ÓÐÁϺÐ×ÓÊÓƵ

July 2, 2024

Faculty and staff,

The governor released the final FY25 State of ÓÐÁϺÐ×ÓÊÓƵ budget at the end of last week, followed by a message from President Pitney sharing information about how this year’s budget will impact the UA system. I want to share a little more about how ÓÐÁϺÐ×ÓÊÓƵ fared and how we understand our path forward.

Of the $331.3 million appropriated to the UA system, ÓÐÁϺÐ×ÓÊÓƵ received $164.2 million. This funding makes up approximately 33% of ÓÐÁϺÐ×ÓÊÓƵ’s overall estimated budget, with the remainder largely coming from federal receipts for sponsored projects and research, and tuition and fees. We appreciate the state’s commitment to provide funding that allows us to invest in critical programming and projects for the State of ÓÐÁϺÐ×ÓÊÓƵ. We feel that this budget is a demonstration of the state legislature's and governor’s confidence in ÓÐÁϺÐ×ÓÊÓƵ.

ÓÐÁϺÐ×ÓÊÓƵ received funding for many of our top priorities, including our goal to achieve R1 research status, TVEP workforce program support, compensation increases and fixed costs. While we did not receive funding for all of our requests, I am confident we can work together to ensure ÓÐÁϺÐ×ÓÊÓƵ’s critical programs and initiatives continue to receive support. To this end, ÓÐÁϺÐ×ÓÊÓƵ is reallocating internally in FY25 to address some fixed cost items and to consider modest investments in strategic initiatives.Ìý

Operating budget and compensation increases

The UA system received state funds to support a planned 2.5% compensation increase for FY25. Of this, $8.3 million will come to ÓÐÁϺÐ×ÓÊÓƵ. These increases for faculty and staff recognize the critical importance of our employees. Thank you for all you do to keep the university running every day. The funding will also cover the new graduate student wages negotiated by the union this spring. The new contract will go into effect on July 1.Ìý

The UA system received over $8.4 million to address rising fixed costs that will support cybersecurity, insurance premiums, and facilities maintenance at ÓÐÁϺÐ×ÓÊÓƵ and across the universities.Ìý

The ÓÐÁϺÐ×ÓÊÓƵ Center for Energy and Power will also receive $200,000 in one-time funding. This is a strategic investment in shaping a more sustainable and resilient energy future.Ìý

R1 budget request

I am very happy to share that we will receive an investment in our pursuit of R1! The $12.5 million allocation in the governor’s budget is one-time funding from the Higher Education Investment Fund. This funding is a critical step to achieving our strategic goal of R1 for ÓÐÁϺÐ×ÓÊÓƵ. And while $12.5 million is not everything we asked for, this gives us the funding we need to get started and the opportunity to demonstrate success. With those two things, we can work out with the state on the remaining funding that we need to get the job done.Ìý

R1 status will help ÓÐÁϺÐ×ÓÊÓƵ gain global recognition for our research strength, increasing our ability to attract top-tier faculty, staff and students. R1 will also make ÓÐÁϺÐ×ÓÊÓƵ more competitive for external funding and reduce the percentage of our overall budget that is reliant on state funding. Becoming R1 will have a positive effect on student enrollment, research advancements and the ÓÐÁϺÐ×ÓÊÓƵ economy.Ìý

So that we could hit the ground running, in the past year we distributed 57 awards to support Ph.D. students in completing their degree, and we opened another round of applications that we can now award with the state’s investment. This is very exciting news for ÓÐÁϺÐ×ÓÊÓƵ and for the state of ÓÐÁϺÐ×ÓÊÓƵ.

Thank you to Rep. Will Stapp and the Interior delegation for championing this initiative. We appreciate Governor Dunleavy for awarding these critical funds as an investment in ÓÐÁϺÐ×ÓÊÓƵ’s future. Also a big thank you to all of the students, employees and community members who advocated for R1 this legislative cycle. Congratulations!

