Penn State plans 14.1% funding cuts for campuses. What will that mean to Behrend?

A combination of inflation, higher health care costs and demographic challenges has Pennsylvania State University, the state's largest university by enrollment, looking to cut costs.

Some of those cuts could have an impact on operations at Penn State campuses across Pennsylvania, including Erie's Penn State Behrend.

At the same time that tuition prices have flattened out in the post-COVID era, in an effort to remain competitive, Penn State has made a $60 million commitment to salary increases.

That's left the university looking for ways to cut costs, according to what the administration calls a road map to the university's future.

The university's plan for its 2025-2026 fiscal year calls for total reductions of $94 million. Some of the projected cuts are small, including a 0.7% cut to the $65 million budget of the Penn State College of Health and Human Development.

At the other end of the spectrum is a 46.9% cut to the $4.3 million budget of the Penn State School of International Affairs.

Some departments are expected to see a funding increase. But the overall budget for colleges housed at University Park in State College is expected to decline by $11 million or 1.4% from the 2024-2025 allocation, according to the administration.

Penn State's other 20 commonwealth campuses, including Behrend in Harborcreek Township, could be asked to take a hit that is measurably 10 times larger.

In fact, the $383 million budget for Penn State's commonwealth campuses is on track to decline by 14.1%, a reduction of $54 million.

There is a rationale for that larger cut. As a group, enrollment in Penn State's commonwealth campuses has declined by 20,000 since 2010.

Over time, Behrend enrollment is up

But those declines haven't affected all campuses to the same extent.

Total enrollment at Behrend, including both residential students and World Campus students taught by Behrend faculty, is up 16% since 2010, according to enrollment data provided by the college.

While total enrollment at Behrend has been level since 2016, enrollment of first-year and transfer students has risen 18% since 2020.

Behrend, which has an enrollment of about 4,500, has been successful by other measures as the owner and operator of Knowledge Park, a technology and business park that is home to 22 companies and more than 500 employees. Behrend is also home to several research labs and is responsible for more than $8 million in annual funded research.

More: Behrend marks milestone with new lab as Magee Women's Research continues to grow in Erie

Campuses could see different results

The university has left open the door that Behrend's enrollment figures and role as a magnet for employers will be taken into account as funding decisions are made.

According to Penn State's administration: "At this stage, individual campus allocations have not been finalized, purposely, so that the Office of the Vice President for Commonwealth Campuses can work closely with Penn State’s 20 Commonwealth Campuses and their chancellors."

In a question and answer document provided by the university, Margo DelliCarpini, vice president for commonwealth campuses and executive chancellor, said numerous options are being considered.

She said: "Some of the options we are exploring to offset costs may include what it would look like to partner with additional local community colleges and rent out our facilities for some of their programming."

Could some smaller campuses be closed?

DelliCarpini didn't rule out the possibility.

She wrote: "Each of our campuses brings a unique element and value to our Penn State community, our structure and our students. However, a handful of campuses have experienced significant enrollment declines in the last few years and some campuses are spending significantly more than they bring in revenue; with our current funding level from the state, the current business model is unfortunately not sustainable."

What about Behrend?

Penn State Behrend Chancellor Ralph Ford, who has overseen a period of expansion that has included the construction of a new $28 million Erie Hall as well as completion of the Advanced Manufacturing and Innovation Center, is among chancellors who could be facing cuts.

More: Transformational win streak marks Penn State Behrend Chancellor Ralph Ford's 5th anniversary

“Penn State is facing challenges, and Behrend will need to play a part in meeting them," Ford said in a statement. "It is important to note, however, that Behrend is financially sound, with revenue that consistently outpaces expenses. We are seeing growth in enrollment, research and community outreach, and we are one of the top fundraising units at Penn State."

He continued: “We are committed to working with others across the University to identify collaborative strategies and operating efficiencies that advance the land-grant mission and continue to improve the communities that our local campuses call home.”

Community support

Harborcreek Township Supervisor Dean Pepicello is hoping the funding news is good for Behrend.

Aside from a payment made in lieu of real estate taxes, Pepicello said Behrend makes a substantial contribution to the community in the form of both earned income and local services taxes.

"They are a significant economic driver in this community," he said. "Then you add the houses they buy and the significant amount of money they spend in our business district. They are clearly the impetus for Knowledge Park and for most development at that interchange."

Others face a crunch

Penn State isn't the only institution being forced to reevaluate its spending. According to a report in the New York Times, New School in Manhattan, faced with a $52 million budget shortfall, is looking to sell the president's home, valued at about $20 million.

At Penn State, President Neeli Bendapudi, who took office in 2022, said the current discussions are only a first step.

"We must think, innovate, problem-solve and operate differently," she said in a statement. "This is the only way we will be successful."

Contact Jim Martin at jmartin@timesnews.com.

This article originally appeared on Erie Times-News: Penn State Behrend hopes to escape cuts as university trims budget