Governor Lee presented his 2022-23 budget to the Tennessee General Assembly last night.  We have conducted a preliminary analysis of the details of the Governor’s Budget and I wanted to outline how his proposed budget could affect our University, if approved by the General Assembly.

Highlights of the budget as they relate to MTSU’s institutional needs and priorities are as follows:

• Net operating appropriations, which includes adjustments made through the funding formula, will increase by $7.5million.  The University will receive an additional $1.2 million to cover group health insurance premium increases for a partial year.

• The Governor’s Budget included partial funding for a 4.0 percent salary pool for MTSU in the amount of $4.6 million.As in years past, this is only partial funding, and the University would need to fund the remaining pool from other revenue sources.   In the current budget, which keeps tuition and fees flat at higher education institutions, the additional funding would have to come from operating appropriations.  We are in the process of obtaining additional clarification on the salary pool requirements.

• The Governor recommended $1.11 billion in capital improvements funding for all of higher education. These investments mark the largest investment in capital in the State’s history.Included in this recommendation is the renovation project for KOM and Rutledge Hall, which has a total project budget of $54.3 million (includes $2.4 million in University required matching funds).  In addition, MTSU is scheduled to receive funding for an Aerospace Campus totaling $62.2 million, which includes $5.0 million in University matching funds.  In total, this will be $116.5 million in new capital projects for the University with over $109 million funded with new capital appropriations.

• Following last year’s largest capital maintenance budget in state history, the Governor is recommending $108.2 million in capital maintenance funding for higher education, which includes funding for five (5) projects submitted by MTSU for a total of $7.16 million.These projects include lighting and lighting control updates, building mechanical and controls updates, campus wide access control and security updates, elevator modernization, and building exterior updates.

• Non-recurring funding of $2.0 million was included in the budget for MTSU to assist with a 3+4 partnership we have with Meharry Medical College for a fast‐track program for select, qualified students to receive both an undergraduate degree from MTSU and a medical degree from Meharry.The funding is earmarked for financial aid for the students in this medical education program.

• Funding of $170 million for an upgrade to the Enterprise Resource Planning (ERP) systems at the state’s public higher education institutions was also included in the budget.MTSU will have access to $20 million of this funding for upgrading the campus ERP system.

 Other items indirectly affecting the University include the following:

• The GIVE HOPE Expansion Act of 2022 will increase the maximum annual HOPE award to $5,100 for students at four-year institutions and to $3,200 for students at two year institutions. The Act will also expand access to dual enrollment courses for high school students through the GIVE program, lower the age to qualify for Tennessee Reconnect to 23, and expand eligibility for the HOPE nontraditional and HOPE Foster Child Tuition programs.

• Provides non-recurring funding to increase the 401(k) match for one year at 2:1 for first $50 employee contribution.

As a result of the level of appropriations included in the Governor’s Budget, tuition and fees at higher education institutions will remain flat in the 2022-23 academic year.

As the General Assembly debates the final budget, we will continue to review additional information as it becomes available and incorporate the impact into the University’s budgeting process for the upcoming year.  As future developments are known, I will keep the campus updated on the Legislature’s actions.

Sincerely,
Sidney A. McPhee
Sidney.McPhee@mtsu.edu