Shapiro's budget proposal seeks funding increase to merge state-owned universities and community colleges

A unified system of 10 Pennsylvania state-owned universities and 15 community colleges would see a near-historic, 15% increase in state funding under Gov. Josh Shapiro’s proposed 2024-25 state budget, which was unveiled Tuesday.

The increase would support his plan, announced last month, to overhaul the state’s higher education system and cap tuition and fees at no more than $1,000 for many students attending State System of Higher Education universities and community colleges.

The governor also is asking the state Legislature for a 5% boost in institutional support for the four state-related universities, including the University of Pittsburgh, Penn State University, Temple University and Lincoln University.

In turn, he proposed tying state aid for those schools and the state-owned campuses to performance indicators that benefit the state.

Beginning in 2025-26, Pennsylvania Higher Education Assistance Agency state grants would increase by $1,000, upping the maximum award from $5,750 to $6,750, under the governor’s plan.

He said it would allow the newly formed system of two- and four-year campuses to deliver a degree for no more than $1,000 per semester, at an annual $279 million cost to the state, for students coming from households making up to Pennsylvania’s median yearly income.

Shapiro referenced a potential $14 billion state budget surplus as he said the stakes for Pennsylvania’s economy were too great not to make a decisive investment in education.

“After 30 years of disinvestment, too many of our colleges and universities are running on empty, and not enough students have affordable pathways through college and then into good jobs,” Shapiro said. “Think about this: Pennsylvania now ranks 49th for state investment in higher education and 48th in higher ed affordability.”

Shapiro’s midday address in the Capitol Rotunda in Harrisburg kicked off a push to woo support from the Legislature.

While fellow Democrats have embraced the outlines of his higher education overhaul, Republican leaders expressed skepticism over how it would be financed.

That continued Tuesday, minutes after Shapiro’s address, as Republican lawmakers including Senate President Pro Tempore Kim Ward, R-Westmoreland, delivered the GOP response. She called it a budget “of unicorns and rainbows”’ without a clear financial base.

“We will dig into this budget. We will look at it hard. We will try to find out where he’s coming up with money to pay for this in addition to just raiding the rainy day fund.”

If the proposal is approved by the Legislature, the state universities and community colleges being brought under one umbrella would receive $975 million, which would be 15% more than the $850 million they received this year, according to the governor’s proposed budget.

A year ago, in his first state budget address, Shapiro became the latest Pennsylvania governor stretching back decades to propose an overhaul of Pennsylvania’s college and university system. He called it underfunded, overpriced and inadequately supervised to avoid unnecessary competition for limited tax dollars.

The State System universities, though, have frozen tuition and fees for five consecutive years at $7,716 for Pennsylvania undergraduates.

“If we pass my plan and make the investments that I lay out in my budget, we would jump from 49th in the nation today (in state support) to 22nd in just five years,” Shapiro said. “ It’s time to build on this new blueprint for higher education in Pennsylvania and leave a lasting legacy on this Commonwealth.”

The governor’s plan for higher education includes an outcomes-based funding approach. It would create a dedicated funding slot for the state-related universities through the Department of Education — sidestepping a fight to secure two-thirds support in the Legislature each year that has spawned political fights over whether those schools should receive funding.

Shapiro said the state, in turn, would “no longer write them a blank check” and instead tie funding to a predictable and transparent outcomes-based approach.

It could include such goals as increasing the number of first-generation college students enrolled, keeping more students in Pennsylvania after graduation and preparing them for high-demand fields such as agriculture, education and nursing.

In addition to the Western Pennsylvania campuses of PennWest, Slippery Rock and Indiana University of Pennsylvania, the State System schools include Cheyney, Commonwealth (a merger of the former Bloomsburg, Lock Haven and Mansfield universities), East Stroudsburg, Indiana University of Pennsylvania, Kutztown, Millersville, Shippensburg, Slippery Rock and West Chester universities.

In Western Pennsylvania, the state’s two-year schools include Community College of Allegheny College, Westmoreland County Community College and community colleges in Beaver and Butler counties.