Dear Colleagues,

After months of strategic planning, collaboration, consultation with shared governance groups and difficult decisions, NIU leadership presented the FY27 budget plan to the NIU Board of Trustees today, and it was approved. Guided by a commitment to academic quality, student success and fiscal responsibility, the university has moved from a structural deficit of $30.4 million in FY24 to proposing balanced budgets for both FY26 and FY27. These results reflect NIU’s commitment to disciplined stewardship of resources, process improvements, position and spending controls, strategic investments and a continued focus on aligning resources with institutional priorities. Closing FY26 and FY27 without a structural deficit will require sustained effort and agility to execute the approved budget plans.

A few weeks remain before the close of FY26 on June 30, and your continued assistance is critical to achieving a balanced budget consistent with what was approved. As Illinois is working to close its fiscal year, the Office of the Governor is currently withholding 2% of NIU’s FY26 appropriation, approximately $2 million. This action applies to all public universities in Illinois. If these funds are not released before the end of the fiscal year, achieving a balanced FY26 budget will be significantly more challenging and may require the university to take additional mitigation measures.

Therefore, now is not the time to spend down remaining budget balances. All non-essential expenditures should be deferred unless they are necessary to support critical university operations, compliance obligations or immediate student needs.

The Illinois General Assembly concluded its spring session on May 31, and Gov. Pritzker is expected to soon sign into law the State’s FY27 budget where NIU will receive an appropriation of $104.7 million for operating expenses. This represents a 1% increase over FY26.

As many of you are aware, NIU and the state’s public universities, with the exception of the University of Illinois System, have been tirelessly advocating for adequate and equitable funding for higher education. We appreciate your advocacy and support for the proposed legislation which would establish a formula-driven approach to state appropriations funding based on factors that include enrollment, academic program offerings, research intensity and the socio-economic and demographic characteristics of students. If enacted, the model would directly improve access, persistence, completion and workforce readiness across Illinois. We are disappointed that the legislation did not advance before adjournment but encouraged by the positive conversation around higher education. Increasingly, policymakers across Illinois are recognizing the need for a more equitable and sustainable approach to supporting our institutions and the students we serve. We remain optimistic and committed to advocating for change in the methodology for funding Illinois public universities.

The FY27 budget also accounts for existing contractual compensation obligations for employees represented by unions or other legally recognized collective bargaining groups, as well as a 2% increment for all eligible non-represented staff and faculty effective July 1. The Board also approved a new, three-year agreement with the NIU Instructors’ Unit, Local 4100 of the University Professionals of Illinois (UPI). We greatly appreciate the feedback from shared governance that helped ensure the increment for non-represented staff, as well as the respectful and productive bargaining process with UPI that occurred throughout the academic year.

NIU has made significant investments in employee compensation annually for eight of the last nine years. Doing so reflects leadership’s commitment to investing in employees, but the costs of doing this, combined with increasing costs of technology, energy, transportation, student services and more, have grown to a point where the university’s expense budget is unsustainable without savings through position control, restructuring, shared services and position eliminations.

Division budget plans and university-wide shared services plans that have been in development throughout the academic year are being finalized for implementation in the first quarter of FY27. Change is necessary and our ability to move forward is a credit to the hard work of colleagues across the university who have used their time and expertise to develop the most strategic approach.

The Academic Planning Council, the President’s Budget Roundtable, the University Council’s Resources, Space and Budget Committee, and the University Advisory Council have provided invaluable candor, feedback and perspective on the budget process, strategies and what’s necessary to move NIU forward. Collectively they have challenged university leadership to address NIU's structural budget gap by prioritizing mission-aligned activities, reducing spending on lower-priority functions, and pursuing meaningful operational transformation rather than relying on recurring incremental cuts. Their feedback helped shape the FY27 budget and will play an important role in shaping decisions as we begin planning for FY28 this October. 

Thank you all for the extra effort, creativity and collaboration you continue to bring to your work despite ongoing resource constraints.

Together Forward,

Lisa C Freeman
President