Penn State has tried to increase its reserve funds in the past 18 months — in case the financial outlook gets ‘really bad in Pennsylvania,’ university President Graham Spanier said Tuesday.
‘We hope that doesn’t happen,’ Spanier said, addressing a question during a Faculty Senate meeting at University Park.
Spanier said the university still doesn’t know how much state funding Gov. Tom Corbett may propose for public higher education in his initial budget. That budget is due before legislators in early March.
Given that the state is facing a multi-billion-dollar budget deficit, Penn State knows that ‘it could be very difficult’ as a budget year, Spanier said.
‘We don’t want that to be traumatic at Penn State,’ he said. He did not specify how much money Penn State has shifted recently into its reserves.
But Spanier did imply that the ongoing recommendations for consolidation and reduction of some Penn State programs are relatively tame. Those recommendations, intended to help the university contain costs, will continue to emerge in the coming months.
A Core Council appointed by Spanier is developing the suggestions, meant to cut $10 million in expenses university-wide. Penn State’s total annual budget runs in the $4 billion range.
‘Whatever you think is belt-tightening here that you have angst about — I’m not sure you have any idea how (tough) it is in all of our peer institutions around the country,’ Spanier said. ‘I think it’s because we’ve managed (conservatively) and thought about what pockets of funds we need to hold in reserve’ that the cuts won’t be deeper.
Spanier called the university’s financial practices ‘very prudent’ and ‘very conservative.’
‘We’re not a rich university that has some huge endowment that we can just turn to for the fun of it or the heck of it, or because we just wanted to do something we hadn’t thought about,’ he said.
In other remarks before the Faculty Senate on Tuesday:
- Spanier said the university may reach the 120,000-application threshold this year. ‘That’s actually within striking distance,’ he said.
- Penn State’s current fundraising drive, ‘For the Future: The Campaign for Penn State Students,’ has passed the $1.2 billion mark, Spanier said. Its goal is $2 billion. Spanier reiterated that the campaign’s No. 1 priority is to generate money for scholarships, ‘to help keep the doors of opportunity and access open, to keep Penn State affordable.’
- A faculty member noted that students participating in the annual Penn State Interfraternity Council/Panhellenic Dance Marathon sometimes suffer health problems after the event. She asked whether the university has considered again trimming the event’s length, which went from 48 to 46 hours several years ago. ‘There is a downside to an event that keeps on their feet that long,’ Spanier replied. ‘People get worn out.’ He said the university tries ‘to emphasize all of the right values with’ THON. ‘But it is a student-run event,’ he went on, ‘and it’s important to keep it that way.’
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