Gov. Tony Evers urges increased funding for UW system after audits show fiscal strains (2024)

Gov. Tony Evers is calling on the GOP-led Legislature to increase funding for the Universities of Wisconsin after the system’s leaders released a slate of third-party financial audits that showed half of its schools are in financial trouble.

The UW system on Thursday released audits developed by consulting firm Deloitte showing that, if seven of its universities — Green Bay, Oshkosh, Parkside, Platteville, River Falls, Superior and Whitewater — do not make drastic changes, the schools could accumulate millions in debt through 2028. Audits for Milwaukee, Eau Claire, La Crosse, Stevens Point, Stout and the UW system administration are still underway and are set to be released later this year.

Deloitte is not conducting an audit of UW-Madison because the flagship university’s budget isn’t in the red.

The assessments show the effect underfunding the UW system in recent decades, and failing to remedy cuts made in recent years, Evers said in a statement Friday.

“Republican lawmakers have spent more than a decade waging war on public education in Wisconsin, including our UW System and higher education institutions, and have consistently refused to make the necessary, meaningful investments our state and our campuses desperately need to compete and that our students deserve,” Evers said.

The UW system ordered the audits last year after its universities were on pace to be nearly $60 million in the hole by the end of fiscal year 2024. Oshkosh was projected to be short the most, at $18 million.

Altogether, if the seven universities did nothing to cut expenses, Deloitte projected they’d be in a cumulative $254.9 million in debt by fiscal year 2028.

Several universities already have made painful cuts. For example, Oshkosh cut one of every six jobs in October, declined to renew the contracts of short-term instructors and implemented furloughs. Parkside, Green Bay and Platteville also furloughed faculty and staff, offered retirement buy-outs and eliminated administrative positions.

UW system leaders largely point to the Legislature freezing in-state undergraduate tuition for nearly a decade and cutting or state aid was often cut or remained stagnant.

In his statement, Evers did not specify a dollar amount he felt the Legislature should allocate to the UW system, saying only “the largest increase in state support ... in over two decades.”

During the last budget cycle, UW system administration asked for an increase of $435.9 million in state aid dollars and Evers proposed a $309.5 million increase. The Legislature, though, didn’t authorize new funding and held back about $32 million until a fight over diversity, equity and inclusion initiatives was resolved.

UW system President Jay Rothman said Thursday the UW system would need an additional $440 million in state aid just to put to increase its standing nationally based on state investment. The UW system is ranked 42nd nationally on state investment per student, according to a Wisconsin Policy Forum report from 2023.

“Do we want a 42nd-ranked university system because ultimately, that’s what we will have if we continue to invest at that level,” Rothman said. “And when you think of the power of higher education to change the trajectory of people’s lives, those are Wisconsinites, and we can do better than we are doing today.”

What the audits show

Chancellor reaction

UW-Green Bay Chancellor Michael Alexander said in a statement that Deloitte’s report is a snapshot in time of fall 2023 and does not reflect decisions that already have been made.

Alexander said there’s a $11.7 million difference between the audit’s projections for fiscal year 2028 and the university’s projections. Deloitte’s report does not include any revenue from the Continuing Education program, the growing high school dual-enrollment program or the university’s Phoenix Innovation Park that would pair university researchers with private industries.

UW-Oshkosh Chancellor Andrew Leavitt wrote in a statement that Deloitte’s audit “validates” the steps administration there have taken to cut down the university’s budget shortfall. In addition to reducing staff, UW-Oshkosh also will condense the number of schools within the university from four to three to reduce administrative overhead.

“The report acknowledges our efforts to reduce an $18 million gap to $3 million through difficult but necessary measures while striving to shield student services and experiences. Consultants leading the independent review acknowledge the perfect storm of demographic, enrollment and fiscal pressures we have identified,” Leavitt said. “And they conclude that (UW-Oshkosh’s) Institutional Realignment Plan ‘has substantially changed the trajectory of its financial situation.’”