Facing a structural deficit of $46 million, Brown is looking for solutions. While the current deficit is only 3% of the University’s total operating budget, it could grow to more than $90 million by next year without intervention.
On Tuesday, the University shared its next steps to address the deficit and put Brown on a path to positive operating margins in five to six years.
The deficit is a result of the University’s efforts to reposition itself as a leading research institution rather than a liberal arts college, The Herald previously reported. While Brown’s academic focus is aligned with that of a research institution, its financial model is not, and the University relies heavily on undergraduate tuition to support its costs.
The steady size of the undergraduate student body, increased financial aid and growing salaries are some of the “key drivers” of the deficit, wrote Provost Francis Doyle and Executive Vice President for Finance and Administration Sarah Latham in a Tuesday Today@Brown announcement.
Brown plans to restrict faculty and staff growth, reduce PhD admissions, limit operating expenses and grow revenue from master’s programs. With these strategies, Doyle and Latham expect that the deficit will be no more than $60 million in 2026, excluding the University’s long-term investments in affiliated health systems.
Restricting faculty and staff headcount
In the last 20 years, faculty headcount has grown by over 20%, and the number of unrestricted staff — staff not funded by grants or gifts — has grown by 28%, according to the announcement. But during this time, undergraduate enrollment has grown by only 13%.
This has placed “considerable pressure on the University’s tuition-dependent budget,” Doyle and Latham wrote.
To fix this, the University plans to hold faculty headcount growth to 1% and unrestricted staff growth to 0%.
This step will include an “enhanced review process for vacant positions,” according to the announcement. Starting in 2025, all open positions will be reviewed to determine if they will be refilled.
Doyle and Latham wrote that “there are no plans for across-the-board layoffs,” adding that each department will be affected differently. They also reaffirmed their commitment to providing faculty with competitive salaries. Faculty have previously voiced their concerns about compensation and the University’s plans to restructure it.
Reducing PhD admissions
The cost of Brown’s PhD programs has grown by 43% in the past five years, in part due to increases in the number of admitted students and time-to-degree completion, Doyle and Latham wrote.
The University hopes to decrease these programs’ budget growth to 4% — rather than the projected 6% — by reducing the number of admitted students. According to the announcement, this will impact departments depending on their size and how they are funded.
Limiting the growth of unrestricted operating expenses
Despite predicting a 7.3% increase in operating expenses, the University hopes to reduce this growth to 3% through the standard budgeting process. The University has asked academic and administrative units to identify potential areas for permanent cost reductions in their fiscal year 2026 budgets.
These reductions will be supplemented by “ongoing fundraising and investment efforts, focusing on achieving strong performance to yield sustained financial support for the University,” Doyle and Latham wrote.
They also plan to expand academic offerings and research through “new revenue-generating programs,” according to the announcement.
Continuing to grow master’s revenue
Brown hopes to double the number of residential master’s students and increase the number of online learners to 2,000 in the next five years, according to the announcement.
“Growing master’s education aligns with diverse funding models for research institutions that are not as heavily dependent on undergraduate tuition to fund their operations,” Doyle and Latham wrote.
“We are seeking to slow expense growth in a sustainable way, with an eye toward long-term solutions that allow Brown’s resources to continue to support our community’s priorities and aspirations,” they added.
Cate Latimer is a senior staff writer covering faculty and higher education. She is from Portland, OR, and studies English and Urban Studies. In her free time, you can find her playing ultimate frisbee or rewatching episodes of Parks and Rec.
