.  Nevertheless, the longer-term trends are based on known population demographics by age.

Another Nevada advantage for potential future enrollment growth is a traditionally low college participation rate [4]. The high school to college matriculation rate was 37th among states at 58% compared with the national average of 64% as of 2018 [4]. Nevada was 48th in the percentage of 18- to 24-year-olds enrolled in college as of 2017 [4]. The challenge for UNR, NSHE, and Nevada is to increase the college readiness and college matriculation rates of our high school population as well as the retention of college students. Investing in programs proven to do that should be the highest priority. 

Working toward future enrollment gains can be helpful, if the associated revenue becomes available for instructional staff to handle the teaching load. Using inflated enrollment and revenue projections to justify committing resources to priorities outside the core educational mission is a recipe for the budget cuts to academic programs being implemented now.

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The information in this series of analyses of the UNR budget is based on cited public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

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[1] A UNR Assistant Professor hired at Q1 on the current salary schedule would earn $69,383. Adding the 33.8% fringe rate gives $92,834, or 10.8 positions per million dollars. By action of the Board of Regents on December 1, 2023, the salary schedules will be augmented by 10% as of July 1, 2024, giving 9.8 positions per million dollars for future new hires.

[2] NSHE Accountability and Budget-to-Actual Reports: 2007, 2008, 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020, 2021, 2022, 2023.

[3] Western Interstate Commission for Higher Education, Knocking at the College Door: Projections of High School Graduates, 2020, www.knocking.wiche.edu.

[4] NCHEMS Information Center for Higher Education Policymaking and Analysis, National Center for Higher Education Management Systems, www.higheredinfo.org (Nevada data from 2017 and 2018).

Updated 1/16/2024 8 p.m. to include student-faculty ratio data. Updated 1/18/2024 to include additional information on concurrent enrollments.

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update

 

UNR Budget: Misplaced Priorities and Diverted Resources

Student Fees and Unrestricted University Assets Diverted to Business Building PPP

Part 5 in our series on the budget situation at the University of Nevada, Reno. Here we examine the funding of the new Business Building.

The new UNR College of Business Building at University Way & East Ninth Street is being funded under a complex Public–Private Partnership (PPP) in a lease-back arrangement. Since no state funds are being provided for the $164 million Mathewson Gateway project [1], a private corporate entity is financing and constructing the 128,000 sq. ft. building, which will be owned by UNR after thirty years. 

According to the PPP agreement submitted to the Board of Regents, UNR is committed to payments of $10.25 million/year in lease payments for thirty years ($308 million total) for the business building. That annual amount will be sourced by a quasi-endowment, anticipated hotel/convention center revenue, and the Capital Improvement portion of student registration fees: 

• An estimated $4.1 million per year is projected to be generated from a $100 million quasi-endowment to be raised by the UNR Foundation. Of that, $50 million is a transfer from the University to the Foundation of existing unrestricted proceeds from the University’s ownership stake in the Marigold gold mine in Valmy, Nevada–royalties from a mining claim donated to UNR in the 1970s (video). 
• An estimated $500,000 per year is anticipated revenue from a proposed hotel/convention center project to be built on the property, which is near the existing hotels and convention center in downtown Reno. It is difficult to estimate how competitive a new non-gaming property will be in this location, and the hotel/convention center phase of the PPP has not yet been brought forward to the Board of Regents for approval.
• As the “last dollar” source, the remainder of the annual lease payments come from the Capital Improvement portion of per-credit student registration fees. (See Part 4 for an explanation of student registration-fee distribution). UNR estimated to the Regents that “approximately one-half” of the lease payment, or $5.1 million/year, will come from the student Capital Improvement fee. However, that could be more or less depending on the quasi-endowment fundraising and potential hotel/convention revenue.  

When the UNR College of Business proposed in December 2019 and March 2020 to raise differential student fees for business courses to help fund a new building, the Board of Regents refused twice. But then a 34% increase of the UNR Capital Improvement registration fees for all undergraduate UNR students (20% increase for graduate students) was approved in May 2022 without any discussion by the Regents (details in Part 4). When the PPP was approved a year later by the Board of Regents, in June 2023, the UNR Chief Financial Officer told Regents there were no new student or differential fees for the project, only the “existing capital improvement fee” (video). That was technically true because the increases in Capital Improvement student registration fees for FY2024 and FY2025 had been approved in May 2022.

As described in Part 4, the large increase in the Capital Improvement portion of undergraduate per-credit registration fees to help fund the Business Building came with a negative trade-off. Namely, there will be zero inflationary increases for FY2024 and FY2025 in the registration fees supporting the State Operating Budget, which funds instructional and support personnel who serve students and basic operations. That represents an ongoing diversion of student fees of $3.65 million per year from UNR’s core instruction and support operating funds and is a large part of the $5.1 million or more in student Capital Improvement fees obligated to the PPP. All UNR students, regardless of whether they benefit from the new building, will now pay for it through reduced services and course options across the university. Each $1 million diverted from the state-supported Operating Budget represents about 10 new faculty positions that cannot be filled [2].

