Budget process differs from previous years

Five people made most of the decisions about Pitt’s budget this year, including tuition hikes…. Five people made most of the decisions about Pitt’s budget this year, including tuition hikes. The process differed from the University’s usual committee-based reccomendation process which includes student input.

Provost Patricia Beeson said that she, Chancellor Mark Nordenberg, Vice Chancellor Art Ramicone, Senior Vice Chancellor Arthur Levine and Executive Vice Chancellor Jerome Cochran worked off of general reccomendations that a University-wide committee made months before the state finalized its appropriations for the University.

The University altered its usual process because of the wide range of potential funding cuts Pitt faced — intially as high as 50 percent — Beeson said. She said that there has never been this big of a budget issue and there has certainly never been such a cut from the Commonwealth.

But even though this has been “a very difficult and painful several months,” Beeson said that the University tried to make sure no one group at Pitt had to bear the whole burden of the 22 percent funding cuts finalized two weeks ago.

The five administrators had worked on the budget for months, coming up with a variety of possible budgets for when the state passed Pitt’s funding. The group sought input from a number of sources, including number-crunching from Ramicone’s staff in the office of the budget and controller.

When the state passed its budget, and Pitt’s 22 percent cut, the five administrators still had work to do.

“There are no easy choices in this situation,” Beeson said. “Even when you have a plan, there’s still angst and kicking the tires.”

Once Nordenberg approved a plan though, the group made its recommendation to the Board of Trustees, which approved the budget last week.

“When the boss decides on something we buckled down and said ‘this is what we’re going to do’” Ramicone said.

Most years — even in 2009, when the state passed its budget more than four months late — planning starts at the department level. Those reccomendations then go to school committees, to a provost’s committee and finally to a University-wide committee that reports to Nordenberg.

Each committee has at least one student representative, in addition to staff, faculty and administrators, Beeson said. There are two student representatives on each committee, one undergraduate and one graduate student, who are recommended by SGB.

This year, instead of making specific reccomendations for tuition increases and other portions of the budget, the University-wide committee made three general priority recommendations to Nordenberg in late April. This allowed the five-member group to finalize a budget once the state passed Pitt’s appropriation.

The top three priorities included keeping tuition low, minimizing budget cuts and giving minimal salary increases, Beeson said.

Pitt’s budget included an 8.5 percent tuition increase, yet-to-be-finalized cuts to the budget, and a 2 percent salary increase for faculty.

When making budget decisions, the five senior administrators consulted Ramicone’s staff, students and other members of the University community, Beeson said, although the outside advisors didn’t have the same level of input as the five.

Ramicone said that the students they consulted focused “almost solely” on tuition increases.

Though Beeson said that administrators will try to avoid it, students may see some effects of the cuts, such as larger class sizes. She also declined to comment on what programs the University might cut as a result of the budget, saying it was “too early to know” and she was still in conversations with various school deans.

Ramicone said that although the 22 percent cut is a victory over Gov. Tom Corbett’s original 50 percent, the overall $27.15 billion state budget is only down 4 percent. Over the past eight years, inflation has gone up 20 percent, the state budget has gone up 40 percent and the budget for K-12 education is up 60 percent.

During that eight year period, higher education funding has remained flat. And this year it faces drastic funding cuts.

“You get numb to the process,” Beeson said. “Getting from 50 percent to the 22 percent cut was a victory, but the fact that we started at 50 percent is very concerning and the fact that we ended up where we did is still concerning even though it was a victory.”

Ramicone said that even if the committees had given their input, the University might have reached a similar result. Pitt can only alter a certain portion of its budget, which basically amounts to the state appropriation and tuition, when reaching its budget.With the 22 percent funding cuts that Pitt received from the state,

Ramicone said that diffcult choices had to be made and they were left with a “selection of bad choices.” They spent months deciding where cuts in the budget would cause the least damage.

Beeson said that they had to look long-term when constructing the budget and had to find ways to maintain the quality of programs at Pitt.

Tuition and the state appropriation are the main aspects of the budget that can be changed, Ramicone said.

The federal government doesn’t let Pitt divert the $800 million it receives in research funding, and the University only uses auxiliary fees, such as room and board to cover those expenses. In addition, endowments given by individuals have very little flexibility, both legally and through agreements with donors.

In addition, Ramicone said the University’s health care costs, software licensing fees, real estate insurance and property maintenance costs go up each year, regardless of the budgeting process. Also, when the student population grows or Pitt adds buildings to campus, utility fees go up to handle the extra electricity, water, heating and cooling those buildings use.

Even though tuition will rise by $1,196 for in-state students, Beeson said that it could have been much worse. If Pitt had raised tuition without any budget cuts, the hike would have been more than $1,500. If the stat had passed Gov. Tom Corbett’s original 50 percent cut, Pitt might have raised tuition by about 20 percent, she said.

Beeson said Pitt’s tution is straightforward compared to other universities. She compared Pitt’s tuition to that of Penn State, which increases tuition when students move from lowerclassmen to upperclassmen. Likewise, the 14 state-system schools will charge students an increase of 2 percent for fees on top of the 7.5 percent increase in tuition.

Ramicone said that salary freezes were avoided this year because the faculty already took one two years ago. And while students are focused on tuition, he said the University has 12,000 faculty and staff members to consider.

Ramicone said that most faculty at Pitt are already paid less on average than the other three state-related schools. The faculty and staff at Pitt are competing on a national level, and an investment of this importance this needs to maintained, or risk other schools “raiding” Pitt’s departments, he said.

One of the most important aspects of the budget cuts was to make sure that the cuts do not impact the classroom, Beeson said.

She said that University decision makers have to take into account the shifts in student demands and the University’s sense of what is important.

Beeson said that Pitt will likely still move forward with a number of new academic programs in the next few years, which will consist mostly of certificate programs. These frequently take existing classes that students already use for different courses of study and restructure them into a 15 to 20 credit certificate.

Beeson said that the University will continue its outreach to influential legislators in Harrisburg and will keep alive the discussion about the importance of higher education in Pennslyvania.

Beeson said that “many people were involved in getting legislators to undersand what the value of an education is to students at Pitt.”

“Despite everything negative, that was a real positive about the whole thing,” Beeson said.

Beeson said that even with the state funding cuts and the tuition increases, there are still bright aspects of the situation.

“Everybody wants a lot of the same things for the Unviersity. They want the University to remain an excellent provider of undergraduate education and the faculty and staff and students all want that and are willing to sacrifice in different ways,” Beeson said. “There is a real core belief in what the University should be and a real strong feeling that we want to maintain what we have and continue to advance the institution.”