Budget Allocation Approach

Penn State has developed a new data-driven budget allocation model as part of a comprehensive effort to modernize the University’s budgeting approach and to uphold Penn State’s commitment to student success, research, and the land-grant mission across the commonwealth.


The budget work unfolded in three phases.

In the first phase, the working group discussed the unique nature of Penn State and essential factors that needed to be kept at the forefront of conversations and decision-making. This led to the creation of a guiding set of principles for the project. 

In the second phase, the group followed decision points related to higher education finance and budgeting to develop a test model. Data from the old model were input into the new model to identify outcomes. The working group adjusted the model to better reflect its guiding principles and create a workable first draft.

In the final phase, the draft model was presented to key stakeholders for questions and feedback, which was discussed and adapted into the final model.

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students walking


Starting in January 2023, budget executives will work with financial officers to create a multi-year budget based on the new model for fiscal years 2024 and 2025. Once unit budgets are finalized, The University Budget Office will present the budgets in July 2023 to the Board of Trustees for final approval. In fall 2023, the model will be rerun with current data for fiscal year 2026.

In addition to the budget development work, the group will create educational materials for the Penn State community, growing fundamental base knowledge around how University financial resources flow into and through the institution.

Close up of the old main clock tower

Penn State’s Institutional Values

Upholding and strengthening Penn State's core mission, vision and values are the foundation of the process to build a new budget model.

University Park bell covered in snow


The working group identified key principles to guide the budget model decision-making process. 

World turtle with students in the background

Frequently Asked Questions

Here you will find answers to the common questions about the budget allocation initiative.

A screenshot from an Asked and Answered Video Series

Asked and Answered

A video series featuring members of the Working Group addressing questions about the budget plan.