The new Business Building—still lacking a $25 million naming gift—has been under construction since October 2023. That month, the UNR administration told the Faculty Senate the University had raised 65% of the $100 million quasi-endowment goal. Of that, $50 million is from the transfer of the existing Marigold Mine funds from the University to the UNR Foundation (video), so only $15 million of the remaining $50 million goal had been raised at that juncture as new donations for the Business Building. Fundraising of $15 million pales in comparison to the cumulative thirty-year cost of $308 million, not including maintenance and utility costs. [Update: On 1/18/2024, Vice President Richard told the Faculty Senate that "over $10 million" in private philanthropy had been raised for the business building.]

[Update 2/6/2024: According to the minutes of the May 22, 2023, meeting of the Executive Committee of the UNR Foundation, the Foundation approved up to $1.9 million for four years for the purpose of paying the Business Building sublease, as a backstop pending fundraising for the quasi endowment. The Foundation liquidated the $1.8 million unrestricted Stevenson family trust endowment to provide for the backstop funding. The Foundation also waived its 0.5% management fee for the $50 million quasi endowment for a four-year period.] 

The $50 million of the windfall from the Marigold Mine represents unrestricted university assets that could be used to support academic programs but are now committed to the Business Building project for thirty years. Since gold mine royalties are a fluctuating and finite revenue stream, it is a smart move to convert the accumulated royalties into a quasi-endowment for long-term stable income [3]. 

Along with the risk of the financial viability of the proposed hotel/convention facility, the PPP funding model carries potential risks. Edgemoor, the development firm engaged by UNR, uses a “progressive PPP” model with a shorter track record than traditional PPPs and potential pitfalls. As with the ill-fated Fire Science Academy in Carlin, the UNR and NSHE officials who approved the PPP will be long gone by the time we know whether the funding plan for the business building is sound. 

The thirty years of $10.25 million/year in commitments will tie up $5 million/year in student registration fees (or more, depending on the success of fundraising for naming opportunities and hotel/convention center revenue) as well as the income from the Marigold Mine quasi-endowment (estimated at $2 million/year). Since construction is moving forward, the thirty-year PPP commitment is not reversible.

In the worst-case scenario of no additional fundraising and a hotel/convention center that does not materialize or run a profit, students will be paying $7.6 million/year in Capital Improvement fees while receiving fewer services, fewer classes, and greater frustrations.

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The information in this series of analyses of the UNR budget is based on public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

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[1] Acharya, Tanvi. "FC details for Nevada uni P3", IJGlobal Project Finance and Infrastructure Journal, 7/24/2023. [Available via EBSCO at library.unr.edu]

[2]  A UNR Assistant Professor hired at Q1 on the current salary schedule would earn $69,383. Adding the 33.8% fringe rate gives $92,834, or 10.8 positions per million dollars. By the Board of Regents action on December 1, 2023,  the salary schedules will be augmented by 10% as of July 1, 2024, giving 9.8 positions per million dollars for future new hires.

[3] NFA submitted a public records request in December to determine the continuing royalty income amounts and their distribution. [Update 2/6/2024:  In FY2023, the $50 million in Marigold Mines royalties were transferred to the UNR Foundation for the quasi-endowment. An additional $5.6 million was transferred to "Institutional Support" (program destination to be determined), leaving $491,452 in the royalty account as of 6/30/2023.] 

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update

The State Board of the Nevada Faculty Alliance is saddened to learn of the passing of former Regent Jason Geddes, a stalwart and pragmatic defender of higher education in the Silver State. His record as both a member and chair of the Board of Regents is marked with integrity, enthusiasm, and collegiality. Although the NFA and Regent Geddes sometimes disagreed on issues, he was always available, willing to listen, and treated differences of opinion with respect. Many NFA officers, past and present, appreciated his uplifting sense of humor and considered him to be a friend. He left a lasting positive legacy on higher education in Nevada. He will be missed. 

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UNR Budget: Misplaced Priorities and Diverted Resources

Student Registration Fees Diverted from the State-Supported Operating Budget

Part 4 in a series of articles on the budget situation at UNR. This installment addresses how student registration fees are being spent by the UNR administration.

The distribution of student registration fees at UNR has been shifted from the State Operating Budget into Capital Improvement and General Improvement fees. Specifically, about $3.65 million/year in FY2025 and beyond is being diverted from the core instructional budget into other priorities of the UNR administration. Each $1 million diverted from the operating budget represents about 10 new faculty positions that cannot be filled.

Student Registration Fees

First, we provide some background on the distribution of student registration fees, which are paid by all undergraduate and graduate students on a per-credit basis.

