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Penn State Tuition Uncertain as State Budget Talks Continue

on June 17, 2011 9:44 AM

A month before university trustees are expected to set 2011-2012 tuition rates, Penn State remains uncertain how its state-funding situation will unfold for the new academic year, spokeswoman Annemarie Mountz said this week.

"It's really hard to say at this point what may happen," she said. " ... Anything can happen (with the state budget) between now and the end of June, so we're not counting on anything until it happens."

Penn State administrators have said that tuition rates, to be decided July 15, will hinge heavily on the university's appropriation from the state. That appropriation would be cut roughly in half from current levels -- to about $165.1 million -- under Pennsylvania Gov. Tom Corbett's budget proposal, introduced in March.

Corbett has said severe cost-control measures are necessary to help the state live within its means and bridge a projected $4 billion deficit.

Under a House-approved version of the budget, though, the Penn State cut would be moderated to 25 percent, granting the university and its peer, state-related universities about 75 percent of their current funding levels. Meanwhile, state Sen. Jake Corman, R-Bellefonte and the Senate Appropriations Committee chairman, has introduced a bill that would grant Penn State about 85 percent of its current funding.

Legislators are now working through the nuances of those proposals, aiming to reach an agreement by early July.

"We're very grateful for Sen. Corman's latest proposal in trying to restore the funding" for Penn State, Mountz said.

State Rep. Kerry Benninghoff, R-Bellefonte, said he believes legislators have reached a consensus to limit overall state spending to $27 billion in the coming year. That's the same overall spending level included in Corbett's proposal.

Any bump to the university's proposed line item, Benninghoff said, will inevitably mean declines in proposed funding for other areas of the budget. He said he supports funding Penn State at 75 percent of its current level and simultaneously trimming monies for some other sectors, including select social services, he said.

"I understand Penn State wants their money. They want it like everyone else does," Benninghoff said.

But he doesn't believe state funding has had a demonstrable effect on the university's tuition rates, he said. The tuition rates have roughly tripled since the mid-1990s; for in-state undergraduates at University Park, they ranged from about $14,400 to $18,600 for the 2010-'11 academic year.

"If you look at history, only three times has the Legislature reduced the appropriation" for Penn State, Benninghoff said. "But there has always been an increase in tuition. I find it very frightening to see how much higher costs have skyrocketed, to the point where it's becoming cost-prohibitive for a lot of families."

(UPDATE @ 11:06 a.m. June 17: Information shared by Penn State suggests five cuts in state appropriations have been implemented since 2000. A university-supplied graph is on this page.)

Benninghoff also believes "there needs to be some other discussion" about how to keep Penn State's tuition down, he said. And he said he's curious about where the money for Corman's 85-percent-funding proposal would come from.

(StateCollege.com has exchanged phone messages with Sen. Corman and will follow up with a new report when more information about his Penn State funding bill is available.)

In addition, Benninghoff said, he would like to see state money for Penn State agricultural research and Cooperative Extension be separated out into their own line items, as they used to be. It would be nice, he said, to have those areas be funded at current levels, without any cuts.

On the Democratic, state Rep. Scott Conklin, of Rush Township, will not support any state budget that fails to fund Penn State at its current levels, said Conklin's chief of staff, Tor Michaels.

"We think that this assault on education by this administration is unwarranted," Michaels said. " ... We're still flummoxed to understand what education had to do with the current crisis we're in."

He pointed especially to updated state-revenue projections, which show $540 million more than expected flowing into state coffers, Michaels said. In all, he said, state revenue could climb $1 billion higher than anticipated this year.

Conklin's office hopes that state senators -- now negotiating budget proposals -- "understand the importance of Penn State, and all the rest of the state-related universities, given the fiscal health that we are now seeing here in the commonwealth," Michaels said.

But Benninghoff said the unanticipated boost in revenue doesn't come anywhere close to fixing the state budget deficit.

Meanwhile, Penn State's tuition rates for 2011-2012 remain a question mark.

Back in September 2010, before the scope of the state's fiscal straits was clear, the university requested a five-percent increase in state funding for 2011-2012. With state funding at that level, Penn State President Graham Spanier said, the university could hold tuition increases to 4.9 percent for in-state students at University Park and 2.9 percent for those at Commonwealth Campuses.

With a five-percent state-funding increase all but impossible now, though, it's not clear just how much tuition rates may grow. The university has not publicly identified any likely rate increases at this point. Mountz, a spokeswoman, said the university finance office is looking at "various options" and scenarios.

Spanier has argued vigorously -- and publicly -- for moderation in Corbett's proposed funding cut, saying that the proposal could well necessitate staffing and programming reductions, tuition increases -- even Commonwealth Campus closures.

"Public higher education is not just a private good. It is a public good that benefits all society," Spanier said in a March press conference.

He has said Penn State is will minimize any potential impact on tuition rates by carefully controlling its expenses. Most university employees, for example, will see a pay freeze in the coming academic year.

If, in theory, students were to shoulder the entire burden of Corbett's proposed Penn State funding cut, they could see a tuition increase of about 30 percent, informed university sources have said. But administrators have effectively ruled out an increase that dramatic, according to their public statements.

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