As inflationary pressures, an enrollment cliff, and stagnant state appropriations squeeze the University of Iowa from all sides, the state’s largest public university will see a 2.5% general education spending increase in the coming fiscal year.
The Iowa State Board of Regents is set to give final approval to the University of Iowa’s budget for Fiscal Year 2027 — which began on July 1 — at its next meeting on Wednesday, July 29. Here’s what to know:
Tuition increase adds $22 million bump to UI’s general education fund
The UI’s general education budget is predicted to grow by roughly $22 million after the regents approved a 3% tuition increase for undergraduate students in April. This brings the UI’s total revenue in its general education budget to $893 million in Fiscal Year 2027, up from $871 million in Fiscal Year 2026.
The increase will bring the total tuition revenue to more than $602 million, which makes up 67% of general fund revenue. State appropriations remained the same at $223 million, accounting for only 25% of the university’s total general education revenue. This is down from 25.7% of general education revenue in the previous fiscal year.
The increase in revenue is matched with a rise in spending, particularly tied to salary, supplies, and building repairs.
Salary spending will increase by $15.2 million in Fiscal Year 2027, a 2.7% increase from last fiscal year. During a presentation to the regents in April, Terry Johnson, the UI”s chief financial officer, said the university is facing competition for faculty and providing adequate yearly raises helps them retain staff. Currently, they have a 95% retention rate, he said.
Supply costs are increasing by $1.4 million, due to inflationary pressures, according to a regent memo. These same pressures are increasing building repair costs by $5.6 million.
According to the Bureau of Labor Statistics’ Consumer Price Index, a tool used to measure the inflation an average consumer would pay, inflation has risen prices by 3.5% since last July.
Inflation, along with an enrollment cliff — an enrollment trend that shows the U.S. has a large decline in college-age students — has forced the University of Iowa to shore up a several million dollar budget gap. Johnson said in April that realigning staff and improving operational efficiency across the unviersity has been a priority.
State appropriations prop up Center for Intellectual Freedom in year two
The burgeoning Center for Intellectual Freedom is entering its second year.
Recent reporting from the Cedar Rapids Gazette shows that the interim director, Luciano de Castro, is running into systematic and bureaucratic barriers in his efforts to get the center off the ground due to the unique governance structure dictated in the law.
The center was the work of Iowa Republican lawmakers, who in 2025 passed a state law that requires the regents to establish a Center for Intellectual Freedom at the University of Iowa.
The center struggled with enrollment in its first year, only offering two classes in March, and no classes appear to be scheduled for this fall. Center staff has not responded to the Press-Citizen’s request for comment.
The $1 million appropriation will fund the interim director’s salary as the center’s advisory board scrambles to hire a permanent director.
The center is also tasked with administering two new civics courses in the fall of 2028, after state lawmakers mandated the courses for UI undergraduates.
More than $600,000 of the $1 million goes towards salaries, including the salary of the center’s few administrative employees. The remainder will be used for guest speakers, marketing, and office supplies.
The Regents on Wednesday will also vote to approve the creation of a new Center for Intellectual Freedom committee, which will have direct oversight of the center.
UNI sees $2.9 million decrease in general education budget
Despite a 3% tuition increase, the University of Northern Iowa is expecting a $2.9 million decrease in the general education budget for Fiscal Year 2027, due to flat state appropriations, increasing costs, and declining enrollment.
According to a budget memo, UNI is expecting enrollment to decrease by 119 students in the coming year.
UNI made nearly $7.7 million in reductions and reallocations by eliminating mostly vacant positions. Though UNI staff still saw pay increases, total salary costs dropped by 3.6%.
(This article was updated to include a gallery.)
Liam Halawith covers Johnson County local government, the University of Iowa, and crime for the Press-Citizen. Reach him by email at lhalawith@registermedia.com. Follow him on X at @liam_halawith.
This article originally appeared on Iowa City Press-Citizen: University of Iowa budget grows by $22M as tuition hike lifts revenue
Reporting by Liam Halawith, Iowa City Press-Citizen / Iowa City Press-Citizen
USA TODAY Network via Reuters Connect
By Liam Halawith, Iowa City Press-Citizen | USA TODAY Network
