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July 20, 2006

Trustees set FY07 budget

Pitt’s Board of Trustees have approved a fiscal year 2007 operating budget of $1.55 billion that includes a 3.25 percent increase in the salary pool and tuition increases of up to 5.9 percent. (See related story.)

The budget for FY07, which began July 1, represents an increase of approximately 2 percent over the FY06 budget of $1.52 billion.

Included in the budget are net tuition revenues of $356.4 million and a state appropriation of nearly $183 million.

The University has allocated $679.5 million for salaries and wages and $209.3 million for benefits (including an expected 7.7 percent increase in medical insurance expenses) for a total of $888.8 million for salaries and benefits. Compensation is by far the biggest expense in the University budget, representing nearly 60 percent of total expenses.

At the Pittsburgh campus, in-state undergraduate students in all schools will see tuition increases of 5.9 percent (to $10,246 per year for School of Arts & Sciences undergrads) while out-of-state tuition will be raised 3 percent (to $20,156 per year for A&S undergrads). The School of Medicine will raise tuition 3 percent across the board to $33,184 per year for in-state students and $38,064 for out-of-state students.

At the regional campuses in Bradford, Greensburg, Johnstown and Titusville, tuition will rise 3 percent for in-state students, with no increase for out-of-state students. Annual in-state tuition at the regionals will range from $8,970 to $12,824 depending on the campus and the program; out-of-state tuition will range from $17,610 to $25,012.

The Pittsburgh campus percentage increases are the lowest since 2001 and the regional tuition hikes are the lowest in more than 30 years, said Arthur G. Ramicone, Pitt’s vice chancellor for Budget and controller. The financial aid budget has been increased by a corresponding percentage, he noted.

The largest revenue line item in the FY07 budget is research grants and contracts at $625.7 million, representing 40.35 percent of budgeted revenues.

In his comments before the trustees’ budget and executive committees, Ramicone took the opportunity to tout the University’s regional economic impact, noting that each dollar of Pitt’s state appropriation is leveraged into more than $3.50 in external research support. Much of that is spent within Pennsylvania on salaries, goods and services, he said, yielding “an extraordinary return on investment for the commonwealth.”

Expenses in the FY07 budget approved July 14 also include $50.86 million for utility costs — a $7.2 million or 16.5 percent increase, mainly to cover rate increases and costs at new facilities — and $34 million for maintenance and facilities.

A separate $104.16 million capital budget also was approved. Among the line items are $22.2 million in upgrades to Benedum Hall, $18.2 million for new medical student housing to be built on Darragh Street, $7.1 million in renovation and preservation for housing, $9.7 million for Pittsburgh campus preservation, $7 million for information technology, $1.89 million for regional campus preservation and programmatic costs and $1.5 million for classroom renovations.

—Kimberly K. Barlow

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