The Regents set the total student registration fees. Since 2019, the annual increase in registration fees has been indexed to the Higher Education Price Index under NSHE’s Predictable Pricing Program. The largest portion of student registration fees funds the State-Supported Operating Budget, UNR’s main instructional budget including instructional and support personnel and all regular academic department and administrative unit operations. Student Access funding for financial aid is mandated by the Board of Regents to be 15% of the overall registration fee for the universities. Smaller portions of the registration fees for General Improvement and Activities & Programs are intended to support programs that enhance the educational or student experience, rather than regular academic and administrative departments. Capital Improvement fees may be used directly for construction or committed to paying off bonds for major building projects.

In each even-numbered calendar year, the Board of Regents approves the distribution of student registration fees into various budget categories (State Operating Budget, Student Access, General Improvement, Capital Improvement, Activities & Programs, and Student Association fees) for the biennium starting in the following odd year. 

Shift in Student Registration-Fee Distributions

In May 2022, the Board of Regents approved the registration fee distributions for FY2024 and FY2025. The inflationary increases in the total registration fees were 2.5% for FY2024 and 1.9% for FY2025. Traditionally, the percentage increases for the overall registration fees have been applied to the State Operating Budget category as well, with minor variations for the remaining categories. That would have resulted in a 4.4% increase over the current biennium in the student registration fees supporting the core educational mission.   

For the 2023-2025 biennium, however, UNR requested and was granted a 0% change in the portion of registration fees going to the State Operating Budget. Those funds, intended for core instructional activities such as teaching faculty, were distributed instead to Capital Improvement and General Improvement fees. That was a significant departure from past practice, but the Regents did not discuss this shift nor did system or university staff bring it to the public’s attention. As approved by the Board of Regents, therefore, zero additional revenue was dedicated to the teaching of UNR students instead of a inflation-indexed increase of 4.4% over the current biennium, which would have resulted in a $7.86 per credit increase for the State Operating Budget. This diversion of fees represents $3.65 million/year from FY2025 onward diverted from the core instructional budget into other priorities of the UNR administration [1]. Each $1 million diverted from the operating budget represents about 10 new faculty positions that cannot be filled [2].

UNLV also initially requested no inflationary increases for the State Operating Budget registration fees at the May 2022 Regents meeting. However, in response to the higher COLAs approved by the 2023 legislature, UNLV requested in July 2023, a $5.00/credit reallocation from their Capital Improvement fee to the State Operating Budget category. UNR did not request a reallocation.

The diversion of student registration fees from the State Operating Budget diminishes the funding of UNR’s core educational activities. Lower student-fee revenue into the State Operating Budget may ultimately translate into reduced state funding, because the Governor’s Executive Budgets have, since the 2013 legislative session, held state appropriations to a fixed percentage of the total state-allocated budget for NSHE within a narrow range [3].

Trend in Distribution of Student Registration Fees

From FY2019 to FY2025, the overall undergraduate registration fee for university undergraduates as regularly approved by the Board of Regents increased from $224 to $268, a 19% increase. As shown in the chart below, during the same time period UNR:

• Increased the Capital Improvement student fee from $16 to $27 per credit (67% increase)
• Increased the State Operating Budget student fee from $155 to $177 (14% increase)
• Decreased the General Improvement fee for campus-wide student programs from $16 to $13 (17% decrease), although higher than a low of $10 in FY2023.
• The fraction of the undergraduate registration fees allocated to the State-Supported Operating Budget, i.e., core instruction and support, decreased from 69% to 66%.

These values are before the additional 5% increase in student registration fees the Board of Regents approved on December 1, 2023, to assist in funding the 11% COLAs for FY2025. That decision resulted in an increase of $11 per credit ($5.1 million per year for UNR) for the State Operating Budget and $2 per credit ($0.9 million per year) for Student Access. 

How Are Auxiliary Student Registration Fees Used?

The expenditure of the General Improvement and Activities & Programs fees is largely discretionary, as they go into separate accounts from the State Operating Budget and are not part of the state budgeting process. NFA submitted a public records request to UNR on December 18, 2023, to discover how revenue from these student fees is being distributed among programs. An update will be provided when available.

A portion of the Capital Improvement fees has been committed to paying off bonds for various buildings. About $5.12 million/year for thirty years has been committed to the Business Building Public–Private Partnership, as will be described in Part 5 of this series. 

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The information in this series of analyses of the UNR budget is based on public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

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[1] Based on FY2023 average annual full-time-equivalent enrollments, each $1.00 per credit increase in student registration fees corresponds to $464,350 in additional revenue.

[2]  A UNR Assistant Professor hired at Q1 on the current salary schedule would earn $69,383. Adding the 33.8% fringe rate gives $92,834, or 10.8 positions per million dollars. By the Board of Regents action on December 1, 2023,  the salary schedules will be augmented by 10% as of July 1, 2024, giving 9.8 positions per million dollars for future new hires.

