Trustees at the University of Illinois have approved a $5.4 billion operating budget that includes less money from the state, but increases day-to-day spending by 3.7%.

Trustees approved the budget Friday. It applies to more than 77,000 students and 23,000 employees at three campuses in Urbana-Champaign, Chicago and Springfield. The budget is up 7.6%, or about $383 million. But that figure includes about $227 million in employee health care and pension payments. Excluding those payments the budget it up 3.7%.

University officials say the budget includes $612 million in state appropriations, which is down $42.5 million or 6%.

University President Robert Easter called the reduction "anticipated and planned for." He called the university's finances "strong."