The Pennsylvania State System of Higher Education’s (PASSHE) Board of Governors today agreed to request $526.9 million from the state next year to help fund the operations of the 14 state-owned universities.

The funding would support PASSHE’s proposed Fiscal Year 2009-10 operating budget of nearly $1.44 billion. The annual state appropriation provides about one-third of the funds needed to operate PASSHE universities. Student tuition and fees cover most of the rest.

The funding request approved by the Board, which will be presented to the Governor’s Budget Office later this month, represents an increase of $28.4 million, or 5.7 percent, over PASSHE’s current base appropriation from the Commonwealth.

To fully fund the proposed budget, tuition would need to be increased by about $214 next year for full-time, Pennsylvania residents, who make up the vast majority of PASSHE students. The Board will not determine next year’s tuition rate until sometime after passage of the 2009-10 state budget, which usually occurs in June.

In a separate action taken today, the Board agreed to a request by Governor Edward G. Rendell to set aside approximately $22 million from this year’s state appropriation in case sagging state revenues require the Commonwealth to reduce its 2008-09 budget later this fiscal year. The amount would be equivalent to 4.25 percent of PASSHE’s current year appropriation of $498.5 million.

“These are very difficult economic times, and it is imperative that all of us work together to help ensure the Commonwealth’s most vital needs are met,” said Board of Governors Chairman Kenneth M. Jarin. “Our universities will begin looking now for ways they can reduce their budgets, if necessary, in such a way that the reductions will not impact the quality of education our students receive.

“PASSHE has always been prudent with its resources, both the funds we receive from the state and the tuition dollars we receive from our students. We have been aggressive in our efforts to control our costs, and we will continue to look for ways we can operate even more efficiently. Even so, it is important to remember that the funds we receive from the Commonwealth represent an important investment in the future of Pennsylvania. There is no better way to spend our tax dollars than in the education of our citizenry.”

PASSHE’s operating costs are expected to increase by about $69.1 million, or 5.1 percent, next year. Employee salaries and benefits will account for most of that increase, growing by about $56.6 million combined. About three-fourths of PASSHE’s operating budget goes to cover personnel costs.

Utility costs also are projected to increase by about $2.5 million next year, a total offset somewhat by energy conservation efforts. Other increases are anticipated in the cost of materials and supplies and in building maintenance. Some cost increases will be mitigated through the use of strategic sourcing, which combines the purchasing power of PASSHE’s 14 universities to obtain better prices on the purchase of services, supplies and equipment.

In addition to approving the 2009-10 base appropriation request, the Board of Governors also approved separate funding requests totaling about $25.7 million to support a variety of special initiatives, including in the areas of performance funding, economic development, teacher education and diversity and equal opportunity efforts across the System.

The Governor’s Budget Office will consider PASSHE’s appropriations requests along with those prepared by other state agencies and state-supported entities as it develops a proposed 2009-10 general fund budget for the Commonwealth. The governor will submit his budget proposal to the Legislature in February, after which the House and Senate appropriations committees will hold a series of public hearings on the spending plan. The Commonwealth budget must be approved by June 30, 2009, in order to take effect July 1, the start of the next fiscal year.

The Board of Governors this past July approved a $181 tuition increase, the fourth consecutive year tuition was increased at or below the rate of inflation. Tuition at the 14 PASSHE universities – now $5,358 for the full academic year – remains the lowest among all four-year colleges and universities in Pennsylvania. The average total cost of attendance at a PASSHE university, including tuition, required fees, room and board, is below the national average among all public universities in the United States, according to the most recent study conducted by the College Board. Tuition and fee increases at PASSHE universities over the last five years have been the lowest among all public university systems in the nation.

Now in its 25^th year, the Pennsylvania State System of Higher Education is the largest provider of higher education in the Commonwealth, with more than 112,500 students, nearly 90 percent of who are Pennsylvania residents. The 14 PASSHE universities offer degree and certificate programs in more than 120 areas of study. Approximately 405,000 PASSHE alumni live and work in Pennsylvania.

The state-owned universities are Bloomsburg, California, Cheyney, Clarion, East Stroudsburg, Edinboro, Indiana, Kutztown, Lock Haven, Mansfield, Millersville, Shippensburg, Slippery Rock, and West Chester Universities of Pennsylvania. PASSHE also operates branch campuses in Clearfield, Freeport, Oil City and Punxsutawney and several regional centers, including the Dixon University Center in Harrisburg.