Barron talks programs and funding problems at trustees meeting

Eric Barron wants to make Penn State more affordable.

He wants to make Penn State an economic engine for the commonwealth.

What he needs is to have a state budget passed.

And without one by May, he says some jobs in Penn State’s agriculture programs could be at risk.

On Friday, Barron talked to his board of trustees in Hershey about two of his major pushes since taking the reins as Penn State’s president in 2014, namely access and affordability of an education for Pennsylvania students and his Invent Penn State initiative that seeks to harness the university’s power to innovate and develop and hitch it to entrepreneurship to develop the economy.

The goals are popular. They have broad support.

Funding? That’s a different story.

Putting college in reach

Barron put the idea of access and affordability on the table early in his tenure, talking about it often and at length.

He acknowledged the cost of a year at Penn State, and its price coming at the top of the Big Ten list, behind only private Northwestern. But he also made it clear that addressing tuition was only half the battle.

“The biggest tuition increase is a fifth year,” he said repeatedly, pointing to the importance of finding ways to get low-income students out the door and into a job in four years instead of five or six or more.

He has worked on both.

In July, Penn State took a major step with a historic freeze on in-state tuition, the first in decades. Where would that money come from? We will find it, he committed.

Then there were other initiatives, like the Pathway to Success Summer Start. In 2015, 135 at-risk students at six campuses got a $1,500 scholarship to take two summer classes, plus another $1,000 in the form of an on-campus job. Stay in the program for a second summer, and it bumps to $3,000 for four classes and $2,000 in job money. That’s six extra classes, a total of 18 credits, the equivalent of an entire full-time semester.

“It was designed to be self-sustaining with tuition. The economics of that has the potential to work,” Barron said.

In the fall, 300 students will participate in the second round of the program across nine campuses.

“This fall we will have the first sign of whether it’s effective on retention rates. It will take four to six years to see if it’s effective on graduation rates,” Barron said. “If we can get 800 at-risk students to graduate, we will move into the very top echelon of graduation rates.”

That is because Penn State is already pretty good at getting students to stick around and get their degrees. Barron said that statistically, the university ought to put diplomas in the hands of just about 71 percent of its students. Instead, 86 percent get a chance at wearing a cap and gown. But for at-risk students, that number is about 56 percent.

But it isn’t free. The variety of incentives, programs and initiatives on the table, from microscholarships to grants to financial literacy education that pushes students to understand exactly how much an extra semester or two will cost over the length of repaying a student loan, has a price tag of $6 million. Barron said that came from investing $150 million that normally serves as insurance for the university’s financial stability, and he has promised his fiscal caretakers that if that is in jeopardy, he will pull the funds from the program and return them.

Inspiring entrepreneurs

“The ingenious power of partnership.” That’s the tagline for Invent Penn State, Barron’s initiative that aims to create jobs and money and student success at campuses across the commonwealth.

It is a way, he has told people since unveiling it in 2015, to take the amazing ideas inside the heads of both students and faculty and nurture them, growing new businesses that can blossom into more than just concepts, but full-fledged companies with employees and products and bottom lines that can benefit the university, the state and the communities where they are located.

There are different ways that can happen. There are plans for entrepreneurs in residence, people who have been there and done that and can mentor new innovative thinkers on their paths. There are two new law clinics focusing on entrepreneurial issues so that students with ideas don’t have boundaries to finding their way with legal issues.

Then there are the real spaces, things like Happy Valley Launchbox, set to open March 31, and the Innovation Park property now being managed in cooperation with Ben Franklin and funded by an $18 million external investment.

But the university had to put up money, too, to get Invent Penn State under way and keep it nurturing new ideas.

Barron paid for it with $24 million from his own capital budget and $2 milion per year generated the same way the affordability funds were, with investment of $50 million of funds from other places at Penn State, again funds he said he promised to return if it was needed.

Impasse impact

But Barron is becoming concerned that money will be needed back.

In July, just about two weeks before Penn State’s agreement to freeze tuition, Pennsylvania came to an economic roadblock when Democratic Gov. Tom Wolf and the Republican-led legislature, helmed by state Senate Majority Leader Jake Corman, R-Benner Township, locked horns over the budget. Just days into the impasse, something that had happened under both Republican governor Tom Corbett and Democrat Ed Rendell before, there were nods to the fact that no one knew just what the resolution would be.

