Budget 1999-2000: President Rodin's and Provost Barchi's Reports to the University Council

President Rodin's report to Council includes the University's goals and academic priorities, as well as the initiatives that will be implemented in the FY2001 budget; they are shown below. The pie charts show how the funds are spent.

At right the Consolidated Budget pie chart shows the Academic Expense is 44% of the total with the remainder spent by the Health Services.

Below right, the pies show that compensation remains at 54% as it was last year; the schools spend 71% of the Academic Budget and the breakdown by school reflects their relative size.

Further below, the tables show the indirect cost recovery rates the Provost spoke about as well as the tuition and endowment compared to peer institutions.

FY 2000 Consolidated Expenditure Budget

Total=$3.048 Billion

Components of the Consolidated University Budget

The Consolidated University budget has two major components -- "Academic" and "Health Services."

The Academic budget includes:

  • Schools (including the School of Medicine)
  • Resource Centers
  • Auxiliaries
  • Central Service Centers

The Health Services budget includes all components of UPHS except for the School of Medicine:

  • Hospital of the University of Pennsylvania (HUP)
  • Presbyterian Medical Center (PMC)
  • Pennsylvania Hospital
  • Phoenixville Hospital
  • Clinical Practices of the University of Pennsylvania (CPUP)
  • Clinical Care Associates (CCA)

[For UPHS Constraints, CLICK HERE]

Nine Goals of Penn's Agenda for Excellence

  • Attain comprehensive excellence and secure Penn's position as one of world's premier research and teaching universities.
  • Secure greater research funding and new sources of support.
  • Restructure, improve and cut costs of administration.
  • Invest in strategic master's and continuing education programs that can generate revenue.
  • Enhance government and community relations programs essential to Penn's best interests.
  • Increase Penn's international reach and global perspective.
  • Creatively deploy new technologies.
  • Effectively communicate Penn's contributions to the media and the University's various constituencies.
  • Raise the funds required to support Penn's strategic goals.

FY 2000 Academic Budget Expenditures by Expense Type

Total = $1.329 Billion

Six Academic Priorities--Agenda for Excellence

  • Life Sciences, Technology & Policy
  • American & Comparative Democratic & Legal Institutions
  • Management, Leadership & Organizations
  • The Humanities--Meaning in the 21st Century
  • The Urban Agenda--Penn in Philadelphia
  • Information Science, Technology & Society


How the University's Budget Supports the Goals and Priorities of the Agenda for Excellence

  • Provost and Deans work together to develop School budgets that maximize level of resources available for investment in strategic goals and priorities.
  • Executive Vice President and Vice Presidents work together to develop Central Service Center budgets that maximize level of resources available for investment in strategic goals and priorities.
  • Limited central resources--e.g., Subvention, Research Facilities funding, Facilities
  • Renewal Program funding--are directed wherever possible towards investments in the Schools that support their most important goals and priorities and the Agenda for Excellence.

FY 2000 Academic Budget Expenditures by Responsibility Center Category

Total = $1.329 Billion

Penn's Financial Planning Approach

  • The University engages in strategic long-term financial planning.
  • New programs, priorities and initiatives are discussed and planned long before they are included in the annual University operating budget.
  • Consultation occurs through the Academic Planning & Budget Committee and in other forums.
  • New initiatives that will be implemented and budgeted in Penn's Fiscal Year 2001 budget have been identified and publicized already-during the current year or prior years.


Examples of Strategic Initiatives in Penn's FY 2001 Budget

  • Computer and Information Science: New faculty and facilities--Levine Hall
  • Management, Leadership & Organizations: Huntsman Hall--New facilities to support new approaches to management education
  • Genomics and Life Sciences: New facilities and academic programs
  • Undergraduate Fine Arts: New home in Addams Hall
  • Renovation of Graduate Education building
  • Completion of Law and Dental building projects
  • Next installment of classroom renovation projects
  • Undergraduate and graduate financial aid increases
  • Funding for minority recruitment and retention projects

FY 2000 Academic Budget Expenditures by School

Total = $944 Million

  • Student Life:
    • College Houses, Quad Renovation/Expanded Living Learning Programming
    • Opening of Perelman Quad and Wynn Common
    • Locust Walk-Christian Association, Veranda, 3619
    • Development of Pottruck Health and Fitness Center
  • Quality of Life/Neighborhood Initiatives: Hamilton Square; Westside Common; West Philadelphia programs

FY 2000 Academic Budget Total Revenue by Source

Total = $1.329 Billion

Rate of Tuition & Fee Growth: A 20-Year History

For information concerning Recent History of Undergraduate Charge Increases, the Tuition, Fee, Room and Board Increases, and Peer Institution Undergraduate Charges Comparison, see Almanac March 28, online at www.upenn.edu/almanac/v46/n26/032800.html.

Peer Institution Endowment/Student Among Top 20 Endowments as of June 30, 1999
Institution Assets ($000) ($/Student)
Princeton University 6,469,200 1,007,978
Harvard University 14,255,996 795,092
Yale University 7,197,900 661,572
Stanford University 6,005,211 456,774
M.I.T. 4,287,701 441,031
Washington University 3,761,686 365,425
Dartmouth College 1,710,585 327,950
Chicago, University of 2,762,686 246,845
Columbia University 3,636,621 186,666
Northwestern University 2,634,850 174,702
PENN 3,281,342 166,262
Cornell University 2,869,103 151,548

Illustrative Life Sciences Commitments by Peer Institutions

  • Yale
$500 Million Natural Sciences expansion-Molecular Biology and Neuroscience buildings
  • M.I.T.
$350 Million McGovern Institute for Brain Research
  • Harvard
$200 Million Strategic research areas in life sciences
  • Stanford
$150 Million Bio-X building
  • Princeton
$100 Million Genomics initiatives and buildings

Sponsored Project Activity by Fiscal Year

Total Awards Received ($000)

Housing and Dining Renewal Program Funding

  • Estimated total project cost of residential and dining initiative is $378.5 million (in FY 2000 dollars)
  • Project cost will be covered in part by $56 million in gifts, leaving $322.5 million to be funded through debt
  • Annual debt service funding shortfall could range from $4 million to $20 million

Total Indirect Cost Recovery by Fiscal Year


New Constraints Connected to Health System

  • Health System cannot provide the same level of support for University activities
  • Financial pressure on School of Medicine will limit its ability to contribute to University finances
  • University remains committed to academic excellence in School of Medicine

Federal Indirect Cost Recovery Rate by Fiscal Year

How Penn is Achieving its Goals in Light of Serious Fiscal Constraints

  • Development: Ambitious, successful, focused fundraising in support of goals and priorities of the Agenda for Excellence
  • Efficiency: Reduce central administrative expenditures and work with the Schools to constrain school-level administrative expenses. Reduce operating deficits in Penn "Resource Centers." Enhance strategies for Health System cash flow and cash recapture.
  • University/Private Sector Partnerships: Getting others to spend their money to do things Penn needs so that our own resources can be spent on core academic priorities.

More on Budget: The University's fiscal year begins July 1. The budget for FY 2001 will be reviewed and approved by the Trustees at their June 16 Stated Meeting.

Almanac, Vol. 46, No. 32, May 9, 2000