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March 7, 2002

Nordenberg declines to specify tuition hike size if governor's cut is okayed by legislators

HARRISBURG — Unlike the heads of Pennsylvania's three other state-related universities, Pitt Chancellor Mark Nordenberg refused to declare publicly last week that his school would increase tuition by 10 percent or more next fall if state legislators approve Gov. Mark Schweiker's recommended budget.

But Nordenberg hinted that a double-digit tuition hike was likely at Pitt, too, should the governor's plan go through.

"I'm trying not to scare people until we have a good sense of what are the range of options that are available to us," Nordenberg told the House of Representatives' appropriations committee Feb. 27 after lawmakers asked him — for the fifth time in two days — how Pitt tuition would be affected if the General Assembly approves Schweiker's plan to cut funding to Pennsylvania's state-related schools (Pitt, Penn State, Temple and Lincoln) by 5 percent.

But Nordenberg added: "You can look at history as some guide, and you can see that we raised tuition by 7.5 percent last year with essentially a flat budget."

Last summer, state lawmakers approved a 0.6 percent increase in Pitt's appropriation for the current fiscal year. However, facing a $622 million recession-related deficit in the state budget, Schweiker later imposed freezes of 3 percent on funding to Pitt and other state-supported universities.

For Pitt, the 3 percent freeze amounts to nearly $5.4 million out of this year's approved $178.5 million appropriation. It appears increasingly likely that the state will withhold the full $5.4 million from Pitt's final FY 2002 payment from the state, in June.

An additional 5 percent cut next year would further reduce Pitt's budget by $9 million.

q On Feb. 26, the heads of the four state-related universities testified together before the state Senate's appropriations committee. They said Schweiker's proposal was biased against their schools because it would reduce their budgets by 5 percent, while cutting the State System of Higher Education's allocation by just 3 percent and increasing funding to community colleges by 4 percent.

Penn State President Graham Spanier bristled when Sen. Mary Jo White, R-Butler and Venango counties, suggested that state-related universities were better equipped to absorb cuts because they are large and diverse institutions with a broad range of resources.

Spanier noted that he, Nordenberg, Temple President David Adamany and Lincoln President Ivory Nelson "have all said that we have to do our fair share to help the state through this period, and hope that we're beneficiaries when things look better. But, just speaking for myself, I feel like we're being asked to do more than our fair share."

State-related schools recognize the importance of community colleges and wouldn't recommend cutting their funding, Spanier said. But he pointed out that Penn State confers a larger number of two-year, vocationally oriented degrees than any other Pennsylvania school.

Nelson pleaded: "Granted, my colleagues are very diverse, but I am not." With just 2,000-plus students, and lacking the hundreds of millions of dollars in research grants that Pitt, PSU and Temple attract annually, Lincoln more closely resembles one of the 14 state system universities, said Nelson.

Spanier told senators that Penn State would be forced to hike tuition next fall by 10-14 percent if the Commonwealth cuts PSU's funding by 5 percent, on top of this year's 3 percent freeze.

Temple's Adamany said a 10.4 percent tuition increase next fall is the worst case scenario for his university.

Nelson said Lincoln's tuition increase "could go as high as 10 percent" under the governor's budget. "When I'm asked to take a 3 percent cut [in the current fiscal year] and then a 5 percent cut next year, I'm sitting on a precipice," Nelson said.

Nordenberg said Schweiker's budget "particularly when viewed over time, could have devastating effects within our institutions." Adjusted for inflation, the governor's proposed educational and general funding for Pitt would be $9.4 million less than what the University got in FY 1996, Nordenberg said.

Pitt would find it tougher to recruit and retain high-quality faculty and would be forced to postpone important projects, the chancellor said — including, perhaps, projects included in Pitt's three-year information technology plan, now in its second year.

Besides facing predictable cost increases for salaries, health benefits and lab equipment, state-related schools encounter unexpected cost hikes, the university leaders said.

Nordenberg said Pitt's sewage rate increased far more than expected (75 percent), while water rates went up by 10 percent.

He, Spanier and Adamany also cited escalating malpractice insurance costs.

Penn State had budgeted for an $8 million increase in malpractice insurance premiums this year, but premiums actually rose by $18 million, Spanier said. "For an academic medical center, swings of $18 million in malpractice costs are backbreaking," he said.

