The Alabama Commission on Higher Education is proposing a 6.84% budget increase for public colleges next year, which officials say will help offset rising insurance and inflationary costs.

Commissioners approved a $2.12 billion recommendation – a total increase of $135.8 million – for the 2024-25 fiscal year at ACHE’s quarterly meeting Friday.

The ask, which is substantially lower than prior year’s recommended increases of 17% and 11%, will largely go toward addressing mandatory costs like rising insurance premiums. None of the additional funds will support personnel or salary increases, officials said.

At budget hearings held before the commission last month, colleges cited sky-high insurance rates and rising construction costs among their biggest financial challenges.

“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 Friday.

Officials at the University of West Alabama said property insurance costs had increased by nearly 30%. And at the University of Montevallo, officials said liability and healthcare insurance costs had almost doubled in the last three years.

Other colleges in growing parts of the state said they were struggling to keep from losing staff to competing industries and provide affordable housing for students.

“Inflation was really outpacing our ability to maintain our standard of educational environment,” Arletha Harmon, chief financial officer of Jacksonville State University, told commissioners last month.

About three-fourths, or 73%, of the total request will go toward four-year universities, for a 7% year-over-year increase. Community colleges will get 14% of the funding for a 5% increase. Other funds will go toward the commission’s operational budget and support state-level programs.

Additionally, colleges are projecting facilities needs to exceed $3.24 billion for the upcoming fiscal year.

Aging infrastructure, commissioners said, remains a major concern. Nearly half of buildings used by Alabama public colleges and universities were constructed more than three decades ago, and about 12% were built prior to 1960, according to a recent ACHE facilities survey.

“Those built in 1960 are nearing 65 years old,” ACHE assistant finance and facilities director Julian Rogers told the commission. “This is beyond the useful life of major building materials.”

Colleges typically pay for capital projects with a mix of state and tuition dollars. Institutions are asking for 29%, or $939 million, of those projects to be funded through the Education Trust Fund.

The majority of the proposals, 63%, will go toward new construction, with 25% allotted for renovation and repairs and 9% for deferred maintenance.

ACHE also plans to ask the legislature for an additional $7.7 million to support state-level assistance, including increases toward student scholarship programs and deferred maintenance grants.

View your college’s budget proposal below: