Dear Penn State community,
Thank you to everyone who joined me in conversation, either online or in person, this past Wednesday (April 24) on the beautiful Penn State Altoona campus. I truly enjoyed the opportunity to meet so many of you and engage in conversation about Penn State’s future.
I was thrilled to see approximately 100 people join us in the theater and more than 1,200 online, and I am incredibly thankful for your commitment to shared success for Penn State. As always, I am so grateful that we received so many thoughtful and engaged questions; all of them contributed to an important dialogue.
Thank you, also, to the Penn State Altoona community and Chancellor Ron Darbeau, who provided such a warm welcome. I also want to thank Senior Vice President and Chief of Staff Michael Wade Smith, who moderated the discussion; Senior Vice President for Finance and Business Sara Thorndike and Vice President for Commonwealth Campuses and Executive Chancellor Margo DelliCarpini, who joined me on the panel; and Interim Executive Vice President and Provost Tracy Langkilde, Senior Vice President for Research Andrew Read and Vice Provost for Faculty Affairs Kathy Bieschke, who were on hand in the audience to answer questions as needed. The fact that they all joined me for this important conversation reflects the commitment of my entire leadership team to listening to and working with the campus communities as we chart a pathway forward, together.
Our hope with this event was to provide an opportunity for you to ask questions and share your feedback about the progress of the road map for moving Penn State toward a future that enables innovation and growth. This conversation built upon the discussions that Margo has been leading across the campuses. We plan to have additional conversations with subsets of our community, on this topic and others, over the coming months.
We truly appreciate your engagement and encourage you to continue reaching out through our newly launched “Road Map For Penn State’s Future” website with your questions and ideas. We will find solutions to the challenges facing Penn State — and all of higher education — by collaborating and asking the hard questions, together.
What’s next?
We had a wide-ranging conversation — spanning impacts of the budget model to the Academic Portfolio and Program Review (APPR) and diversity, equity, inclusion and belonging (DEIB). Whether you were able to attend or not, I want to thank all of you as faculty and staff members for engaging in such a robust conversation about how to chart a path forward for Penn State that prioritizes our mission of providing an accessible world-class education.
While change can feel overwhelming at times, I want to assure you that Penn State is and will remain an incredibly strong institution, thanks to all of you. Please continue to bring your creativity and passion to work every day. Together, I truly believe we have the opportunity to set Penn State up for hundreds of years of success.
Like many of you, I got into higher education to make a positive impact on the lives of students and the world. The ripple effects of our collective success improve outcomes for individuals, families, communities and society itself in small and large ways.
Our three overarching goals are to ensure that: students who start at Penn State finish with a Penn State degree and are set up for a lifetime of success; researchers have the funding, facilities and support to make world-changing discoveries; and our dedicated and effective employees are properly compensated. This process is intended to make sure we achieve these goals in a way that shows our main revenue providers — especially our students paying tuition — that we are making the best possible decisions about how to allocate these funds to have the greatest impact on our students and our communities.
This is the first of many community conversations on these topics. In the meantime, please continue to share your thoughts, ideas and feedback as we move forward through this road map transition to establish a strong future for Penn State. Please visit RoadMap.psu.edu to keep up to date on the progress and to share your thoughts, ideas and feedback. I look forward to partnering with you on this journey.
As we mentioned during our conversation, we will follow up with campuses directly on some of the specific questions we did not have time to address. Also, for those that couldn’t join us live, below are a few of my top takeaways from our conversation based on the questions you asked.
Sincerely,
Neeli
Why are the Commonwealth Campuses bearing the burden of making up the budget shortfall if they are indeed important to the success of the University's land-grant mission? When will we know what the budget cuts and individual allocations will be for each campus? Will there be campus closures or consolidations?
I want to reiterate my commitment to Penn State’s access mission and our Commonwealth Campuses. As I told you when I first took this job as president, one of the things that really attracted me to this role was the fact that our campuses can deliver on this mission to transform lives by bringing higher education close to home.
I will keep that part of the pledge. But it would be irresponsible for me to say that nothing will change on any of the campuses, including University Park. We are in a difficult environment; all options are on the table, but closing a campus would be way down on the list. We are exploring creative avenues to keep our campuses vibrant, such as creating economic and workforce development hubs, applied research and community impact hubs, and establishing dual enrollment pathways.
Penn State’s commitment to student access will always be a central part of its mission. However, with enrollment decreasing nearly 30% across all Commonwealth Campuses since 2010 and with revenue at some locations being lower than costs, we have to change. Penn State is not alone in this, as demographic shifts and enrollment pressures are being felt at institutions of higher learning across the country. The University Park colleges and administrative and student support units also are set to experience budget reductions for fiscal year 2026 and are being asked to determine ways to find efficiencies and cut costs.
As Sara shared, due to a spreadsheet error in the budget model, we are now working toward an aggregate deficit of $49 million — a decrease of $5 million from the originally targeted $54 million — for the Commonwealth Campuses, which must be addressed.
It’s also important to remember that the campus deficit would be significantly larger without the extra support we provide to help our Commonwealth Campuses meet their access missions, which includes $31 million in provost-provided strategic funding and $25.5 million that has yet to be allocated by the Office of the Vice President for Commonwealth Campuses.
While no decisions have yet been made about specific campus-by-campus allocations for fiscal year 2025-26, as the University undergoes careful evaluation, we are exploring many avenues and considering the best infrastructure and vision to meet our mission and student needs today and into the future.
I want to thank our campus chancellors, and their teams and community members, for their ongoing, dedicated work to identify creative approaches and ideas that focus on student success, innovation and long-term stability.
How has the new budget model been working so far? Have we seen any areas of early savings progress and positive outcomes? Is there any consideration to revising the budget model to better account for the unique aspects of each campus?
I am incredibly grateful for all the work Sara and her team, along with the Office of Planning, Assessment, and Institutional Research (OPAIR), have done developing the data-driven hybrid budget model and communicating the changes across the University. Over the past few weeks, she has been hosting meetings with various groups to walk through the model with deans, chancellors, Faculty Senate, financial officers and others in advance of sharing it with the broader community later this spring.
As Sara said during our event, all of Penn State’s academic units, colleges and campuses are unique, so we need a budget model that has flexibility built into it. This is one of the main reasons why we created a budget model that has investment funds and carryforward built into it instead of a more rigid alternative.
We have already seen early success with increasing savings using this model. Most units are coming in at or close to their 2024 budgets, which is a significant improvement over trends observed in previous years. This is a positive step forward. We’re also now having designated strategic funds set aside, which we’ve been able to use to support campuses through capital projects, enrollment and DEIB.
It is important to remember that we are not making decisions based only on formulas and figures. People are our most important asset, and we are doing what we can to take our time and reduce the impact of any potential changes to people.
Having strategic budgeted funds has helped us be nimbler to fund new opportunities and immediate needs, including capital, new student support programs and enrollment growth opportunities. I want to echo Sara’s thanks to all of you for the work you have done individually and within your units to find cost-savings opportunities, such as identifying redundant systems and renegotiating procurement contracts. We encourage everyone to talk to their campus or unit leaders if they see ways we can operate in a more efficient and cost-effective manner.
How are you aligning budget reductions for the Commonwealth Campuses with the Academic Portfolio and Program Review (APPR) and the Optimized Service Teams (OST) initiative? Where does the strategic planning process fit in with all of this?
We received several questions about whether we would still be undergoing the Academic Portfolio and Program Review (APPR) process if not for the need to balance the budget. Let me be very clear — absolutely, we would. If we aren’t able to look inward and set up a process to regularly ask ourselves whether we are being responsive to student, societal and workforce needs, then we are going to get left behind.
The APPR is about realigning our programs based on student and workforce needs and not directly tied to the 2025-26 budget. We are looking at the APPR not as a budget initiative but rather as an attempt to make sure we are doing our very best to serve our students, provide high-quality programs, and be innovative to meet their needs.
This is about setting Penn State up for the future and something every university should do on a regular basis.
This is a highly collaborative process with extensive involvement from faculty. I am grateful for Faculty Senate leadership and for Tracy, who has stepped into the interim provost position and will keep the APPR initiative moving forward. As Tracy said, this is an opportunity for us to create a continuous portfolio and program review process, so we can regularly look at what’s working, what’s not and make decisions in the context of what is in the best interest of Penn State as well as our local communities.
