September 9, 2025

Dear Corey:

     During my convocation speech, I said that I would provide you with more information about our process to develop a stable, long-term operating budget. I send this email to share that information with you.

     In late April 2025, the General Assembly approved, and Governor Braun signed, the state’s budget for the next two fiscal years—FY26 and FY27. Because of a dismal revenue forecast released by the State Budget Committee in mid-April, the final state budget included significant reductions in operating appropriations for all Indiana public colleges and universities. Specifically, the state’s biennial budget reduced every institution’s operating appropriations by 5%, and the enacted budget allowed Governor Braun to hold back an additional 5% of every institution’s operating appropriations.

     For our University, the total amount of these two reductions is approximately $14 million in state operating support in both FY26, the current fiscal year, and FY27, the next fiscal year. Given the current uncertainty in the economy, we must assume that this substantial funding will not be restored in future years.

     In June, notwithstanding this significant and unanticipated challenge, we were able to develop a balanced operating budget for this current fiscal year without taking some of the immediate expense reduction steps that other institutions in Indiana took, such as eliminating vacant positions and laying off current employees, because of our history of fiscal discipline and our strong long-term financial position. One consequence of this approach, though, was that we were not able to fund recurring salary increases for our faculty and staff. But we were able to fund a meaningful one-time salary supplement, which will be distributed to eligible employees in the next few weeks.

     Now, though, we must engage in a process to develop a balanced operating budget for the next fiscal year. Our target is to reduce annual recurring operating expenses by at least $10 million and, preferably, by as much as $12 million. My expectation is that, if we meet this target, we will have the capacity to provide recurring salary increases in FY27 and in the following years. That objective is vital to our future success.

     As we embark on this process, I have also identified four guiding principles:

     You will have an opportunity to participate in this consultative process. Specifically, every vice president and every academic dean will engage the people in their division or their college during September and October. They will invite you to suggest new ways to reduce operating expenses, while sustaining the commitments that I have identified. I will defer to the vice presidents and the deans, though, to determine the appropriate mechanism for this consultation in their area.

     Later this semester, the vice presidents will share with me the recommendations that they have developed as a result of this consultative process. Then, early in 2026, I will incorporate their recommendations into a proposed FY27 operating budget, which we will present to the Board of Trustees.

     As I said during my convocation speech, we are well prepared to meet this challenge, because we do so from a position of strength. And our greatest asset is our people—our faculty and staff. I look forward to your participation in this important process.

Sincerely,

Geoffrey S. Mearns
President
Ball State University