University Times

A1 percent cut in the University budget and a 2.5 percent increase in state support will combine to help the University hold down tuition increases in fiscal year 2017.

The Board of Trustees executive committee on July 18 approved a $2.1 billion operating budget that includes a 2.3 percent tuition increase for in-state students on the Pittsburgh campus and a 2.75 percent increase for their out-of-state counterparts. The percentage increase is the smallest in 41 years, University officials say.

Annual in-state tuition for full-time undergraduates in the Dietrich School of Arts and Sciences will rise to $17,688 in academic year 2016-17, an increase of $396. Their out-of-state counterparts will see tuition rise to $28,828, an increase of $770.

Tuition for all students on Pitt’s regional campuses will increase 1.9 percent.

Said Arthur G. Ramicone, senior vice chancellor and chief financial officer: “These modest tuition increases are made possible by a combination of additional commonwealth appropriation money, with an increase in our education and general (E&G) support of approximately $5.5 million, or 2.5 percent, and also by the fact that we are cutting the University budget by 1 percent. That provides $7.1 million for reallocation and offsets increased expenses.”

The budget cut, in combination with increased revenue in other areas including tuition, has helped offset increased health care and utility costs and allows for new, targeted investments in support of the University’s strategic plan, Ramicone said.

Where the $7.1 million will be cut remains to be seen. “We haven’t made those decisions yet,” Ramicone told the University Times. He said the 1 percent budget cut will be divided among the senior vice chancellors. “The majority of that cut will be the responsibility of the provost and the senior vice chancellor for the Health Sciences,” he said. “They don’t need to distribute it on a proportionate basis. That’s generally not a good way to cut.

“They can target certain areas that will likely be exempt from cuts and other areas will have to shoulder more than 1 percent,” he said.

University Senate President Frank Wilson expressed relief that the cuts will be made strategically rather than across the board. However, until those decisions are made, “People are going to be nervous about it,” he said. “At least not everybody gets crunched — we’ve had to go through that before. That causes disproportionate pain.”

In a prepared statement, Chancellor Patrick Gallagher said: “Our goal in formulating a budget is to approach tuition as a component of a value-driven equation that puts the interests of students and alumni foremost.

“Serving those interests requires us to carefully monitor and control costs, while increasing quality. Pitt’s reputational strength as a world leader in learning and research is most meaningful when considered against its work to remain one of the best-value institutions in higher education today.

“We’re appreciative of the strong commitment in Harrisburg to provide improved support from the commonwealth,” Gallagher said.

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The $2.1 billion FY17 operating budget includes $604.37 million in net tuition and fees, after tuition discounts of $182.74 million and anticipates nearly $725 million in research funding.

Compensation, the largest expense line item, was budgeted at $1.2 billion, made up of $922.26 million in salaries and wages and $277.98 million in fringe benefits.

—Kimberly K. Barlow