Minnesota State approves plan to use community college funds to help struggling universities

On Wednesday, Minnesota State’s Board of Trustees approved a plan to transfer up to $25 million annually for the next four years to universities facing financial difficulties. The funds will primarily come from peer institutions, mainly two-year community and technical colleges.

For the fiscal year 2028, $10 million will be allocated to St. Cloud State University and $4.8 million to Bemidji State University. The proposal aims to provide a temporary solution to the immediate challenges faced by these two universities, which have already implemented significant cuts to staff, academic programs, and other expenses.

Michael Berndt, president of two community colleges in the Twin Cities suburbs, expressed concern over the situation at his institutions, noting that they have experienced layoffs, larger class sizes, and deferred maintenance. He emphasized that the reductions in funding are demoralizing for employees and have led to a significant reduction in allocation dollars.

The 26 colleges and seven universities that make up the Minnesota State system are expected to contribute a portion of their funds to an emergency support system to assist the struggling universities. Institutions with lower cash reserves will contribute less, and St. Cloud State and Bemidji State will be required to create financial recovery plans.

St. Cloud State University has already reduced its workforce by 40% over 15 years, suspended admission to nearly 200 academic programs, and taken a $2 million loan from the system office. The university will deplete its reserve funding pool by this summer.

Among the institutions contributing funds to the emergency system, Minnesota State University-Mankato would provide the highest amount, $1.8 million. Edward Inch, president of Minnesota State University-Mankato, acknowledged that the system is "spread very thin" and that all institutions have had to make difficult and painful cuts.