[3] The Executive Budgets from FY2014 through FY2025 proposed state appropriations at an average 64.8% of the total state-allocated budget for NSHE overall, with a range of 62.7% to 66.1% and a standard deviation of 1.1%.  2013-2015, 2015-2017, 2017-2019, 2019-2021, 2021-2023, 2023-2025.

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update

 

UNR Budget: Misplaced Priorities and Diverted Resources

Growth of Executive Staff and Compensation

Part 3 in a series of articles on the budget situation at UNR. This installment addresses the diversion of resources to create new or upgraded administrator positions and to increase executive salaries. 

President Sandoval has attributed the freezing of 100 positions at UNR and 5% budget cuts for each department on campus to the underfunding of Cost-of-Living Adjustments (COLAs) by the Legislature. However, during the past period of budget cuts the number of executive-level positions has been increased and their average salaries have been raised well beyond the COLAs and merit raises available to rank-and-file faculty and staff. As documented here, the estimated cost of new executive positions and executive raises between Fall 2020 and Fall 2023 over and above COLAs and merit pay is $4.5 million annually. Each $1 million diverted to administration represents about ten new faculty positions that cannot be filled [1]. 

The data on UNR employees and salaries used for this report have been obtained from public records requests to NSHE at the end of October each year since 2020. NFA has also documented statewide faculty salary trends at NSHE institutions.

Growth in Executive Positions and Salaries

Table 1 shows the number and average salaries of executive-level UNR employees from 2020 to 2023. The combined number of vice presidents, vice provosts, and deans at UNR was 21 in October 2020, with an average base salary of $257K. By the beginning of the Spring 2024 semester, only five of those 21 individuals hold the same position. Only three of the eleven academic deans from 2020 are still in their positions. 

However, in Spring 2024 UNR has a total of 27 vice presidents, vice provosts, and deans (+6 positions / 29% increase). As of November 2023, their average base salary was $313K (24% increase). Only 15% of the salary increase can be attributed to COLAs and average merit increases since 2020. Some of the new executive positions also come with new support staff. 

For comparison, at UNLV the total number of vice presidents, vice provosts, and deans rose from 32 to 36 (12.5%) and their average base salary rose from $269K to $300K (11.6%) from Fall 2019 to Fall 2023.

UNR Executives and Administrative Faculty Range E - Number
Positions	Fall 2020	Fall 2021	Fall 2022	Fall 2023
Deans, Vice Presidents, Vice Provosts	21	24	24	27
Other executive-level personnel	57	53	55	64
Total	79	78	80	92
UNR Executives and Administrative Faculty Range E - Average Salaries
Positions	Fall 2020	Fall 2021	Fall 2022	Fall 2023
President	$449,489	$500,000	$505,000	$565,600
Deans, Vice Presidents, Vice Provosts	$252,872	$250,580	$275,875	$313,226
Other executive-level personnel	$186,576	$190,140	$189,918	$206,806
All	$207,796	$212,710	$219,643	$241,938
Source: NSHE public records. Notes: Averages of annualized base salaries only, other compensation not included. Vacant positions not included in counts. Analysis by NFA 12/2023.

Considering all executive-level employees (Executives and Administrative Faculty Range E) at UNR, table 1 shows that:

• The total number of executive-level employees rose from 79 to 92 (+13 positions / 16% increase) between Fall 2020 and Fall 2023, including net new positions and filled vacancies. 

• Promotions of directors or other positions to Vice President, Vice Provost, or Dean did not result in fewer lower-level executives. 

• In Fall 2020, the total base salaries for 79 executives was $16.4 million.  The 15% in regular increases (COLAs of 1% on 7/1/2022 and 12% on 7/1/2023 and two average merit raises of 1%) would have raised their salaries by $2.5 million to $18.9 million. 

• By Fall 2023, the total base salaries for 92 executives was $22.3 million, a net increase of $3.4 million beyond COLAs and merit for continuing positions. 

• Adding the 34% fringe rate gives a cost of $4.5 million per year as an ongoing annual expense for the added executive positions and executive raises.Each $1 million diverted to administration represents about ten new faculty positions that cannot be filled [1].

Table 2 lists the six new vice president, vice provost, and dean positions that were created, including:

• Two new senior vice provost positions were created with salaries of over $260,000 each.

• The Vice Provost for Information Technology position was upgraded to Vice President for Information Technology, while doubling the salary from $223K to $446K.

• A Director for Government Relations and Community Engagement was hired in December 2020. By Fall 2021, the position had been upgraded to Vice President, Government Relations and Community Engagement, who now has a staff including a Director, Government and Community Relations and a Manager, Government and Community Engagement.

The NFA has submitted public records requests to determine which Vice President positions were filled using a search including faculty representation on the screening committee as required by UNR Bylaws.

