Missouri State University Vice President for Administration and Finance Matt Morris said there’s been a decline in degree-seeking students. That’s in part due to an expected enrollment cliff impacting colleges across the country. Fewer people chose to have children during the 2008 economic downturn, leading to fewer college age students today.
The university's new strategic plan has a goal of 30,000 students by 2030.
"We want more people to be blessed with higher education so they can improve their lives," said MO State President Bill Willams.
More students would also mean more revenue to allow the university to continue to grow.
Morris said revenue for the FY26 budget, which started in July 1 and runs through June 30, 2026, comes from two primary sources: 59% from tuition and fees and 38% from state appropriations. Small grants and finance charge income make up the remaining 3%. MO State was appropriated for FY26 $114.9 million — a 1.5% increase from 2025. The State, he said, keeps 3% before MSU sees the money.
Enrollment growth is vital due to the revenue it brings from tuition and fees. But Morris said, while head count is going up, the number of degree-seeking students has declined.
"So, while we celebrate head count and the increase there in fall of '25," he said, tuition revenue boils down to student credit hours and the enrollment mix because students pay varying rates for those services."
For example, dual credit students receive a discounted rate to earn college credit while taking high-level high school classes. The growth in dual credit students, according to Morris, is roughly $400 a student. The decline in degree-seeking students, he said, is approximately $4,000 per student.
The FY26 budget was based on projections, and ultimately it was concluded that enrollment would be relatively flat, he said. But because of the decline in degree-seeking students at the fall student census, MO State was faced with "a shortfall in revenue of approximately $3.2 million."
The university had frozen budget lines and positions totaling approximately $3 million in FY25 in order to address a potential shortfall, and they left those freezes in place. Fall census numbers resulted in those freezes becoming cuts, according to Morris. Based on average enrollment decline from fall to spring, he said, the university has a projected spring 2026 shortfall in revenue of just over $3.9 million.
Williams said they’ve been meeting with local legislators to talk about the university’s funding needs. MSU plans to ask for a 4% increase in state appropriations next session, and Williams said they'll be "very aggressive in asking." They’re also going to ask that the state compensate MO State $2.2 million—the amount MOSERS (the state’s employer’s retirement system) has increased its employer contribution rate. They’ll ask the state for $2.1 million from MO Excels for an addition to the Kings Street Annex. And they’ll ask for $23 million in state funds to renovate McDonald Hall, a project expected to cost at least $50 million.
Williams said that, in state funding per FTE, MO State is second to last. He said because of that they're telling the legislature that, if it's a tough budget year, an equal cut to universities is not an equal cut.
But with Governor Mike Kehoe's intent to eliminate Missouri's income tax in 2026, there's concern about the impact on the state's universities and other institutions and organizations. Williams said they're talking to legislators and the governor's office to make sure they know what the impact of such a change would be. And he said the Coordinating Board of Higher Education is also working to educate lawmakers about the impact.
"Our local legislators are well aware of what this might happen to higher education if this income tax goes through, so we're hopeful that our advocacy will work," he said.
Phillips said they’re working hard to recruit and retain students. She pointed to the university’s 6-year graduation rate, which hovers around 59%. She said they have to do better. According to Phillips, "when we're out trying to convince students and their families and the State to invest in Missouri State University, we've got to be able to tell a different story than the one we’re currently telling.”
Part of that is to respond when students have barriers, she said, and, fortunately, there are offices and individuals in place to do so.
Anything they do, Phillips said, needs to fit with MO State's strategic plan.
University officials said there are a lot of things happening at MO State to be excited about, including adding PhD programs in the near future. Dawn Medley, vice-president of enrollment management, said they're working to expand national recruitment efforts "in the face of a challenging international landscape." And she said they'll continue to use the national exposure from joining Conference USA to seed the market and draw new students to Missouri State.
And she said the university has redesigned how students apply for and receive money. Every student who fills out FAFSA and sends it to Missouri State by December 1 will get their financial picture by holiday break, according to Medley.
She said they also want to be the number one transfer destination in the state of Missouri, helping adult students with some college credit to finish their degrees.
Phillips said they are looking at different credit requirements in order to make that happen. For example, they might require 90 credit hours for some degrees while sticking with the current 120 requirement for others. She told those gathered for the town hall that all ideas are welcome.
Williams said there will be future town halls to discuss the budget as more is known.