LEXINGTON, Ky. — The University of Kentucky's board of trustees on Friday approved a $6.8 billion budget proposal for the 2023-24 fiscal year.

The historic plan is the largest in the university's history and 21% larger than last year's budget. UK officials say the increase, driven by the institution's growing health care system, will hold in-state tuition hikes at 2.75%.

In a press release, UK President Eli Capilouto said the budget confirms his goal "to advance Kentucky."

"We were created nearly 160 years ago with an essential mission and singular focus—to advance Kentucky—its health, its economy and its quality of life," Capilouto said. "With this budget, we demonstrate how we are honoring that mission today and how we are preparing to continue to honor our promise to the commonwealth for the future.”

When Capilouto took over at UK in 2011, the university's budget was a comparably modest $2.7 billion.

More enrollment and education access

UK anticipates a record first-year class this fall and an overall enrollment of roughly 33,000. If their projections are right, officials said it'll be the second year in a row that first-year enrollment tops 6,000.

Alongside the 21% budget hike, UK has promised to hold tuition increases to 2.75% for in-state undergrads. On average, that would make fall 2023 tuition $6,606.00, up from $6,429.50 in the fall.

UK should hit a record, six-year graduation rate of 70% and a five-year graduation rate that almost matches that milestone, officials said, underscoring successful efforts to accelerate retention levels.

Expanding health care

The academic health system represents nearly $4 billion of UK's budget, officials said, marking a 300% increase from 10 years ago.

UK's health care expansions won't stop any time soon. Around $2.4 billion in new developments are currently in the design phase, including a lofty expansion of the Albert B. Chandler Hospital.

The proposed budget predicts $494 million in revenue from research grants and contracts, the third straight year the research enterprise would top $400 million.