COMMONWEALTH OF PENNSYLVANIA HOUSE OF REPRESENTATIVES COMMITTEE ON APPROPRIATIONS In re: 2001-2002 Appropriations Hearings University of Pittsburgh * * * * Stenographic report of hearing held in Majority Caucus Room, Main Capitol Harrisburg, Pennsylvania, Wednesday February 28, 2001 9:00 A.M. HON. JOHN E. BARLEY, CHAIRMAN Hon. Gene DiGirolamo, Secretary Hon. Patrick E. Fleagle, Subcommittee on Education Hon. Jim Lynch, Subcommittee on Capitol Budget Hon. John J. Taylor, Subcommittee/Health and Human Services Hon. Dwight Evans, Democratic Chairman MEMBERS OF APPROPRIATIONS COMMITTEE Hon. William F. Adolph Hon. Steven R. Nickol Hon. Matthew E. Baker Hon. Jane C. Orie Hon. Stephen Barrar Hon. William R. Robinson Hon. Lita I. Cohen Hon. Samuel E. Rohrer Hon. Craig A. Dally Hon. Stanley E. Saylor Hon. Teresa E. Forcier Hon. Curt Schroder Hon. Dan Frankel Hon. Edward G. Staback Hon. Babette Josephs Hon. Jerry A. Stern Hon. John A. Lawless Hon. Stephen H. Stetler Hon. Kathy M. Manderino Hon. Jere L. Strittmatter Hon. David J. Mayernik Hon. Leo J. Trich, Jr. Hon. Phyllis Mundy Hon. Peter J. Zug Hon. John Myers Also Present: Michael Rosenstein, Executive Director Mary Soderberg, Democratic Executive Director Reported by: Nancy J. Grega, RPR ADELMAN REPORTERS 231 Timothy Road Gibsonia, Pennsylvania 15044 724-625-9101 INDEX Witnesses; Page Dr. Mark A. Nordenberg, Chancellor 4 Dr. James V. Maher, Provost and Senior Vice Chancellor Dr. Arthur A. Levin 26 CHAIRMAN BARLEY: This is day three of the first week of our hearings. We have before us today the University of Pittsburgh but as we have been doing customarily at this point, I will provide the members that are with us an opportunity to make brief introductions of themselves for the benefit of the audience. CHAIRMAN EVANS: DwightTEvans, Philadelphia. REPRESENTATIVE STABACK: Ed Staback, Lackawanna and Wayne. REPRESENTATIVE MANDERINO: Kathy Manderino, Philadelphia. REPRESENTATIVE JOSEPHS: Babette Josephs, Philadelphia. REPRESENTATIVE LaGROTTA: Frank LaGrotta, Beaver, Lawrence and Butler. REPRESENTATIVE FRANKEL: Dan Frankel, Allegheny County and home district of the University of Pittsburgh. REPRESENTATIVE COHEN: Lita Cohen, Montgomery. REPRESENTATIVE FLEAGLE: Pat Fleagle, Franklin County. REPRESENTATIVE STERN: Jerry Stern from Blair and Bedford Counties. REPRESENTATIVE STRITTMATTER: Jere Strittmatter from Lancaster County. REPRESENTATIVE ROHRER: Sam Rohrer from Berks County. REPRESENTATIVE ADOLPH: Bill Adolph, Delaware County. 4 CHAIRMAN BARLEY: and I'm Join Barley, Chairman of the committee/ and I'm from Lancaster County. Mike Rosenstein to my left and he is my Executive Director; Mary Soderberg, Executive Director for Representative Evans. Welcome, Chancellor Nordenberg. We're very pleased to have you here today and we will give you an opportunity to have an opening statement and then, I'm sure, there will be some questions from the members of the committee. You have the floor. CHANCELLOR NORDENBERG: Thank you, Mr. Chairman. It is a privilege for me to meet with you again today and it's fitting that this hearing occur on February 28th. On this very day in 1787 the Pennsylvania legislature passed the act authorizing the creation of the Pennsylvania Academy which, over time, became the University of Pittsburgh. Later today we will celebrate our 214th anniversary. We will do so at our annual honors convocation as we celebrate the achievements of students, faculty, alumni and staff. That convocation will feature remarks from Frances Hesselbein. She served as the Chief Executive Officer of the Girl Scouts for many years, is a recipient of the Presidential Medal of Freedom and currently chairs the board of the Peter Drucker Foundation. Most note­ worthy, in terms of the themes of the day, she began her own remarkable career when she enrolled as a student at our Johnstown campus now decades ago. At the preamble to that act of February 28th, 1787, forcefully declared that the education of youth ought to be a primary object with every government. The significance of that object can be seen in the contributions of those, like Mrs. Hesselbein, who have built upon their education to serve the common good. And its promise is reflected in the ambitions of a new generation of students, who recognize that a high quality higher education is central to the effective pursuit of their life goals and are looking to Pitt in record numbers. From the fall of 1995 to the fall of 2000, under­ graduate applications to the University's Pittsburgh campus increased by well over 70 percent. Applications for next fall are running more than 15 percent ahead of last year's record"setting pace and I probably should note that applications from African-Americans are rising even more rapidly, 39 percent ahead of last year's pace. In Pennsylvania's master plan for higher education, Pitt