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Reaching Retirement, PSU's DiEugenio Sees Hope for Appropriations 'Floor'

on October 17, 2011 9:50 AM

For more than two decades, Rich DiEugenio has been making the case for Penn State.

With Republican and Democratic leaders, among officials in and out of popular favor, he has built relationships, cultivated cross-institutional insight and smoothed political tensions.

So now that DiEugenio, the Penn State chief of governmental relations, is set to retire, what does he foresee for the university's state support?

In short: a mixed bag, it seems.

State lawmakers "do not want to see this unravel," he said last week, referring to the traditional arrangement between Penn State and the state government.

In fact, DiEugenio went on, many lawmakers "hope they've established a floor for appropriations" and want to maintain an ongoing vibrant rapport with the university.

That said, "I can't really predict" what Gov. Tom Corbett may propose for higher-education funding in the next budget cycle, DiEugenio said. Corbett generally -- philosophically -- seems to favor a voucher-style system in which state education monies would follow students, rather than being delivered straight to institutions, he said.

"That can present its own set of challenges, and I can't really predict where it's going to go," DiEugenio said.

In a philosophical sense, he added, it appears that the Legislature is more in tune with supporting public higher education -- including the state-related universities, such as Penn State -- than the gubernatorial administration is.

Dodging a Body Blow

Ask Penn State administrators, and they'll tell you: Even though state money makes up a small fraction of the university's total budget (The number is somewhere in the 6-percent range), those funds remain critical.

For one thing, they offset tuition rates for in-state students, helping to make a Penn State education more accessible to the sons and daughters of the commonwealth.

And for another, they represent an enduring relationship -- one wherein the state supports Penn State, and Penn State supports the people of the commonwealth, their well-being, their advancement.

The arrangement, well more than a century old, has been a key part in the fundamental and long-term transformation of the country, university leaders have said.

But the numbers -- well, the numbers suggest a fundamental shift in that fundamental cause.

As recently as the 1970s, state funds made up 37 percent of the Penn State budget.

That figure has persistently declined, especially in the last decade, as state funding has stagnated and Penn State expenses have climbed.

Corbett issued a body blow in March, when he proposed a roughly 52-percent state-funding cut for 2011-12. The austerity proposal was necessary in light of the state's multi-billion-dollar budget gap, he said at the time.

Lawmakers moderated that cut to the 20-percent range by mid-summer. The result at Penn State hasn't been pleasant: ongoing expense cuts, including layoffs; a wage freeze; a kick in the teeth of morale. Tuition is up, too.

So there's plenty of anticipation here as the university awaits the next Corbett budget proposal, due to be unveiled in March.

Vouching for Public Higher Education

Which leads us back to the school-choice ethos: Is it coming to a university near you? And how soon?

It's not exactly news that Corbett digs school vouchers in the K-12 sector. He'd like to spread the concept across Pennsylvania, to make state funds more widely available to cover private-school and charter-school tuition bills. Under his vision, K-12 students -- and their families -- also would be more able to pick and choose among public schools, taking public funding with them.

All indications suggest that Corbett wants to bring a similar tact to higher education in Pennsylvania. Rather than provide direct appropriations to public and state-related universities, as the theory goes, the state should provide voucher-type certificates to college-bound Pennsylvania residents. Those students could then use the certificates to cover expenses at any in-state college or university.

Corbett appears to believe that Penn State, already popular among Pennsylvanians, would fare well under that approach, DiEugenio said.

But the university has deep-seated concerns. Its fear: that such an effort would divert public monies to private institutions and, in the end, leave less dough in the pot to be distributed among traditionally state-supported institutions, DiEugenio said.

And with less money in the pot for Penn State, he said, tuition may be forced higher still.

Changing the Guard, Not the Priorities

Starting in January, Penn State lobbyist Michael DiRaimo will be the university's front line to tackle whatever may emerge from Corbett's office. He will succeed DiEugenio as leader of the governmental-relations shop.

DiEugenio, meanwhile, will settle into retirement after 25 years -- and eight months -- of service to the university. Penn State President Graham Spanier has granted him emeritus status.

The job is a "constant attempt to communicate and sit down with (government leaders and representatives) one on one," DiEugenio said in an hour-long conversation last week.

Critically, much of the position hinges on understanding government policy priorities, then finding where they mesh with the expertise and work available at Penn State -- and vice versa, he said.

DiRaimo also will face, as DiEugenio has, a strengthening political force: the mentality that higher education is a private, personal good -- not a public one.

"The challenge in all of that," DiEugenio said, "is to have the policymakers understand that even though the resources are strained, we need to find a way to keep that access open."

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