Kevin Hensil: PASSHE continues system redesign with funding update that supports students, universities

The editorial “Funding formula is PaSSHE pipe dream” (June 20, TribLIVE) is built on a misunderstanding of a new formula to distribute state funds among the state-owned universities. The editorial suggests the formula isn’t viable without an increase in state funding. While the formula and funding are separate issues, to be clear, no funding formula will work without sufficient funding.

The Pennsylvania State System of Higher Education (PASSHE) has repeatedly said the current level of state funding is unsustainable. The need for additional state investment in the state-owned universities does not change with or without the new formula. No matter how PASSHE slices the funding pie with a formula, the pie needs to get bigger.

A little background may be helpful. The nationwide trend of declining college enrollment combined with lagging state funding — Pennsylvania ranks 46th in the nation for investments in state-owned, four-year universities — has forced problematic tuition increases starting a decade ago that further depressed enrollment.

The state system universities remain the lowest-cost four-year higher education option in Pennsylvania, but it became clear that rapid change was necessary to preserve access to higher education for tens of thousands of middle- and low-income students.

In 2020, the Legislature passed Act 50, a state law renewing its partnership with state-owned universities. The university system would redesign itself, and the legislature and governor would provide more funding for public higher education and its students.

The state system is keeping its promises with a redesign that is challenging but necessary. The results are positive, with universities working with students, faculty, and communities to create innovative solutions to meet every benchmark.

Today, universities spend no more than they earn, like Pennsylvania families. And the system has saved $173 million and counting by lowering costs to avoid tuition increases for an unprecedented four consecutive years. That’s a huge turnaround after years of annual tuition hikes.

The system is also working with private employers to align education programs with careers in high-demand, like STEM, health, business and education — all critical to addressing the labor shortage in key industries.

The new formula is also part of the redesign. It is the result of more than a year of data-driven and collaborative strategic planning. The new formula is simpler than the previous one and is primarily based on enrollment, so funding follows the student to support their education and success.

We’ve improved how we slice the pie, now it’s time to increase the size of the funding pie. Building on the redesign, the state system made a data-driven request to the governor and Legislature for a significant additional investment in the system to address the workforce shortage and the urgency of the universities’ needs.

The request has three critical investments: First, $550 million, an increase of $72 million, to hold the line on tuition prices for a fourth consecutive year. That would be tremendous news for students, 90% of whom are from Pennsylvania. Second, $201 million for student financial aid especially important for underrepresented students in rural and urban communities. Third, at least $75 million of the remaining $150 million in federal funds reserved for the state system to continue its robust transformation.

The important point is Pennsylvania’s workforce has a talent gap and PASSHE is primed and ready to tackle it. As public universities, we are uniquely focused on providing a high-quality higher education to middle- and low-income students and upskilling or reskilling workers. This creates the pipeline of job-ready workers that businesses need to thrive and helps Pennsylvanians succeed in their home state.

Kevin Hensil is director of media relations, Office of the Chancellor, for PASSHE.