FY26 Budget: FAQ

The University System of Maryland has received a $155 million cut from the State. In an effort to account for a $3 billion budget deficit, the State of Maryland has issued sweeping funding cuts across all state agencies, including higher education.

While the exact figure for SU’s portion of the $155 million cut won’t be known until the USM communicates with individual institutions regarding their share of the cut, we must prepare for the worst-case scenario. Everything we have received from the State of Maryland and the USM to date indicates our share of the cut is projected to be approximately $10 million for the upcoming fiscal year (FY26), which is a 4.6% cut to our originally proposed budget.

Several factors have contributed to this financial challenge:

• State Budget Deficit: Maryland’s fiscal shortfall has led to the reductions in state allocations for SU.
• Enrollment Declines: Our student enrollment has declined by more than 18% over the last 10 years.

• Rising Costs: Personnel costs have increased more than 33% since FY15, and inflation has driven up costs of utilities, construction, and other services.

When the likelihood of a significant budget cut to the USM ($111 million) was announced initially in January, SU began analyzing the best way to weather its portion of that cut. However, an additional cut of $44 million, on top of the cut from January, was announced at the very end of Maryland's legislative session.

• SU was not aware of the size of the new cut the State of Maryland made to USM's FY26 budget until April 7.
• USM institutions were then instructed to submit reduction plans based on the new budget landscape by April 30 – giving SU's finance team only three weeks to work out a plan that meets requirements while maintaining a level of collaborative planning among the divisions, deans, budget administrators, etc.

• For more information on how budget changes were shared, visit the Budget Engagements page.

Over the past several months, financial analysis and planning has been conducted by the budget office, Admin and Finance leadership, and a faculty fellow.  The analysis highlighted areas for operational efficiencies and provided recommendations for how the cuts could be best tolerated across the University.  Based on this information, it was discovered that cuts proportional to each division would allow us to meet our $10 million goal without creating significant harm or damage to any one unit, which would adversely impact the student experience.

We recognize that academics is our core mission as a university.  Our analysis showed that Academic Affairs had the greatest areas for opportunity to find operational efficiencies that would not impact students, services or programs.

• While our reserves provide a financial safety net, they are a one-time influx and are not a sustainable, multi-year solution for ongoing, structural budget gaps. Reserves must be maintained and USM policy requires us to contribute $2.3 million to our fund balance in FY26.
• We can only advocate for and request to use money from our fund balance after we demonstrate all other efforts were made to reduce costs.

• Of the funds held by the SU Foundation, very little is discretionary. Most of the money managed by the Foundation is being managed for a donor towards a particular purpose (ex. Scholarships, Restricted Endowments).
• Similar to using reserve funds, using any money from the Foundation would be a one-time solution and not help create a sustainable budget/path forward.

Our mission is to provide affordable access to higher education. We are mindful of the financial burden on students and must remain competitive with peer institutions. Although incremental tuition increases may occur, they cannot fully offset the budget reduction without negatively impacting enrollment and retention.

• While other institutions are raising tuition and housing costs beyond the USM-approved rate, SU has elected to implement a tuition increase at 2% for in-state students and 3% for out-of-state students, choosing not to increase tuition beyond the approved limit. This equates to a tuition increase of approximately $80 per semester for in-state students in the 2025-26 academic year.

• Most capital projects are funded by restricted dollars that cannot be used for operational expenses and employee salaries or benefits.
• The USM requires a certain amount be spent on facilities renewal projects. This is to ensure our existing facilities remain operational for the benefit of our students and employees. Facility maintenance is essential to avoid higher costs and safety issues in the future.
• Some of these projects generate revenue to support the University.

• No, there are no plans to defund student activities or organizations or use student activities fees for other than their intended purpose, including for Inclusion, Access and Belonging-related services.

• Furloughs offer only short-term, one-time savings. Furloughs also risk harming morale, disrupting academic operations, and triggering complex union negotiations.
• Our goal is to protect and prioritize our people as much as possible.

• These types of programs require Board of Regents approval. It is something that SU is considering. We are currently weighing the benefits versus risks.
• There are significant upfront costs for the incentives, so it is uncertain how much such a program would benefit the University’s FY26 budget.

• The Centennial is a once-in-a-lifetime event and a key marketing opportunity. While mindful of current budget constraints, the planning committee has strategically invested to raise visibility, strengthen community ties, and attract additional support for the University.
  • The initial investment was allotted in FY25 for the Centennial. No additional funding will be provided in the FY26 budget.
• We are creating a destination experience to drive engagement and awareness. Signature elements like the Ferris Wheel – made possible by sponsors and the SU Foundation – serve as anchor attractions and social media-friendly features that generate excitement, attendance, and long-term brand impact.
  • These donors and sponsors earmarked their donations for specific areas, meaning that this donated money is not eligible to be allocated and spent elsewhere.
• Many Centennial activities will tie into events that occur regularly on campus, allowing them to be held at no additional cost.

• We received feedback from our higher-education accrediting agency during an external review process to adjust the student-to-faculty ratio. Doing so will still allow us to continue offering and developing programs that meet workforce and regional needs while continuing to provide students with a wide variety of course options.
• According to the external review, SU's student-to-faculty ratio is well below the expected ratio compared to our public regional comprehensive peer institutions.
• SU's current student-to-faculty ratio is 14:1 – with the target, based on feedback, to adjust to 18:1.

• Student-to-faculty ratio is calculated by dividing the total number of full-time equivalent (FTE) students by the total number of full-time equivalent (FTE) faculty.

• FTE Student (Full-Time Equivalent Student):
  • The FTE student is a metric used to standardize the number of students by accounting for both full-time and part-time enrollment. It is calculated as follows:
  • A full-time student counts as 1.0 FTE.
  • Part-time students are converted to a fraction of FTE.

• FTE Faculty (Full-Time Equivalent Faculty):
  • The FTE faculty is a measure that standardizes faculty workloads by combining full-time and part-time faculty members into a single metric. It is calculated as follows:
  • A full-time faculty member counts as 1.0 FTE.
  • Part-time faculty members are converted to a fraction of FTE.

• As part of a broad set of strategies to find efficiencies in academic affairs, balancing the quality of education and ensuring that faculty can still engage meaningfully with students, deans and department chairs are working to increase the minimum class size to 18 where possible and pedagogically appropriate.

• This does not mean that every class will meet this minimum. Some courses will have lower course minimums based on classroom size, accreditation requirements, pedagogical needs, or another exceptional circumstance.

• There are benefits to increasing course minimums. Increasing the target for course minimums can help ensure that faculty time is used efficiently, avoiding underutilized teaching capacity and leading to a more balanced distribution of workload across departments. Increasing the target for course minimums can also help ensure that there are more seats for students in the courses they need.

• It is important to note that class sizes and student-to-faculty ratios are two different measures. A course minimum is a benchmark for course viability and avoids under-enrolled courses. Student-to-faculty ratio reflects overall staffing levels relative to the student body, independent of individual class size.

• It is also important to note that a targeted course minimum is just that, a minimum. We will continue to offer courses with much higher max seats.

• Looking ahead, Maryland’s budget outlook is expected to remain challenging over the next few years. While the FY26 budget is expected to close the current deficit, it leaves a $300 million projected deficit that legislators will need to address in FY27.

• Due to several factors, the General Assembly added triggers to the FY26 budget that may result in a special legislative session to consider additional budget cuts to the FY26 budget later this year.
  • While this does not necessarily mean additional cuts to the USM or SU, we must be prepared for these additional cuts.

• Because of Salisbury University’s longstanding fiscal stewardship, we are in a strong position to handle these cuts in ways that some institutions are not.