The U.S. Department of Education has directed Gov. Ed Rendell to resubmit an application for federal economic stimulus money, this time counting the four state-related universities as public institutions of higher education.

It remains unclear, however, whether this means the four schools -- once slated to share $42 million this year -- will receive any of the $1.6 billion in State Fiscal Stabilization Funds available for education to Pennsylvania over about two years under the American Recovery and Reinvestment Act.

In a formal application filed June 26, the governor excluded the four schools -- the University of Pittsburgh, Penn State, Temple and Lincoln universities -- from the application for state fiscal stabilization funds, saying they are not "under the absolute control of the Commonwealth."

The action prompted the majority of the Pennsylvania Congressional delegation and the leaders of all four schools to write to U.S. Education Secretary Arne Duncan asking the four schools be considered public and included.

In an e-mail sent to the state Monday afternoon, the U.S. Department of Education said that the four schools "must be considered" public institutions of higher education under the State Fiscal Stabilization Fund program.

"As a result, Pennsylvania must revise its application to reflect state support for these institutions," the e-mail stated. "Each of these institutions is eligible for support under the SFSF program."

In determining the amount of money requested for the schools, the e-mail stated, "The governor may take into consideration the extent to which an IHE [institution of higher education] agrees to limit tuition increases for in-state students."

The federal law requires higher education institutions to use stimulus money "for education and general expenditures, and in such a way as to mitigate the need to raise tuition and fees for in-state students" or for certain other purposes, such as modernizing instructional facilities.

While the state-related universities are eligible for federal stimulus money, Donna Cooper, policy secretary for the governor, said allocations have not yet been determined and there is no guarantee that they will receive the money.

She interprets the federal directive as mandating that Pennsylvania consider the amount it had provided to those schools as part of the state's required maintenance-of-spending effort and restoration of spending for public higher education in general, not specific institutions.

States are required to maintain education spending at least at 2005-06 levels. She said the governor has the authority to recommend how the stimulus money will be distributed, a decision that in Pennsylvania requires state legislative approval.

Ms. Cooper noted the administration's official statement, which says, "We remain committed to using those funds where they can have the most impact."

U.S. Department of Education officials were unable to comment on the e-mail yesterday afternoon.

Under the new calculation, the state would need to restore $97 million in higher education spending this year, which is about $20 million more than what would have been required in the June application. This reduces the amount of stimulus money available for elementary and secondary education.

In a preliminary application filed in April, the governor had allotted about $42 million in fiscal stabilization money for the four and none for the 14 universities in the State System of Higher Education, including California, Clarion, Edinboro, Indiana and Slippery Rock.

But in the June application, he excluded the four state-related schools and allocated $54 million for the State System, $21 million for the 14 community colleges and $1.7 million for the Thaddeus Stevens College of Technology.

Officials at state-related universities remain hopeful they will receive economic stimulus money.

"We are basically hopeful for our students and our families," said Lisa Powers, spokeswoman for Penn State University, who called the U.S. Department of Education's decision "a positive development."

Penn State's tuition bills are expected to go out tomorrow, and Ms. Powers said Penn State remains "concerned that the Commonwealth is not committed to maintaining support for our universities."

Last week, faced with a proposed 13 percent cut in state appropriations, Penn State trustees -- one third of whom are nominated by the governor -- unanimously approved a plan to raise base tuition 9.8 percent, or $1,280 a year, if the cut stands, and 4.5 percent, or $590 a year, if the money is restored.

With proposed state funding falling $61 million below what Penn State was to receive in 2008-09 before mid-year cuts, Penn State faces layoffs and tens of millions of dollars of cuts even with the higher tuition plan.

In passing the two plans, officials said a final choice needed to be made by the end of this week for fall although tuition could be revised for spring if the state allocation picture improves.

In April, Temple University trustees approved a 2.9 percent tuition increase, the smallest percentage in 13 years, as part of a budget that reduced expenses by $40 million. Since then, the governor has proposed cutting Temple's allocation by $21 million and stimulus money by $10.5 million.

The Temple board's executive committee plans to revisit the tuition rate this week, most likely at a meeting this afternoon. Temple's bills are to go out on Monday.

The University of Pittsburgh board, which previously approved a tuition freeze at its branch campuses, is expected to set its tuition rate for its Oakland campus today.

Lincoln has not yet set its rate.

U.S. Rep. Jason Altmire, a member of the House Education Subcommittee on Higher Education and among those who wrote to Mr. Duncan, said he hopes the stimulus money will help prevent costly tuition increases at the state-related schools.

"The American Recovery and Reinvestment Act was intended to help universities continue to provide families with high quality, affordable education during this current recession, and I feel strongly that Pennsylvania should honor that legislation's intent and make funding available to these universities," he said.