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Tab B - Tutiion and Mandatory Fee Increases
 

The Pennsylvania State University

Meeting of the Board of Trustees

Friday, July 10, 2009
Finance and Physical Plant
On Agenda Item As Section 6, Part C, #5

Consideration of Proposed Operating Budget for the
University for the Fiscal Year Beginning July 1, 2009

 

     Will the Committee on Finance and Physical Plant recommend to the Board of Trustees adoption of the following resolution:

     Whereas, the Commonwealth of Pennsylvania has not approved its budget and related appropriation to The Pennsylvania State University as of July 1, 2009; and

     Whereas, The Pennsylvania State University administration, knowing of the depth of the current fiscal crisis in the state and beyond, determined months ago to forgo salary increases at the University this year and has reduced the academic and administrative budgets; and

     Whereas, The Pennsylvania State University is committed to provide exceptional educational experiences and positive workplace environments for all,

     THEREFORE, BE IT RESOLVED, That in the event that the Commonwealth of Pennsylvania's budget is finalized by July 17, 2009 at the level proposed in the Governor's Budget Recommendation of March 3, 2009, the proposed Operating Budget for the University for the fiscal year beginning July 1, 2009, as shown in Scenario 1 and Schedules I-V which are attached hereto and made part hereof, is approved.

     FURTHER RESOLVED, in the event that the Commonwealth of Pennsylvania's budget is not finalized by July 17, 2009, or is finalized at the level proposed in the Governor's Proposal of June 26, 2009, the Officers of the University are authorized to effect the Operating Budget for the University for the fiscal year beginning July 1, 2009, as shown in Scenario 2 and Schedules I-V which are attached hereto and made part hereof.

     FURTHER RESOLVED, in the event that the Commonwealth of Pennsylvania's budget is finalized at an adjusted level between the Governor's Proposals of March 3, 2009 and June 26, 2009, the Officers of the University are authorized to effect the Operating Budget for the University for the fiscal year beginning July 1, 2009, as shown in Scenario 2 and Schedules I-V which are attached hereto and made part hereof, and a revised operating budget will be prepared and reviewed with the Board of Trustees at the earliest opportunity to effect appropriate changes for the Spring Semester 2010.

 

 

SCENARIO 1

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED OPERATING BUDGET
SCHEDULE I
SUMMARY SCHEDULE FOR TOTAL UNIVERSITY

 
    (1)   (2)   (3)  
    Adjusted          
    Budget       2009-10  
    2008-09   Changes   Budget  
General Funds:              
               
    Educational & General (a) $ 1,478,592,000 $ 54,273,000 $ 1,532,865,000  
    Agricultural Research   27,955,000   0   27,955,000  
    Cooperative Extension   31,781,000   0   31,781,000  
               
            Sub-Total   1,538,328,000   54,273,000   1,592,601,000  
               
    College of Medicine   89,230,000   4,714,000   93,944,000  
    Pennsylvania College of Technology   94,114,000   (2,128,000)   91,986,000  
               
Total - General Funds   1,721,672,000   56,859,000   1,778,531,000  
               
Federal Funds - Agriculture   19,995,000   0   19,995,000  
               
Restricted Funds (b):                
               
    Educational & General (a)   468,500,000   23,424,000   491,924,000  
    Agricultural Research   28,820,000   1,441,000   30,261,000  
    Cooperative Extension   15,340,000   767,000   16,107,000  
    College of Medicine   76,000,000   0   76,000,000  
    Pennsylvania College of Technology   22,423,000   567,000   22,990,000  
               
               
Total -  Restricted Funds   611,083,000   26,199,000   637,282,000  
               
Auxiliary Enterprises (c):              
               
    Educational & General (a)   296,792,000   13,456,000 (d) 310,248,000  
    College of Medicine   3,899,000   164,000   4,063,000  
    Pennsylvania College of Technology   22,503,000   1,275,000   23,778,000  
               
Total -  Auxiliary Enterprises   323,194,000   14,895,000   338,089,000  
               
TOTAL $ 2,675,944,000 $ 97,953,000 $ 2,773,897,000  
               
The Milton S. Hershey Medical Center   939,265,000   52,958,000   992,223,000 (e)
               
TOTAL UNIVERSITY $ 3,615,209,000 $ 150,911,000 $ 3,766,120,000  
               
               
Note:  Footnotes follow Schedule V.              
 

