What’s in University of Kentucky proposed budget for 2022-23?

A 2% tuition increase, more than $17 million in raises for employees and $250 million for a new health education building are among the initiatives included in the proposed University of Kentucky budget.

The $5.6 billion budget for the 2022-23 academic year is the largest in UK’s history, President Eli Capilouto said Monday. The budget is about $537 million larger than it was last year, with much of the growth generated by UK Healthcare, he said. The board of trustees will vote on the budget at its meeting next week.

“We believe we are positioned, like never before, to do more for our state,” Capilouto said. “We have big goals and far-reaching aspirations for Kentucky — not only because it is what we want, but because it is what our state requires.”

The proposed budget includes:

• $947 million in undesignated general funds, coming from tuition, state appropriations and other sources to use for instruction, public service and student aid.
• $3.4 billion in designated general funds, coming from UK HealthCare, clinical services, fees and other sources, to use for patient care, instruction and various student services and supports.
• $247.5 million in auxiliary funds, which come from and pay for UK Athletics, housing, dining, transportation and service centers.
• $561.5 million in research grants and contracts, endowments and investments and financial gifts, which are used for research, student financial aid and public service.
• $452.4 million in fund balances from prior years’ savings, used for capital projects, faculty start-up packages and pilot programs.

“A budget is an expression of our deepest values,” Capilouto said. “It reflects and details where we spend our time and how we invest those resources entrusted to us. And what we value is the people we are counting on to advance this state — to create a Kentucky tomorrow that is healthier, wealthier and wiser than it is today.”

Tuition and fees

Tuition and mandatory fees for in-state undergraduate students would increase to $6,429 per semester next school year, up by $124 from $6,305 last school year, according to UK.

The Kentucky Council on Postsecondary Education sets tuition increase limits for universities in the state. For the 2021-22 and 2022-23 academic years, tuition cannot increase by more than 3% over those two years, and cannot increase by more than 2% in a single academic year.

UK is expecting a record-setting class of freshman this fall of 6,000 students, Capilouto said. That will result in nearly $50 million in the budget from tuition and fees, he said.

UK also plans to invest heavily in financial aid, nearly $162 million in scholarships and grants for students. That is $14 million more than what was budgeted last year.

Raises and health care for employees

UK will have $17.3 million available for employee raises next fiscal year. Eligible employees will receive at least a $1,000 raise, but could potentially receive a higher raise, said Angie Martin, UK’s vice president for financial planning and chief budget officer.

“It’s critical to our faculty and staff, and in complete alignment with our strategic plan of supporting our employees,” Martin said on Monday. “It’s already in process, pending board approval.”

The $17.3 million has been allocated proportionally across campus, with flexibility given to supervisors to determine how to best distribute the money for raises, Martin said.

Additionally, employees will again be allowed to carry over their leftover vacation leave.

UK has also worked to keep increases in health care costs low: most plans will see no increase in monthly costs, and plans that do see an increase will be between $4 and $12 each month, said Eric Monday, UK’s executive vice president for finance and administration.

Buildings and capital investment

UK has also budgeted for several major capital projects in the budget, including a new health education facility and cancer and ambulatory facility.

The health education building will have space for four different colleges, and “significantly increase the number of health professionals who will serve our state,” Capilouto said. The building is estimated to cost $380 million, $250 million of which comes from state bonds.

UK has also budgeted for a new cancer and ambulatory facility to expand UK HealthCare. The building is estimated to cost $450 million and will come from university funds.

UK also received $9 million in the state budget to rebuild the Grain and Forage Center of Excellence in Princeton, which took a direct hit in the December 2021 tornadoes. The center conducts research impacting grain and beef farmers, and was nearly completely destroyed in the tornadoes.

“It’s critical, and what the state has done by giving us $9 million to help us reinvest in that area is we’re going to be able to rebuild this facility to be an amazing research facility,” Martin said.

This story was originally published June 7, 2022 10:05 AM.