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ACHE requesting $2.1B for colleges, universities in 2025

Citing increased salary and insurance premium costs and needed capital improvements, the Alabama Commission on Higher Education is requesting $2.12 billion in state funding in fiscal 2025.
That’s a $135.81 million, 6.84% increase over the current year.

“The state’s colleges and universities are facing budget challenges associated with inflation that is impacting many aspects of campus operations,” ACHE Executive Director Jim Purcell said in a recent statement.

In budget hearings last month with the ACHE board, leaders from several universities shared concerns about increases in insurance premiums, inflation, deferred maintenance and competition with the private sector for faculty and staff.

“Common themes seem to emerge from these hearings each year, and increased mandatory costs like rising property insurance premiums, software subscription costs, and retirement contributions were a regular discussion topic this year.” ACHE Finance Committee Chairman Stan Nelson said in a written statement after last week’s recommendation vote.

The request comes as revenues in the Education Trust Fund flatten after pandemic-related spending surges. Lawmakers are warning state agencies funded in the ETF and General Fund not to expect significant allocation increases in fiscal 2025.

According to ACHE, colleges and universities are estimating capital project needs that exceed $3.24 billion, 63% of that being new construction.

More than 37% of the square footage used by public colleges and universities was constructed between 1960 and 1989. An additional 12.5% was constructed before 1960.

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