 

SCENARIO 1

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED GENERAL FUNDS BUDGET
SCHEDULE II
SUMMARY OF PROPOSED EXPENDITURES

 
      (1)   (2)   (3)
      Adjusted        
      Budget       2009-10
      2008-09   Changes   Budget
               
GENERAL FUNDS:            
  EDUCATIONAL & GENERAL (f):            
      Instruction and Research $ 591,824,000   $ 5,197,000 $ 597,021,000
      Other Public Service   44,121,000   184,000   44,305,000
      Academic Support   295,439,000   1,219,000   296,658,000
      Institutional Support   240,787,000   1,375,000   242,162,000
      Student Services   98,539,000   567,000   99,106,000
      Student Aid   39,890,000   6,175,000   46,065,000
      Physical Plant Operations   157,956,000   15,353,000   173,309,000
      University Contingencies     10,036,000   14,663,000 (g) 24,699,000
      Cost Savings/Internal Reductions   0   (17,817,000)   (17,817,000)
      Salary Increases & Related Benefits (h)   0   2,919,000   2,919,000
      Benefits Cost Increases   0   24,438,000   24,438,000
               
  Total Educational & General (i)   1,478,592,000   54,273,000   1,532,865,000
               
  AGRICULTURAL RESEARCH (j):            
      Salary Adjustments & Benefits Costs   0   616,000   616,000
      Program Changes   27,955,000   (616,000)   27,339,000
               
  Total Agricultural Research (k)   27,955,000   0   27,955,000
               
  COOPERATIVE EXTENSION (j):            
      Salary Adjustments & Benefits Costs   0   729,000   729,000
      Program Changes   31,781,000   (729,000)   31,052,000
               
  Total Cooperative Extension (k)   31,781,000   0   31,781,000
               
  Sub-Total   1,538,328,000   54,273,000   1,592,601,000
               
  COLLEGE OF MEDICINE   89,230,000   4,714,000   93,944,000
               
  PA COLLEGE OF TECHNOLOGY (l)   94,114,000   (2,128,000)   91,986,000
               
TOTAL GENERAL FUNDS $ 1,721,672,000 $ 56,859,000 $ 1,778,531,000
               
               
Note:  Footnotes follow Schedule V.            
 

 

SCENARIO 1

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED GENERAL FUNDS BUDGET
SCHEDULE III
SUMMARY OF ANTICIPATED INCOME

 
    (1)   (2)   (3)  
    Adjusted          
    Budget       2009-10  
    2008-09   Changes   Budget  
GENERAL FUNDS:              
EDUCATIONAL & GENERAL (m):              
    State Approp. & Federal Stimulus Funding:              
        Educational & General $ 267,451,000 $ 0

(o)    $

267,451,000  
        Recruitment & Retention of              
            Disadvantaged Students   454,000   0 (o) 454,000  
        Transfers   (4,032,000)   0   (4,032,000) (q)
    Sub-Total - State App. & Fed. Stimulus Funding 263,873,000   0   263,873,000  
    Tuition and Fees   1,110,795,000   52,809,000 (p) 1,163,604,000  
    Facilities & Administration and              
        Investment Income   66,515,000   3,500,000   70,015,000  
    Sales and Services Income   28,810,000   0   28,810,000  
    Other Income   18,599,000   (36,000)   18,563,000  
    Other Transfers   (10,000,000)   (2,000,000)   (12,000,000)  
               
