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May 17, 2012

Tuition hike cap could avert cuts

Proposed funding cuts to Pitt and other state-related and state-owned institutions may be averted in exchange for a pledge by school administrators to hold down tuition increases in the coming academic year.

John Fedele, Pitt’s associate director of News, stated, “The University of Pittsburgh has been working with [Senate appropriations committee chair Jake] Corman and other legislative leaders and has agreed to hold any tuition increases for the next academic year to a blended rate no greater than the 2011 consumer price index of 3.2 percent, if the commonwealth appropriation is fully restored to last year’s levels.”

Pitt’s amended appropriations bill (SB 1468) would restore state funding to $133.993 million in general support plus $2.083 million for rural education outreach, the amounts legislators approved last July for fiscal year 2012. (See July 7 University Times.)

Appropriations bills for the state-related universities are poised for Senate action. Support for “non-preferred” entities not under the complete control of the state is approved through legislation separate from the general fund appropriation. Pitt is among the non-preferred entities; its appropriation requires a two-thirds vote of the House and Senate for approval.

Although the agreement would avert additional budget cuts, the FY12 appropriation represented a cut of 19 percent from the $168 million Pitt received in FY11. (In that budget, Pitt’s overall state support was cut nearly 22 percent —19 percent from the general appropriation and approximately 50 percent from medical school funding.)

For FY13, Gov. Tom Corbett proposed a 30 percent cut to Pitt’s education and general appropriation and a 10 percent cut to its academic medical line item support, a combined reduction of nearly $42 million. (See Feb. 9 University Times.)

Similar cuts were proposed for Penn State and Temple, while funding for Lincoln, the smallest of the four state-related universities, was held flat.

In comments to Senate Council May 9, Chancellor Mark A. Nordenberg regarded the Senate’s proposal as progress. “Current year levels, again, are $67 million less than they were the year before but they are a lot better than what was proposed in the budget address in February,” he said.

“We’re at least moving in the right direction but we also need to recognize that there are other hurdles yet to be faced as we move down the path toward the passage of the commonwealth budget, including our appropriation in the weeks ahead. … I’m hopeful that by the middle of the summer we will have an appropriation and a budget that is better than what we had anticipated at the end of February.”

Provost Patricia E. Beeson told the University Times: “I certainly am heartened by the fact that our friends in the legislature see the value in public education and are working to provide funding for that public education. … Hopefully, the governor will agree that the resources are available.”

General fund budget

Before non-preferred appropriations can be approved, legislators must pass a general fund budget.

The state Senate last week passed a $27.656 billion general fund budget bill (SB 1466) for the fiscal year that begins July 1, which would be $517.2 million higher than the budget Corbett proposed in February.

That Senate bill would restore the proposed 10 percent cut to Pitt’s academic medical center funding contained in the governor’s budget proposal. Pitt’s medical school funding from the state is part of the Department of Public Welfare budget.

The budget bill now goes to the House of Representatives, which will reconvene May 21.

In a prepared statement last week, Senate appropriations committee chair Corman attributed the improved budget to a better-than-anticipated revenue picture.

“Increased revenues over the past few months allowed us to alter what the governor had initially proposed back in February, including significant restorations to higher education, basic education, early childhood funding and social service funding,” Corman said.

“The significant restorations to higher education get funding back to last year’s level,” he stated. “With our commitment to higher education, we have received commitments from the three presidents of Penn State, Pitt and Temple, as well as the chancellor of the State System of Higher Education, that the full restoration will give them the ability to keep tuition increases to a minimum, at most no higher than the Consumer Price Index.

“That will be significant to the families and students around Pennsylvania and a refreshing change for them to see a smaller tuition increase.”

Freeze remains

The proposed restoration of funding does not lift a mid-year freeze on a portion of Pitt’s FY12 appropriation.

In January, Gov. Corbett, faced with below-estimate revenues, warned the state-related universities of a 5 percent freeze on their FY12 appropriations. That represents a $6.8 million cut for Pitt that would be withheld from the state’s final FY12 monthly payment.

Eric Shirk of the governor’s press office said those funds remain frozen in light of an anticipated revenue shortfall.

Although in February the governor projected a $719 million FY12 year-end shortfall, initial revenue estimates released May 1 by the state’s Independent Fiscal Office (IFO) projected that the shortfall will be $300 million. The IFO’s official revenue estimate will be released in mid-June.

—Kimberly K. Barlow

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