In February 2004 Governor Phil Bredesen’s State of the State and budget message called for a reduction of 5 percent in UT’s state allocation. Finally, the state provided around $1 million less to UT than in 2003, but a mandated 2 percent across-the-board pay raise and increases in fixed costs required $12 million to fund. Chancellor Crabtree indicated that the funds to provide the mandatory pay raise ($5 million, including benefits) would need to come from internal reallocations, instead of raising tuition, since the state of Tennessee did not provide monetary assistance for the mandatory pay raise. Bredesen did promise a 1 percent bonus payment for all employees.