Penn State approves 2% tuition increase for in-state University Park undergraduates

In-state undergraduates at Pennsylvania State University’s main campus would face a 2% tuition increase for 2023-24, raising the annual tab for freshmen and sophomores to $19,672, under a plan approved Thursday.

Rates are higher for juniors and seniors and vary by program.

But Pennsylvania residents attending the university’s 19 Commonwealth campuses would not see their tuition rise at all, under the action taken by the university’s finance, business and capital planning committee. Their tuition and fee rates range from $13,966 to $15,904.

The tuition plan is subject to final approval by the full board of trustees, which is scheduled to meet Friday afternoon.

» READ MORE: Temple raises tuition more than 4% for Pennsylvania and out-of-state residents

The action comes even though the state legislature has yet to approve funding for Penn State and the other three so-called state-related universities, including Temple, the University of Pittsburgh, and Lincoln. The legislature isn’t likely to act before September. Republican lawmakers have been pushing for more transparency from the state-related universities, which currently are not fully subject to Pennsylvania’s Right to Know law. Lawmakers also have called for the universities to freeze tuition.

Penn State is assuming it will get the 7.1% or more than $17 million increase in funding that Gov. Josh Shapiro proposed, and if it doesn’t, “then we have a plan to reduce our expenses by that amount,” said Sara Thorndike, senior vice president for finance and business.

In-state undergraduates make up about 68% of Penn State’s enrollment. Out-of-state undergraduates, meanwhile, will face a 1% tuition increase at the Commonwealth campuses and a 4% increase at the University Park campus. They currently pay a range of $23,044 to $26,370 in tuition and fees at the Commonwealth campuses and $38,102 at University Park.

The plan also anticipates the same tuition increases and freezes for the 2024-25 year. The second year assumes flat funding from the state. It’s the first time that Penn State is acting on tuition rates for two years, Thorndike said.

“We want our students to know what they are going to pay before they decide to come to Penn State,” she said.

Board member Barry Fenchak asked what more the university could do to balance the budget without raising tuition, but other board members defended the budget and said money is needed to give raises to employees.

The university last year raised tuition 5% for in-state undergraduates at the University Park campus and 2% for students at the Commonwealth campuses. But the school also announced it had budgeted $14 million in financial aid to offset the increase for students coming from households with incomes of $75,000 or less.

The university will budget $14 million again this year and in subsequent years to help with both need-based and merit-based financial aid, though it will not be used specifically to freeze tuition for students from those households, a university spokesperson said.

If the two-year tuition freeze for Penn State’s in-state Commonwealth campus students is approved, it would be the fourth and fifth time that tuition has been frozen since 2018-19.

Thorndike also reported that Penn State’s projected deficit for the 2022-23 year, which ended July 1, has been reduced from $140 million to $63 million in its $2.6 billion budget. A hiring freeze, higher investment income, and health care savings were among the items that contributed to the reduction, she said.

The university anticipates the deficit will drop to $44.5 million in 2023-24 and $34.1 million the following year, with a balanced budget by 2025-26.

Earlier Thursday, the board of governors for the Pennsylvania State System of Higher Education voted to freeze tuition for the fifth consecutive year, keeping it at $7,716.

» READ MORE: Attention Pa. state students: Your tuition costs will remain the same for another year

But other colleges have raised costs. Temple University last week approved more than a 4% tuition increase for both in-state and out-of-state students, with in-state students, who make up the majority of Temple’s enrollment, paying a base tuition of $17,979 for 2023-24 and out-of-state students paying $32,376.

Also last week, Rutgers hiked its price tag 6%, while the University of Pennsylvania announced in March that it was increasing tuition and other costs 4%.