Dear Colleagues,

Welcome back. While many of us were on spring break last week, the Joint Budget Committee (JBC) for the state of Colorado finalized its proposal for higher education.

I’m delighted to report the JBC has recommended increasing funding for higher education by 2.5% for the 2025-26 fiscal year. This would close CU Denver’s projected structural deficit to an estimated $5.5 million, which we intend to address with retirement program savings and operational reductions in central units, some of which we have made earlier this year.

Next week, the University of Colorado Board of Regents will review the CU system final budget plan for 2025-26, which includes details for CU Denver. Then, the state legislature has until the end of its session to finalize the state budget.

As I shared in my November communication, our process for determining our budget hasn’t changed, despite all the uncertainty and changes in higher education and in the federal and state economies. The factors that determine the bulk of our revenue remain the same today: enrollment, tuition rates, and our state allocation. Here’s an update on where we stand. 

Enrollment, Tuition, and State Allocation

The budgeted enrollment estimate submitted to the Board of Regents in February was a 1.8% decline year-over-year. Countering that forecast is the continuing work of everyone involved in student enrollment and retention efforts across the entire institution. Our teams in the Division of Strategic Enrollment and Student Success (SESS) and our schools and colleges, as well as partners in University Communications, have continued to engage in marketing outreach, admissions actions, and yield activities. Examples include faculty working to retain students, the financial aid teams shepherding our students and families through funding alternatives, the Advancement team cultivating donors with scholarship support, and everyone engaged in Access and Campus Engagement.

After the release of the governor’s budget proposal in November, the following several months focused on legislative advocacy and review. The CU system partnered with all Colorado institutions of higher education and encouraged the JBC to recommend a 2% increase in state allocation to higher education.

The JBC plays a key role by rigorously engaging in a line-item review of the governor’s proposed budget and any advocacy requests that have been submitted. Both tuition rates and state support are refined for recommendation to the full legislative body at the conclusion of the figure-setting session, which was finalized last week.

The JBC recommended a 2.5% increase in funding for higher education. That’s good news for us. CU Denver is expected to receive a 2.9% increase in state funding because of the formula used to distribute funding across the CU system. The JBC also recommended a tuition rate increase for in-state undergraduate residents of 3.5% and a 2.3% increase for out-of-state residents.

Potential Revenue Gap

Despite this good news, expenses continue to increase at a faster rate than our projected revenue. Some of our increased expenses are indicative of our commitment to our employees—reflected in competitive pay and raises—while others are beyond our control, such as inflation.

This brings us back to our current situation of an estimated $5.5 million structural deficit for 2025-26. This gap is better than some of the scenarios I shared with you in November, but a gap still remains. Throughout this fiscal year, I’ve reiterated CU Denver’s intent to address deficits by leveraging savings from the retirement incentive that was offered last year. In addition, ongoing central administration operational savings throughout this year will be applied to any remaining budgetary gaps. We have now submitted our plan, which will be reviewed by the Board of Regents on April 10.

Future Financial Planning

These are unprecedented times, and given the uncertainty at the state and federal levels, it is hard to predict a particular outcome with accuracy. How changes to federal tax policy may impact the feasibility of loans, scholarships, and even Pell Grants for our student population is unclear. The potential dismantling of the Department of Education is likely to have a wide range of unforeseen effects. Conversely, economic and job disruptions may mitigate any enrollment declines. A renewed appreciation for higher education and its role in society has the potential to reach more adult, nontraditional, and returning students beyond the traditional young adult population. With our history of serving nontraditional students and meeting students where they are, we could be well positioned.

Any commitment to a multi-year budget forecast at this time would be foolhardy. I can, however, commit to providing you with timely updates and an inclusive process for gathering our campus community’s ideas. The two financial foresight sessions conducted in early December generated a wide range of innovative ideas, and we are scheduling additional sessions on April 8 (12:30 to 1:30 p.m. for faculty in the Lectures Landing Zone in Learning Commons) and April 14 (2 p.m. via Zoom). Stay tuned for more details.

In addition to unit-specific updates by members of the Budget Allocation Review Committee (BARC), which launched in September 2024 to explore the university's budget model, I welcome your engagement at upcoming campuswide informational sessions. The in-person and virtual options are listed below.

• April 3 from 2 to 3 p.m. (virtual)
• April 30 from 9 to 10 a.m. (Business School, Room 2007)
• May 1 from 2 to 3 p.m. (virtual)

To register for these sessions, please follow this link.

As always, I welcome your thoughts and constructive suggestions through email at [email protected].

And finally, thank you to everyone reading this message, in whatever capacity you contribute to CU Denver’s mission and strategic goals. You are a link to the enduring legacy of the 50-plus years of CU Denver’s service to our students, their families, and the state of Colorado, and we collectively will meet this moment!

Warm regards,

Ann Sherman 
Executive Vice Chancellor for Finance and Administration