Balancing Our Budget
The University of Nebraska–Lincoln will reduce its State-aided budget by $27.5 million to address a structural budget deficit and anticipated challenges in FY2026. This total includes approximately $21 million to close the structural gap and an additional $6.5 million in proactive reductions. These steps will ensure we can continue delivering on our important mission for students, faculty, staff and the people of Nebraska. You can read Chancellor Rodney D. Bennett’s message here.
Rationale
The University’s current revenues are not sufficient to meet operating expenses. This gap stems from a combination of factors: declining state appropriations, reduced net tuition revenue, smaller campus allocations, and sharply rising costs for health care, property and liability insurance, and utilities.
The University of Nebraska–Lincoln relies on multiple funding sources—primarily state appropriations, student tuition, federal research grants and student aid, and private giving. While Fall 2024 marked our first overall enrollment growth since 2017, net tuition revenue fell short of projections. The increase was driven by more Nebraska residents enrolling, while the number of higher-paying out-of-state students and international students declined.
A Strategic Approach
Addressing our budget deficit requires more than short-term cuts—it demands a deliberate, long-term strategy that protects our core mission while positioning the University for sustainable success. We will focus resources on high-impact priorities, align programs with enrollment trends and market needs, and streamline operations to reduce costs without compromising academic excellence.
This approach will combine disciplined financial management with strategic investments to grow revenue, expand partnerships, and strengthen our competitive position.
Immediate Steps
Immediate steps are being taken, including an extension of an existing hiring freeze, refilling only those positions most essential to university operations. A Voluntary Separation Incentive Program (VSIP) program is being offered this fall to eligible tenured faculty members.
Timeline
The Academic Planning Committee
The Academic Planning Committee (APC) is a university-wide group responsible for formulating and recommending academic and planning goals and initiatives for UNL in the areas of education (resident and extension), research, and service to the Faculty Senate, Colleges, and Chancellor. The APC recommends actions and procedures for new and existing academic programs and is empowered to recommend changes in programs, including elimination.
Academic Program Review
The Executive Leadership Team has proposed teaching and research metrics that will be used for academic program analysis with input from many people. These metrics have been shared with Deans and department executive officers. Valuable feedback from these meetings has resulted in improvements to this metrics-based approach that can be consistently and fairly applied across programs.
This quantitative approach, combined with qualitative assessments like strength of the program, needs of the state, and workforce alignment, are being considered as part of the current process.
This approach address our current deficit in a strategic way that moves beyond the percentage-based approaches of previous budget reduction processes. And to think in a way that establishes a foundation for future decision-making and success. The anticipated result is a more streamlined, efficient university that retains the profile and impact of a comprehensive, Big Ten, land-grant, research university, continues its significant return of investment for the state of Nebraska and its taxpayers, and positions UNL to move forward toward aspirational goals, including being considered for readmission to the AAU.
Teaching metrics include:
- Student credit hour generation
- Number of majors
- Anticipated demand (in terms of recent growth)
- Retention
- Measures of instructional efficiency (e.g., ratio of student credit hours to instructional full-time employee)
- Comparison of tuition vs. instructional budget
Research metrics include:
- Normalized AAU Phase I indicators (competitive federal research expenditures; highly prestigious awards, fellowships, and memberships; book publications; and citations)
- Academic Analytics Scholarly Research Index (SRI) relative to AAU public institutions
- Externally sponsored awards (including NU Foundation) relative to state-aided budget
- Unit growth in externally sponsored research awards relative to UNL total growth
The Path Forward
UNL's current budget situation requires the university to reduce its expenses in the immediate future, but recurring budget reduction cycles are not a path to growth and distinction. For UNL to achieve an extraordinary future, the university must realize growth fueled by increased revenue generation.
UNL must enroll more students—providing Nebraskans with the opportunity of a Big Ten, Carnegie R1 education, while also attracting and retaining a greater share of out-of-state and international students.
UNL must also continue to make our compelling case to state leaders and other stakeholders that there is no better investment than the University of Nebraska-Lincoln.
UNL is an economic and cultural driver in the state of Nebraska with a $3.1 billion economic impact on the state. For every $1 invested in the University of Nebraska System, $10 is returned to the state.
UNL must remain committed to working closely with our federal partners and others to ensure that they continue to see the full value of our transformative research and creative activity-work that drives innovation and reflects the resilient spirit of Nebraska.
And UNL must continue to appeal to our alumni and friends, who are already so generous to the university, but whom we are increasingly reliant upon as we face an uncertain financial future.
FY2026 Budget Messages
August 8, 2025
Message from Chancellor Bennett - Budget Reduction Framework
August 8, 2025
Message from President Gold - Voluntary Separation Incentive Program
August 4, 2025
Message from Chancellor Bennett - Addressing our Budget Deficit
June 19, 2025
Message from President Gold - Update to the Board of Regents
May 20, 2025
Message from President Gold - Salary Guidelines
May 20, 2025
Message from Chancellor Bennett - Salary Program Update
March 4, 2025
Message from Chancellor Bennett - Budget Reductions
Prior Budget Reductions
Since FY20, UNL has made permanent budget reductions of approximately $75 million. Most recently, in our continued efforts to be fiscally responsible stewards, UNL finalized a $12 million reduction in January 2024, as well as a $10.8 million reduction in June 2023 and $5 million Spring 2025.