Dr. Rodin: A year ago, with the 1994 election results freshly in mind, it was only beginning to become apparent that we faced the possibility of fundamental change in the relationship between the Federal government and American higher education. Today, that possibility is rapidly becoming a reality. Among the startling changes that new reality may soon bring upon us, are potentially dramatic cutbacks in federal support for scientific and biomedical research; severe cuts in student loan programs; the virtual elimination of funding to the arts and humanities; and a tragic assault-by-indifference on the structure and financing of academic medical centers. And changes at the Federal level are but one of the major external areas that will significantly affect our future. As the focus of governmental activities shifts from the federal to the state and local level, we face the task of building new and far more complex working relationships with once passive constituencies in Harrisburg and City Hall. I have invited Carol Scheman to describe the crucial challenges that we face in our relations with government and the community.
There is an enormous amount of activity to cover; this is a period of significant change in the political composition of state and federal governments. More to the point, it is a time when virtually all institutions are charged with doing more with less. The challenge to the University is to engage proactively in policy development to insure the maintenance of a set of underlying principles that have served society well in its support for higher education and research.
Funding--Federal/Commonwealth Revenue Streams
As an excellent summary of federal issues, please refer to "The Federal Budget: Broad Outlines, Much Uncertainty," by Carl Maugeri in the October 31 edition of Almanac.
President Rodin, Dr. Vagelos and other University leaders have been and continue to be very active in Washington to advocate on behalf of basic research and student support as investments in the future health, strength and competitiveness of the United States and, in general, this message has been heard and adopted by leaders in both parties.
The examples are numerous and include President Rodin, as a member of the President's Council of Advisors for Science and Technology, in- itiating a study of the future of research universities; Congressman Murtha's meeting with President Rodin earlier this week to discuss the potential effects of current Congressional action; faculty and administrators from Drexel, Temple, and Penn working with local U.S. Representative Curt Weldon to discuss opportunities for increased Advanced Research Projects Agency investment in basic research; President Rodin's meeting next week with the Secretary of Housing and Urban Development, Henry G. Cisneros, to discuss the University's continued partnership plans with the West Philadelphia community; and, Drs. Rodin's and Amado's ongoing meetings with faculty regarding the effects of changing federal policies on Penn's research activities. The University also works with other higher educational institutions through the Council on Competitiveness, the Research Coalition, the AAUP, and a variety of student aid coalitions in making the case and developing the necessary strength to garner support for various programs.
So far, higher education and research universities have fared reasonably well, relative to other federal programs. We are clearly seen as a national priority. Nevertheless, it would be a serious mistake to believe it will be "business as usual" in Washington. The federal deficit is real and we must anticipate reductions in federal spending-- no program will be (or can be) held 'harmless'. Whether spending and taxes are cut or if just spending is reduced, the size and scope of governmental programs will change. It is for these reasons that it is even more important to understand and articulate how and for what purpose public funds are spent.
One area of general agreement for some modest increase is the level of support for the NIH. This entity--Penn's largest research sponsor-- may grow by 3-5% (it is, unfortunately, the case that even this level of increase will not keep pace with research opportunities). Drs. Rodin and Vagelos have led the charge on behalf of the University by contacting the Congressional leadership and the President directly to seek to ensure this level of NIH funding for FY96. Other research agency budgets--like those for the NSF, the Department of Defense, and the Department of Energy--are likely to be funded roughly at last year's levels (because of increased costs and scientific opportunities, this could result in fewer research grants and/or more severe cuts in the amount per grant).
The student aid programs that are most important to Penn students are also protected from cuts, and most of the proposals to reduce student subsidies in the federal student loan programs have been dropped for this year. Nevertheless, the level of savings Congress is committing to over the next 5-10 years makes it unlikely that such programs will remain unscathed in future years.
As you undoubtedly have read, the federal government is currently operating under a short-term Continuing Resolution that extends until November 13. Most appropriations bills remain unfinished and a deadline for raising the federal debt ceiling is looming. It is under these conditions that even with a short-term extension of the debt ceiling, Congress and the Clinton Administration appear to be headed toward a budget showdown, leaving spending decisions vital to Penn, its faculty, and students unsettled.
There are many programs of importance to university faculty, students and staff that are likely to experience substantial cuts--such as NEH dollars, environmental research funds, and several areas of graduate training. Major reductions in funding for services and medical training provided by teaching hospitals like HUP through subsidies characterized as GME, IME, and DSH--all factors that seek to recognize and reimburse for the increased costs of care--are also part of the restructuring of Medicare that Congress adopted last week. These changes will, along with increasing programs of managed care, have enormous effects on health centers. Penn is positioned better than most, but will also be affected.
It should be clear that, on the road to a balanced budget, we should not expect to see in the future the growth in federal programs that we have experienced in the past 25 years and, for many programs of research and student support, there will be real and painful cuts for this upcoming fiscal year and into the foreseeable future. There are fundamental public policy questions about federal commitment to research, merit-based allocation, infrastructure, and access to higher education and graduate studies that must be addressed and answered if we are to avoid mindless cuts in programs.
The road to Harrisburg also has been well-traveled by University leaders over the past months. Securing adequate and stable Commonwealth funding for the Veterinary School remains a top priority, and in particular, seeking ways to lower in-state tuition for vet students. Dr. Rodin, Dean Kelly and I will meet with state officials for the remainder of the year to address this issue. In addition, we seek to rationalize and regularize Commonwealth support for other programs at Penn.
