2007-08 BUDGET PRESENTATION
By any measure, Penn State is a sound investment that pays important dividends to the Commonwealth of Pennsylvania and the nation.
Penn State’s nearly 500,000 living alumni 
contribute to every imaginable
area of society, and in Pennsylvania, their contributions to the
Commonwealth’s intellectual, cultural,and economic prominence are
immeasurable.
The value of a Penn State degree continues to be widely recognized by Pennsylvania families. For nearly 84,000 students matriculating at 24 campuses across the Commonwealth, Penn State provides unparalleled access to knowledge and skills, social mobility, and a bright future. This year, Penn State received over 94,000 applications for admission, believed to be the most of any university in America.
Penn State ranks as one of the nation’s largest and best public research universities. The University’s nearly $657 million research program, with most of this funding coming from sources outside the Commonwealth, helps unfold new frontiers of knowledge, new products, and new business. The discoveries, breakthroughs, and creative work by Penn State faculty in fields as diverse as medicine, agriculture, engineering, science, and the fine arts strengthen the Commonwealth’s competitive economic position and contribute measurably to the quality of life enjoyed by all Pennsylvanians. Penn State Outreach activities reach half of the households in Pennsylvania with everything from 4-H and farm advice to continuing education and public broadcasting.
Within the Commonwealth, the University does 
more to power the economy
than any other enterprise in the state. Penn State produces a
collective statewide economic impact of more than $6 billion annually
and an induced impact of an additional $7 billion. For every dollar
that is invested by the Commonwealth, Penn State returns $19.42 in total
economic impact to the Commonwealth.
Penn State’s 2007-08 budget request reflects the University’s need to keep pace with rapidly rising costs associated with carrying out its land-grant, public university mission and the need to continue providing access to high quality programs for students across every region of the Commonwealth. Penn State seeks an appropriation increase from the Commonwealth of $23,295,000, or 6.8 percent. Of this amount, $17,567,000 is requested for the Educational and General line item and $4,765,000 for the other line items. An increase of $963,000 also is requested in the State and Federal Medical Assistance funding provided to the Milton S. Hershey Medical Center through the Pennsylvania Department of Public Welfare.
These funds will be used to help support the University’s basic operating cost increases, with emphases on escalating health care costs, deferred maintenance and facilities improvements, and modest faculty and staff salary adjustments.
If the Commonwealth is able to support this request, the University would be able to keep its tuition increase for the 2007-08 academic year below average increases throughout higher education. Indeed, Pennsylvania resident students attending most Penn State campuses other than University Park would see a rise in their tuition of only 3.8 percent, while those at University Park would see a 4.8 percent increase.
Penn State takes its responsibility to be good stewards of the state’s resources seriously and ranks as one of the most efficient universities in America. Over the past decade, the University has aggressively trimmed budgets, producing $147 million in budget reallocations. These funds have been reallocated to help offset cost increases and to provide critically needed support for academic programs. Over the years, this has resulted in a significant shift of funds from non-academic to academic functions. Since 1992, the University has merged or eliminated 116 academic programs as it has added new ones. The University will continue to cut and reallocate; however, inadequate funding will negatively affect the University’s continued ability to provide the access and economic vitality so critical to the Commonwealth’s future.
Penn State achievements in teaching, research, and service are making life better in Pennsylvania. Recent national rankings serve to highlight the University’s accomplishments. In August of 2006, Washington Monthly named Penn State the 3rd best university in America, based on how universities contribute to the good of the nation.
Surely there can be no wiser investment for the Commonwealth than to bolster the resources available to Penn State. The budget request that the University is submitting will make the University and the Commonwealth partners in an effort to assure continued access and affordability for the citizens of our state, while ensuring the level of quality that Pennsylvanians have come to expect from their land-grant university.
