Penn State requested a big increase in state funding. Here’s what PA lawmakers passed
Penn State will receive flat funding for its general support appropriation from the state for the fiscal year 2025-26, marking the sixth consecutive year that the university will not see an increase in funding.
The state legislation approved the 2025-26 appropriations for Pennsylvania’s state-related universities on Wednesday. The bill allocated about $647 million in assistance for Penn State, University of Pittsburgh, Temple University, Lincoln University and University of Pennsylvania’s veterinary activities.
The university requested an increase of $30 million in funding for its general support appropriation for this year.
Penn State received $242,096,000 for general support, which the university uses to discount tuition for in-state students. It received $35,670,000 for general support for the Pennsylvania College of Technology — a 5% increase from last year.
In a press release, Neeli Bendapudi, president of Penn State, said she was pleased to see the state pass the budget and emphasized the importance of state funding.
“The funding Penn State receives from the commonwealth is essential to making higher education attainable for tens of thousands of Pennsylvania students and their families. State investment is the foundation that allows us to provide an accessible, high-quality education through our in-state tuition rate, while also supporting Penn State Extension, Penn State Health, Invent Penn State, and Penn College — all of which strengthen communities and enhance the lives of people across the state,” Bendapudi said.
Penn State’s general support funding last received an increase in 2019-20, which was a 2% increase. The release states that if Penn State’s funding kept pace with inflation over the past 25 years, its appropriation today would be more than $450 million.
“On a per-in-state-student basis, Penn State’s funding ranks last among Pennsylvania’s public universities. When divided among approximately 42,000 Pennsylvania-resident undergraduates, Penn State’s current $242.1 million general support appropriation equals approximately $5,796 per student. This is well below the levels of per-Pennsylvania-student support provided to Temple ($10,830), the schools in the Pennsylvania State System of Higher Education ($10,200), and Pitt ($9,342),” the release states.
To bring the university to the same funding level as other public universities in Pennsylvania, the release states the state would have had to increase its general support allocation by $156 million for the 2025-26 fiscal year.
For 2026-27, the board of trustees recently approved requesting an additional $49 million in general support. The university said that amount would allow them to freeze tuition for all undergraduate students across all campuses for the 2027-28 academic year.
Pennsylvania state Senators Wayne Langerholc, R-Johnstown, and Cris Dush, R-Brookeville, represent parts of Centre County and voted for the bill. Centre County state Representatives Paul Takac, D-College Township, Scott Conklin, D-Rush Township, and Kerry Benninghoff, R-Bellefonte, also voted for the bill.
The breakdown of Penn State’s 2025-26 state appropriation includes:
- General Support: $242.1 million (level funding)
- Agricultural Research and Extension (Land Scrip Fund): $57.7 million (level funding)
- Pennsylvania College of Technology: $35.7 million (increase of $1.7 million, or 5%, from 2024-25)
- Penn State Health and the College of Medicine: Level funding
- Invent Penn State: $2.35 million (level funding)
Performance-based funding
Bendapudi has long advocated for a performance-based funding model, which would reward the state-related institutions for reaching goals that support areas like student success and workforce development. The state passed a Senate bill that establishes a State-Related University Performance Fund and outlines a performance-based funding formula, but it is not funding for 2025-26, the university’s release states.
Bendapudi said she will work with leaders in Harrisburg to have the “critical conversation” about the university’s support.
“...Particularly through the state’s new performance-based funding formula, we plan to demonstrate to the General Assembly that Penn State is a committed partner and worthy of additional state investment. New funding would support Penn State’s efforts to be a catalyst for innovation, economic and workforce development, and to create upward mobility across Pennsylvania,” she said.
Once it is funded, it would apply to Penn State, Temple and Pitt. The formula considers the university’s in-state population in a number of categories, and each school’s allocation would be calculated based on goals in metrics, according to the release, including:
- Four-year graduation rate for in-state, undergraduate students
- Six-year graduation rate for in-state, undergraduate students
- Six-year graduation rate for in-state, Pell-Grant-recipient undergraduate students
- High-demand degree production for in-state undergraduate students
It also includes a bonus for a university’s improvement in performance metrics year-over-year, and an affordability bonus for universities that keep the percentage increase in their total attendance cost below the percentage increase in the most recent Higher Education Price Index, the release states.
Mike Stefan, vice president for government and community relations at Penn State, said they’re pleased to see the performance-based funding one step closer to becoming a reality.
“We feel strongly that performance-based funding will be a win-win for the commonwealth and the state-related universities by tying funding increases to metrics that will help to advance student success, improve college access and affordability, and strengthen our workforce,” Stefan said. “We are eager to continue working as partners with the commonwealth to meaningfully fund this new model, for the benefit of our Pennsylvania-resident students and families.”