New or Upgraded Executive Position	Previous Position	Prior Salary*	2023 Salary
Vice President, Legal Affairs and General Counsel	General Counsel	$233,181a	$282,250
Vice President, Information Technology	Vice Provost, Information Technology	$222,916a	$445,760
Vice President, Governmental Relations and Community Engagement	Director for Government Relations and Community Engagement	$189,500b	$259,567
Senior Vice Provost, University Projects and Strategic Initiatives	New position. Incumbent was formerly Associate Dean.	$160,311b	$260,127
Senior Vice Provost	New position. Incumbent was formerly Vice Provost for Faculty Affairs.	$164,800a	$265,332
Dean, Honors College	Director of the Honors College	$128,750a	$181,388
Source: NSHE public records. New executive position titles between July 2020 and December 2023. *Prior salary is for incumbent or former holders before position upgrade or promotion as of (a) Fall 2020 or (b) Fall 2021.

... continued in part 3B

UNR Budget: Misplaced Priorities and Diverted Resources

Growth of Executive Staff and Compensation

Part 3B, continuation of Part 3 of our series of articles on the UNR Budget. [Updated 5/1/2024 with total compensation data, table below.]

Stagnant Academic Faculty Positions

Table 3 below documents the changes in the numbers of academic faculty, administrative staff, and executives at UNR between Fall 2022 and Fall 2023, just over the past year. The number of range A through D administrative faculty grew 12% and the number of executive-level staff grew 15% (net new positions and filled vacancies). But during this year of strong growth for administrative faculty and executive-level personnel, the number of academic faculty remained flat (+3 / 0.3% increase). 

Table 3 also shows the salary changes for continuing employees from Fall 2022 to Fall 2023. All faculty, staff, and executives benefited from a 12% COLA and a 1% merit pool on 7/1/2023. Academic promotions from Assistant Professor to Associate or Associate to Full Professor come with a fixed 10% raise at UNR, but administrative and executive salary changes are discretionary. Academic faculty who were promoted had an average combined COLA and raise of 20.5%, while executive-level personnel with a promotion or change of title got an average raise of 33.4%.

Examples of the top 50 raises at UNR (table at link) between Fall 2022 and Fall 2023 include a $108,000 COLA for the Dean of the Medical School, a 34%/$66,000 salary increase for the Vice President of Government Relations and Community Engagement, and upgrading the General Counsel to a Vice President for Legal Affairs with a 19%/$44,000 salary increase.

Without a promotion, the 12% COLA on 7/1/2023 and the 11% COLA to be awarded on 10/1/2024 will bring a faculty member’s take-home salary only back to 2020 in purchasing power after inflation (details in part 7 of this series).

Table 3

Academic, Administrative, and Executive/Administrative Faculty Fall 2022 to Fall 2023
Category	Academic Faculty	Administrative Faculty (Range A to D)	Executive & Administrative Range E
Number of employees 10/31/2022	1008	1103	80
Number of employees 10/31/2023	1011	1231	92
Change in number of employees	+3	+128	+12
Percent change in number of employees	0.3%	12%	15%
Average salary percentage increase for continuing employees with no change in position title	13.9%	14.2%	13.2%
Average percentage salary increase for continuing employees with a change in position title	20.5%	29.4%	33.4%
Source: NSHE public records. Continuing employees = employees in the category on 10/31/2023, who were also employed at UNR on 10/31/2022. Salary changes are inclusive of the 12% COLA and merit raises from the 1% internal pool on 7/1/2023.

Expansion of Executive Staff Results in Cuts to Rank-and-File Faculty and Staff in Departments Serving Students

These data document the rapid growth in administrator and executive positions and salaries at UNR during a period of budget cuts, while the number of academic faculty remains flat. Salary adjustments for academic faculty have largely been limited to COLAs and regular promotions in rank. Even if the needs of the University fully justify the new executive positions, it is irresponsible to create them during budget shortfalls and flat enrollments. In the meantime, 5% budget cuts to academic departments and administrative units will result in vacancies and eliminations of positions that directly serve students.

The full impact of hiring decisions on academic programs at the department level is hard to gauge because UNR stopped publishing annual budget reports after 2018. 

The public records available to NFA do not indicate the sources of funding at the individual position level. Still, to the best of our knowledge, most of the executive-level positions are funded through state-supported operating budgets (exceptions include Athletics and clinical faculty). That is, increases in executive positions and salaries reduce the available budget for other professional employees.

The central administration’s practice of sweeping vacancy salary savings from academic colleges has varied over the past decades at UNR:

• The Lilley administration instituted central sweeps and even made departments justify positions based on detailed individual-faculty-level teaching loads, which contributed to serious disparities and low morale. 

• President Glick returned authority over salary savings to college deans to allow them to manage their academic portfolios and respond to challenges and opportunities. 

• President Johnson largely maintained that practice, although new positions from growth were allocated through a centralized decision-making process. 

• The Sandoval administration has gone back in the direction of centralized command and control, thereby assuming full responsibility for decisions and priorities while having limited ability to understand situations facing various departments and programs closest to students. 

