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Minnesota Senate approves $2.5 million in funding for UMD

DULUTH -- The Minnesota Senate has designated $2.5 million for the University of Minnesota Duluth in its finance bill.

UMD faces a $9.4 million recurring budget deficit and a $3.9 million one-time shortfall.

The amount is a recognition by the Senate that UMD has budget issues because of the way its revenue stream is structured, said Sen. Roger Reinert, DFL-Duluth.

“It’s just so tuition-driven,” he said. “With enrollment coming down from historic highs, that’s left this budget gap. And UMD is an undergraduate-heavy campus, which is a part of it as well.”

UMD’s financial troubles come from a reduction in the amount of state money doled out by the University of Minnesota, a drop in enrollment beginning in 2011 and a fringe benefit problem discovered last year that dates back several years. Its nonrecurring $3.9 million budget deficit comes partly from drawing down that fund to pay for items out of the recurring budget, said UMD Chancellor Lendley Black. The nonrecurring fund pays for things like equipment and special projects. The recurring fund pays for salaries, for example.

The idea for the money comes from higher education committee chairwoman Sen. Terri Bonoff, DFL-Minnetonka, Reinert said, and would be a one-time allocation to help UMD “transition through this period.” While lawmakers can specify where within the University of Minnesota system they would like money to go, they ultimately cannot tell the U of M how to spend it.

Gov. Mark Dayton proposed $5 million for the university in March. The House of Representatives has not included money for UMD in its budget proposal. The entities will negotiate before the session ends in May.

Black said he was “very pleased” that the Senate is interested in supporting UMD. He said he’ll continue to talk with members of the House and Senate and the governor’s office about UMD’s needs. If money comes through, he said, it probably would be used to help pay down UMD’s one-time deficit.

“We’re working toward being less tuition-dependent,” Black said. “Part of our collaboration with the University of Minnesota is figuring out ways to do that. … This situation we are in was not created overnight, and we are not going to solve it in one year.”

Already, more than 60 employees have taken voluntary layoffs as part of a budget reduction plan. Cuts across the university have been proposed, including cuts to academics. The elimination of graduate music and political science programs are among them. A more detailed plan will be released next week.

Reinert said UMD students “get a lot of credit” for UMD’s inclusion in the bill, noting the school’s Bulldog Day brought down many people from the university.

“UMD has done a great job of telling their story,” he said.