Like many major organizations, MSU operates on a specific, given budget. Funding for the university is comprised of money from the state of Montana and from student tuition and fees, which together make up the general fund. MSU has a general fund budget of $178,579,474 for the 2013 fiscal year. MSU is a non-profit organization, meaning that it utilizes all of the funds it receives each fiscal year.
Annually, the State of Montana designates a sum of money to the Montana University System (MUS). The MUS consists of four MSU campuses, four University of Montana campuses and three community college campuses. The amount of money allocated each fiscal year is based on the availability of funds. The MUS can submit inflationary increases to the state. While the state takes these into account, they make their final decision based on budget flexibility.
Vice President of Administration and Finance Terry Leist explained that in Montana, state funding makes up a larger portion of the overall budget than in many other states. “Our tuition is fairly low on a national basis, and that is because we get good state support. We get 30 percent of our general fund from the state, which is higher than many states.”
In addition to receiving a portion of the general fund from state funding, MSU acquires revenue from student tuition and fees. State funding has a direct influence on tuition for resident students. “Two out of the last three biennials we’ve had no tuition increase for resident students. There are no increases for resident students this year or next year,” Leist said.
Recently, the difference between the amount of revenue that comes from state support and from student tuition has been increasing. Over the past 20 years, the ratio of state funding to tuition revenue has decreased significantly. In 1993, state funding accounted for 68 percent of the general fund. This year, state funding accounts for only 29 percent.
Once the general fund is established, The Board of Regents (BOR) then divides it among the 11 Montana colleges. Leist explained that MSU and the University of Montana receive a bulk of the funding. “It is pretty even, about 50/50 overall. They’ve got 4 campuses and we have 4 campuses.”
The division of the general fund is based on a three-year average resident full-time equivalent (FTE). FTE accounts for the number of full-time students enrolled on a campus. A full-time student is defined as an undergraduate student enrolled in 15 credits or a graduate student enrolled in 12 credits. As such, FTE is calculated by taking the cumulative number of credits in which the student body is enrolled divided by 15 for each undergraduate student and by 12 for each graduate student. For the 2013 fiscal year, MSU-Bozeman has an FTE of 12,910, which makes up 84 percent of total enrollment. This is due to the fact that not all MSU students are considered full-time. Comparatively, the University of Montana has an FTE of 11,937.
The general fund is budgeted across the following categories: waivers and scholarships, instruction, research, public service, academic support, student services, institutional support and facilities.
Certain programs at MSU are not supported by the general fund. Auxiliaries is a department that acquires its own resources through student housing fees and other fees. Auxiliaries uses this money for the expansion and maintenance of residence halls, dining halls and parking services.
Research is federally funded at MSU, and faculty apply for grants to fund their research expenditures. Research funding is used solely for the purpose which it was designated. For the 2012 fiscal year, MSU received about $94,000 for research. Leist explained that a majority of this money came from the federal government with a smaller portion from state and private entities. For the 2014 fiscal year, MSU’s proposed research budget decreased by 47.17 percent — from $2,370,272 in 2013 to a requested $1,252,314 for 2014.
Instruction: This includes money to fund classes taught — including paying the salaries of teachers and expenditures for department chairpersons.
Research: While a majority of MSU research is federally funded, a portion of its funding is derived from the general fund. The Agricultural Experiment Station receives the largest sum of research money from the general fund.
Public Service: Money in this category is used to fund community services, public broadcasting, and extension services. The MUS Extension Service provides academic support to communities across the state.
Academic Support: Academic support funding is used to improve the success of higher education. Money goes towards services such as curriculum development and academic administration.
Student Services: Student services include career guidance, financial aid administration, student recruitment, counseling and student records.
Institutional Support: Money in this category funds faculty support, alumni relations and a variety of other administrative tasks.
Facilities: This category includes building repair and maintenance, custodial services, landscaping and utilities.
Waivers and Scholarships: Fee waivers authorized by the BOR are recorded in this category.