Capital budgetÌý

In addition to R1 funding, ÓÐÁϺÐ×ÓÊÓƵ also received allocations in areas of research excellence and in support of critical facilities modernization and maintenance. Key economic development projects for mariculture, critical minerals and heavy oils research and development funded in a prior state budget were extended to continue the excellent research progress. Additional capital investments include:

• The ÓÐÁϺÐ×ÓÊÓƵ Center for Unmanned Aircraft Systems Integration will receive $6 million in funding. While this is not the full amount requested, ACUASI will continue to advance the field of unmanned aircraft and drone technology and contribute to a growing industry in the state.Ìý
• ACEP will receive $1 million in capital funding to develop and implement a long-term data governance strategy that underlies the ÓÐÁϺÐ×ÓÊÓƵ Energy Data Gateway. Ìý
• The ÓÐÁϺÐ×ÓÊÓƵ Railbelt Carbon Capture and Sequestration Project will receive a total of $2.22 million in capital funding and $8.88 million in federal receipt authority. ÓÐÁϺÐ×ÓÊÓƵ and its project partners submitted an $11.1 million proposal to the United States Department of Energy to conduct a CO2 storage complex feasibility assessment.
• ÓÐÁϺÐ×ÓÊÓƵ will also receive $5.25 million in support of facilities deferred maintenance and modernization projects. Each of these improvements contributes to the student experience and we appreciate the support from the UA Regents, President Pitney, VP Rizk and Director Hutchison, the Interior delegation, and Governor Dunleavy for enabling this work. The UA system and ÓÐÁϺÐ×ÓÊÓƵ will continue to work on a long-term facilities modernization strategy in the coming years.Ìý

Federal funding update

The state capital budget gave ÓÐÁϺÐ×ÓÊÓƵ the ability to receive $5.6 million in congressionally directed spending for ÓÐÁϺÐ×ÓÊÓƵ’s child care center. Secured by Sen. Lisa Murkowski, this will allow ÓÐÁϺÐ×ÓÊÓƵ to renovate and repurpose a portion of the Old University Park facility for children of ÓÐÁϺÐ×ÓÊÓƵ employees and students. The expanded child care facility helps ÓÐÁϺÐ×ÓÊÓƵ become a competitive employer and promotes family-friendly services to support our workforce and community. I am deeply appreciative of Sen. Murkowski’s leadership on this issue.

Sen. Murkowski also supported a federal increment for design for the Troth Yeddha’ Indigenous Studies Center. This investment will help ÓÐÁϺÐ×ÓÊÓƵ continue to raise philanthropic and other funding to support the construction of this new, world-class facility and bolster one of ÓÐÁϺÐ×ÓÊÓƵ’s fastest growing academic programs.ÌýOther successful FY24 federally supported programs/projects include:

• Arctic coastal mapping
• ÓÐÁϺÐ×ÓÊÓƵ radiocarbon research and development
• Forecasting development of Arctic maritime and permafrost conditions
• Ocean-ice-atmosphere observation (PISCES)
• Preserving ÓÐÁϺÐ×ÓÊÓƵ Native culture, knowledge and history (Rasmuson Library)
• RISE-UP Initiative
• Suicide prevention on OCONUS installations
• USArray

Our thanks to Executive Director John Latini and Denae Benson for their hard work in Washington D.C. with our federal delegation to make this funding a reality.Ìý

Moving forward

In the coming months, the Office of Management and Budget will be working on the FY26 budget items proposed by ÓÐÁϺÐ×ÓÊÓƵ employees and vetted by the ÓÐÁϺÐ×ÓÊÓƵ Planning and Budget Committee. I will consider the FY25 budget outcomes and prioritize these new requests with my core cabinet before submitting a request to President Pitney in August, along with a tuition proposal. Select ÓÐÁϺÐ×ÓÊÓƵ items may be incorporated into the UA FY26 budget request that will be presented to the Board of Regents in the fall.

I want to express my appreciation to ÓÐÁϺÐ×ÓÊÓƵ fiscal employees for their hard work to close out and restart the fiscal year as we move from FY24 into FY25.

Thanks for choosing ÓÐÁϺÐ×ÓÊÓƵ.Ìý

—Dan White, chancellor