DULUTH — A bill destined for Gov. Tim Walz’s signature won’t result in cuts at Lake Superior College and would mean a budget surplus at Fond du Lac Tribal and Community College.
Reached last week, Minnesota lawmakers’ $4.2 billion compromise on higher education spending would apportion about $1.87 billion over the next two school years to the Minnesota State Colleges and Universities system.
That total includes $75 million, spread across next year and the one after it, to offset an agreed-upon freeze in tuition rates for the approximately 300,000 students who attend the system’s 26 colleges and seven universities, plus $50 million worth of one-time campus support next school year.
At Lake Superior College, it means the school’s budgeted general fund revenue for the 2023-24 school year will rise by about $2 million to $34.5 million, according to Al Finlayson, the college’s vice president of finance and administration.
Of that increase, $700,000 comes from a hike to the school’s basic appropriation via the Minnesota State system, and the remaining $1.3 million comes from the one-time campus support money. The school’s budgeted expenditures, Finlayson said, will rise to $34.5 million as well.
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Baked into those projections is an assumption that salaries at the college will rise by about 4% overall, benefits will rise by about 0.5%, and that enrollment will decline by about 3% to the equivalent of approximately 2,000 full-time students.
Finlayson said the enrollment estimate is deliberately pessimistic, and that recent enrollments suggest it won’t come to pass. Higher education administrators frequently use “full-year equivalent” figures when they put together a budget because that figure more readily accounts for students who are taking partial credit loads than a strict headcount does.
At FDLTCC, the higher ed bill would mean general fund revenue for the coming school year of about $10.4 million, up from about $10 million this year, according to Bret Busakowski, the college’s chief financial officer.
But the college initially expected to spend only about $10.3 million, resulting in an extra $100,000 that school administrators plan to spend in the coming year.
“We got a little more than we expected,” Busakowski said.
That projection assumes that enrollment will increase by about 10% to the equivalent of about 490 full-time students, and that personnel costs will increase by 6% and non-personnel costs, like classroom supplies and utilities, will increase by 10%.
It’s a swing from the school’s earlier projections, which suggested it would need to balance its budget by drawing between $235,000 and $440,000 from the approximately $11 million it has in reserve.
“Overall, this is a really good bill for Minnesota State,” Busakowski said.
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Administrators at the University of Minnesota Duluth said they wouldn’t be available to discuss how the higher ed bill would affect the university’s budget until later this week.
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