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March 6, 2008

State-relateds plead case to legislators

HARRISBURG — Leaders from Pennsylvania’s state-related universities didn’t need a senator to tell them, but Senate appropriations committee member Jake Corman (R-Centre Co.) said it anyway. “Clearly the governor’s budget reflects his priorities and you’re not one of them,” he told Chancellor Mark A. Nordenberg and his colleagues from Penn State, Temple and Lincoln universities.

The contingent of university leaders presented their cases for increased funding and answered questions Feb. 26 as part of separate House and Senate appropriations committee hearings that follow the governor’s annual budget proposal.

In his Feb. 5 budget announcement, Gov. Edward G. Rendell cited a 4.1 percent inflation rate as he proposed a state general fund budget of $28.3 billion, an increase of 4.2 percent over 2007-08.

Higher education didn’t fare as well: Rendell proposed 1.5 percent increases to the operating (educational and general) budgets of the state-relateds, while cutting or holding flat other line items.

The governor proposed 3 percent increases in total funding for community colleges and 3 percent operating increases for State System of Higher Education schools. (See Feb. 7, 2008 University Times.)

For Pitt, Rendell proposed an appropriation of $188.85 million including $166.78 million in E&G funding.

Nordenberg told the Senate committee, “When you take the 1.5 percent recommended for our E&G lines and make adjustments for the line items that are either frozen or reduced in the proposed budget, for Pitt we come in at about 1.2 percent,” pointedly comparing the number to Rendell’s much larger percentage increases for other schools and for the overall budget.

“It almost makes you wonder whether you are out of the game,” Nordenberg said. “It does not seem to be the kind of recommendation that would have been generated by the levels of performance that you see from the institutions at the table. And it runs exactly contrary to the trends that you see in other states where state governments are investing heavily in their public research universities, believing that is a sound investment in terms of the building of the economy of the state.”

Nordenberg pointed out in his opening remarks to the House committee that the state-related universities still are trying to regain ground lost to budget cuts and freezes in previous years. “As we have come to Harrisburg each year, we have said, ‘Let’s try to get back to where we were. Let’s take some reasonable steps.’ We know we can’t bite all of this off in a single year, but we really have not made much progress. At the University of Pittsburgh, if you took our 2001 appropriation and you simply advanced it by the CPI — not the higher education price index, which is higher — we’re about $30 million behind where we were at the beginning of the decade,” Nordenberg said.

The University is doing its part to hold down expenses through cost-cutting and private fundraising efforts, the chancellor said, but he added that parents and donors want to feel as though they’re part of a partnership in which the state is providing some assistance as well.

Noting that the appropriation impacts tuition, Nordenberg said, “When you look at the recommendations for this year, it would seem as if the commonwealth really has abandoned even an attempt to move forward and deal with this problem in a way that would benefit our students, that would benefit the communities that we call home and that also would benefit the commonwealth through economic development.”

Nordenberg’s fellow panelists echoed his sentiments, with Penn State President Graham Spanier labeling the proposed appropriation “completely inadequate.”

Lincoln University President Ivory Nelson told the panels that in the wake of a 16 percent increase in Lincoln’s health care costs, the governor’s recommended increase of $207,000 would cover just two months’ worth of his institution’s health insurance bills.

Spanier noted that undergraduate education mainly is funded through tuition dollars and the state appropriation, adding that if the appropriation fails to keep up with inflation, tuition must rise. “If you increase tuition beyond inflationary levels, you make it difficult for some people to consider coming to college,” he said.

Anthony Wagner, Temple vice president of financial affairs, added, “When you look at what’s happening in the credit markets and access to guaranteed loans being even more difficult because of global financial issues it’s a real concern.”

The hearings came just days after the Pennsylvania Higher Education Assistance Agency held an emergency student loan funding summit to address a potential crisis in student loan funding. In the wake of failed bond auctions, PHEAA has since announced its withdrawal, effective March 7, from the Federal Family Education Loan Program.

The university representatives’ concerns were met with some sympathy at the Capitol. In reviewing proposed increases in the state education budget, House appropriations committee chair Dwight Evans (D-Philadelphia) acknowledged, “Unfortunately, higher education seems to fall at the bottom of the rung, even though we should be investing more rather than less.”

Rep. Dan Frankel (D-Allegheny Co.), who also is a Pitt trustee, noted that many other states are supporting higher education with much larger investments. “We need to change something,” he said.

“Ultimately you’ve done a lot with less from us and it is disturbing as we sit here every year and see what is essentially a disinvestment in our state-related educational institutions. And to say every year we’re not going to meet even half the cost of living index … we’re not doing our job at the end of the day,” Frankel said. “Ultimately we talk about increasing taxes; we are increasing taxes on Pennsylvania students and their families who have to pay tuition increases that you are really forced to do,” he told the administrators. “I think we really need to be more responsive ultimately.”

Sen. Mary Jo White (R-Venango Co.), whose district includes Pitt-Titusville, said, “I happen to think a 1.5 percent increase proposal is almost embarrassing and I certainly hope that when the negotiations proceed that we can find a way to do better for our state-related institutions because they do so much for Pennsylvania.”

White added a bit of levity to the hearing when she pointed out that when she opened Temple’s annual report she found an envelope for donation. Congratulating the Philadelphia school for its ingenuity, she teasingly chided the other administrators for not doing likewise.

Following the hearings, Nordenberg said he felt good about the committee members’ reactions to the presentations.

“They seemed almost as surprised as we had been at the governor’s low recommendation,” he said. “We all know, though, and they understood this fact that now there will be a real struggle over the course of the next several months to try to improve our position.”

Prior to the hearings, the chancellor presented a written statement to the committees outlining Pitt’s needs, drawing heavily on a Jan. 11, 2008, Chronicle of Higher Education comparison that found the average level of state support for higher education rose 7.5 percent in the 2007-08 budget year. In contrast to the national trend, Pennsylvania’s support for higher education rose 1.8 percent, placing it No. 47 among the states.

Noting that neighboring states are subject to economic conditions similar to Pennsylvania’s, he said that West Virginia’s support for higher education rose 14.3 percent, Ohio’s rose 7.7 percent, New York’s rose 6.8 percent, Delaware’s 4.2 percent and New Jersey’s 2.7 percent.

The chancellor reiterated the economic information in his report to Pitt’s Board of Trustees at its Feb. 29 meeting.

Nordenberg declined to predict how much of an increase in the state appropriation Pitt might receive. He said Pitt leaders will continue to work behind the scenes “advancing our case in less-public settings as we take advantage of opportunities that we have to present our case to legislative leaders as part of the process of shaping the budget.”

Among the efforts is the upcoming Pitt day in Harrisburg in which University leaders enlist the help of alumni in meeting with their representatives.

—Kimberly K. Barlow


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