Chancellor Mark Hagerott, speaking to the Appropriations - Education and Environment Division on Jan. 9, presented the University System Office’s needs-based budget and outlined priorities that include student financial aid, workforce programs and information-technology modernization.

The presentation set context for a $2.838 billion system request (all funds) that the system office has forwarded to the State Board of Higher Education and the governor, and listed principal asks such as challenge grant funding, financial-aid increases and several capital requests.

Why it matters: the NDUS general funding and targeted program requests determine tuition pressure, campus operating capacity and the state’s ability to pay for workforce-related degree production. NDUS leaders told the committee they are balancing enrollment recovery with large one‑time capital needs and legacy IT systems.

Hagerott introduced the system’s organizational structure and cited recent accomplishments, saying the State Board of Higher Education “has been governing the university system for 85 years.” Vice Chancellor Jerry Rostad reviewed program-level outcomes and noted the North Dakota Career Builders and Loan Repayment Program has produced 435 workers in in‑demand occupations; he also described a “challenge grant” program that campuses match with private funds and said the challenge grant “was funded at $20,000,000.”

Dave Kroposbach, NDUS vice chancellor for administrative affairs and chief financial officer, presented the budget arithmetic, including a needs‑based budget request that lists general‑fund, tuition and other funds and a governor’s executive recommendation. He outlined specific asks by tab in the budget packet: a nursing education consortium, an artificial‑intelligence and machine‑learning request ($3 million, with $2 million for software and $1 million for staffing at Core Technology Services), planned‑obsolescence technical infrastructure funding ($2.6 million) and high‑demand workforce development dollars ($3 million).

Kroposbach flagged the enterprise resource planning (ERP) replacement as a near‑term need: the PeopleSoft systems that run student, HR and finance operations are “more than 20 years old” and the system office asked for $10 million in planning funds that the governor included for ERP preparation.

Committee members and NDUS staff also reviewed capital requests included in the system office and board package: Mayville and Minot projects, a capital building fund request the governor has proposed at $20 million, and a large challenge‑grant ask that the governor’s recommendation moved during the morning (Kroposbach described separate governor proposals at $30 million and $50 million across different briefings earlier in the day).

The system office briefed committee members that some one‑time requests were not supported in the earlier governor’s budget, and that the executive recommendation added salary and fringe adjustments and an emerald ash borer mitigation item for Forest Service budgets. NDUS leaders said they will provide more detailed materials in subsequent committee hearings and noted the system will present campuses separately over the following days.

The presentation contained several budget clarifications (amounts and where governor proposals differed from board requests) and a request that the committee evaluate the system’s combined operating and one‑time capital needs as hearings continue.

Ending: NDUS staff told the committee they will return with campus presentations and detailed budget tables; committee leadership scheduled follow‑up hearings for the remainder of the week.