HARRISBURG, Pa. — Penn State President Neeli Bendapudi highlighted the need for increased state funding for Penn State’s in-state students and their families, as well as the value of a Penn State degree and the University’s work in educating the state’s future workforce, during a March 30 hearing of the Pennsylvania Senate Appropriations Committee in Harrisburg.
Joining Bendapudi for the hearing were senior leaders from Pennsylvania’s other state-related universities — Lincoln University, the University of Pittsburgh, and Temple University. Previously, Bendapudi appeared before the House Appropriations Committee on March 21.
In her remarks to the committee, Bendapudi discussed the University’s request to increase its general support funding by $115.2 million for fiscal year 2023-24. Despite educating more students than any single institution in the state, Penn State ranks last among Pennsylvania’s public universities in per-student funding — receiving between $2,600 and $3,400 less per in-state student than the commonwealth’s other public universities. To close that gap, the requested increase would raise the University’s per-student support to match that of Temple University, the state’s next lowest-funded public university on a per-student basis.
“I understand that it appears that we have a really big requested funding increase, but I would ask you to look at the numbers,” Bendapudi told lawmakers. “If you look at the fact that, per student, we have been so desperately underfunded for the last 50 years, that we now have a large structural deficit that puts increasing pressure on tuition. As I look at it, we only have two real income sources: support from the state and tuition.”
With Pennsylvania ranking 47th among the 50 states in per-capita support for public higher education, Bendapudi underscored the critical need for additional state investment to keep costs lower for Pennsylvania students and reduce the pressure on the University’s tuition rates.
Penn State’s general support appropriation directly funds the University’s discounted in-state tuition rate, benefiting approximately 45,000 Pennsylvania resident students and their families each year. Even as state funding has lagged inflation and instructional costs have increased, Penn State has continued to provide an in-state tuition discount that far exceeds the per-student appropriation, in line with its land-grant mission to serve the citizens of Pennsylvania.
Bendapudi noted that Penn State currently receives approximately $5,600 in state support per Pennsylvania resident student, yet the University’s in-state tuition rate saves the average Pennsylvania student approximately $13,000 annually on tuition costs compared to their nonresident peers.
When asked about the reasoning behind the University’s funding request, Bendapudi’s answer was clear: “It begins and ends with the students,” she said.
In his 2023-24 budget address, Pennsylvania Gov. Josh Shapiro proposed a 7.1% increase in general support funding for Penn State and the other state-related universities. If approved by the General Assembly, the University’s appropriation would increase by $17.2 million, to $259.3 million, for the next fiscal year. Penn State’s general support funding last increased in 2019-20.
University budget update
Bendapudi provided lawmakers with an update on Penn State’s efforts to reduce costs to close its approximately $140 million budget deficit, and she was specifically asked about plans for employee layoffs.
“Internally, we’re making some tough choices,” she said. “We still do not have any plans for mass layoffs, that is important to state. One-size-fits-all [cuts] — we used to do 2% across-the-board cuts, 3% across-the-board cuts — those just are not strategic, because some units may need more investment, some may need less. We’ve created a new budget model, and we’re creating transparency about what the needs are. We are doing everything we can because our people matter.”
The value of a Penn State degree
A common theme throughout the hearing was higher education’s return on investment, both for students and families and for the commonwealth itself, and how to keep students in Pennsylvania for college and beyond. Bendapudi noted that Penn State produces more STEM (science, technology, engineering and mathematics) graduates than any University in the country. With nearly 400,000 Penn State alumni living in Pennsylvania, the University also educates the state’s future workforce like no other entity in the commonwealth.
Bendapudi said internships and providing students with clear paths to jobs and opportunities early on are important factors in keeping them in Pennsylvania for the long term.
When asked how to encourage more Penn State students to remain in Pennsylvania after graduation, Bendapudi replied, “Jobs — one of the things that students look for is what their prospects to be successful will be if they stay here. A big part of that is connecting them to internships. … The sooner we connect them to opportunities in state, the more likely they are to stay.”
Preparing students for a career and life success is at the core of Penn State’s academic mission, and Bendapudi said strong partnership and commitment from the state is important for the University to have the means and agility to meet the needs of students, employers and the commonwealth in a rapidly changing world.
“We make a difference with our degree,” Bendapudi said. “We are ranked No. 5 in the country, tied with MIT, for how prepared our students are for jobs. So, this is a wise investment. I have worked closely with governors and legislatures in different states because we know that when employers are looking at where they would locate, where they would grow, they want a robust pipeline of talent.”
