State budget passes; Penn State funding restored to previous levels

July 01, 2012

UNIVERSITY PARK, Pa. -- The Pennsylvania General Assembly has passed, and Gov. Tom Corbett has signed into law, a nearly $27.7 billion state budget that includes level funding for Penn State and Pennsylvania's other state-related and state-owned universities. Penn State President Rodney Erickson thanked legislators and the governor for their work to restore the University's funding to last year's levels, and said the funding will benefit students and their families.

The state's general appropriation to Penn State, currently amounting to about $214 million, is used to reduce the cost of tuition for Pennsylvania resident students. In mid-May, Erickson pledged that if state funding remained at the same levels as the previous year, Penn State would hold any tuition increase for students to no more than last year's Consumer Price Index. Erickson will request approval of an operating budget at the July meeting of the Board of Trustees that includes a 2.9 percent tuition increase for Pennsylvania resident students at the University Park campus and a 1.9 percent increase at the Commonwealth Campuses. The proposed 2.4 percent blended tuition rate increase will be the lowest since 1967.

"We are very appreciative of the work our state representatives and the administration have done to restore level support for Penn State's students, even in the face of unprecedented fiscal challenges," Erickson said. "As the state's only land-grant university, Penn State's relationship with the Commonwealth always has been special. This commitment from the state, in concert with Penn State's continued and significant cost-cutting measures, reflects the strength of our partnership as we work toward our mutual goal: ensuring the availability of a world-class education to students from all walks of life."

Erickson said, in particular, Sen. Jake Corman, R-Centre County, was instrumental in restoring last year's funding levels. Corman is chair of the Senate Appropriations Committee, which earlier this year unanimously amended and adopted a bill to overturn the original proposed 30 percent appropriations cut for Penn State and to restore funding to 2011-12 levels. In addition to Penn State's overall education funding that now awaits the governor's signature, agricultural research and extension is set to receive level funding of $44.7 million and Penn College is slated to also receive level funding of nearly $13.6 million.

Over the past 20 years, Penn State has cut $237.7 million in recurring costs from its operating budget, including $67 million in cuts to recurring costs since 2008. This year's level funding for the University comes one year after a $68 million reduction in the state's appropriation to Penn State, brought on by the recent economic downturn. In the past year, the University has eliminated hundreds of jobs through layoffs and attrition, held the line on salaries for the second time in three years, cut academic programs and merged academic departments, while managing to keep last year's blended tuition increase to 3.8 percent.

Erickson said the University will continue its longstanding efforts to identify savings and efficiencies. The cost-cutting initiatives implemented over the long term, he said, have helped the University to remain accessible. Penn State is now educating 96,000 students a year at 24 campuses and online. Currently the University's appropriation is the same as it was in 1995, when Penn State's total enrollment was 76,600.

Last Updated July 16, 2012