Total Educational & General   1,478,592,000   54,273,000   1,532,865,000  
               
AGRICULTURAL RESEARCH:              
    State Approp. & Federal Stimulus Funding:              
        Agricultural Research   25,594,000   0 (o) 25,594,000  
        Transfers   1,184,000   0   1,184,000 (r)
    Sub-Total - State App. & Fed. Stimulus Funding   26,778,000   0   26,778,000  
    Sales and Services Income   1,177,000   0   1,177,000  
               
Total Agricultural Research   27,955,000   0   27,955,000  
               
COOPERATIVE EXTENSION:              
    State Approp. & Federal Stimulus Funding:              
        Cooperative Extension   30,384,000   0 (o) 30,384,000  
        Transfers   1,397,000   0   1,397,000 (s)
    Sub-Total - State App. & Fed. Stimulus Funding   31,781,000   0   31,781,000  
    Sales and Services Income   0   0   0  
               
Total Cooperative Extension   31,781,000   0   31,781,000  
               
Sub-Total   1,538,328,000   54,273,000   1,592,601,000  
               
COLLEGE OF MEDICINE   89,230,000   4,714,000   93,944,000  
               
PA COLLEGE OF TECHNOLOGY (n):              
    State Approp. & Federal Stimulus Funding:              
        PA College of Technology   14,492,000   0 (o) 14,492,000  
        Transfers   396,000   0   396,000 (t)
    Sub-Total - State App. & Fed. Stimulus Funding   14,888,000   0   14,888,000  
    Tuition and Fees   75,076,000   1,522,000   76,598,000  
    Other Income   4,150,000   (3,650,000)   500,000  
               
Total PA College of Technology   94,114,000   (2,128,000)   91,986,000  
               
TOTAL GENERAL FUNDS $ 1,721,672,000 $ 56,859,000 $ 1,778,531,000  
               
Note: Footnotes follow Schedule V.              
             
 

 

SCENARIO 1

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED GENERAL FUNDS BUDGET
SCHEDULE IV
SUMMARY OF PROPOSED EXPENDITURES
THE COLLEGE OF MEDICINE AT THE MILTON S. HERSHEY MEDICAL CENTER

 
      (1)   (2)   (3)
      Adjusted        
      Budget       2009-10
      2008-09   Changes   Budget
               
GENERAL FUNDS:            
               
      Instruction and Research $ 29,141,000 $ 667,000 $ 29,808,000
               
      Other Public Service   4,440,000   (393,000)   4,047,000
               
      Academic Support   10,251,000   322,000   10,573,000
               
      Institutional Support   18,058,000   996,000   19,054,000
               
      Student Services   1,583,000   329,000   1,912,000
               
      Student Aid   1,645,000   0   1,645,000
               
      Physical Plant Operations   24,112,000   2,713,000   26,825,000
               
      Salary Increases & Related Benefits    0   6,000   6,000
               
      Benefits Cost Increases   0   74,000   74,000
               
TOTAL GENERAL FUNDS   89,230,000   4,714,000   93,944,000
               
RESTRICTED FUNDS (u)   76,000,000   0   76,000,000
               
AUXILIARY ENTERPRISES (v)   3,899,000   164,000   4,063,000
               
TOTAL $ 169,129,000 $ 4,878,000 $ 174,007,000
               
               
Note:  Footnotes follow Schedule V.            
 

 

SCENARIO 1

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED OPERATING BUDGET
SCHEDULE V
SUMMARY OF ANTICIPATED INCOME
THE COLLEGE OF MEDICINE AT THE MILTON S. HERSHEY MEDICAL CENTER

 
      (1)   (2)   (3)  
      Adjusted          
      Budget       2009-10  
      2008-09   Changes   Budget  
                 
GENERAL FUNDS:              
                 
      Tuition and Fees $ 25,201,000 $ 460,000 (z)  $ 25,661,000  
                 
      Facilities & Administration and              
          Investment Income   15,890,000   0   15,890,000  
                 
