HARRISBURG, Pa. -- Penn State President Rodney Erickson and Bruce McPheron, dean of Penn State's College of Agricultural Sciences, appeared before the Pennsylvania Senate Appropriations Committee Feb. 29 to discuss the University's proposed appropriation for the 2012-13 fiscal year. The 90-minute session was held a week after the Pennsylvania House Appropriations Committee hearing in Harrisburg, where Erickson appeared jointly with the leaders of the University of Pittsburgh and Temple and Lincoln universities. Pennsylvania Gov. Tom Corbett has proposed flat appropriations in 2012-13 for Lincoln University and a 30 percent cut each for Temple, Pitt and Penn State.
"One cannot understand the Penn State of today -- our mission, where our many facilities are located or the cost of tuition -- without understanding the 1863 agreement between the federal government and the Commonwealth of Pennsylvania to establish a new type of institution of higher education," Erickson said during his opening remarks. He referred to legislation passed by the General Assembly designating Penn State as the sole beneficiary of land-grant funds for the Commonwealth of Pennsylvania.
"Together," he added, "the Commonwealth and Penn State devised a two-pronged approach to keep this type of academic program affordable and accessible to the children of lower income and working families. First, like most publicly supported universities, Penn State offers in-state tuition that is substantially less than the actual cost of instruction, and about 60 percent of the rate paid by nonresidents of Pennsylvania. That difference of as much as $12,000 per year is made possible by the direct annual appropriation to Penn State.
"Second, over a century-long period, the Commonwealth and Penn State added 19 undergraduate campuses besides the original campus in State College, which over the years became more oriented toward upper-division and graduate programs of study," he continued. "This strategy of establishing multiple points of access has allowed generations of Pennsylvania students to afford a top-notch degree in a wide range of fields that otherwise may have been out of their reach."
For Penn State, the governor's proposed reduction of $64 million would drop Penn State’s general support line to less than $150 million. It is the second consecutive deep cut proposed by the governor, following a 52-percent cut mitigated by state legislators to roughly 20 percent, or $68 million, for 2011-12. In addition, a statewide budget freeze announced in early January has held back Penn State's current appropriation by an additional $11.4 million.
During the meeting Erickson thanked the Legislature for its help in restoring a significant portion of last year's proposed cuts and acknowledged the Commonwealth's current fiscal challenges. Following his opening remarks and those made by Sen. Jake Corman (R-Centre, Juniata, Mifflin, Perry, Union), the committee's chair, Erickson and McPheron fielded questions from committee members.
Sen. Vincent Hughes (D-Philadelphia) asked what impact the proposed cut could have on tuition rates if it were theoretically passed on, dollar for dollar. Erickson said that if that were an option, then it could translate to an estimated 9.3-9.4 percent increase, although he emphasized that the University simply couldn't ask Penn State students and their families to absorb a cut of that magnitude. He added that the University continues to look for additional ways to cut costs and will do everything possible to make any tuition increase as modest as possible.
Sen. Lisa Baker (R-Luzerne, Wayne) inquired about the impact of the proposed budget cuts on staffing, unfilled vacancies, pay freezes and the potential for furloughs. Erickson noted that in the field of higher education, personnel is the largest and most important category of expenditures. In any given year, 70 to 75 percent of direct costs incurred by the University are for salaries and employment benefits, and in two of the last three years, the University has frozen salaries. He added that higher education, among both public and private institutions, also is a very competitive environment, particularly in attracting and retaining the best faculty, which he said is "a great challenge for us."
Reducing costs in the College of Agricultural Sciences is a unique challenge at the University, McPheron explained, because it must balance its research and Extension budgets separately from its academic budget. The college's budget planning began two-and-a-half years ago to address the expected loss of temporary stimulus funds. "In that time period we have reduced, in just our college, 176 positions out of a standing base of 825 positions, so we've seen a very significant drop," he explained. He added that over the last five years there has been a 48 percent increase in the number of undergraduates studying in the College of Agricultural Sciences, even as the college is proactively consolidating from 12 to nine academic departments.
Of the college's 176 positions lost, part of a cost-saving Cooperative Extension restructuring, 83 were county-based Extension educators from among Pennsylvania's 67 counties. During the same time, he said, Extension educators have stepped up to provide Marcellus shale educational outreach, a previously unanticipated area of expertise.
Several senators recognized the University's research achievements, particularly in the discovery of Marcellus shale gas deposits and related economic, environmental, industrial and technological research, as well as educational outreach to Pennsylvanians in deposit-rich regions. Several others praised the "highly successful endeavor" and wide-reaching economic and research benefit of the University-led Energy Innovation Hub at the Philadelphia Navy Yard, noting hope for job growth, including more green jobs in the Commonwealth.
"That original land grant mission, '...to promote the liberal and practical education of the industrial classes,' is as alive at Penn State in 2012 as it was in 1863," Erickson said. "The question is whether this is still the mission that the Commonwealth wants Penn State to pursue, and whether the state is willing to continue to invest in that mission. Or does the state want us to continue to pursue the land grant mission, but in a different way? If that is the case, I would urge you to enter into a dialogue with us about changes you’d like to see at Penn State, rather than simply cutting our appropriation so severely that we’re forced to consider a future with little or no state support."
To read President Erickson's full opening remarks, visit http://live.psu.edu/story/58125.