Monday, July 28, 2014
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Another tuition hike in store at Penn State?

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Another tuition hike in store at Penn State?

By Susan Snyder

Inquirer Staff Writer

Pennsylvania State University plans to ask the state for a 5.1 percent boost in state funding for 2014-15 – but even that won’t be enough to stave off another tuition increase for students,

At a meeting Thursday morning, members of Penn State’s board of trustees heard the administration’s desire to request a $14.7 million increase in state funding, which would bring the university’s total appropriation to almost $300 million.

It’s a particularly ambitious request, considering the state froze funding to Penn State, as well as Temple and the University of Pittsburgh, the last two years – and cut funding 19 percent the year before that.

Even if the university were to get the funding, it plans to raise tuition 3.49 percent for in-state students on the main campus and 2.4 percent for students at the branch campuses. The overall average increase would be 2.85 percent under the proposal, which will be voted on by the board of trustees at its full board meeting on Friday.

Also at the committee meeting, the board heard a request from the athletic department to allow it to borrow up to $30 million - if needed - to cover losses as a result of the child sex abuse scandal involving former assistant football coach Jerry Sandusky.

Attendance at football games is down and is expected to be at about 88 percent capacity through the duration of the ban on bowl games handed down by the NCAA as a result of the scandal. The department also must pay the $60 million fine levied by the NCAA.

The department is reluctant to raise ticket prices during the Bowl ban, and it is losing $21.2 million in bowl game revenue.

The borrowing would include $5 million to $10 million for an operating line of credit to offset projected deficits in fiscal years 2014-2016 and $20 to $25 million for short-term capital needs.

Trustees will consider giving authorization for the borrowing at its full board meeting.

On seeking the funding boost from the state, Penn State President Rodney Erickson left no doubt in a press release issued later that if the state doesn’t provide the money, it could mean even higher tuition hikes for students.

“This increase” in state funding “would directly offset operating costs that would otherwise impact tuition,” the press release said.

University officials cautioned that it’s very early in the budget process and a lot could change.

“The request to the Commonwealth and our budget planning are driven primarily by our top priority -- keeping tuition increases low," Erickson said in a prepared statement. "Our plan also is driven by the overarching priority to maintain the quality of our academic programs and provide the high-value education that our students deserve."

The state education department gave no hint as to how it would regard the request.

“…Penn State’s request will be considered along with other requests for funding to ensure they are affordable and in line with what Pennsylvania taxpayers can afford,” said department spokesman Tim Eller.

In-state students at Penn State’s main campus this year are paying $26,362 in tuition, fees and room and board. That includes a 3.39 percent tuition increase and a 4.2 percent increase in room and board. Those increases were enacted as the state froze funding.

Penn State officials said the funding boost is necessary to support increasing costs, including an estimated 2.5 percent rise in base salaries and benefits and a 1 percent increase in a merit pay pool. The budget also includes inflationary increases for health care costs and additional money for agricultural research, the medical center and the college of technology. New faculty hires and an additional $1 million for student are part of the plan, too.

Also at the finance committee meeting, the board announced plans for a $2.7 billion, five-year capital plan to upgrade classrooms, academic buildings, residence halls, technology, equipment and other needs at the university’s main campus and branch campuses. No new buildings are included in the plan, a spokeswoman said.

About two-thirds of the buildings at Penn State’s main campus are more than 25 years old and have had no significant upgrades, the school said.

The university also announced that its endowment rose $174 million over the last year, finishing at $2.03 billion as of June 30.

Contact Susan Snyder at 215-854-4693 or ssnyder@phillynews.com or follow on Twitter @ssnyderinq. Read her blog at www.inquirer.com/campusinq

 

 

 

 

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