      Academic Support from MSHMC (w)   20,000,000   800,000   20,800,000  
                 
      Sales and Services Income   1,639,000   661,000   2,300,000  
                 
      Other Income   15,445,000   793,000   16,238,000  
                 
      State Appropriation:  Transfers   1,055,000   0   1,055,000 (aa)
                 
      Other Transfers   10,000,000   2,000,000   12,000,000  
                 
TOTAL GENERAL FUNDS   89,230,000   4,714,000   93,944,000  
                 
RESTRICTED FUNDS (x)   76,000,000   0   76,000,000  
                 
AUXILIARY ENTERPRISES (y)    3,899,000   164,000   4,063,000  
                 
TOTAL $ 169,129,000 $ 4,878,000 $ 174,007,000  
                 
Note:  Footnotes follow Schedule V.              
 

 

Scenario 1

Footnotes for Schedules I - V

 Schedule I:

(a)    Excludes College of Medicine.

(b)    Includes Grants, Contracts, Restricted Gifts and Restricted Endowment Income. The Adjusted Budget 2008-09 is based on 2007-08 actual and 2008-09 estimated income.  Expenditures are offset directly by income for the same purpose.

(c)    Self-supporting budgets representing sales and services, primarily to individuals. Educational and General Auxiliary Enterprises include Housing and Food Services, Intercollegiate Athletics, Commons Operations, Penn State Hospitality Services, Bryce Jordan Center, and Airport Operations.

(d)     Includes $11,257,600 from room and board rate increases approved by the Board of Trustees on November 21, 2008, and other adjustments. Expenditures are offset directly by income for the same purpose.

(e)     Total income from the 2009-10 budget for The Milton S. Hershey Medical Center (MSHMC) that was approved by the Board of Directors of MSHMC on June 25, 2009.

 Schedule II:

(f)     Excludes College of Medicine.

(g)     Historically, Penn State has taken a conservative approach in developing its operating budget. It is important for Penn State to preserve as much flexibility as possible in its budget planning in light of the volatility that continues to exist with the economy in general. These funds have been included to position the University against future contingencies and unanticipated financial pressures.

(h)     Funding to meet a 3.0 percent salary increase for employees included under the University’s collective bargaining agreement.

(i)     Employee benefits expense distributed by function.

(j)     Includes expenditures offset by funding allocated by the Commonwealth and by sales and services income.      

(k)     Includes allocated employee benefits for Agricultural Research and Cooperative Extension personnel paid on Federal Funds-Agriculture.

(l)     The Pennsylvania College of Technology (Penn College) is a separate but wholly owned subsidiary of the University administered through the Corporation for Penn State.

Schedule III:

(m)     Excludes College of Medicine.

(n)     Penn College is a separate but wholly owned subsidiary of the University administered through the Corporation for Penn State.

(o)     The 2009-10 operating budget (excluding the College of Medicine) includes an estimated direct appropriation of $318,073,000.  This is $20,302,000, or 6.0 percent, less than the 2008-09 appropriation level. Also includes State Fiscal Stabilization Funds allocated by the Commonwealth which offset the $20,302,000 reduction in direct state appropriation.

(p)     Includes tuition rate changes for 2009-10 of $46,986,000. Also reflected are additional income of $1,225,000 from the Information Technology Fee, $179,000 from Student Activities Fee, and $4,419,000 from Student Facilities Fee.      

(q)     Represents the following transfers:  $1,055,000 to the College of Medicine for redistribution of 2004-05 increase, for graduate and nursing programs, for the prior years’ Tuition Challenge Grants, and for a proportionate share of the 1997-98 Special Projects appropriation (which was folded into E&G in the 1998-99 appropriation).  $2,977,000 to other line items for redistribution of 2005-06 and 2004-05 increases, and for a proportionate share of the 1997-98 Special Projects appropriation.

(r)     Represents the following transfers: $462,000 redistribution of 2005-06 increase, $516,000 redistribution of 2004-05 increase and $206,000 for a proportionate share of the 1997-98 Special Projects appropriation.

