LINN — State Tech Regents unanimously approved revisions to the college’s fiscal year 2026 budget and adopted the fiscal year 2027 budget on June 30 after Vice President of Finance Jenny Jacobs outlined a financial plan she said keeps the college in a strong financial position despite significant investments in campus expansion projects.

Throughout her presentation, Jacobs emphasized that the college’s financial picture remains healthy even though the budget reflects millions of dollars being spent from reserves. She explained that nearly all of that spending is tied to one-time capital construction projects rather than ongoing operating expenses.

“The overspend is all capital and not operating expenses,” Jacobs told the board. She explained that the college prepares its budget on a cash basis, meaning construction costs are recorded as expenses when they are paid. However, the college’s audited financial statements capitalize those projects as assets and depreciate them over time, resulting in a much stronger financial picture than the operating budget alone would suggest.

Regents approved revisions to the FY26 budget, increasing the unrestricted operating budget from $37.06 million to $46.98 million. The auxiliary budget increased from $9.66 million to $10.34 million, while restricted grant funding was revised from $23.2 million to $19.57 million and restricted financial aid decreased slightly from $19.21 million to $18.6 million based on updated projections.

Jacobs said several revenue categories outperformed original expectations during the fiscal year. Private gifts increased by more than $462,000, sales and services revenue rose by more than $1.04 million and capital appropriations added approximately $1.45 million for the Heavy Equipment Operations expansion project. Tuition and fee revenue also finished slightly ahead of budget, offsetting a reduction of approximately $540,000 in state appropriations.

She also credited departments across campus for helping contain costs. Approximately $500,000 was saved through budget withholding, including about $70,000 in academic support and approximately $100,000 in student services, led primarily by admissions. Those savings helped offset the increased costs associated with construction activity.

The largest impact on the budget came from the college’s ongoing construction program.

Jacobs said the Agriculture Building and Heavy Equipment Operations expansion road and sewer project accounted for approximately $10.6 million in expenditures during FY26. After applying state appropriations, additional revenues and departmental savings, the projects reduced reserves by roughly $7.2 million.

She noted, however, that State Tech had already received $3.2 million in Missouri MO Excels funding for the Agriculture Building before construction expenses were incurred. Taking that into account, the effective reduction in reserves is closer to $4 million, lowering unrestricted reserves from approximately $19 million to about $12 million while leaving the college in a solid financial position.

Jacobs also reviewed auxiliary operations, noting mixed results among the college’s self-supporting enterprises.

Housing revenue fell slightly below projections because of approximately 12 vacant beds during the academic year. Dining revenue declined after meal plan participation dropped by roughly 70 during the fall semester and 50 during the spring semester, reducing revenue by approximately $100,000.

The Klebba Activity Center finished within about $2,000 of its revenue goal, representing a significant improvement over previous years.

The bookstore exceeded revenue projections by approximately $47,000 due largely to increased digital course material sales, although expenses increased because of a substantial inventory write-off.

Osage View continued to exceed expectations during only its second full fiscal year of operation.

Jacobs reported the facility generated approximately $615,000 more revenue than budgeted. Although expenses exceeded projections by about $415,000, the operation still improved its overall financial position by roughly $200,000. “So, kudos to them,” Jacobs said.

Overall, auxiliary operations finished approximately $500,000 above projected revenues while expenses exceeded budget by about $680,000, resulting in a projected operating loss of approximately $176,000. Jacobs said that figure could improve before the fiscal year closes depending on when several remaining projects are completed. She also noted the college continues to meet all required bond covenant requirements.

The board also reviewed revised federal and state grant budgets.

Jacobs said the revised FY26 budget includes approximately $1.2 million from a congressional spending award supporting construction of the Agriculture Building and $312,000 in Perkins grant funding that was fully utilized during the year. She added that Missouri awarded the college two enhancement grants totaling approximately $1.655 million, allowing State Tech to purchase approximately $2.4 million in instructional equipment.

Financial aid projections also changed during the year. Jacobs said Pell Grant expenditures finished approximately $1 million below budget after changes to the federal FAFSA formula reduced student eligibility. Increased participation in Missouri Access grants helped offset much of that decrease.

Looking ahead to FY27, Jacobs said the proposed budget uses conservative assumptions while continuing the college’s investment in campus improvements.

The budget includes approximately $3.3 million in planned capital projects, including replacement of the Mill Street parking lot, the TAP sidewalk project, east entrance improvements, completion of the Agriculture Building, construction of a Department of Natural Resources-funded walking trail and completion of remaining ARPA-funded projects. The proposed spending plan anticipates using approximately $1.8 million from reserves to complete those projects.

The FY27 auxiliary budget assumes residence halls will remain fully occupied during both the fall and spring semesters with no increase in housing rates.

Dining Services plans to increase door prices and à la carte pricing by 10% while implementing a declining-balance meal plan allowing students to use prepaid meal dollars throughout campus dining locations, including the cafeteria, Starbucks, Osage Burger Company, the Activity Center and Osage View.

The Klebba Activity Center budget includes a 5% membership increase along with funding for additional equipment and replacement scoreboards. The bookstore established a goal of increasing revenue by $25,000, while Osage View is expected to continue its recent growth pattern. Jacobs said auxiliary debt payments remain on schedule and the college expects to continue meeting required bond covenant standards.

Federal grant projections for FY27 include approximately $1.1 million in remaining ARPA funding, $1.7 million from a congressional spending award for the Agriculture Building, $415,000 through the TAP sidewalk grant, $331,000 in Perkins funding and $750,000 in state enhancement grant revenue. Jacobs said those estimates are based on known awards and are not expected to fluctuate significantly during the fiscal year.

Regents unanimously approved the FY26 budget revisions and the FY27 budget.