Thaw in Pa.’s Budget Freeze Funds 4 State Universities

After months of wrangling, Pennsylvania lawmakers recently passed a spending bill that ends a long-standing and contentious partisan debate over hundreds of millions of dollars spent annually on four of the state’s leading public universities.

The measure was approved only after the lawmakers reached consensus on one key condition: the leaders of the universities had to commit to adopt increased financial transparency practices.

The bill, which was approved in mid-November, authorizes $603.5 million in funding for the University of Pittsburgh and Penn State, Temple and Lincoln Universities. It was attached to an open records bill requiring the universities to make records about their finances, employees and operations publicly available. Governor Josh Shapiro, a Democrat, signed both bills into law on Nov. 16.

The transparency legislation helped to eliminate a loophole lawmakers, particularly Republicans, had been working to close for years. The state-related universities will now have to share more financial information publicly. Although the new law does not hold the universities to the same public disclosure requirements as other state agencies, it strengthens their transparency practices.

Passage of the spending bill came five months after the original budget deadline in June. Lawmakers went on summer recess in early July after they deadlocked along party lines about approving the funding. The institutions were left waiting in limbo.

Much of the gridlock stemmed from the House, where Democrats hold a one-vote majority, which wasn’t enough support for a bill that required a two-thirds majority to pass. Some of the chamber’s most conservative Republican members opposed the bill for reasons related to fetal tissue research and medical care for transgender children at university hospitals. But most of the Republicans wanted the leaders of the universities to agree not to raise tuition and to implement the transparency measures as a condition of receiving state funding.

Pennsylvania is not the only state where lawmakers have withheld funding for public colleges and delayed budgets in an attempt to push university administrators to adopt certain policies. The Wisconsin State Legislature has had a months-long budget standoff, particularly over cuts to diversity, equity and inclusion programs.

Some Pennsylvania Republicans had long argued that the state should not just act as an ATM, dispensing funds to the universities without condition, and made clear that agreeing to increased transparency would be a sticking point if universities wanted to receive any additional state funds.

“Pennsylvania students, families and the taxpayers who support the Commonwealth’s four state-related universities deserve to more clearly understand how their hard-earned dollars are being spent,” Kate Klunk, a Republican and co-sponsor of the transparency bill, wrote in an email.

The top administrators of the universities all voiced support for the public records bill, but some were not entirely satisfied with the new funding levels.

Pitt, Penn State and Temple will be funded at the same level as last year. Lincoln, an HBCU, and the Pennsylvania College of Technology, which is part of Penn State, will receive an increase of $3.2 million each. Shapiro had initially proposed a 7 percent increase in funding for all four institutions.

In a statement about the passage of both bills, Temple said university leaders recognize the importance of financial accountability and would comply with the new transparency laws.

“While five straight years of flat funding does present a challenge to the university’s operating budget, there is no overstating the significance of the non-preferred appropriation as it is key in helping to make the highest quality education accessible for Pennsylvania college students and their families,” the statement says.

“We believe that the new public records requirements will help the public and lawmakers understand the value of the important work that Temple does for the economy and citizens of Pennsylvania,” it adds.

Jared Stonesifer, a University of Pittsburgh spokesperson, said in an email that the institution is grateful for the funding and that Pitt’s administrators would continue to work with state lawmakers “to find a more sustainable way to fund higher education.”

Wyatt DuBois, a Penn State spokesperson, said the financial transparency bill “strikes a fair balance and represents a significant expansion of the type and amount of financial information” the universities currently make available to the public.

Brenda Allen, president of Lincoln, said via email that her institution supports “providing the data needed for the General Assembly to make informed decisions” and is “grateful” for the passage of the appropriations bill and its 21 percent increase in funding for the historically Black university.

“Lincoln depends on the state appropriation to benefit Pennsylvania resident students and provide funding critical to our operations,” Allen said.

The president also credited 14 Lincoln students, who marched 66 miles from the university’s campus to the state Capitol in protest of the budget freeze, and said their activism exemplified the institution’s values of activism and leadership.

Republican lawmakers had hoped that by withholding university funding they would also prevent the institutions from raising in-state tuition rates and help improve the state’s abysmal rankings for college cost-effectiveness. But only Lincoln’s president was willing to do so. (Penn State committed to freeze tuition only for its regional campuses.)

Some of the materials mandated for public release under the new open records law, such as boards of trustees’ meeting minutes and enrollment figures, are already provided voluntarily by the universities. But the institutions will now also be required to provide a greater level of financial transparency, including the salaries of all administrators and highest-paid employees, detailed financial statements for each academic department, and any enterprise that is funded by tuition or taxpayer money. The institutions will also be required to publicly publish information about contracts exceeding $5,000 and submit the agreement to the governor’s office and Legislature.

Klunk believes the new requirements will help reinforce public trust in the institutions.

“It was imperative for me that the Right-to-Know bill passed both chambers before we approved funding for the universities. Many members shared this sentiment as well,” she wrote in an email.

“While many of us would like to see further transparency requirements, I am thankful we were able to get this bill across the finish line with such bipartisan support,” Klunk said. “We can always work to amend the Right-to-Know Law if we find the public and the legislature could benefit from having access to additional information.”