Tech makes cuts to address $18M shortfall
HOUGHTON — Michigan Technological University’s Board of Trustees approved a balanced budget with $18 million in cuts to the general and auxiliary budgets during a remote meeting Monday.
The budget includes a decrease in non-payroll spending and a six-month pay reduction for employees earning over $60,000 a year. Fifty-six open staff positions and 31 filled staff positions are being eliminated, which President Rick Koubek said was done as a last resort.
Realigning our expenses while preserving the academic excellence of our programs was crucial,” he said during Monday’s meeting. “And I’m thankful to everyone who addressed a difficult financial situation with so much creativity and resolve.”
The administration also requested the ability to be flexible in spending to maintain a balanced budget to reflect any changes in state appropriations or a tuition cap.
Budget projections include revenue losses from tuition, room and board, state appropriations and other areas, said Trustee Jeffrey Littman, who was named the board’s vice-chair for the coming year later in the meeting. Assumptions included the start of in-person instruction in September and standard housing and dining revenues based on a moderate drop and enrollment. The drop in state funding is also expected to be moderate, Littman said.
The institutional portion of money given to Tech from the federal CARES Act will be used to offset expenses related to instructional costs and expected additional expenses to maintain social distancing and other safety protocols.
The board also approved tuition increases of 3% for Michigan residents and 3.8% on average for non-residents. Koubek said the increase was to adust for inflation or order to maintain the quality of academic programs.