Penn State’s land-grant impact and the Commonwealth Campuses
Several lawmakers lauded the University for the impact of its research enterprise in solving challenges and creating new opportunities across the commonwealth. This includes the work of the University’s Center for Critical Minerals to explore the recovery of rare earth elements from Pennsylvania streams, which holds both economic and ecological promise, as well as the impact Penn State Agricultural Research and Cooperative Extension has on the state’s agriculture industry.
As part of Penn State’s commitment to creating opportunities for all Pennsylvanians, Bendapudi also pointed to the University’s Commonwealth Campus structure as a foundational piece of its land-grant partnership with the state. Penn State’s Commonwealth Campuses are key to its decades-long model of meeting Pennsylvanians where they are — 96% of the state’s population lives within 30 miles of a Penn State campus. Penn State’s campuses are centers of education, culture, employment and economic development, Bendapudi said, and they make higher education possible in many Pennsylvania communities by providing affordable, close-to-home access to one of the world’s top universities.
“It’s a question of return on investment,” Bendapudi said. “When you look at a first-generation college student or a low-income college student, what really matters is not just that they have a piece of paper, but what it unlocks. What does it do to break generational poverty? What does it do to create opportunities? A Penn State degree means they have access to 700,000 living alumni.
“Penn State is truly unique in the United States higher education system. I make that bold of a statement because students are getting a four-year degree from Penn State [no matter the campus] — same curriculum, same courses. No one else can make that statement. I feel very confident in the value of the degree that these students are getting.”
As examples of the critical role the Commonwealth Campuses play in Penn State’s land-grant mission, nearly 80% of Commonwealth Campus students are Pennsylvania residents and almost 40% are the first in their family to attend college.
As valuable regional assets, Bendapudi said that increased state support would help the University to maximize the enrollment and economic development potential of the Commonwealth Campuses.
Fostering greater diversity, equity, inclusion and belonging
Bendapudi was asked about efforts at the University related to the recruitment and retention of underrepresented students and faculty. As part of her vision for the University, Bendapudi has emphasized a commitment to creating a welcoming environment for individuals of all backgrounds and implementing a metrics-driven strategy to improve DEIB-related outcomes University-wide.
“I’ve begun conversations on this topic with our students, faculty and staff,” Bendapudi said. “We’ve published publicly a dashboard that shows our diversity efforts, so that we can all hold ourselves accountable to what we are doing with our students, in terms of their graduation, and what we are doing with our faculty, in terms of having representation. Something that’s very important to me is we cannot even just report numbers of faculty of color if they’re all in one or two departments. Because what we really need to do is give students the opportunity to learn from diverse perspectives. This is not a solution that’s immediate, but we truly, to our core, believe in inclusive excellence, and I’m hoping to come back to you each year and report on the progress that we make.”
The future of enrollments in the commonwealth
In response to a question about enrollments and the approaching “demographic cliff,” in which the number of college-aged individuals in Pennsylvania and across the Northeast is expected to decrease, Bendapudi identified four strategies that the University is pursuing to address demographic challenges. These include:
- Increasing student retention.
- Aggressively reaching out to students who started college but didn’t finish.
- Reducing the barriers to entry and making it easier to navigate the process.
- Reskilling and upskilling individuals already in the workforce.
“I can tell you that the ‘demographic cliff’ is very real, and this is not going away anytime soon,” Bendapudi said. “We’re actually going to see the worst of it over the next decade or so. However, there is still great reason for optimism.”
Performance-based funding
In recent years, members of the General Assembly have discussed implementing a performance-based funding mechanism for higher education, a concept that Bendapudi said she supports, while adding her thoughts on how such a funding mechanism should be constructed.
“While I would support some form of performance-based metrics, I would say there are some guardrails that need to be established,” Bendapudi said. “It needs to be transparent. We need to consider the mission of each university; we are all unique, so it should not be one-size-fits-all. There also needs to be clarity on what we are trying to do. And then it should be aligned with the needs of the commonwealth.”
Penn State’s appropriation is expected to be finalized this summer, as the General Assembly must agree upon and present a 2023-24 state budget for the governor’s signature by the end of the fiscal year on June 30. Penn State students, faculty, staff, alumni and friends are urged to voice their support for Penn State and the University’s state funding at Capital Day on Campus on April 14. To learn more about supporting the University’s legislative priorities as a Penn State Advocate, visit psu.edu/advocate.