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October 9, 2014

Pitt asks for 14.7% appropriation hike

The University is aiming high in its annual request for state funding for the upcoming fiscal year.

For its first budget request under Chancellor Patrick Gallagher, Pitt is seeking a 14.7 percent increase to its base appropriation in fiscal year 2016, asking for $156.29 million for general support and rural education outreach.

Pitt also is asking for nearly $11.66 million for the School of Medicine, including support for the School of Dental Medicine and dental clinic, Western Psychiatric Institute and Clinic and the Center for Public Health Practice, an increase of 5 percent. The medical school funding is part of the academic medical center line item in the Department of Public Welfare budget.

Combined, the request of $167.95 million represents a 13.9 percent increase in state support for the fiscal year that begins July 1.

In a statement that prefaced the University’s request, Gallagher said: “The dual roles of providing educational opportunities for individual Pennsylvanians while functioning as a critical economic engine for both western Pennsylvania and the entire commonwealth are at the heart of our request for an increased level of state funding.”

At that level of funding the University would raise the compensation pool 2.5 percent and keep tuition increases “as small as possible,” said Paul A. Supowitz, vice chancellor for Community and Governmental Relations.

The request projects a 1.2 percent increase in revenue from tuition and fees in FY16, but does not specify a proposed tuition increase figure.

Gallagher, in his statement accompanying the request, emphasized the quality and value of a Pitt education, the University’s efforts to control costs, its contributions to the region’s economy and the impact of tuition increases on students.

He noted that the state appropriation enables Pitt to discount tuition for in-state students, who currently pay about $10,000 less per year than out-of-state students. “However, under current state funding levels, only half of that amount is supported by funds from the commonwealth, with the remainder provided by the University,” he stated.

“In today’s knowledge-based economy, the value of higher education has never been greater. Simply put, the commonwealth benefits from having an educated populace, a globally-competitive workforce, a vibrant research community and support for increasing Pennsylvania’s economic competitiveness in today’s global economy,” Gallagher stated.

The University’s request reiterated that its current levels of state support are equal to its 1995 appropriations, unadjusted for inflation. “Dealing with a 2014 cost structure when state support has been taken back to 1995 levels, then, is one very significant challenge,” it stated, citing increases of almost 55 percent in the Consumer Price Index and 75 percent in the Higher Education Price Index during that time, along with enrollment growth of nearly 3,000 students and annual research expenditures up more than $500 million since 1995.


The approach to this year’s budget request differs from past requests in that it specifies the new initiatives that would be possible with increased state funding, essentially saying, “Here’s what we want to do, if you can support the effort,” Supowitz said.

Of the additional $20 million in general support Pitt is seeking, $11 million would be used to control tuition increases for in-state students, $7 million to offset inflationary increases to operating expenses and $2 million to expand innovation programs, Gallagher stated in the request submitted Oct. 3 to the Pennsylvania Department of Education.

The innovation funding would be used to establish a two-part Innovation Institute pre- and post-startup program to support student entrepreneurs, and to expand the Innovation Institute’s PittVentures commercialization startup program.

Current state funding

In last year’s request, Pitt sought a 5 percent increase, seeking $155.19 million — nearly $143.11 million for general support and $12.08 million in academic medical center funding — for FY15, at which it would hold tuition increases to 3 percent and raise the compensation pool 2.5 percent.

The state responded with an appropriation of $135.99 million in general support and approximately $11 million in academic medical center funding.

Pitt’s current budget included a 3.3 percent blended tuition increase and a 2.5 percent salary pool increase. (See July 24 University Times.)

The budget process

The annual appropriation request, typically made in late September, is an early step in the state’s budget process. Following agency budget submissions, the starting point for budget negotiations comes when the governor presents a proposed state budget in early February.

Appropriations committee hearings in the House and Senate follow, with a deadline of July 1 for legislators to negotiate and approve a budget for the new fiscal year.

With a gubernatorial race to be decided Nov. 4, it’s not yet known whether incumbent Tom Corbett will be proposing the state’s FY16 budget, or whether that duty will fall to challenger Tom Wolf, who is leading in pre-election polls.

While the governor’s race is relevant, Pitt’s “bold” request isn’t based on any projections as to who will be elected, Supowitz said.

The most recent budget proposal to include increased funding for Pitt was in 2008 when Gov. Edward G. Rendell proposed a 1.3 percent increase as part of his FY09 budget draft. Flat funding for Pitt has been the norm in the ensuing years’ proposals, with the exception of Corbett’s FY12 proposal that would have halved the University’s overall support and a proposed 30 percent cut to Pitt’s appropriation in his FY13 budget draft.

—Kimberly K. Barlow

Filed under: Feature,Volume 47 Issue 4