When salary savings are swept centrally, deans have little to bring to the table when making hiring requests. But it gives the central administration the ability to expand the executive staff and raise their salaries, as has happened since 2020. 

[Update 5/1/2024. The data in this post are based on reported base salaries. We have also obtained total compensation including benefits and allowances during calendar year 2023 for UNR leadership positions, listed in the table below and available with detailed break-downs by compensation category.

Title as of 12/2023	Total 2023 Compensation
Dean, Medicine - University	$1,007,871
Director, Athletics	$615,282
President, UNR	$582,535
Dean, College of Engineering	$500,388
Executive Vice President and Provost	$474,446
Vice President, Information Technology	$472,429
Vice President, Research And Innovation	$430,888
Dean, School of Public Health	$384,412
Dean, College Of Business	$379,002
Vice President, Student Services	$347,583
Dean, Education	$346,303
Vice President, Administration and Finance	$338,519
Dean, College of Liberal Arts	$313,017
Vice President, Legal Affairs and General Counsel	$307,418
Dean, Reynolds School Of Journalism	$302,863
Dean, University Libraries	$298,515
Dean, Cabnr/naes/unce	$297,218
Dean, Orvis School of Nursing	$294,240
Senior Vice Provost	$293,658
Vice President, Advancement	$285,593
Vice President, Governmental Relations and Community Engagement	$284,630
Senior Vice Provost, University Projects and Strategic Initiatives	$268,517
Dean, School of Social Work	$258,863
Vice Provost, Undergraduate Education	$255,488
Vice Provost, Faculty Affairs	$255,400
Vice Provost for Graduate Education/Dean of the Graduate School	$231,828
Dean, Honors College - University	$209,540
Dean, College of Science	$182,170
Dean, Students	$149,985
Vice Provost, Online Learning	$80,155

(end updated information)]

###

The information in this series of UNR budget analyses is based on public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

_________

[1]  A UNR Assistant Professor hired at Q1 on the current salary schedule would earn $69,383. Adding the 33.8% fringe rate gives $92,834, or 10.8 positions per million dollars. By the Board of Regents action on December 1, 2023,  the salary schedules will be augmented by 10% as of July 1, 2024, giving 9.8 positions per million dollars for future new hires.

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update

UNR Budget: Misplaced Priorities and Diverted Resources
Part 2. $10+ Million Increase in University Support for Intercollegiate Athletics
This is the second article in a series of analyses of the UNR budget situation. 

Here we take a deeper dive into the diversion of resources away from the core academic mission by the UNR administration. In August 2023, the Nevada Sports Network reported that UNR is boosting institutional support of Intercollegiate Athletics by $10 million per year, funds that presumably could be spent on instructional operations. Unfortunately, we cannot yet answer the question about the exact source of the extra $10 million per year in university support of Athletics [1]. Spoiler alert: it could be from student registration fees.

Athletics budget data are obtained from the UNR Annual Athletics Reports submitted to the Board of Regents for 2019-20, 2020-21, and 2021-2022 [2].

UNR institutional support for Athletics was zero in FY2016 and FY2017. In FY2018 and FY2019, $650,000 each year was provided in Cost of Attendance Funds (financial aid for student-athletes beyond fees and tuition). In FY2020, that went up to $1,425,000, adding “COLA and fringe assistance.”

In response to the pandemic, UNR added $10 million in institutional support to offset the revenue losses for Athletics in FY2021, for a total institutional support of $11.1 million. Those funds were likely from federal Higher Education Emergency Relief Funds granted through the American Rescue Plan Act, although the UNR Annual Athletics Report does not indicate the source. 

UNLV also increased institutional support for Athletics in FY2021, by $7.5 million from COVID relief funds according to the UNLV Annual Athletics Report. For future years, however, UNLV is returning to pre-pandemic institutional support levels. In contrast, UNR continued the increased institutional support for FY2022, at $10.7 million.

UNR Athletics budget projections include institutional support of $10.1 million in FY2023, $11.7 million in FY2024, $12.9 million in FY2025, and $13.0 million in FY2026. The chart below shows actual and projected revenues for UNR Intercollegiate Athletics for FY2016 through FY2027, obtained from the Annual Athletics Reports provided to the Board of Regents for 2019-20, 2020-21, and 2021-2022. “Athletics Income” represents all the revenue internally generated by Athletics including ticket sales, dedicated gifts, and media and conference income; the remainder is from state appropriations, student fees, waived tuition and fees, and institutional support. Institutional support was a tiny fraction of the UNR Athletics budget prior to 2020; now it is about 30% of the budget. Internal Athletics income now covers only about 50% of the expenditures: the remainder is from state appropriations, student fees, tuition and fee waivers, and institutional support. The combined state, student, and institutional subsidies for UNR Athletics are projected to be nearly $23 million for FY2024. 