I think it also is important to remember that the work of finding efficiencies and savings opportunities isn’t limited to the Commonwealth Campuses. The Optimized Service Teams initiative is an example of an effort underway to figure out how we can work better and more efficiently University-wide.
And, yes, all of these initiatives are happening at the same time as the University’s strategic planning process, which is in its second phase. There is a lot of change happening all at once, and I humbly thank you all for your patience and grace as we move forward in the processes together to create a better Penn State.
Can you provide clarification for how the work of the various Commonwealth Campus working groups can inform the 2026 budget allocation? Will any of the cost-savings ideas members of our campus community have come up with be shared with the rest of the community? Do you plan to implement any of those ideas?
Separate from the APPR, Margo and the chancellors have been working diligently in three working groups on laying the groundwork for the important work that will take place to brainstorm the future of the Commonwealth Campuses, benchmark with multicampus peer institutions, and analyze policies and practices at Penn State that may need to be updated to support long-term campus success.
These working groups are led by tri-chairs — consisting of a Faculty Senate or Faculty Advisory Council leader, a Staff Advisory Council leader or someone designated in that role, and a chancellor. These groups will engage at campus and regional levels to tap into expertise across campuses and gather broad input from faculty, staff, students and external stakeholders.
I was thrilled to hear Margo share all the thoughtful cost-saving ideas you all have already suggested, including looking at faculty load, course enrollment, outsourcing services and facilities, leveraging technology, looking at staffing levels and limiting discretionary spending. There have been a lot of good suggestions. Please keep them coming. The plan is to share these ideas more broadly once Margo and her team have a chance to analyze and code the data.
During our conversation, a member of the Penn State Altoona community asked whether there has been any thought to incorporating vocational education at the campuses to support local and regional industries and trades. This is an example of the type of out-of-the-box thinking that is taking place and the ideas we welcome and encourage you to continue sharing.
With the scrutiny that diversity, equity, inclusion and belonging (DEIB) is experiencing across the nation, what is the administration’s perspective on units that support DEIB efforts across the campuses?
We know that so many of our campuses support students from diverse and historically underrepresented backgrounds, including minority racial and ethnic backgrounds, the economically disadvantaged, first-generation college students and those living in rural communities. Taken all together, our Commonwealth Campuses are uniquely positioned to serve many Pennsylvanians from diverse backgrounds.
Please know that your work serving Penn State’s access mission matters. This is something I’ve personally been committed to for decades, and the Board of Trustees is behind us. I do not believe in proactively cutting programs or stopping initiatives is the right move. We are not going to be moving away from believing in and supporting diversity, equity, inclusion and belonging for everybody.
So what does this mean in terms of how we create welcoming environments, antiracist campuses and opportunities for all of our students? Margo shared that she has been in talks with campus leaders about how to bring a more centralized and intentional approach to DEIB across the campuses that increases our understanding of the different challenges our students face and how we can create opportunities for success.
I look forward to seeing how all these conversations progress and what that will mean for students across Penn State.
As one faculty member asked, ‘How can I, in good conscience, tell faculty applicants that Penn State is a good place to work and has an administration that supports the Commonwealth Campuses and teaching faculty?’ What has been done to ensure our teams are valued, appreciated and feel supported, considering the impacts on morale?
Penn State is an extraordinary place to work. That’s backed up by the number of high-quality applicants we continue to receive for open positions and a testament to Penn State’s strength. A lot of that is because of you and the passion and commitment you bring to your work every day.
I also know that fatigue over change and fear about an uncertain future are real issues that we take extremely seriously. When you confront those types of feelings, it’s natural to feel worried. It would be hard not to. But I want you to know that we see you and we value you.
That’s why we kept our promise and invested $60 million into the Compensation Modernization initiative, to make sure staff, who often get overlooked in this conversation, are compensated fairly and competitively for their enormous contributions to Penn State’s mission. Everything we’re doing now is to try to make sure we can create an environment for our faculty where they can look forward to predictable cost of living adjustments and merit increases.
We will never get there if we just continue with the across-the-board cuts that have been part of the annual budget approach at Penn State in the past. We need to be more strategic. We are working to support a future in which our current employees, and the best and brightest prospective faculty and staff, know that when they come to Penn State, they’re coming here to grow with us.