Our Financial Outlook and the Year Ahead

Dear Colleagues,

As we approach the start of the new fiscal year, we want to share an update on RIT’s financial outlook and the decisions shaping the year ahead. Each spring, university leadership develops, with input from many stakeholders, a preliminary budget for Board of Trustees approval at its June meeting. Enrollment and other key information are then reviewed in the fall, and a final budget is presented to the board for approval in October. This very important process ensures we are fulfilling our obligation to be fiscally responsible while supporting our academic mission and providing long-term financial health and stability.

Our Financial Outlook

RIT remains fiscally strong. However, we must acknowledge economic pressures and uncertainty affecting higher education nationally and the broader economy. Expenses continue to rise, reflecting inflationary pressures across many areas of university operations. Because expense growth is projected to outpace revenue growth, careful planning and disciplined stewardship are necessary to maintain a balanced budget and position RIT for a robust future.

Our student enrollment remains strong despite ongoing demographic changes and increased competition for fewer prospective students nationwide. We are projecting the total number of  incoming students to be similar in size to last year, with an increase in undergraduate students balancing a reduction in international graduate students. Because last year’s graduating class was the largest in RIT’s history, overall enrollment is expected to be slightly lower. These factors require us to make critically important choices, reducing overall costs while investing in areas of strategic importance, including high-demand academic programs.

To strengthen RIT’s long-term resilience, the 2027 preliminary budget reflects several important realities. While we project an increase in gross tuition and fees, the need to provide additional financial aid to students resulted in essentially the same projected net revenue (about $790 million) in fiscal year 2027 as in 2026. This, coupled with an increase in non-discretionary expenses, including healthcare, energy, and debt service (about $10 million), and the need to invest in high-demand academic programs, required reductions in other areas of the budget to keep it balanced and maintain a healthy contingency. In the spirit of transparency, we wish to share some of the details of the preliminary budget with you.

The year ahead

We want to assure you that RIT enters the new fiscal year from a position of strength, with a balanced preliminary budget, but whose creation required some difficult choices:

• To maintain RIT’s strong fiscal position, an overall net reduction in spending across colleges and divisions of $6.4 million is required. Senior leadership, in consultation with deans, vice presidents, and other university leaders, determined the allocation of these reductions with a priority of supporting the academic mission of the university, considering increased enrollment demand in certain areas and reduced enrollment in others.
• Most budget reductions will be achieved through prioritization, management of replacements for vacant and incremental positions, natural employee attrition, and careful spending review. Unfortunately, the preliminary budget does not include provisions for merit increases for 2026-2027. We recognize the impact of this decision and do not make it lightly.

The preliminary budget reflects the work of leadership across the university working together to evaluate priorities, identify opportunities for continued investment, and better align resources. We must balance our responsibility to our community with the need to maintain long-term financial stability.

Throughout the summer, we will continue monitoring enrollment, including retention of current students and the broader operating environment, and will use this information to develop a final budget for approval by the board in October.

Stability for Our Long-Term Future

Today’s challenges require us to be strategic and deliberate. Our decisions are intended to position RIT for long-term success. They allow us to remain focused on students, sustain our academic mission, and preserve our ability to invest in future opportunities.

RIT remains well-positioned to lead through disruption and turn challenges into opportunity, as we have for nearly 200 years. We remain confident in RIT’s future and our ability to navigate whatever lies ahead. The dedication of our faculty and staff, together with the distinctive education and opportunities RIT provides to students, will continue to distinguish our university.

We recognize that this information may raise questions. As we continue to refine the budget and plan for the year ahead, we are committed to keeping you informed and providing updates as decisions are finalized. We are grateful for the care, expertise, and commitment you bring to our students and to one another every day. That collective work remains central to RIT’s strength and to the future we are building together.

Sincerely,

Bill Sanders
President

Prabu David
Provost and Senior Vice President for Academic Affairs

Jim Watters
Senior Vice President and Treasurer