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March 31, 2011

Chancellor encouraged by support, mum on possible Pitt actions

Gov. Tom Corbett’s March 8 budget proposal that calls for cuts of more than 50 percent to Pennsylvania’s state-related and state-owned institutions of higher education has moved students, employees, alumni and other supporters of those institutions to contact legislators and take to the streets in protest rallies on campuses across the state and in Harrisburg.

Chancellor Mark Nordenberg addressed a student rally March 22.

Chancellor Mark Nordenberg addressed a student rally March 22.

Corbett, in announcing his $27.3 billion general fund budget proposal, said the state entered 2011 more than $4 billion in debt. His plan to close that budget gap would cut Pitt’s state appropriation from $160.49 million to $80.245 million and eliminate funding for the School of Medicine, Western Psychiatric Institute and Clinic, Pitt’s dental clinic and the Center for Public Health Practice, an additional loss of almost $17 million.

Following budget hearings before the state House and Senate appropriations committees, Chancellor Mark A. Nordenberg told the University Times he was heartened by the support expressed by many legislators, a number of whom made it clear that the governor’s proposal is only a first step that paves the way for further budget deliberations.

“However, the realities of the budget deficit and the expectation that it will be closed are always there,” the chancellor said. “Even with expressions of support, there will be real challenges in identifying the funds that could be used to restore some substantial portion of our existing funding.”

State support has declined in proportion to Pitt’s budget, falling from some 30 percent of the budget in the 1970s to less than 10 percent. The governor’s proposal would reduce state support to slightly less than 5 percent of Pitt’s $1.89 billion operating budget.

“When your starting point is a series of cuts that add up to such a large figure, the real worry is that even if you’re successful in achieving some measure of restoration, there still will be a sizable budget cut to deal with,” Nordenberg said.

Penn State last week announced it would freeze employee wages for the coming fiscal year and has warned of possible layoffs, satellite campus closings and program cuts if Corbett’s proposal is enacted. Lincoln University President Ivory Nelson warned legislators his school would have to raise tuition and fees 20 percent to make up for such a cut. Faculty at the 14 state-system schools have offered to negotiate a wage freeze to avert what could mean a 33 percent tuition increase on their campuses.

While other institutions have offered examples of what such deep cuts would mean, Pitt administrators have declined to pinpoint how the University might deal with a significantly lower state appropriation.

In a March 8 press conference, the chancellor said, “The prospect of cuts this size almost means that everything has got to be on the table.”

Nordenberg told the University Times March 29 that the University planning and budgeting committee has begun considering steps that could be taken. “Our traditions, though, are to respect the work of that committee as well as the preliminary discussions that might occur within the [Board of Trustees budget] committee and not to publicly reveal plans until we’re close to being able to implement them,” Nordenberg said.

“At this point I’m not sure that it would be constructive to talk about what we might do if we have a 50 percent cut, a 25 percent cut or 10 percent cut. All of them would be difficult for us, given the fact that we already operate in a lean mode and because we really do believe in the good that flows from the funds that are invested in our work,” he said.

“Clearly the actions that already have been taken at Penn State and the discussions that are occurring within the State System of Higher Education are additional indicators of how difficult our budget situation is likely to be this year,” Nordenberg said. “Beyond that, though, it’s hard for me to be very specific at this point.”

Pitt’s budget issues won’t be settled until state budget decisions are made. While legislators in recent years have failed to meet consistently the fiscal year-end budget deadline, Nordenberg said he believes legislators are motivated to complete the budget before the June 30 deadline.

Once a state budget is enacted and Pitt’s appropriation (which is allocated in a bill separate from the state general fund budget) is set, Pitt’s Board of Trustees will act. “It’s at that point in time that we put together a budget, including any special steps that would need to be taken,” Nordenberg said.

Although the University has dealt with previous cuts in state support, none has been of such magnitude, the chancellor noted.

“Everyone who has a measure of responsibility for the finances of the institution obviously is aware that very significant cuts to a principal source of support have been proposed. Almost certainly, then, anyone shouldering those responsibilities is thinking about the programs for which he or she is responsible and thinking about steps that might be taken,” the chancellor said.

“We have indicated publicly that we’ll do what we can to make certain that the full weight of these reductions is not felt by our students through tuition increases. Still, when you are talking about possible cuts of this size, and cuts to the very funding that is intended in large part to support the tuition differential between in-state and out-of- state students, it would be almost impossible to escape sizable tuition increases, particularly for in-state students,” Nordenberg said.

“The employees of University have been through other challenging times in the recent past. They have demonstrated a collective commitment to the overall work of the University and an understanding that in challenging times sacrifices sometimes are required. When you face the prospect of a better-than-50-percent reduction in the support from your home state, it really does mean that almost everything reasonable needs to be considered.

“Hopefully, the weeks ahead will provide some measure of relief from a threat of that size, but it does appear that there will be uncertainty for a period of additional weeks.”

—Kimberly K. Barlow

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