The addition of $10 million in university subsidies to Athletics represents a 26.4% increase over the pre-pandemic actual total revenue of $37.8 million for FY2019, which was an especially good year for Athletics income. It doubles the total subsidy from the state, university, and students.  Although Athletics is subject to a $830,000 reduction for FY2024 as part of the 5% “across-the-board” cuts to university programs, that is offset by an increase in the state appropriation to $5,580,806 from the projected budget of $4,835,440, an increase of $745,366. A $830,000 cut would be 5% of a budget of $16,600,000; it is not clear to which portion of the projected FY2024 $46.1 million total Athletics revenue that applies. 

Where does the extra $10 million to $13 million per year in UNR institutional support to Athletics come from for FY2023 and beyond? Federal COVID relief funds are no longer available. It is not from direct state appropriations ($4.8 million/year) or the student per-credit fees specifically for athletics ($2.8 million/year or $6/credit), which are reported separately, as are gifts designated for Athletics ($3.0 million per year including season ticket sales). The UNR Foundation has provided capital improvement funds for Athletics facilities; unrestricted foundation funds could also be used for support of Athletics operations–the 2022-2023 UNR Foundation Annual Report lists $2.4 million in program gifts identifiable as athletics-related.

The 2022 legislative audit [3] of NSHE self-supported programs for FY 2018 through FY2021 faulted two NSHE institutions, presumably UNR and UNLV, for using restricted student fee funds to support athletics: "Specifically, two institutions used a total of nearly $6.7 million in general improvement and other restricted student fees to support athletics and band programs over several years" [3]. However, the institutions argued that support for athletics was an allowed use.

Our understanding is therefore that the institutional support funds for Athletics could be derived from per-credit student registration fees in the General Improvement, Activities & Programs, or Student Access budget categories. That is, student support for Athletics could be significantly greater than is reported as “student fee revenue” in the Annual Athletics Reports. There may be other unrestricted discretionary funds available that have not been disclosed as the source, including continuing royalty income from UNR’s Marigold Mine stake and investment income from the NSHE Operating Pool. Regardless of the exact source of funding [1], the Sandoval administration is diverting an extra $10 million/year or more to Athletics on an ongoing basis that could be used for core academic programs to serve all students (or for financial aid in the case of Student Access fees).  Each $1 million diverted from the core instructional budget is equivalent to about 10 new academic faculty hires [4].

[Update 2/2/2024: UNR Intercollegiate Athletic's annual financial statements to NCAA are submitted in mid-January for the prior fiscal year.  The following chart shows the annual operating surplus or deficit reported to NCAA from FY2019 through FY2023, along with the (negative) ending reserve balances  (as reported in UNR's Annual Athletics Report for FY2019 and calculated forward).  The additional $10 million/year in University support started in FY2021.  With this extra operating revenue, UNR Athletics about broke even in FY2021 and FY2023 and had a $2.7 million operating surplus in FY2022.  In other words, most of the $10 million annually is being spent.]

###

The information in this series of analyses of the UNR budget is based on public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

___________

[1] Public records requests were submitted to UNR in December 2023 to determine how General Improvement student fees, Activities & Programs student fees, and Marigold Mine royalty income are being distributed. An update will be provided when available.

[2] The Annual Athletics Reports from UNR and UNLV to the Board of Regents present budget data in two forms. The NCAA Annual Statements of Revenues and Expenditures include various non-cash contributions that are not included in the internal Workday budget data. “Direct Institutional Support” as reported to NCAA includes tuition and fee waivers in addition to the “Institutional Revenue” reported to the Board of Regents for budget reports. Tuition and fee waivers represent lost revenue to the university instructional budget, but arguably some would not be realized if fewer student-athletes were attracted to the program. Here we use “institutional support” to mean the cash portion of direct institutional support and use the internal reports of total revenue and expenditures.

[3] Performance Audit, Nevada System of Higher Education Self-Supporting and Reserve Accounts, Legislative Auditor, 2022.

[4]  A UNR Assistant Professor hired at Q1 on the current salary schedule would earn $69,383. Adding the 33.8% fringe rate gives $92,834, or 10.8 positions per million dollars. By the Board of Regents action on December 1, 2023,  the salary schedules will be augmented by 10% as of July 1, 2024, giving 9.8 positions per million dollars for future new hires.

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update
• 
  

Updated 1/18/2024 in include information from the 2022 Legislative Audit of NSHE.

Update 2/2/2024 to include information on annual operating surpluses and deficits and negative reserve balances.

 

UNR Budget: Misplaced Priorities and Diverted Resources
Part 1. Overview

This is the first of a series of analyses of the budget situation at the University of Nevada, Reno. UNR is facing serious budget difficulties in the 2023-2025 biennium despite an increase in total state appropriations of $26 million (20%) from FY2023 to FY2024 for the main UNR instructional budget [1]. 

