President Scholz gave the following remarks to the UO Senate on Wednesday, May 20, 2026.
Good afternoon.
This was scheduled to be Provost Long’s report, but in light of my budget message last week, I was anxious to join you today. I thank the Provost and Senate leadership for giving me this opportunity.
We have a challenging road ahead. I know this is hard on everyone. All of you are doing a lot right now. You’re supporting students, advancing your teaching and research, studying, doing your job, all while managing the uncertainty that comes with this news. I acknowledge just how hard that is.
Today is not an announcement of what will be done, but instead it’s the start of a six-month dialogue. The Senate will play an important role in providing meaningful input that will shape that dialogue.
So that everyone is on the same page, let me start with some basics on the university’s finances.
There are four major sources of funding for America's public research universities: tuition, state support, research overhead, and philanthropy. The UO does well in three of the four categories. We are competitive in federal and foundation-based grant funding, though grant overhead is smaller than at many peers, given that we do not have a medical school or a large engineering college. But we do very well
We do well philanthropically, though donors generally have specific aspirations they hope to achieve with their philanthropy. Our work in fundraising is to try to match university priorities with donor’s aspirations. Once given, gifts are often restricted to specific purposes.
Where we fall short is state funding. Oregon ranks 46th among states in public support for four-year universities. Funding per full-time Oregon student is $6,531. Idaho invests 58 percent above that. California and Nevada, more than 70 percent. Washington, 127 percent, more than double our level of support. The picture grows more challenging when you factor in state-mandated benefits, primarily PERS and PEBB, which are the 8th most expensive in the country. We continue to make the case that investment in four-year public institutions is one of the best ways to support Oregon's prosperity.
This leaves tuition.
We benefit enormously as a university from both our in-state and our out-of-state students. We continue to be popular among our Oregon students. In fact, we anticipate a class next year that will be near our historic high for in-state enrollment.
Over the past 10 years, we have averaged nearly 2,400 new non-resident undergraduate students each fall. After seeing deposits in April and early May, we now expect fewer than 1,900 new non-resident students. This is 500 fewer non-resident students than last year.
A natural question to ask is, what happened?
This is an exceptionally difficult time for higher education. International enrollments have been sharply cut through visa restrictions and international politics. Research funding has been disrupted and, in important cases, canceled. Trust in higher education has fallen and, in some communities, the value and economic return of a college degree is being questioned. Add significant economic uncertainty—including concern around inflation and AI—and it is easy to see why making the case to spend more to attend a university out of state becomes harder for many families.
Universities that are able to do so have responded by admitting more students. The UC system is taking more California students, at the same time the number of students graduating from California high schools is falling. Utah is offering in-state tuition to nonresident students after one year. Many of our Big Ten peers are recruiting in California and other states aggressively, including taking significant numbers from their waitlists. We are in a more competitive environment than we have ever been before.
Another important factor for our future: there are fewer young people. U.S. birth rates began falling in 2007 and have not yet recovered. That generation is now reaching college age. The Western Interstate Commission for Higher Education projects that the number of high school graduates in the United States peaked in 2025 and will decline through 2041, falling roughly 13 percent nationally. The decline will be steeper in the West, where projections show a drop of about 20 percent.
We have now experienced two years of unexpectedly low out-of-state enrollment. One year can be an aberration. With a second year of evidence, I believe we need to treat this as our new reality.
The new reality means adjusting our future enrollment forecasts, so as not to have to make budget cutting an annual exercise. We are lowering sharply assumptions about future nonresident enrollment, resulting in our estimated $65 million budget shortfall.
When things do not go the way that we would like, there is a human reaction to want to assign blame. I believe strongly that our budget challenges are a result of external factors. We have an outstanding enrollment management team. They held 37 admitted student receptions around the country. They hosted five Duck Days, with 4,000 participants (including parents). Our student ambassadors are remarkable. All our efforts were similar or exceeded what we have done previously. In addition, we expanded the Clark Honors College, initiated the Provost Undergraduate Research Associates for first-year students, and created a new set of recruitment events. Our budget forecast team is similarly excellent.
Moving forward, we are committed to collaborative work to address our challenges. We look forward to the conversation later this meeting about the Academic Modification Advisory Committee, or AMAC.
This work will require difficult conversations and tradeoffs. It will also be an opportunity—to clarify what matters most, to focus our efforts, and to position the University of Oregon for long-term strength.
This budget process will unfold over the next six months. While work inevitably will be done over the summer, we are committing to not making any final decisions during the summer and early fall. We plan on presenting to the board of trustees at next December’s board meeting the changes that need to be made.
I am grateful for the Senate’s work toward the AMAC process.
I offer two principles I think should be at the core of UO’s future.
- We should elevate and invest in research strengths that can meet the needs of our communities and industry, enhance our academic reputation, and distinguish the UO. We will hire strategically, with a view to making the UO known for leadership and excellence in specific areas of research.
- We cannot do everything. But by focusing thoughtfully, we can continue to do some things exceptionally well—and further enhance distinction that benefits our students and the entire university.
- We should continue to invest in the quality of the student educational experience and make the University of Oregon a destination of choice for more students. We should aspire to make the UO a place that is irresistible for students, building from all that we do that is working so well. We have powerful foundations to build on, and this is an opportunity to double down on what makes UO distinctive and meaningful to students.
The future of the university depends critically on what each faculty and staff colleague does every day. The university community is special. People care deeply. I am grateful for the many ways people build community at the UO and the way that instructors inspire in our classrooms. We cannot lose this commitment and care.
Since it has only been a week since the announcement, I will not have answers to many questions, but that is exactly why the consultation and collaboration processes that are being developed by the Senate are so valuable.
We will get through this by working together—listening carefully, engaging honestly, and supporting one another along the way.
I ended my email with a nod to our upcoming 150th anniversary and creating a strong future for those who come next. I am hopeful, despite how hard the work ahead will be. Moments like this test institutions—but they also shape them. I am confident in the creativity, resolve and resourcefulness of all of you in the UO community. Thank you.