Paul L. Caron

Thursday, April 11, 2019

Minnesota Law School Is On Track To Eliminate Multi-Million Dollar Deficit While Defending Its Top 20 Ranking

Minnesota LogoFollowing up on my previous posts (links below):  Minnesota Daily, Rising Enrollment, Applications a Good Sign; Law School Is on Track in its Three-Year Plan to Eliminate a Multi-Million Dollar Deficit:

Rising enrollment numbers and applications are among signs of progress for the University of Minnesota’s Law School as it works its way out of a multi-year, multi-million dollar deficit.

This fall, the Law School saw its largest entering juris doctorate class in seven years. Exceeding its own enrollment projections, the school’s prospects for next year look just as bright. As of January, J.D. applications are up 20 percent.

Increasing enrollment and tuition revenue is a key part of the Law School’s three-year plan to eliminate its deficit by fiscal year 2021. University officials say the plan is on track after its first year, but the Law School still needs to resolve a $3.9 million shortfall over the next two years.

“They’re beating their numbers both on revenue and enrollment, and they’re holding the line on expenses,” said Brian Burnett, the University's senior vice president for finance and operations. “They are doing the things we asked them to do. They are hitting the metrics we ask them to hit. But it’s not a magically there thing. It’s a continuous process.”

The Law School met or exceeded all 18 benchmarks set for the plan’s first phase, which range from increasing enrollment to amping up philanthropic donations and cutting discretionary expenses.

The school has reduced non-student aid expenses by 33 percent in the past two years. The reduction has largely come from eliminating dozens of faculty and staff positions, cutting tenured faculty salaries and limiting raises.

Law School Dean Garry Jenkins said the efforts have not been easy. “It has meant a lot of cuts, a lot of change. Lower salary increases for our faculty and [professional and administration] employees than those received by the rest of the University for four of the last five years,” Jenkins said at a Board of Regents meeting early this month. “It is something we have been taking very seriously and we are very committed to success.”

The Law School deficit followed the freefall in prospective students applying for law schools after the Great Recession. Between 2010 and 2017, J.D. applications across the country fell around 40 percent. Applications dropped by more than 50 percent in that time period at the University, which led to a decline in overall revenue.

The University plan, approved by the Board of Regents, seeks to maintain the school's reputation as a top 20 law program by investing more while incrementally cutting its deficit.

This year, the University will increase operations funding for the Law School by $1.7 million. In the next two years, the University will contribute $2.8 million more in operations funding. 

“Having a top 20 law school is important to law firms here in the Twin Cities,” Burnett said. “We looked at some schools that decided not to defend their ranking and continue to grow to try and solve fiscal issues. And the lower the ranking got, the harder it was for them to generate tuition.” ...

“After a semester into this ... three-year plan, all signs point to the Law School doing the things they need to do on their end to successfully come out of this,” Burnett said.

Prior TaxProf Blog coverage:

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(Subject to the elimination of GradPLUS Loans, of course - which both the White House and Senator Alexander, who is busy drafting an overhaul of the HEA - want to do. This would throw UMinn Law, and every other law school, into an existential crisis but let's not cover or even talk about it until the HEA reauthorization is imminent. Great strategy.)

Posted by: Unemployed Northeastern | Apr 11, 2019 1:57:34 PM