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February 21, 2013

Report analyzes higher ed spending

Ongoing scrutiny of costs in higher education, along with calls from state and federal officials to peg taxpayer support to institutions’ performance, is prompting the University Senate budget policies committee (BPC) to look closely at data used to reflect Pitt’s efforts.

Gov. Tom Corbett, in a precursor to his proposed fiscal year 2014 budget, announced flat state funding for higher education in exchange for the state-system and state-related universities’ pledge to hold down tuition increases. (See Feb. 7 University Times.) And President Barack Obama, in his State of the Union address, called on institutions to hold down rising tuition costs, proposing that affordability and value be among the criteria used to determine which schools receive some forms of federal aid.

On BPC’s Feb. 15 meeting agenda was a report on the Delta Cost Project on Postsecondary Education Costs, Productivity and Accountability (DCP), which aggregates Integrated Postsecondary Education Data System (IPEDS) data in order to analyze spending by institutions of higher education.

Based on FY09 IPEDS data, education and general (E&G) expenses on the Pittsburgh campus total $58,254 per student, said David DeJong, vice provost for academic planning and resources management, as part of a broader presentation to BPC.

Pitt’s regional campuses, auxiliary and hospital expenditures are excluded from the data. Medical school faculty salaries also are excluded but other expense categories for medicine were included in the total, noted BPC chair John J. Baker.

The total E&G expenditures are made up of three categories: education and related ($26,246 per student); research and related ($28,571 per student), and public service and related ($3,424 per student).

“At Pitt, 45 percent of our total expenditure in E&G is education; 49 percent is research, 6 percent is public service,” DeJong said.

In turn, education expenditures are attributed to instruction ($16,043 per student) and student services ($3,662 per student); research accounts for $21,450 per student, and public service adds up to $2,570 per student. The “related” category, which DeJong said loosely represents overhead, totals $14,516 per student.

The “related” category is broken down into three components: academic support, institutional support and operations and maintenance expenditures. Academic support expenditures total $6,012 per student; institutional support represents $4,688 per student, and operations and maintenance account for expenditures of $3,816 per student.

DCP’s definition of E&G expenditures (spending in IPEDS’s instruction, research, public service, student services, academic support, institutional support, operations and maintenance and net scholarships and fellowships categories) does not align with what commonly is understood as E&G for Pitt’s budget purposes, noted Arthur G. Ramicone, chief financial officer.

“Our E&G makes up only 42 percent of our total,” he said, noting that Pitt’s E&G does not include research or medical school expenditures.

DeJong’s presentation also included Pittsburgh campus costs, tuition prices and levels of state/local support among data benchmarked against a group of two dozen peer and aspiration institutions. “We keep who we compare ourself with confidential,” DeJong said.

He cautioned that there are variations among institutions in categorizing data they submit to IPEDS.

Citing government attention to rising tuition costs, DeJong said he hopes for better reporting standards. “The data are not audited and yet there’s more and more scrutiny on these data,” he said, adding, “I would really hope that the standards for reporting would reflect how much attention we are paying to these data.”

DeJong said, “It is an apples-to-ranges comparison and it’s very difficult to see where you stand comparative to everyone else. We know how we report, but we don’t know how everyone else reports. To the extent that the rules explicitly give lots of flexibility, it becomes difficult.”

Another fact to consider, emeritus faculty member Phil Wion noted, is that institutions with larger student bodies may show lower per-student costs due to their higher student population.

Baker and the administrators all recommended caution in interpreting the data, urging users to understand category definitions and what is included in each.

For example, “One of the big differences across institutions that IPEDS allows for is how you report IT expenses,” DeJong said.

At Pitt, “If our IT streams are unrestricted, we attribute those to the education activities. Restricted ones, then, are reported to categories in which they belong.”

In addition, how intercollegiate athletics is reported can vary among institutions. Pitt, among others, reports athletics expenditures under student services, DeJong said. Some other institutions, such as Penn State and Ohio State, Ramicone noted, treat their athletics expenditures as a separate auxiliary, “so you have some big revenues over in the auxiliary versus student services.”

The University of Illinois and Georgia Tech are among schools that, like Pitt, place athletics in the student services category, Baker said, noting that most large public institutions treat athletics as an auxiliary in these data. Baker said that based on athletics expenses reported in Pitt’s annual disclosures to the state, correcting for that difference “knocks about $1,300 off [per student].”

DCP data can be found online at


In other business:

• BPC held a closed session lasting approximately 40 minutes in order to discuss, according to the meeting agenda, “how the SBPC committee should handle future discussions of confidential and sensitive information. The purpose is to establish some agreed upon ground rules for deciding what information discussed by the committee is ok to discuss in public and what should be discussed in closed session. The goals are 1) to encourage frank discussion on issues without having to worry about something coming out wrong in the public press; and, 2) to continue to release agreed upon information and SBPC reports publicly that are factual, informative and useful to the University community.”

With regard to standing committees, the University Senate bylaws state: “All meetings are normally open to members of the University community, although standing committees may meet in executive session when necessary and appropriate for dealing with confidential matters.”

Following the meeting Baker and DeJong said BPC would continue in much the same way as it has traditionally, closing the meeting for matters needing confidential discussion, and reserving the right to request that some parts of the open meeting be off the record.

They said the closed sessions preferably would be held following the public session.

In addition, they said it was agreed that Baker would aim to be “more efficient” in scheduling which issues would be on the agenda for discussion in public and which would be addressed in closed session.

• BPC left undecided the issue of whether to meet in March, given that its typical third-Friday monthly meeting date would fall on the University’s spring holiday. Baker told the University Times he would consult members about their wishes.

The committee’s other spring term meetings are set for 1:15 p.m. April 19 and May 17 in 156 Cathedral of Learning.

—Kimberly K. Barlow

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