AICUP Message to Friends of Independent Higher Education
January 9, 2012

 

Special Edition:  Governor Freezes $160 Million in State Spending

 

Last week, Governor Corbett put $160 million in FY 2011-12 appropriations in budgetary reserve.   Governor Corbett said the decision to freeze these funds was not made lightly, but he felt obligated to impose the freeze because the revenue picture did not improve at the end of December. Collections are running $486 million below the mid-year estimate. Three percent of FY 2011-12 appropriations across government departments was the average amount frozen, with a high of 10 percent in some cases.  The Governor requested that PHEAA freeze and return 5 percent of its funding or about $21.1 million.  Last year Governor Rendell imposed a 1.9 percent freeze, which ultimately resulted in an $8 million reduction in the PHEAA appropriation. However, PHEAA used its reserves to find the money and did not reduce the grant amount for students.  Institutional Assistance Grants (IAGs) were also not decreased in last year’s freeze.  If Governor Corbett’s recent request is honored, the grant amount could decrease.  The PHEAA Board will consider the Governor’s request at its January 26 board meeting.  State appropriations for the PHEAA Student Grant Program were essentially flat funded in 2011-12 (though the Agency added $50 million of its earnings to the program), but the IAGs were cut by 19 percent (or $5.1 million) for 2011-12.

 

The four state-related universities (PSU, Pitt, Temple and Lincoln) also saw a freeze of 5 percent (or $25.8 million) after budget cuts of 19 percent (or $173.2 million) for 2011-12.

 

The Governor requested that the State System of Higher Education (SSHE) institutions, such as Bloomsburg, Shippensburg, and Slippery Rock, freeze 5 percent of their appropriation (or $20.6 million). The SSHE suffered an 18 percent cut of $90.6 million in the 2011-12 budget.  As an independent entity, the SSHE Board of Governors must agree to this freeze but that is likely given that the Governor appoints the Chair of the Board of Governors.

 

The Governor did not freeze any funds in the main appropriations for the Community College General Fund and capital funding.

 

A portion of the funds cut from public universities included federal ARRA funds which were not received by the PHEAA grant program or the private colleges that receive IAGs.  If external agencies comply with the Governor’s request, the total freeze would be $222.4 million.

 

 

AICUP Message to Friends of Independent Higher Education
January 9, 2012

 

Special Edition:  Governor Freezes $160 Million in State Spending

 

Last week, Governor Corbett put $160 million in FY 2011-12 appropriations in budgetary reserve.   Governor Corbett said the decision to freeze these funds was not made lightly, but he felt obligated to impose the freeze because the revenue picture did not improve at the end of December. Collections are running $486 million below the mid-year estimate. Three percent of FY 2011-12 appropriations across government departments was the average amount frozen, with a high of 10 percent in some cases.  The Governor requested that PHEAA freeze and return 5 percent of its funding or about $21.1 million.  Last year Governor Rendell imposed a 1.9 percent freeze, which ultimately resulted in an $8 million reduction in the PHEAA appropriation. However, PHEAA used its reserves to find the money and did not reduce the grant amount for students.  Institutional Assistance Grants (IAGs) were also not decreased in last year’s freeze.  If Governor Corbett’s recent request is honored, the grant amount could decrease.  The PHEAA Board will consider the Governor’s request at its January 26 board meeting.  State appropriations for the PHEAA Student Grant Program were essentially flat funded in 2011-12 (though the Agency added $50 million of its earnings to the program), but the IAGs were cut by 19 percent (or $5.1 million) for 2011-12.

 

The four state-related universities (PSU, Pitt, Temple and Lincoln) also saw a freeze of 5 percent (or $25.8 million) after budget cuts of 19 percent (or $173.2 million) for 2011-12.

 

The Governor requested that the State System of Higher Education (SSHE) institutions, such as Bloomsburg, Shippensburg, and Slippery Rock, freeze 5 percent of their appropriation (or $20.6 million). The SSHE suffered an 18 percent cut of $90.6 million in the 2011-12 budget.  As an independent entity, the SSHE Board of Governors must agree to this freeze but that is likely given that the Governor appoints the Chair of the Board of Governors.

 

The Governor did not freeze any funds in the main appropriations for the Community College General Fund and capital funding.

 

A portion of the funds cut from public universities included federal ARRA funds which were not received by the PHEAA grant program or the private colleges that receive IAGs.  If external agencies comply with the Governor’s request, the total freeze would be $222.4 million.