PA House Budget Makes Vital Upgrades to the 2023-24 Budget Proposal for Higher Education

Diana Polson and Stephen Herzenberg |

In our analysis of Governor Shapiro’s first budget proposal, we highlighted the governor’s recognition that higher education in Pennsylvania is in crisis. The governor stated bluntly in his budget address “…it’s on us to rethink our system of higher education – because what we’re doing isn’t working… I’ve tasked Acting Education Secretary Mumin to immediately convene our college and university presidents to pick up on the conversation I’ve already started with them.” With help from this group, the Governor said in his budget address, “…when I stand before you next year, I can present a comprehensive and meaningful reform plan for higher education.”

The Governor’s recognition of the long-term problems of Pennsylvania higher education is extremely important—as we elaborate below. But the chronic underfunding of public higher education means that we can’t wait until the 2024-25 budget to boost funding. For this reason, we’re glad to report that the Pennsylvania House of Representatives last week passed a budget (HB 611) that increased funding for higher education over Governor Shapiro’s original proposal.

The table below shows these increased budget allocations for the main components of publicly funded higher education in the state budget.

The House bumped funding for the Pennsylvania State System for Higher Education (PASSHE) up 4% compared to Governor Shapiro’s proposal (an additional $22 million), and 6% from last year’s funding level. The House also included $30 million for “facilities support,” or one-time debt relief, for PennWest University—the three state system campuses in the western half of the state (California, Clarion and Edinboro) that were brought together to form one institution last year.

Under the House’s budget, community colleges would see an additional $10.3 million—also an increase of four percent over the governor’s proposal and 6% over last year’s allocation. This 6% increase still falls far short of the request from the PA Commission for Community Colleges (PACCC) for a 25% increase ($64 million). The PA Commission also requested an $8 million capital appropriation increase, which the House granted. This funding would provide one-half of the cost of approved capital projects to modernize education and workforce training facilities at community colleges across the state.

Looking beyond this year’s budget, in this recent presentation we highlighted why Governor Shapiro is spot on in recognizing the need for systemic reform of Pennsylvania higher education.

  • Pennsylvania ranks 47th in the nation for per capita state investment in higher education ($143 per capita), which is only about half of the national average ($288 per capita). Pennsylvania’s inflation-adjusted funding of public higher education has declined 41.9% since 1980, the most of any state (see this report Table 3-2, p. 45). That is, since roughly the moment that our state began hemorrhaging hundreds of thousands of steel and other manufacturing jobs—the good jobs requiring no more than a high-school education—we have systematically disinvested in the public colleges now critical more than ever to the living standards of working Pennsylvanians.
  • This low state investment has led to higher costs of attending our public universities. For example, public 4-year or above colleges have increased in price by 47% over the last 2 decades (2002-03 to 2020-21). Meanwhile, median household incomes have only increased 13%, putting enormous strain on students and their families to pay for college.
  • As a result, student debt has also skyrocketed in the state. Since 2003, total student loan debt owned by residents of Pennsylvania has increased four-fold, from $19 billion to $76 billion. We rank third in the nation for the average amount of debt among college graduates.
  • We have a Swiss cheese community college system, with big geographic holes that result in low college attendance (see figure below). Residents of 27 counties do not even have a branch campus of a community colleges—and must travel long distances in most cases and then pay “double tuition,” the same as “out-of-state” students. Residents of another 17 counties have a branch campus locally but still have to pay “double tuition.” Inaccessible, expensive community colleges reduce Pennsylvania educational attainment, hurt employers seeking middle-skill workers with at least some postsecondary education, and hold back our economic growth. Pennsylvania is one of only three states in which enrollment at public two-year colleges declined by more than 10% in each year since the start of the COVID-19 pandemic in three states (11.8% in 2021 and 10.1% in 2022) (see this report, p. 37).

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  • Because we have a “Swiss cheese” community college system and high tuition at public colleges across the board, many Pennsylvania high school students don’t see higher education as accessible or affordable. They don’t even bother applying for—and therefore don’t receive—federal financial aid (Pell grants) to attend college as much as students in other states. (The map below shows how much lower Pennsylvania FAFSA completion rates are in PA rural school districts than in even the neighboring rural counties of New York.) Pennsylvania students attending public colleges receive only about two thirds the amount in federal financial aid as our students should, given the size of our population: they receive $465 in federal Pell grants when our population-based share of the national Pell grant pot (for students attending public college) would be $737 million. In sum, we leave a cool $271 million in federal funds on the table every year (and growing).

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This $271 in federal funding left on the table could have a silver lining as Pennsylvania seeks to rise to the Governor’s challenge to fundamentally reform higher education. If, as part of our reform effort, we can get more Pennsylvania students to see the benefit of applying for a Pell grant, then much of the funding for more affordable and accessible community college and four-year college can come from the federal government. The most direct way to increase draw down of Pell grants by Pennsylvania students attending public colleges is for the legislature to provide “last dollar” scholarships for students to attend college—state scholarships that make college tuition free AFTER students get federal aid for which they are eligible.

In closing, we applaud the Pennsylvania House of Representatives for making improvements in the proposed 2023-24 higher education budget. The Senate should approve these increases on a bipartisan basis—because those most harmed by Pennsylvania’s underfunding of higher education include individuals and businesses in rural areas. Individuals have no access to affordable college and the postsecondary credential that might help them access a living-wage job. Businesses cannot find workers with the postsecondary credentials and skills they seek. Communities spiral down including in college towns with declining enrollment.

The calamitous consequences of underfunding public higher education for rural Pennsylvania helps explain why former Republican President Pro Tempore of the Senate, Joseph Scarnati was a champion for plugging the geographic gap in community colleges in Pennsylvania’s northern tier. This year—and next year with a more ambitious higher education funding proposal potentially on the table—Pennsylvanians will need Republican Senate leaders to rise above partisanship and recognize that the future of rural Pennsylvania hinges in part on investing in a higher education system that does work.