The UNR administration has blamed legislative underfunding of COLAs for the current budget shortfalls in the state-supported instructional budget. However, the entire ongoing underfunding of COLAs for professional and classified staff of $21.7 million per year could have been covered if the UNR Administration had not chosen to fund non-academic budget priorities instead of the core instructional mission.

UNR’s core educational mission is largely accomplished by the work of rank-and-file faculty and staff serving students. It is funded through the main UNR instructional account in the State-Supported Operating Budget, the budget for most instructional and support personnel who directly serve students as well as basic operations. This series will document how the budget deficits at UNR are caused in significant part by the diversion of resources away from the core educational mission into other priorities of UNR’s administration, specifically:

• About $10 million per year in increased direct university support of Athletics. [Details in Part 2]

• New administrator positions and increases in their base salaries beyond COLAs and merit. From Fall 2020 to Fall 2023, the number of executive-level personnel at UNR (Executives and Range E Administrative Faculty) increased by 13 from 79 to 92 (16% increase). The estimated cost of new executive positions and executive raises between Fall 2020 and Fall 2023 over and above COLAs and merit pay is $4.5 million annually. That is an ongoing cost for these positions in future budget years. [Details in Part 3]

• About $3.7 million per year in inflation-indexed increases in student registration fees has been diverted from the State Operating Budget to the Capital Improvement fee and the General Improvement fee. [Details in Part 4]

• Up to $10.25 million per year committed to the new Business Building. Of that, $5.1 million per year is from student registration fees funded largely by diverting the inflation increases to registration fees from the State Operating Budget into the Capital Improvement student fee. Approximately $2.3 million per year is unrestricted revenue from $50M in Marigold Mine royalties transferred from the university to the UNR Foundation as a quasi-endowment. The remainder is to come from fundraising for the quasi-endowment (only $15M of $50M raised so far) and hotel project revenue yet to be realized. [Details in Part 5]

• About $3.5 million per year for the Digital Wolf Pack Initiative, which supports Apple Distinguished School status for UNR. [Discussed elsewhere.]

Each $1 million diverted from the core instructional budget is equivalent to about 10 new academic faculty hires [2].

UNR’s budget officers have counted on unrealistic increases in future student enrollment during a multiyear period of declining or flat enrollment, resulting in budget shortfalls of $8.5 million and  $10 million in FY2024 and FY2025, respectively. [Details in Part 6]

On December 1, 2023, the Board of Regents approved Option A for funding COLAs, which delayed 11% COLAs for faculty until October 1, 2024, and increased student fees and tuition by 5% to help cover the cost of COLAs for both professional and classified staff. In the budgets for Option A presented to the Regents, UNR projected that 108 positions would be eliminated or held vacant. This high number of vacant positions accounts for 76% of all vacant positions to be held vacant at all NSHE institutions. (UNR’s closest counterpart, UNLV, projected no positions to be eliminated or held vacant.) The UNR administration has imposed 5% budget cuts for FY2024 across all university units, while recent additions of personnel were concentrated in the administrative and executive ranks. UNR’s academic mission will be seriously compromised by these cuts to personnel and operations. [Details in Part 7]

These budget issues will be documented in subsequent posts in this series over the next few weeks, followed by suggested solutions [Part 8]. 

###

The information in this series of analyses of the UNR budget is based on public reports and records, interpreted as accurately as possible given uncertainties in the assumptions used for various reports. Corrections from authoritative sources are welcome. Contact: kent.ervin@nevadafacultyalliance.org.

_______

[1] FY2024 NSHE State-Supported Operating Budget Report, University of Nevada, Reno (p. 29). Includes COLA appropriations. State-allocated American Rescue Plan Act funds were added to the FY2023 state appropriation for comparison with FY2024.

[2]  A UNR Assistant Professor hired at Q1 on the current salary schedule would earn $69,383. Adding the 33.8% fringe rate gives $92,834, or 10.8 positions per million dollars. By the Board of Regents action on December 1, 2023,  the salary schedules will be augmented by 10% as of July 1, 2024, giving 9.8 positions per million dollars for future new hires.

Articles in this series:

• Part 1. Overview
• Part 2. Increased University Support for Athletics
• Part 3. Growth of Executive Positions and Salaries 
• Part 4. Diverted Student Registration Fees
• Part 5. Business Building PPP
• Part 6. Inflated Enrollments
• Part 7. Underfunded COLAs
• Part 8. Summary and Solutions
• May 2024 Update

Updated: on 1/3/2024 to clarify that the quasi-endowment for the Business Building is held at the UNR Foundation and was created with Marigold Mine funds transferred from the University.

Updated on 1/4/2024 to clarify that the $5.8 million increase in base salaries for executive-level administrators is for the entire group, not just for the 13 additional positions.

Updated on 1/8/2024 to report the cost of new executive positions and increased executive salaries net of regular COLA and merit increase and including fringe rate, per calculation in part 3.