(s)     Represents the following transfers:  $556,000 redistribution of 2005-06 increase, $620,000 redistribution of 2004-05 increase and $221,000 for a proportionate share of the 1997-98 Special Projects appropriation.

(t)     Represents the following transfers: $293,000 redistribution of 2004-05 increase and $103,000 for a proportionate share of the 1997-98 Special Projects                                                                                                   

Schedule IV:

(u)     Expenditures are offset directly by income for the same purpose.

(v)     Self-supporting budgets representing sales and services, primarily to individuals.  These sales and services include student housing.  Expenditures are offset directly by income for the same purpose.

 Schedule V:

(w)     Reflects funding received by the College of Medicine from The Milton S. Hershey Medical Center (MSHMC).

(x)     Expenditures are offset directly by income for the same purpose.

(y)     Self-supporting budgets representing sales and services, primarily to individuals.  These sales and services include housing.

(z)     Reflects an annual increase of $1,036 for in-state medical student tuition and $1,374 for out-of-state medical student tuition.

(aa)     Represents the following transfers: for redistribution of 2004-05 increase, for graduate and nursing programs, for the prior years’ Tuition Challenge Grants, and for a proportionate share of the 1997-98 Special Projects appropriation (which was folded into E&G in the 1998-99 appropriation).

 

 

SCENARIO 2

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED OPERATING BUDGET
SCHEDULE I
SUMMARY SCHEDULE FOR TOTAL UNIVERSITY

 
  (1)   (2)   (3)  
  Adjusted          
  Budget       2009-10  
  2008-09   Changes   Budget  
General Funds:              
             
    Educational & General (a) $ 1,478,592,000 $ 41,284,000 $ 1,519,876,000  
    Agricultural Research   27,955,000   (4,607,000)   23,348,000  
    Cooperative Extension   31,781,000   (5,469,000)   26,312,000  
             
            Sub-Total   1,538,328,000   31,208,000   1,569,536,000  
             
    College of Medicine   89,230,000   4,714,000   93,944,000  
    Pennsylvania College of Technology   94,114,000   (2,913,000)   91,201,000  
             
Total - General Funds   1,721,672,000   33,009,000   1,754,681,000  
             
Federal Funds - Agriculture   19,995,000   0   19,995,000  
             
Restricted Funds (b):                
             
    Educational & General (a)   468,500,000   23,424,000   491,924,000  
    Agricultural Research   28,820,000   1,441,000   30,261,000  
    Cooperative Extension   15,340,000   767,000   16,107,000  
    College of Medicine   76,000,000   0   76,000,000  
    Pennsylvania College of Technology   22,423,000   567,000   22,990,000  
             
             
Total -  Restricted Funds   611,083,000   26,199,000   637,282,000  
             
Auxiliary Enterprises (c):              
             
    Educational & General (a)   296,792,000   13,456,000 (d) 310,248,000  
    College of Medicine   3,899,000   164,000   4,063,000  
    Pennsylvania College of Technology   22,503,000   1,275,000   23,778,000  
             
Total -  Auxiliary Enterprises   323,194,000   14,895,000   338,089,000  
             
TOTAL $ 2,675,944,000 $ 74,103,000 $ 2,750,047,000  
             
The Milton S. Hershey Medical Center   939,265,000   52,958,000   992,223,000 (e)
             
TOTAL UNIVERSITY $ 3,615,209,000 $ 127,061,000 $ 3,742,270,000  
             
Note: Footnotes follow Schedule V.              
 

