Board of Trustees committee recommends 2018-19 budget plan

UNIVERSITY PARK, Pa. — The Penn State Board of Trustees Committee on Finance, Business and Capital Planning today (Nov. 9), recommended for approval a 2018-19 budget plan that includes a request to the Commonwealth to increase the University’s total appropriation by $19.8 million for a total of $337.9 million in support. The plan still requires approval of the full board and will be presented at the Nov. 10 meeting. 

This appropriation request is historically submitted to the Pennsylvania Department of Education in late September. However, this year’s request was delayed until November due to the 2017-18 budget stalemate, which was only recently resolved.  

If the Commonwealth provides the requested appropriation for 2018-19, Penn State will keep increases in base tuition for Pennsylvania residents as low as possible to fund the first year of the new capital plan approved by the Board of Trustees in July 2017. If the request is fully funded, tuition rate increases would be approximately 1.75 percent for Pennsylvania resident students and 2.27 percent for non-Pennsylvania resident students at University Park and Commonwealth campuses. In addition, the University’s budget plan would include modest faculty and staff compensation increases and support for facility maintenance, operations, strategic initiatives and innovation. The plan also includes a $2 million increase for need-based student aid.  

“This request recognizes fiscal realities at the state level, but also the desire to hold tuition increases as low as possible for our resident undergraduate students, and only funding costs related to the five-year capital improvement plan that advance critical investments into aging infrastructure and future needs across the institution,” said Penn State President Eric J. Barron. “We look forward to ongoing conversations with the Commonwealth about the value of the appropriation to drive economic development across the state and to also enhance access and affordability for students.”  

If the board approves the plan and the state provides the requested funds, the University’s appropriation would increase from $318.2 million this year to $337.9 million in 2018-19.  

Each year, state appropriations are used to lower Penn State tuition for Pennsylvania resident students; support Agricultural Research and Extension operations that have a profound impact on one of the Commonwealth’s largest industries; and provide critical funding for Pennsylvania College of Technology in Williamsport and the Penn State Milton S. Hershey Medical Center, all in support of Penn State’s land-grant mission to benefit the citizens of Pennsylvania.  

The appropriation request includes an increase of $13.8 million, or 6 percent, for the University’s Educational and General Budget. It also includes an increase of $3.1 million to cover cost increases and restore critical program funds in Agricultural Research and Cooperative Extension. 

The University also is requesting funding in the amount of $24.1 million in continued support for the Pennsylvania College of Technology to build on recent increased state investments to expand instructional capacity for technical fields that are in high demand, and $14.2 million is requested for the Penn State Milton S. Hershey Medical Center in state and federal medical assistance funding. 

The plan sets a target for more than $34.4 million in expense reductions. Cost-savings initiatives include reductions in health care costs and programs to reduce operating subsidies for revenue-generating units. 

This is the first step in the appropriations process, and there are many factors that will contribute toward a final University budget to be adopted in July 2018 by the Board of Trustees. 

Last Updated November 09, 2017