The University of Illinois Board of Trustees on Sept. 13 approved the system'wide fiscal year 2026 operating budget, a package administrators described as a 7.8% overall increase to $8.9 billion and a 5.6% recurring increase when state fringe benefits are excluded.

The budget vote followed a presentation from Paul Ellinger, vice president, chief financial officer and comptroller, who said the system'wide plan balances targeted investments in academic excellence, student success and affordability while acknowledging headwinds such as inflation, uncertain federal grant funding and higher energy and insurance costs.

Ellinger said the headline figures reflect state appropriations, tuition (the income fund), sponsored programs and hospital activity. He told trustees the full budget is $8.9 billion including state-paid fringe benefits and $7.3 billion excluding those fringe benefits. He said salaries and benefits remain the single largest cost, totaling roughly $3.6 billion or about 50% of the budget.

The budget packet presented to trustees assigns 44% of the total budget to Urbana, roughly 50% to Chicago including hospital activities, and 1.5% to Springfield; tuition receipts are allocated 64% to Urbana, 34% to Chicago and the remainder to Springfield. Ellinger also described a variety of one-time and nonrecurring revenue sources such as interest earnings and emphasized that many restricted revenue streams (gifts, grants, auxiliaries) carry limits on how they can be used.

Trustees heard that the system recorded 101,081 students enrolled this fall, a 3.4% increase over the prior year and nearly 26% more than a decade ago, a statistic administrators cited as a primary driver of revenue growth. Ellinger warned, however, that recurring revenue growth remains slower than unavoidable cost increases and highlighted risks including possible reductions in indirect cost recovery (overhead) rates on sponsored programs and uncertainties in federal appropriations.

Ellinger described efforts to control costs and improve efficiency, including nearly 600 automations implemented since 2013 that he said have saved an estimated 1.5 million work hours systemwide and ongoing pilots of artificial intelligence tools intended to yield additional savings. He also noted campus-level actions: operational-excellence initiatives at Urbana, a hiring pause at Springfield and process reviews at Chicago.

After discussion, trustees approved the budget in a roll-call vote. Trustees moved and seconded the motion and a full roll call returned affirmative votes; the board chair recorded a limited abstention on a separate procedural item noted in the roll call record.

Why this matters: Board and administration leaders said the budget aims to preserve affordability'including a long-standing program of limited in-state tuition increases'while investing in retention, student wellness, faculty hiring and deferred maintenance. Trustees and finance officers stressed that several revenue lines are constrained, which requires continued efficiency work and scenario planning.

What to watch next: The administration said more granular results will be presented at the board's November meeting, when actual revenues and expenditures through the close of FY2026 will be reported and when trustees will see details tied to campus-level capital and operating plans.