Beyond Dollars--Regulatory and Legal Issues
As budgets become tighter, government at the federal, state, and local levels has become more aggressive in pursuing new revenue sources as well as increasingly strident in its regulatory oversight. While 'regulatory relief' is a popular concept, there is a dismal history of attempts to reduce regulatory burdens or the accompanying costs. At the federal level, we remain focused on issues including indirect cost recovery, research integrity, and the use of animals in research. Also of great concern is an amendment proposed by Congressman Ishtook which would restrict political advocacy by recipients of federal grants.
In Harrisburg, we are working with other nonprofits to eliminate objectionable language from Senate Bill 355, legislation establishing standards for tax-exempt status. Specifically, we are concerned about an amendment offered which would stipulate that no institution in Philadelphia can be considered tax-exempt if it pays any employee over $100,000 (unless it has an agreement with the City). A House Select Committee on Higher Education also has raised our concerns as it aggressively examines the way colleges and universities spend their state aid.
Furthermore, within our municipal limits, we have agreed to make a voluntary contribution to the city of $1.93 million each year for five years for a total of $9.65 million.
The University as a Good Neighbor
Penn has the enormous benefits--as well as the challenges--of being located in an urban setting. Delineated below are some of the things that we are doing.
We are improving our overall efforts to provide state and local public officials as well as community leaders and members with complete information on University programs and initiatives that involve and/or effect their constituencies--good and bad. There are several goals involved including the promotion of greater program interaction across the University; involving more students, faculty and staff; providing greater access to programs; and to get more institutional and individual credit for what is accomplished.
This is, of course, not a simple task and requires ongoing efforts on many individuals' parts. The President and Provost hosted a meeting last April 4th of Deans and other institutional members active in service programs. This meeting resulted in, among other things, a "Compendium" of activities, available 'on-line' for internal and external use. It is not a static document and is expected to be under constant revision.
Academically-based community service continues to be strong at our University. Many faculty and students work at seven university-assisted community schools in West Philadelphia including the Turner Middle School, Shaw Middle School, Sulzberger Middle School, University City High School, West Philadelphia High School, Wilson Elementary School, and Anderson Elementary School. Over 5,000 children, their parents, and community members are involved in community school programs in West Philadelphia. Examples include:
Development and support for undergraduate and graduate seminars, courses, and research projects are also areas of priority. This past fall, over 30 courses were offered which support Penn's work in West Philadelphia. An example is Dr. Peter Conn's "American Studies" course which exposes students at University City High School to an interdisciplinary curriculum combining American literature and history. His undergraduates are working as teaching assistants at University City High School.
Getting into Medical School: A Planning Guide for Minority Students was published this fall after six years in the making. The 14 authors and editors were all students at Penn's School of Medicine when they worked on the book, now most have gone on to internships and residencies and two are completing their M.D./Ph.D. training at Penn. A book signing event is planned for this Saturday, November 4, at the Medical School.
In addition, medical school students have begun plans to open a free interdisciplinary medical clinic in a West Philadelphia church utilizing the skills of students from all of the University's professional schools. Local residents will receive services from medical, nursing, dental, and social work students as well as pro bono legal advice from law students. Fund-raising strategies will be coordinated by undergraduate and graduate students of Wharton.
Direct traditional service also is important. The Program for Student-Community Involvement (PSCI) facilitates student services in a wide-range of community settings. Over 75% of Penn students are involved in some form of service during the academic year. Some highlights include the organization of over 1,000 incoming freshman to go "Into the Streets" for neighborhood clean-up projects during orientation; and the 350 students engaged in "Hunger Clean-Up" service projects which focus on issues of homelessness.
In addition, Communiversity Days at Penn will take place on November 2 and will include youth from a local community organization and a fraternity, Delta Upsilon. The day will consist of an array of college activities including lectures and tours of dorms, fraternity houses, and other college life attractions.
This fall, a dozen community organizations signed up to participate in "Community Sports Saturday"--a program that provides access to Penn recreation facilities to community youth in basketball and volleyball. One hundred and fifty youths are currently participating on Saturday mornings.
In coordination with local community associations and the West Philadelphia Partnership, a mediating, non-profit organization composed of institutions (including Penn), businesses, and community organizations, the University has worked on community planning projects that have produced city funding secured for capital improvements of a major business corridor along 40th Street. A business owners' association is being formed to oversee the project. In addition, strategic plans for housing and commercial revitalization of two West Philadelphia communities--Spruce Hill and Walnut Hill--have been devised.
Penn's Purchasing Department is working to expand opportunities for minority and female employment and business ownership in West Philadelphia through the development of minority purchasing contracts. As a direct result of the Buy West Philadelphia Program, Penn's purchasing from West Philadelphia suppliers has increased from $2.1 million in 1987 to $15 million in 1994.
World Wide Web sites for West Philadelphia information have been coordinated by Penn's office of Data Communication and Computing Services (DCCS) and the Center. These two offices have also coordinated an Internet training program, involving software and technical support for over 100 West Philadelphia teachers. One result from this ongoing project will be the provision of Internet connections to West Philadelphia public schools and communities.
The University of Pennsylvania is not only one of the nation's leading research universities, we are also--by virtue of our faculty, students, staff, range of schools and programs--deeply involved in our many communities and with all governmental entities. It is for this reason, I believe, as well as because of our really terrific campus and location in Philadelphia, that we are under active consideration as a site for the upcoming Presidential debates.
(To next page of reports.)
Tuesday, November 14, 1995
Volume 42 Number 12