U. must report top service spending

Penn and other tax-exempt organizations are now required to submit a more detailed report of expenditures to the Internal Revenue Service, justifying their exemptions.

A new component of the 990 form asks the University to list its top service expenditures, which for Penn were education and research, followed by health care.

The combined education and research expenditures for fiscal year 2009 were $2,071,093,946, and health care was $1,667,649,000, according to Penn’s 990 form. Penn’s fiscal year runs from July 1 to June 30.

These numbers are not surprising because they align with Penn’s “core mission,” according to Office of the Executive Vice President spokesman Tony Sorrentino.

They also reflect Penn’s commitment to service in West Philadelphia, he said. For example, the quoted expenditure on health care includes care given to patients without health insurance, and the education expenditure includes the Penn Alexander School in West Philadelphia.

Penn benefits West Philadelphia by generating economic activity, improving the health of local residents and by improving education in the region, according to a statement from Penn President Amy Gutmann. This commitment to public service draws “the most talented, public spirited students from around the world,” she wrote.

The IRS form hasn’t changed since 1979, according to Associate Comptroller MaryAnn Piccolo. The change was intended to enhance transparency of tax-exempt organizations, promote tax compliance and to minimize the filing burden for organizations, she said.

In order to complete the form, particularly the section requiring the top service expenditures, the Division of Finance had to send a message to the 12 school deans, asking them to report expenditures individually, Sorrentino said.

The revised 990, which is useful for donors and grant applications, is a “microcosm of a grander level of scrutiny,” Vice President of Finance and Treasurer Stephen Golding said. “Everyone wants more information and transparency,” but consolidating information from all of Penn’s 12 schools is “very time consuming and very costly.”

Reporting these expenditures is a “mammoth project,” Piccolo agreed, but it is getting bigger — starting next year, Penn will have to report its hospital and tax-exempt bonds schedule.

Despite the difficulty in reporting, Piccolo said the updated 990 form will allow students to see more clearly “what your being here helps us do.”

Please note All comments are eligible for publication in The Daily Pennsylvanian.