But no one doubted it would be resolved.

That was almost eight months ago.

Penn State officials have become increasingly concerned about the historically long budget impasse. Barron wrote a blog post about it in January. A month later, there is still no motion.

Student leaders from the four state-related universities, including Penn State’s Emily McDonald, have spoken out about the threat to education. That was more than two weeks ago.

On Friday, Barron warned his trustees about a critical impact that strikes at the university’s oldest responsibility, agriculture.

“Without the agriculture funding and the ability to support things like 4-H and the Master Gardener programs, before May 1 we will have to give notice to 1,100 employees,” he said.

That would hit more than 9,500 volunteers, and 92,000 participants, in communities all over Pennsylvania.

It also has larger implications, potentially cutting at $90 million in appropriations from other bodies, such as individual counties and the federal government.

“It’s an incredibly serious issue,” Barron said.

Penn State has six trustees specifically elected by agricultural societies. One of them is Keith Eckel.

“Sometimes we focus on the fact that (agriculture) is geared to serving farming, but it’s geared to serving every consumer in this state. It’s critically important that this does not happen,” Eckel said.

Barron agreed.

Penn State is Pennsylvania’s land-grant university, and he looked at the access and affordability issue, the economic driver and agriculture together as three integral aspects of that.

“It’s my opinion that is the land grant mission,” he said. “I never, never want to give up any of those.”

Harrisburg’s response

Ask the state leaders about the crisis, and the response has changed little week to week and month to month.

“Gov. Wolf’s original budget proposal provided a more than 20 percent increase to Penn State and would have restored the funding that was cut from state-related schools over a two year period. Unfortunately, Republican leaders did not support this investment,” said Wolf’s spokesman, Jeffrey Sheridan.

“Instead, the governor worked with Republican leaders and reached a compromise that would have provided a 5 percent increase to higher education, including Penn State, and would have restored funding over future years. This funding, which was part of the bipartisan, compromise budget, passed the Senate 43 to 7, but when it was primed for final passage in the House, Speaker Turzai recessed without holding a final vote. He still has not allowed a final vote,” he said. “Since then, Republican leaders have been unwilling to pass the revenue necessary to provide funding to higher education.”

Corman’s camp had a slightly different take.

“As part of his line-item veto, Gov. Wolf reduced spending for the Department of Agriculture by $70 million. He deleted this money from the budget despite the fact that this was an agreed-to line of spending in the budget. This has seriously impacted the ability of the Penn State Cooperative Extension program to serve our communities across the state. It also will impact the 4-H programs and other agriculture education as well as research into areas such as the avian flu,” wrote Corman’s spokeswoman, Jennifer Kocher, in an email Friday.

“At the same time, the Senate, Sen. Corman included, voted to provide state funding (with a 5 percent increase) for Penn State and three other state-related universities. When the measure got to the House, it required a two-thirds majority to move to the governor’s desk. House Democrats voted unanimously against that bill, leaving Penn State and three other schools unfunded,” he said. “It is beyond disappointing that the governor bypassed the opportunity to embrace bipartisan solutions and meaningful government reforms. Instead, he chose to continue to push a false narrative about the choices facing our state.”

“And Penn State isn’t the only casualty here. Due to the governor's line-item vetoes, our schools are staring down a $3.1 billion shortfall, rural hospitals are still operating without state funding for critical services, and prisons are grappling with the issue of having only half of their funding released. We have sent three different budgets to the governor. When he finally signed one, he specifically focused his veto pen on agriculture and rural Pennsylvania,” Kocher wrote.

“The governor knows Penn State’s importance to higher education and the economy, and he wants to ensure Penn State has the resources necessary to support the institution, but Pennsylvania is facing a fiscal crisis and without new, recurring revenue, we simply do not have the money,” Sheridan said. “Gov. Wolf looks forward to working with Sen. Corman and other leaders to pass a final budget and make the investments we need in Penn State and all of higher education.”

Barron, however, is like many others who rely on the state’s budget. He just wants it to pass.

Both sides have agreed on an increase for the university, he said, asking why the flat funding could not be released while the extras are debated.

There are just more than two months until that drop-dead deadline when Penn State could see cut jobs.

This story was originally published February 26, 2016 at 4:51 PM with the headline "Barron talks programs and funding problems at trustees meeting."