Adamany said Temple's faculty practice plan, which used to contribute to that university's operating budget, has for the last three years been losing money "entirely because of the increase in malpractice costs."

Nordenberg didn't cite figures on Pitt's malpractice insurance costs during the Feb. 26 Senate hearing. But at the next day's hearing of the House appropriations committee, he reported that Pitt's faculty practice plan was charged $13 million for malpractice insurance last year. "This year, it's up to $17 million, and we can expect that number to rise further next year," Nordenberg said.

Last Tuesday's hearing was the first, at least since the 1970s, at which the heads of all four state-related universities testified together before the Senate appropriations committee.

Through nearly three hours of testimony, the leaders presented a united front. In their opening statements, each focused on a particular topic relevant to all four universities.

For example, Adamany talked about the universities' collective teaching mission. He noted that tuitions at Pitt, Penn State and Temple are already $3,200 above the national average for public universities. Further hiking those schools' tuitions will even more heavily burden Pennsylvania students with debt and deter others from pursuing college, the Temple president said.

In 2000, Pitt ranked 27th among states with 23.9 percent of its population over age 25 being college-educated. Among neighboring states, only West Virginia (17.9 percent) had a smaller proportion of college-educated 25-and-older residents, Adamany said.

Nordenberg described biotechnology research at the state-related schools, including their key roles in the Pittsburgh Digital Greenhouse and the state's three new Life Sciences Greenhouses.

National studies indicate that every $1 million in research and development funding supports 30-31 jobs, Nordenberg said. At that rate, Pitt alone — with its $405 million in research grants — can be expected to generate 12,000 well-paying jobs, he said.

In response, Sen. Robert M. Tomlinson, R-Bucks Co., called state-related universities "part of the economic solution for Pennsylvania to be more competitive." He argued against Schweiker's proposed cut of the universities' budgets. "In a time of recession," Tomlinson said, "this Commonwealth should be investing where we believe there is a return on investment, in jobs."

While exchanges between senators and university heads were respectful during the Feb. 26 Senate appropriations committee hearing, the House appropriations committee sounded downright sympathetic toward the University of Pittsburgh during a Feb. 27 appearance by Nordenberg and other Pitt senior administrators.

Rep. Dan B. Frankel, D-Allegheny Co., called Gov. Schweiker "cynical" for bragging that his proposed budget would be the first Pennsylvania spending plan during recessionary times that would not raise taxes.

Frankel argued that the governor's plan calls for the equivalent of tax increases in such forms as higher tuition for Pennsylvania college students and their parents.

Rep. Babette Josephs, D-Philadelphia, also criticized what she called Schweiker's "backdoor way of raising taxes."

Josephs was one of two lawmakers last week who mentioned the controversy over Pitt's Environmental Law Clinic. (The other was Sen. Joseph Scarnati, R-Warren, key member of the legislative group that convinced the General Assembly to insert a line in Pitt's current appropriation bill, stating that no state money could be spent on the clinic. Scarnati and other lawmakers in northwestern Pennsylvania were angry with the clinic for representing opponents of logging in the Allegheny National Forest. During the Feb. 26 Senate hearing, Scarnati told Nordenberg: "I want to thank you for your accessibility and your interest in helping to resolve that" issue. Scarnati also praised Pitt's Bradford and Penn State's Dubois campuses, both located in his district, as "valuable economic engines.") During the House hearing, Rep. Josephs praised the Environment Law Clinic and its students. "Those students took seriously the duty of attorneys, which is to make sure that everyone has their day in court," she said. "As a result, they ruffled feathers of people who were powerful, which is what law students are supposed to do."

Josephs called the General Assembly's action against the clinic "totally improper" and asked for Nordenberg's perspective on the controversy.

Reiterating what he has said and written on the subject since last fall, Nordenberg described the clinic's history and his administration's response to the General Assembly mandate.

"We have believed from the outset that dealing with this issue is, in the first instance, the responsibility of those in the law school, the unit of the University that is [the clinic's current] home," the chancellor said. "They are, I am quite confident, continuing to work on alternative solutions and we are being optimistic that there will be a good result."

At last Friday's meeting of the University Senate's budget policies committee, a professor noted the warm reception that House members gave Pitt administrators.

But one of those administrators, Vice Chancellor for Budget and Controller Arthur Ramicone, pointed out: "When I left, though, there was no money in my hand."

— Bruce Steele


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