Although enrollment is projected to increase slightly, total enrollment is still far below where it was in 2017 when peak enrollment reached 40,240. This past year, while first-year undergraduate enrollment increased, overall enrollment decreased. Fewer students mean less tuition revenue. At the same time, expenses —including compensation and financial aid—continue to rise.

Our two main revenue sources—tuition and the state appropriation—account for 84% of our operating budget. Tuition revenue has dropped by approximately $200 million since 2017 due to a 25% decline in overall student enrollment. Meanwhile, our Commonwealth appropriation has been flat since 2019 despite inflation.

We may receive additional funding from the Commonwealth this fall through a performance-based funding pool, which is a positive development but does not resolve our financial challenges. For context, more than 15 years ago, during the 2009-10 fiscal year, Temple’s state appropriation was $175.1 million. Within a few years, it was reduced to $139.9 million, and it has never reapproached its peak despite near unprecedented levels of inflation in recent years. 

Compensation makes up the largest share of university expenses. Reduction of recurring expenditures is necessary to permanently reduce the deficit while preserving our ability to support core academic and student-facing services.

Reserves are meant for one-time investments, not to support ongoing operations or recurring expenses like salary and benefits that will continue year after year. Using reserves to cover regular expenses is not sustainable as once a reserve dollar is spent, it is gone and not replenished. Continued use of reserve funds would lead to more severe financial problems in the future.

Major construction projects are supported by funding from the Commonwealth that is restricted to capital improvements and cannot be used for operational expenses. These facilities help attract students and improve Temple's learning and research environment. The Commonwealth funding coupled with philanthropy has covered a large portion of recent major capital projects, without adding debt.

Athletics is subject to budget reductions as well. In light of changes at the national level, we are carefully reviewing our investment in athletics.

We’re making difficult but necessary decisions to reduce the university's structural deficit, while also investing in the future - expanding online programs, launching a fundraising campaign, growing enrollment, and focusing resources where they’ll have the greatest impact.

The decision to move away from RCM reflects an honest assessment of Temple’s experience. While RCM can function effectively at some institutions, it requires deep decentralization of authority, strong financial reserves, and a culture that tightly links local decisions to financial consequences. Temple’s experience demonstrated that these conditions were not in place. Beginning July 1, 2026, we will move to a centralized budget structure that allows us to operate as one university, rather than a collection of independent financial units. It is a ‘One Temple’ budget model, which represents a significant cultural shift for our institution.