University of Alaska President Pat Pitney at the Board of Regents meeting Nov. 10. Photo by Matthew Schmitz.
On Nov. 10, the Board of Regents reconvened for its yearly budgetary analysis and approval for UA’s next fiscal year. The tone among the board was positive compared to the previous day, when staff representatives expressed disappointment at the University of Alaska’s administrative policy.
Regents expressed a shared sense of hope for on-campus learners, raising anecdotes about visible recovery of student activity and sentiment as the system returns from the long-drawn impacts of the COVID-19 pandemic. The board unanimously praised healthy collaboration between regents and UA campuses.
In priority strategies for the coming year, the board formally recognized its new “Empowering Alaska” branding – focusing on an inclusive higher education structure encompassing traditional CTC programs and community projects as well as traditional university pathways.
President Pat Pittney heralded this transition, saying, "Our ability to get to graduation is going to be different than our traditional four-year to two-year degrees,” – a nod to existing efforts by the university to strengthen CTC.
The operating budget for fiscal year 2025 is expected to cement UA’s drift away from relying on often contested state funding. The percentage of UA’s Operating Budget represented by state funding is projected to drop 10% from a decade ago.
A major area of progress noted by the board was UAF’s moves toward achieving the nationally-coveted R1 research status — a category occupied by prestigious institutions such as Stamford and MIT. This opens Fairbanks up to a minimum of over $40 million from the federal government if it reaches its goal – which appears to be within reach – by the 2027 target.
The University is also pulling more resources directly from its earned revenue — restricted funds — to increase its overall employee headcount. This category shows a projected 19% year over year growth rate compared to the 5% brought on with ‘unrestricted general funds’ that represents outside funding. This is welcome news for the board, which faced an employee turnover rate dramatically higher than the annual 4-5% target from FY14 through FY22. The presented budget shows a 2.5% increase in compensation across the board.
However, state funding is still a key revenue source for the university. For the first time since before 2014, UA has seen actual year over year growth and a lack of cost-cutting measures.
Building on this success was a new deferred maintenance and modernization budget featuring a $20 million increase to $35 million total. UA plans to achieve this through collaboration with governor Dunleavy and a state legislature that is broadly friendly. President Pittney added that a decline in debt service costs meant a long-term commitment of $1-2 million year over year budget increases in this category.
This funding may become crucial, as property insurance costs have risen by over 50% for UA in the past three years. This sharp increase — brought on by climate-related disasters nationwide — is to be offset using a ‘captive insurance’ strategy which aims to lower premiums through program retention. Another strategy the board presented was establishing a ‘loss reserve’ fund with the state. A similar loss reserve has already produced positive results for the Mat-Su Borough.
All of this is accompanied by a continued freeze in tuition — which the board said would improve retention. This is a part of another move to make ‘Community Campus Rates’ consistent across UAA, UAF and UAS. Noting an uptick in new student acquisition, the board unanimously supported this measure.
During the final rounds of voting, the board was quick to approve most budgetary measures and outgoing requests, but one conflict slowed the approval of the FY2025 Capital Budget Requests — the Alaska Leaders Archive. Similar to the Ted Steven’s Archive collection, the Alaska Leaders Archive intends to document transformative public servants and policy leaders from the state’s history.
This $12 million construction project – along with Consortium Library Remodeling – had a planned start date of July 1 as per initial documentation. The Alaska Leaders Archive being included in the Capital Budget Requests caused concern amongst some members of the body that it would derail the approval of deferred maintenance requests once it was brought to governor Dunleavy who would be instrumental in presenting the requests and carrying support.
UAA Chancellor Sean Parnell disagreed with this notion — and several board members including President Pittney and Board Chair Seekins joined him, as a delay in funding could extend to two legislative cycles. Regents Michel, Andersen and Perdue and other board members in favor of moving it to the ‘Receipt Authority Only’ category said that – due to a $6 million shortfall from private partners – the archive wouldn’t have enough funding even with legislative approval. While they were in favor of the archive, the challenges of keeping it as a part of Capital Budget Requests instead of lower-priority restricted spending gave them pause. Parnell’s group was unable to defeat their amendment.
Afterward, the board passed a resolution of appreciation for Dr. Priscilla Schulte — who was recognized for her decades of service as an anthropology instructor, Alaska Native cultural researcher, longtime UA-system donor and Ketchikan Campus Director. Her years of service and altruism were recognized in the board’s motion. Schulte is retiring after this semester.
The election of board officers concluded with Ralph Seekins as chair, Karen Perdue as vice chair, Dale Anderson as secretary and Scott Jepsen as treasurer.
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