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Northern Arizona University is projecting a decrease in both revenue and expenses for fiscal year 2026, according to a budget presentation at last week’s meeting of the Arizona Board of Regents (ABOR).

ABOR approved the fiscal year 2026 budgets for all three of Arizona’s public universities during its June 12 meeting. These included projections of the universities' revenue, expenses and days cash on hand, as categories such as the state budget and enrollments for the upcoming school year are not yet finalized.

"There’s an unusual amount of uncertainty about some of the other financial dynamics that the universities face this year," Brad Kendrex, ABOR's vice president of finance and administration, said in his introduction of the item.

Similarly, Bjorn Flugstad, the chief financial officer at NAU who presented the university’s budget, said "the key theme is uncertainty in revenue streams."

The board will hear further updates on university finances throughout the course of the year. A fall update will include the final form of appropriations approved in the state budget, for example.

NAU is expecting around a 4% decrease in revenue for the year: from $735 million in fiscal year 2025 to $702 million in fiscal year 2026.

Flugstad noted that this is still higher than prepandemic revenue. A chart in his presentation showed the university’s revenue increasing annually between 2018 and 2024 (from $590 million to $738 million), before decreasing in the following two years.

He said NAU plans to adjust its expenses to match the revenue. He listed items such as state appropriation, final enrollment for the fall semester and grants and contracts as areas of revenue where the university would have additional information in the coming months.

NAU is currently projecting decreases in the revenue categories of grants and contracts, financial aid grants and tuition and fees. Its total of private gifts and philanthropy and auxiliary are expected to increase -- the foundation is having a record year for giving, according to Flugstad -- while TRIF and other revenues are expected to remain stable.

The state budget category of revenue is listed as vulnerable in the presentation, with uncertain financial aid for the Arizona Promise Scholarship and Arizona Teachers Academy (both programs saw cuts in last year’s state budget).

The projected decrease in net tuition and fees -- Flugstad said this is under 1%, while the revenue per student is expected to grow 2.6% -- is because NAU is expecting a 3% decrease in enrollment for the coming school year. He listed the total of incoming nonresident undergraduate students and undergraduate retention as positives from the fall enrollment so far, and international visas as a "wildcard.�

“We’re continuing to be very flexible and adaptable with either hybrid delivery, online delivery to see what we can do to capture as many international students as we have,� he said, “but we do have to see those applications and interviews actually proceed.�

The university is planning to adjust its expenses to go along with the trends in revenue, meaning that expenses would also decrease in fiscal year 2026. According to the presentation, NAU has plans to decrease in the categories of salaries and wages, scholarships and fellowships and other costs, while its operating costs increase.

The university is “leaning very heavily into efficiency� in multiple areas as a way to manage its non-personnel operating costs, Flugstad said. 

NAU is expected to have 167 days cash on hand compared to 172 in the previous year. Both fall in the board’s range of 130 to 218 days cash on hand.

A recording of this item is available at , with the budget presentations beginning about an hour and 35 minutes into the June 12 board meeting.