Meeting starts 9 a.m. Thursday in Lincoln
By Zach Wendling | Nebraska Examiner
LINCOLN — The University of Nebraska Board of Regents will move one step closer Thursday to becoming the sole owner of Nebraska Medicine while considering whether to increase tuition as part of NU’s next annual budget.
The regents will consider two related agenda items that would effectively reduce the $500 million needed to proceed with sole Nebraska Medicine membership to $300 million. Nebraska Medicine is the hospital, clinical and medical services partner to the University of Nebraska Medical Center. Rather than paying the full sum to Clarkson Regional Health Services for its 50% stake in the nonprofit, the other $200 million would serve as an “in-kind donation” back to NU.
Regents and Clarkson had originally agreed that, as part of the deal, Clarkson would donate $200 million back to NU, earmarked for the $2.19 billion “Project Health,” a longstanding NU endeavor to build up the future of health care and train the next generation of professionals.
NU will still be on the hook for the full $500 million because of the earmark. NU has also agreed to pay Clarkson another $300 million to purchase related properties.
Asked whether NU had raised enough funds in the past five months to close the transaction by June 30, the NU spokesperson said yes but did not elaborate. The spokesperson did not respond to multiple requests to confirm how the funds were raised.
NU President Jeffrey Gold, in January, said raising funds would include debt restructuring and monetization of real estate bought under the agreement. Dr. Gold and regents committed to lawmakers that no taxpayer dollars, tuition or research funds would be diverted for the deal.
‘Everything’s lined up’
The deal is still expected to close by June 30. An NU spokesperson said regents might have to meet one more time this month to vote on amended nonprofit governance documents.
“I think everything’s lined up, far as I know,” NU Regent Paul Kenney, board chair, told the Nebraska Examiner on Tuesday. “I think everything’s progressing as it ought to.”
NU leaders and regents first announced the Nebraska Medicine deal Jan. 2 after more than a year of behind-closed-doors conversations, which were subject to multiple nondisclosure agreements. After initially setting a vote for one week after the announcement, state lawmakers requested more time. Regents delayed to Jan. 15, when they unanimously voted in favor of the deal.
At the time, the now-former leaders of the Nebraska Medicine Board of Directors protested the transaction and filed a lawsuit the following week seeking to block the deal.
Gold, the regents and Clarkson leaders shortly after replaced most board members and inserted Gold, Clarkson CEO Dr. Bill Lydiatt and another Clarkson representative alongside interim UNMC Chancellor H. Dele Davies as chair. All supported the deal, and the judge overseeing the case accepted a Nebraska Medicine-led motion to drop the suit.
The Jan. 15 vote effectively allowed NU to proceed toward closing the deal while consolidating much of the future ins and outs of the transaction in the hands of Kenney.
Kenney said his message to Nebraskans who might have asked questions over the past five months has been informing them about the history, status and success of Nebraska Medicine. a nonprofit under the NU-Clarkson banner since 1997.
Third-straight tuition hike?
Also Thursday, regents will consider approving NU’s $1.14 billion operating budget for the next year. The budget includes a legislatively approved 0.6% increase in state appropriations and a proposed 4.25% tuition hike.
This would be the third straight year that regents have raised tuition after freezing tuition rates for three academic years during and after the COVID-19 pandemic. Regents increased tuition by 3.5% in 2024 and 5% last year.
NU Regents Kathy Wilmot of Beaver City and Rob Schafer of Beatrice opposed the budget last year in part due to the tuition increase.
Gold, in a media statement, said raising tuition isn’t a decision made “lightly” and that NU strives to “deliver an extraordinary educational experience for each of our students.
“The budget the board is set to consider reflects that commitment,” Gold said. “It preserves and strengthens our need- and merit-based scholarship programs, while ensuring we can continue providing an outstanding education that remains among the most affordable within our peer university group.”
The budget would maintain free tuition for undergraduates whose families make $65,000 or less and appropriate an additional $1.5 million to expand the “presidential scholars” program, a free ride plus $5,000 annual stipend for high-performing Nebraskans based on the ACT.
Kenney said regents looked across fellow Big Ten universities when examining tuition. He said NU campuses, compared to peers, would still have the second-lowest rates in the Big Ten.
Said Kenney: “We want affordable tuition, but we also have to be able to compete in the marketplace.”
Other agenda items
This year, regents also hope to fund salary increases for UNMC and University of Nebraska-Lincoln faculty, plus staff across NU, after freezing salaries amid budget cuts. The latest proposal calls for 3% merit salary bumps for non-union employees.
Faculty at the University of Nebraska at Omaha and the University of Nebraska at Kearney, who are unionized, will receive raises subject to collective bargaining contracts.
After finalizing more than $40 million in cuts last year, NU’s latest proposed budget calls for another $8 million in cuts. An NU spokesperson said the expected reductions include previously approved voluntary faculty separations and other past approved spending cuts.
The spokesperson did not specify how much in new cuts would be needed.
Also on Thursday’s agenda:
- A detailed proposal to move forward with an NU system-wide institute on advanced artificial intelligence.
- Confirmation of Dr. Davies as UNMC’s next permanent chancellor. Davies has served as interim chancellor since July 2024, when Gold assumed the presidency after 10 years as the medical center’s chancellor.
- Major renovations to UNL’s Selleck Quadrangle housing complex and dining hall. The project, estimated to cost $368 million, would be funded through internal bonds and cash reserves. Construction would begin next year with the first phase done by August 2030 and the second and final phase completed by August 2032.