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February 9, 2012

Governor wants 30% cut

for 3 state-relateds

Fiscal year 2013 will bring more sharp cuts in state funding for Pitt if Gov. Tom Corbett has his way. Corbett proposed slashing the University’s education and general (E&G) appropriation to $95.25 million, excluding medical school funding, as part of a $27.14 billion state budget proposal unveiled Feb. 7 in Harrisburg.

Three of Pennsylvania’s four state-related universities — Pitt, Penn State and Temple — would see their state support reduced by 30 percent under Corbett’s proposal. Funding for Lincoln University would remain flat at $11.16 million.

The governor’s proposal would cut Pitt’s general appropriation support from $134 million in the enacted FY12 appropriation to $93.8 million and reduce support for rural education outreach from $2.08 million in FY12 to $1.46 million in the coming fiscal year.

Pitt also would see a 10 percent cut in medical school funding as part of a proposed $1.26 million program reduction for academic medical centers statewide, said Paul A. Supowitz, vice chancellor for Governmental Relations.

The combined cuts in E&G and academic medical line item support total nearly $42 million, a reduction of about 29 percent.

In addition, the proposed budget appears to eliminate a program that uses tobacco settlement fund revenues to fund health-related research. Chancellor Mark A. Nordenberg, in a Feb. 7 University Update, stated that Pitt’s annual share of those revenues averaged more than $9.2 million.

Nordenberg noted that the governor’s proposal would return Pitt’s level of state support to mid-1980s levels in absolute dollars and cut the state appropriation to less than 5 percent of the University budget.

Impact on PSU, Temple

Corbett’s proposed budget would cut Penn State’s general support from $214.1 million to $149.9 million while funding for its Pennsylvania College of Technology would remain steady at $13.6 million, for a total appropriation of $163.5 million. Temple’s general support would be cut from $139.9 million to $97.94 million under the governor’s proposal.

Cuts on top of cuts

Nordenberg labeled FY12 “a brutal budget year,” estimating that the accumulated cuts for the fiscal year total some $67 million and the cumulative two-year cuts add up to more than $100 million.

Pitt started FY12 with a reduction of more than $40 million, representing a combined 22 percent cut in state support.

Last June, legislators reduced Pitt’s appropriation to nearly $136.1 million (comprised of $134 million in general support and $2.08 million for rural education outreach), cutting its $168 million FY11 appropriation by 19 percent in the FY12 budget.  Funding for Pitt’s medical school, Western Psychiatric Institute and Clinic, dental clinic and Center for Public Health Practice was cut in half — down approximately $8.5 million from FY11’s $16.9 million in academic medical center support. (See July 7, 2011 University Times.)

The situation has since gotten worse: The University’s share of state capital fund money was cut in half, from $40 million to $20 million. (See Jan. 12 and Jan. 26 University Times.)

And an additional $6.8 million in state funding was placed into budgetary reserve in early January following a state Department of Revenue midyear report that showed collections were lagging behind estimates.

The freeze includes a $6.7 million reduction in general support and a $104,000 reduction in rural education outreach funding, which would reduce the state’s FY12 support to $129.3 million, excluding academic medical center funding.

That freeze did not extend to the state’s academic medical centers appropriation, which is part of the Department of Public Welfare budget. (See Jan. 12 University Times.)

Corbett indicated that the frozen funding could be released if the state’s economic picture brightened. However, in his update, Nordenberg called the budgetary reserve terminology “a polite term-of-art for a mid-year budget cut,” and the revenue department’s most recent report showed a widening gap in collections, with year-to-date revenues as of Jan. 31 lagging by $497.2 million, or 3.5 percent less than anticipated.

In his update, the chancellor placed the cumulative reduction into perspective. “If we had tried to deal with a $67 million cut solely through workforce reductions, that would have required us to eliminate more than 1,000 Pitt staff jobs carrying average levels of compensation and benefits. Or if we had tried to deal with a $67 million cut solely through tuition increases, that would have required an average tuition increase of about $2,600 for each of our in-state students,” he stated.

“For an in-state undergraduate student enrolled in the arts and sciences on the Pittsburgh campus, that would have been an 18.5 percent increase and would have taken tuition to $16,676 per year. For an in-state undergraduate student enrolled in the arts and sciences on a regional campus, that would have been a 23 percent increase and would have taken annual tuition to $13,886,” the chancellor stated, noting that, rather than cutting jobs, the University instead reduced budgets, deferred salary increases for most employees and implemented more moderate tuition increases for in-state undergraduates in the arts and sciences  — 8.5 percent in Pittsburgh and 4 percent on the regional campuses.

“We believed that this approach was fairer in human terms and also made good business sense, because the demand for our services remains high and does depend upon the quality of those services,” he stated.

What comes next

The governor’s annual budget proposal is the start of budget negotiations for the upcoming fiscal year. A final state budget is due by the June 30 fiscal year end.

Following the governor’s presentation, state House and Senate appropriations committees hold public hearings in which state agencies testify about their budget needs.

Legislators then introduce budget bills that may be amended before passage.

The state-related universities are scheduled to testify before the House appropriations committee on Feb. 22. The Senate appropriations committee, which visited the four state-related schools’ campuses last fall (see Sept. 15, 2011, University Times), has not scheduled a hearing for the four universities this year.

Commenting on the governor’s proposal, Nordenberg stated, “This is just the beginning of the state’s budget-building process. We now will move through legislative hearings and will seek to advance our case in other settings as well. Knowing the daunting challenge that we now face, we need to build upon the outstanding advocacy efforts undertaken by students, faculty, staff and alumni during the budget-building process last year. Officers of the University Senate, the Staff Association Council (SAC), the Student Government Board, the Graduate and Professional Student Assembly and the Pitt Alumni Association already have stepped forward to express their desire to be advocates for Pitt. In the end, though, the success of this effort depends upon even broader participation throughout the University community.”

A call to action

In remarks to Pitt’s Senate Council on Feb. 1, Nordenberg commented on the role of eroding state support and the need for broad-based grassroots advocacy in response.

He said, “Just last week, President Obama at the University of Michigan spoke to a national need to keep tuition increases within some range of reason. I think it is that part of his address that got most of the attention. But he also indicated, and his secretary of education said more explicitly, that the biggest problem in public higher education is the continuing erosion of state support. What we saw last year was not just an erosion, it really was a dramatic decline in the levels of support that we might have expected.

“We do need to be prepared to advocate again against another round of deep cuts,” he said.

He said he and the other state-related university presidents were in Harrisburg in late January, adding that he also was pleased that 45 Pitt students participated in a Jan. 31 Pennsylvania Association of State-Related Students rally at the Capitol to protest cuts in higher education funding.

“I’ve met with the officers of the [University] Senate and the officers of SAC, and I know that everyone is prepared to step forward this year. We really do need to have a strong, united, organized, well-reasoned approach if we are to be successful in blunting whatever cuts might otherwise come our way.”

He told Senate Council, “The cause is a noble and worthy one, and we’ve got to keep working at it so that these difficult times don’t set public higher education back in ways that will make recovery difficult. I believe and I know you believe that if that happens it’s a setback not just for us, it’s a setback for society, for our country and for the progress that we otherwise are helping to fuel.”


Nordenberg’s University Update is posted at

Complete state budget details are at

—Kimberly K. Barlow

Peter Hart contributed to this story.

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