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Penn State

Penn State, Pitt, and others get hundreds of millions in taxpayer funds. Tracking it is a challenge.

by Wyatt Massey of Spotlight PA State College |

People walk across Old Main lawn on Penn State’s University Park campus in State College, Pa.
Transparency into how Pennsylvania’s state-related universities, including Penn State, spend annual appropriations is limited.
Abby Drey / Centre Daily Times

This story was produced by the State College regional bureau of Spotlight PA, an independent, nonpartisan newsroom dedicated to investigative and public-service journalism for Pennsylvania. Sign up for our regional newsletter, Talk of the Town.

STATE COLLEGE — Each year, Pennsylvania’s legislature sends hundreds of millions of taxpayer dollars to the four state-related universities but, while state law dictates how the appropriation should be used, state lawmakers, government officials, and the public have little insight into how the money is actually spent.

Lincoln University, Penn State University, Temple University, and the University of Pittsburgh have a special status that allows them to operate independently while receiving money from the state.

Pennsylvania law requires that the universities use the appropriation only for costs directly related to the instruction of students or student-related services. Temple, Pitt, and Penn State are among the most expensive universities for in-state tuition and fees in the nation, according to U.S. News & World Report. Each state-related university raised tuition in 2022.

Democratic Gov. Josh Shapiro’s 2024 budget proposal would allocate nearly $640 million collectively for the state-related universities, a 7.1% increase over last year. State lawmakers have until June 30 to pass a budget for the 2024 fiscal year.

As in previous years, the funding would come with a mandate that the universities file “a statement that specifies the amounts and purposes of all expenditures made from money appropriated by this act and other university accounts” with the state Department of Education, the General Assembly, and the auditor general within 120 days after the close of the 2024 fiscal year.

Through an open records request, Spotlight PA obtained copies of reports filed with the auditor general in the past five years. The documents show that the state-related universities report their appropriation spending as a lump sum.

A screenshot of Penn State’s “statement of appropriations earned” for fiscal year 2022.
A screenshot of Penn State’s “statement of appropriations earned” for fiscal year 2022.

“It does not appear that the universities have been required to track their exact expenditures directly to the appropriations, which is likely why the statutory sections allow them to also include ‘other university accounts’ so that it is reported in total,” Michèlle Pokrifka, deputy chief counsel in the Department of the Auditor General, told Spotlight PA in an email.

The four universities also file an annual report with the state Department of Education that details budget information for the previous and current fiscal years. The universities report lump sum spending of the state appropriations in these reports.

Similarly, Pennsylvania’s Office of the Budget publishes monthly updates on how much money each of the universities has used, though the reports do not specify how the appropriations were spent.

State Rep. Ryan Warner (R., Fayette) said in an emailed statement that the lack of transparency is “beyond frustrating,” given the universities got nearly $600 million from the state during the latest budget cycle.

“The people who foot the bill for this — the hard-working taxpayers of our Commonwealth — deserve to know how their money is being spent,” Warner wrote. “Unfortunately, it seems the heads of the four universities do not agree. For the last two years, I have directly asked them if they would support legislation making them subject to the Right to Know Law, and none of them have committed their support.”

Spotlight PA contacted each of the state-related universities by email to request information about how the university spends its appropriation. We essentially asked, for each $1 that the university receives in taxpayer money, what percentages go to student financial aid (merit- or need-based), instructional costs,building maintenance, and other expenditures?

Penn State, in an emailed statement, said it does not track appropriation spending this way. “All of it is used to offset the cost of instruction and provide a discounted tuition to Pennsylvania residents, which the university more than doubles to provide an even greater discount for in-state students,” a university spokesperson wrote.

Penn State’s request to the General Assembly for fiscal year 2024 provides some insight into how the university spends the money, but the document only details how Penn State would spend the additional money it requested over what it received in fiscal year 2023. Specifically, the university said it would spend $55.7 million more on salaries to retain employees, $29.7 million more on “strategic priorities” determined by the administration, $14.9 million more on facilities, and $14.9 million more on “need-based student aid and grants-in-aid along with other vital student success services.”

Lincoln, in its 2024 appropriation request, sought $19 million, of which it planned to spend $11 million on tuition discounts and scholarships, and $2 million on hiring new faculty. The university did not respond to Spotlight PA’s request for comment by publication time.

Jared Stonesifer, a spokesperson for Pitt, told Spotlight PA in an email that money approved by the legislature reduces tuition rates for state students.

“Every cent of the university’s annual state appropriation goes to supporting reduced tuition for Pennsylvania’s students and families,” Stonesifer wrote. That information is reflected in Pitt’s fiscal year 2022 audited financial statement.

In an emailed statement to Spotlight PA, Steve Orbanek, director of communications for Temple, said all of the annual appropriation is used to determine the in-state tuition rate.

On its website, Temple says it uses the state funds “to pay for the necessary expenses to educate students, including salaries and benefits for faculty and staff, utilities, facilities and technology needs.”

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