Record budget proposal represents power of partnerships, focus on mission to advance Kentucky

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LEXINGTON, Ky. (June 14, 2024) — University of Kentucky President Eli Capilouto said Friday that a nearly $8.4 billion budget proposed for UK for fiscal year (FY) 2024-25 represents record investments in students, people and the health of Kentucky.

 “We were created — and we exist — to advance Kentucky in everything that we do,” Capilouto told members of the Board of Trustees, who are voting on the annual budget during a June 14 meeting. “We are a big, sprawling and complex enterprise. This budget proposal, though, reflects the strong and enduring focus of more than 26,000 UK people on our north star to work with partners across this state for a stronger, healthier and more secure Kentucky.”

The nearly $8.4 billion proposed budget represents an increase of about $1.6 billion over last year alone, more than 23%. It is nearly three times more than the university’s budget only a decade ago, a 178% increase. 

The continued trajectory over the last decade has been powered by largely two factors: the continued growth of UK’s health care system and steady growth in enrolling, retaining and graduating more students. An additional driver in this year’s proposed budget is historic increases in support from state policymakers, who Capilouto called “our crucial partners for progress in advancing Kentucky.”

• The UK HealthCare Hospital System represents more than 60% of the consolidated budget, at about $5 billion. 
• The 28% increase in the UK HealthCare Hospital System budget — about $1.1 billion more than last year — reflects large increases in the numbers of patients treated and discharged over the last decade, from about 35,000 in 2014 to more than 45,000 this past year.
• It also includes revenues from the recent acquisition of King’s Daughters Medical Center in Ashland and the projected purchase of St. Claire HealthCare in Morehead.
• UK’s enrollment has grown in the last decade from about 30,000 students to a projected nearly 35,000 students this fall.
• UK projects a first-year class in August of about 6,500 students, roughly the same as last year. First-year classes in the last decade have increased from about 5,000 to more than 6,000 per year.
• Even with the enrollment increases, UK has experienced a historic growth in retention and graduation rates over the last decade. 
• Retention has increased more than 4 percentage points, to nearly 87% for the 2022 cohort of students. 
• Six-year graduation rates in that same period increased more than 9 percentage points to 70% — among the top institutions in the country.
• At $3.1 billion, UK’s proposed budget for its higher education enterprise represents a 17% increase in funding.

State appropriations are up nearly $50 million for FY 2024-25 over last year, or about 16%. It is the largest single increase in state appropriations on record, UK officials said. 

• In FY 2024-25, UK will receive nearly $359 million in state funding, a combination of direct appropriations and allocations from the state’s performance funding pool, which was established in 2019. 
• The funding model measures each public institution’s performance in aligning with Kentucky’s priorities in areas such as enrollment and graduating students, especially in fields such as science, technology, engineering, math and health (STEM+H).
• At the same time, the legislature authorized spending a combination of UK resources and appropriations from the state on facilities that will expand UK’s ability to serve more patients, conduct research into the state’s biggest health and agricultural challenges and renovate classroom space, labs and other support facilities in the heart of its campus.
• New infrastructure authorized by the state legislature includes spending $2 billion of UK resources on a new Chandler Hospital bed tower for health care; $285 million — including $200 million of state bonds — for an Agriculture Research Facility for the Martin-Gatton College of Agriculture, Food and Environment;  and $154 million — including $124 million of state bonds — for the continued renovation of university facilities through the asset preservation program.

“Our progress as Kentucky’s institution is predicated on partnerships. Policymakers, from the governor to the Kentucky General Assembly, have stepped up in a historic way to invest in the University of Kentucky,” Capilouto said. “We have an obligation and deep responsibility to honor the expression of faith — and investment — Kentucky has made in us: to enroll and educate more students, to expand our commitment to service in every corner and community of the state and to extend the promise of healing and hope to ensure no Kentuckian must ever leave home to receive the best of care in the most challenging of moments. We intend to deliver. We intend to honor our promise to Kentucky.”