UW-Madison Chancellor Jennifer Mnookin is directing schools and colleges to reduce their base budgets by 5% for fiscal year 2025-26, citing uncertainty at the federal and state levels.

Mnookin wrote in a communication to faculty and staff yesterday that changes in how much the federal government will reimburse the university for administrative costs related to research could cost the campus $65 million to $130 million, and possibly more.

“We believe that by implementing these reductions now, we will be significantly better positioned to navigate the challenges ahead together,” Mnookin wrote.

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In March, Mnookin directed campus leaders to implement cost-saving measures.

Those included a reduction in non-essential spending for the remainder of 2024-25 as the Trump administration took steps to reduce federal money for research on campuses, including the overhead it would cover. At the time, she asked campus leaders to be prepared for a reduction in 2025-26 in the range of 5% to 10%. She noted in yesterday’s message the final number was on the lower end of that ask.

Along with schools and colleges reducing their budgets 5%, administrative and other units were directed to cut them by 7% in the coming fiscal year.

In addition to what’s happening at the federal level, Mnookin’s communication comes as work on the budget has hit an impasse in the GOP-controlled Legislature. 

Senate Majority Leader Devin LeMahieu, R-Oostburg, on Thursday said his caucus had pulled back from renewed talks with Assembly Republicans and Gov. Tony Evers because “these discussions are heading in a direction that taxpayers cannot afford.” Assembly Speaker Robin Vos, R-Rochester, and Joint Finance Co-chair Mark Born, R-Beaver Dam, invited Senate Republicans to come back to the table as their caucus had “chosen to work together so our tax reductions actually become law, schools continue to be funded, Medicaid patients continue to receive care, and road construction projects do not stop.”

Joint Finance hadn’t yet posted a notice of its next public meeting since canceling Thursday’s votes, and the offices of the committee co-chairs didn’t immediately respond to a message seeking comment.

Before talks broke down, Republican lawmakers were discussing an $87 million reduction in state aid to the system, drawing opposition from Evers.

“This is among the many reasons Gov. Evers has said cuts to UW are a nonstarter in this biennial budget and why he continues to urge Republican lawmakers to make real, meaningful investments in our UW System,” said Evers spokesperson Britt Cudaback.

Mnookin’s message laid out a number of financial challenges at the federal level, including:

  • More lost federal grants; Mnookin wrote the campus has seen more than 90 awards terminated since January or receive a stop work order.
  • Questions about international students’ ability to study in the U.S.; she wrote that could impact enrollment. The university said it had 7,626 international students — about 15% of total enrollment — in the 2023-24 school year.
  • Changes to federal aid, including Pell Grants, that could impact students.
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