Penn State Announces Potential Tuition Freeze For Students, While Some Employees' Salaries Are Halved
STATE COLLEGE, Pa. (KDKA) -- Penn State University reports economic hardships since stay-at-home orders and social distancing guidelines were issued more than a month ago.
In a letter published on the university website, Penn State President Eric J. Barron addressed students, faculty and staff on April 23 about the measures being taken by the administration during this time.
Barron said there had been more than $100 million in projected losses to the university since March. Due to a significant decrease in enrollment, the university also reported an estimated $160 million loss in revenue for 2020-2021 academic and fiscal year.
Penn State will be keeping university employees who are unable to work at home on the payroll, but their salaries will be halved effective May 4 through June 30 of this year. Their reduced salary will be sourced from federal stimulus funds given to the university by the federal government, according to the letter. Barron said that Penn State received around $55 million from the federal Higher Education Emergency Relief Fund.
The letter clarified that affected employees will receive benefits associated with their adjusted salaries. Barron said that based on talks with state government officials, a majority of these employees will likely be eligible for stimulus aid and unemployment benefits. Most of these employees work in the university's auxiliary units and physical plant.
"There are too many uncertainties at this time to make workforce projections after June 30, but we will continue to assess circumstances and provide updates regarding whether further steps are necessary," Barron said in the letter.
The administration is also requesting the heads of every unit to cut 3 percent from budget expenditures for the next fiscal year.
"These cuts will not be easy to implement and may result in some job losses," Barron said in a video attached to the letter.
To aid students, the university announced it is considering a proposal to adjust tuition rates for the summer semester, which the Board of Trustees will review in May. The Board of Trustees is reportedly also reviewing a proposal to not increase tuition for the upcoming academic year.
Barron intends to hold a town hall meeting in the coming weeks to address more of the university's plan and initiatives for the upcoming year.