is classified as a Commonwealth Unidersity. in addition to offering a broad range of educational programs, then, we are expected to make other contributions as a major research university. In fact, the first responsibility assigned to us is to enlarge the reservoir of essential knowledge. In advancing that mission in the last 12 months, we have attracted more than $350 million in sponsored projects support and our research funding in the current fiscal year almost certainly will double our state appropriation! reflecting the fact that we are one of the most effectively leveraged public universities in America. We are first nationally in funding from the National Institute of Mental Health. We are in the top ten in funding in the national Institutes of Health, and we typically rank in the top 20 American universities in total science and engineering support. We are, in short, a major driver in the Commonwealth's ongoing transition to a position of leadership in the new knowledge economy. As I have gratfully acknowledged on many past occasions, the University of Pittsburgh never could have achieved these high levels of performance without Commonwealth support but neither will we be able to sustain our current momentum without a partnership that is strong and forward looking. The budget proposed for the next fiscal year recommends a four percent increase to the base budget of the state system of higher education which actually is low by national standards. That same proposal, however, recommends only a three percent increase for state-related universities, a full percent lower than that recommended for the state system and lower than the 3.25 percent base budget increase that Pitt received last year. In addition, our last two appropriations as well as 7 thoae of the state system and the other state-related universities have included funding for well targeted line item initiatives. Pitt has used these funds to modernize the laboratories, to purchase state of the art equipment, and up­ grade our information technology network. Initiatives of this type were eliminated from the proposed budget. When their deletion is factored in, that proposal actually triggers a budget reduction for the University of Pittsburgh and we do hope that they can be restored. More generally as you press forward with your own budget deliberations, we respectfully ask that you think both about past returns on your investments in Pitt and about the assets that are most critical to the Commonwealth's own future. When you do, we hope you will conclude that Pennsylvania's public research universities, including in particular the University of Pittsburgh, continue to be deserving of your support and emerges appropriations priorities for the coming year. Thank you very much. CHAIRMAN BARLEY: Thank you, Chancellor. I know you brought attention to the actual reduction in the Governor's proposed budget for your institution, for Pitt. Could you tell the committee what the actual reduction will be? Do you have that number? Do you know what the actual dollar amount? In other words, I understand it's — he's proposing a three percent in the line but when you factor the reductions of programs that both the General Assembly supported and the administration supported in the past, as you have indicated, you end up with a net loss in revenue. Do you know what that number is? CHANCELLOR N0RDENBER6: Yes. The net reduction would be just over $4 million in terms of the support that we received last year and the support that has been proposed for this year. BY CHAIRMAN BARLEY: Q So, a proposed budget that indicates a three percent uncrease in your base line, in reality is a $4 million reduction in revenue for this year? A Yes. With the loss of a line item support that we did enjoy and did appropriately invest during the course of the past year, the total support actually decreases by over $4 million. Q I'm certain that was an oversight. A I'd like to think that was the case, Mr. Chairman. Q A miscalculation. I'm certain that was not intentiona! and you have my commitment as Chairman of this committee to rork with you in whatever way we can to see that that oversight :an be remedied. I have had opportunities to visit your campus. \s a matter of fact, we had a hearing there on one occasion and : am very appreciative of the work that you are doing and I enow you have Art Levin with you today. I was so impressed 9 with some of the work the good doctor is doing there and some of the research in other areas. Again, I think it's important for the committee to understand that you are not really receiving a three percent increase. You are receiving a $4 million reduction. A I'm deeply grateful for that expression of support as well as for your acknowledgement that we are doing and trying to do many good things at the University of Pittsburgh.