“Nearly half of the revenue to support the institution's operation comes from student tuition fees and state appropriations for the coming academic year,” Pierce said.

The deficit was attributed to unclear state appropriations. The Michigan Legislature has yet to finalize the budget for public universities in the state, meaning the budget passed by the board is not informed by state funding. 

In April, House Republicans proposed a 62% slash to MSU state funding. The proposed budget set state appropriations to the university at $208.8 million, compared to the current fiscal year, when MSU received $333.7 million.

The board voted to raise tuition by 3.99% across the board. 

The resolution passed 4-2, with trustees Rema Vassar and Mike Balow dissenting. Trustee Kelly Tebay Zemke did not attend the meeting.  

The 3.99% increase falls atop a 5% increase in housing and dining rates for the 2026-27 academic year that the board approved in April. 

This will equate to freshman paying $8,828, sophomores paying $9,023 and upperclassman paying $10,012 per semester for in-state tuition.

Changes to tuition rates may not be the end of fiscal changes for the university. 

“We know we have another year ahead of us with more tough decisions to make with our spending,” President Kevin Guskiewicz said.  

The vote falls amid negotiations between the Union for Tenure System Faculty and the university. The agenda says that the university does “anticipate” bargaining to begin in late June. 

During last year’s June meeting, the board increased tuition by 4.5%. That tuition hike equated to roughly $798 more per academic year for resident undergraduates.

The board also approved a $27.7 million expansion of their anaerobic digester and the addition of a renewable natural gas facility. 

The resolution lists that athletics will be in debt, though it is unclear by how much. The budget says that Spartan Ventures, the university’s new media company set to be launched on July 1, will help “eliminate the operating deficit.”  

These changes come as the university enacts its 9% budget cut plan over two years. In 2025, the board passed a 6% cut for the 25-26 academic year, followed by a 3% cut for 2026-27. 

"Higher education in this country has reached the point where the model is starting to crack in terms of how it's traditionally been funded and how it needs to be funded over the next 50 years," Balow said.

The university reports these changes are a reflection of changes at the national level. The resolution reads, “Changes to federal student loan policies are creating headwinds across higher education, although the full impact has yet to be realized. Professional and other graduate degree programs may be most at risk.” 

Changes to budget and tuition rates were made public the morning before the vote took place. It was the only action item not made public before the meeting.

"I know that these proposed changes will have a meaningful impact on our students and their families," Trustee Sandy Pierce said. "Every trustee recognizes that the administration and the board don't take the decisions lightly."