 

SCENARIO 2

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED GENERAL FUNDS BUDGET
SCHEDULE II
SUMMARY OF PROPOSED EXPENDITURES

 
    (1)   (2)   (3)  
    Adjusted          
    Budget       2009-10  
    2008-09   Changes   Budget  
               
GENERAL FUNDS:              
EDUCATIONAL & GENERAL (f):              
    Instruction and Research $ 591,824,000   $ 5,197,000 $ 597,021,000  
    Other Public Service   44,121,000   184,000   44,305,000  
    Academic Support   295,439,000   1,219,000   296,658,000  
    Institutional Support   240,787,000   1,375,000   242,162,000  
    Student Services   98,539,000   567,000   99,106,000  
    Student Aid   39,890,000   10,045,000   49,935,000  
    Physical Plant Operations   157,956,000   15,353,000   173,309,000  
    University Contingencies     10,036,000   0   10,036,000  
    Cost Savings/Internal Reductions   0   (17,817,000)   (17,817,000)  
    Salary Increases & Related Benefits (g)   0   2,919,000   2,919,000  
    Benefits Cost Increases   0   22,242,000   22,242,000  
               
Total Educational & General (h)   1,478,592,000   41,284,000   1,519,876,000  
               
AGRICULTURAL RESEARCH (i):              
    Salary Adjustments & Benefits Costs   0   616,000   616,000  
    Program Changes   27,955,000   (5,223,000)   22,732,000  
               
Total Agricultural Research (j)   27,955,000   (4,607,000)   23,348,000  
               
COOPERATIVE EXTENSION (i):              
    Salary Adjustments & Benefits Costs   0   729,000   729,000  
    Program Changes   31,781,000   (6,198,000)   25,583,000  
               
Total Cooperative Extension (j)   31,781,000   (5,469,000)   26,312,000  
               
Sub-Total   1,538,328,000   31,208,000   1,569,536,000  
               
COLLEGE OF MEDICINE   89,230,000   4,714,000   93,944,000  
               
PA COLLEGE OF TECHNOLOGY (k)   94,114,000   (2,913,000)   91,201,000  
               
TOTAL GENERAL FUNDS $ 1,721,672,000 $ 33,009,000 $ 1,754,681,000  
               
Note: Footnotes follow Schedule V.              
 

 

SCENARIO 2

THE PENNSYLVANIA STATE UNIVERSITY
2009-10 PROPOSED GENERAL FUNDS BUDGET
SCHEDULE III
SUMMARY OF ANTICIPATED INCOME

 
    (1)   (2)   (3)  
    Adjusted          
    Budget       2009-10  
    2008-09   Changes   Budget  
GENERAL FUNDS:              
EDUCATIONAL & GENERAL (l):              
    State Appropriation:              
        Educational & General $ 267,451,000 $ (48,224,000)

(n)   $

219,227,000  
        Recruitment & Retention of              
            Disadvantaged Students   454,000   0 (n) 454,000  
        Transfers   (4,032,000)   0   (4,032,000) (p)
    Sub-Total - State Appropriation   263,873,000   (48,224,000)   215,649,000  
    Tuition and Fees   1,110,795,000   88,044,000 (o) 1,198,839,000  
    Facilities & Administration and              
        Investment Income   66,515,000   3,500,000   70,015,000  
    Sales and Services Income   28,810,000   0   28,810,000  
    Other Income   18,599,000   (36,000)   18,563,000  
    Other Transfers   (10,000,000)   (2,000,000)   (12,000,000)  
               
Total Educational & General   1,478,592,000   41,284,000   1,519,876,000  
               
AGRICULTURAL RESEARCH:              
    State Appropriation:              
        Agricultural Research   25,594,000   (4,607,000) (n) 20,987,000  
        Transfers   1,184,000   0   1,184,000 (q)
    Sub-Total - State Appropriation   26,778,000   (4,607,000)   22,171,000  
    Sales and Services Income   1,177,000   0   1,177,000  
               
Total Agricultural Research   27,955,000   (4,607,000)   23,348,000  
               
COOPERATIVE EXTENSION:              
    State Appropriation:              
        Cooperative Extension   30,384,000   (5,469,000) (n) 24,915,000  
        Transfers   1,397,000   0   1,397,000 (r)
    Sub-Total - State Appropriation   31,781,000   (5,469,000)   26,312,000  
    Sales and Services Income