Israel, Lebanon set agenda Compromise could lead to withdrawal By JONATHAN IMMANUEL Associated Press Writer KIRYAT SHMONA, Israel Following pressure from President Reagan, Israel and Lebanon broke a three-week deadlock yesterday and agreed to negotiate simultaneously on the withdrawal of foreign troops from Lebanon and future relations between Israel and Lebanon. Despite agreement on a compromise agenda giving priority to neither issue, the two governments made clear that in the negotiations each would put its primary.concern first. Lebanese officials in Beirut said when the Israeli, Lebanese and American negotiators get down to business at their next meeting Monday, their delegation would propose a comprehensive plan for withdrawal of all Israeli troops from Lebanon. Israeli Defense Minister Ariel Sharon said he was sure the negotiators "will arrive at security arrangements and normalization as the first stage to peace between Israel and Lebanon." The agreement came after Middle East envoy Philip C. Habib arrived with word that the president wanted an end to the deadlock. O'Bannon fired welfare head Thornburgh By RICH KIRKPATRICK Associated Press Writer HARRISBURG Welfare Secretary Helen O'Bannon was fired yesterday as Gov.. Dick Thornbu'rgh continues to shakeup his cabinet in preparation for the Start of his second term next week. O'Bannon, credited with bringing tough-minded management to an agency that spends billions of dollars a year, was called in by Thornburgh and told she would not be reappointed She will leave as of noon inauguration day, next Tuesday Reached at home last night, O'Bannon indicated she had a feeling her time was short in the administration and said "the last couple weeks have taken a toll." . She had applied for a job as welfare secretary in Arizona, after she was contacted by Gov. Bruce Babbitt'S staff last month. She was one of the top five candidates, but did not get the post. Asked why she had applied, she said she had no inkling from Thornburgh about her role in the second term. "I think he is looking for new people, new blood, new energy and new direction," O'Bannon, 43, An original member of Borough undecided about uses for surplus Editor's Note: This is the last of a two-part series examining how State College has stayed on a sound fiscal course while many municipalities are suffering from an urban fiscal crisis. . By TONY PHYRILLAS Collegian Staff Writer With an eroding tax base, cutbacks in federal aid, inflation and declining population, many municipalites are having a difficult time balancing their budgets. State. College, too, has a problem; but it's one problem Many municipalities wish they had: deciding what to do with a budget surplus. Aided by improved tax collection, some unexpected one-time revenue and a higher revenue sharing allocation, State College finished 1982 with a $662,000 budget surplus Although about half of that has been the daily Thornburgh's cabinet, she refused to express any bitterness at being dropped five dayi before the start of the new administration. "I'm not bitter," she said. "These are hard decisions, not made lightly." Her departure is the third to be disclosed within the past two days. Revenue Secretary Robert Bloom was likewise told he would not be back and Commerce Secretary Geoffrey Stengel is returning to private business in Philadelphia, . sources reported. Thornburgh's office has steadfastly refused to comment on any of the reports. The governor is expected to announce his new cabinet late this afternoon. O'Bannon, who was brought to state government in 1975 by Democratic Gov. Milton Shapp, became the first woman to serve as a member of the Public Utility Commission. She holds a bachelor's degree in economics from Wellesley College and masters in economics from Stanford University. During her career, she has worked as a researcher, fiscal economist; and college administrator. At the Welfare Department, she was in charge of implementing the administration's program of cutting able-bodied people from the cash assistance rolls. committed to either balance this year's budget or as an emerge* fund to meet cash flow problems, the borough still has about $305,000 in surplus funds available. State College Municipal Council members have discussed various projects the money could be put toward, but seem reluctant to dip into the surplus. And, although the 1983 budget represents a 5.7 percent increase over last year's budget, municipal manager Carl B. Fairbanks said he wants to emphasize that the budget does not include any new major spending programs. Council President Joseph Wakeley Jr. and other members of the council's Republican majority John Dombroski, Fred Honsberger and Gary Wiser —have said that they kept a close watch on the budget process. "I think the staff picked up on the general thought council wanted to convey hold the line on spending," Wakeley said. Fairbanks said, "It's a budget in step with olle • lan Ariel Sharon Weather or not Accu-Weather forecaster Stu Ostro searches the charts of the company's offices, 619 W. College Ave., for clues to the upcoming weather. Please see story, Page 3. present economic conditions and the needs of the population. We're not doing anything too big yet, we're not letting any program drop by the wayside." ."~.~:.~.A : ti~:~~,`: re ..~~r.l' - ~ 1 The increased expenditures, for the most part, will cover normal increased costs in • such things as telephone service and equipment purchases. Also included in the budget, Fairbanks said, are modest salary increases for 140 borough employees. "There are no new substantial or large programs in the budget we're not entering into a new field this year such as buying a cab company," he said. In fact, the October sale of the Centre Cab Co. to a private owner will relieve the borough of picking up the deficits the cab service, incurred in the last two years. The borough will be involved in smaller projects this year such as the start of a five year program to resurface downtown alleys at $25,000 per year, Fairbanks said. - ~ ~' ";. Photo by Eric C. Hogedus Although no formal decisions have been made on how to spend the budget surplus, council members and staff have offered several suggestions. . One of the options being considered is not to spend the surplus at all but to keep the money as a cushion against potential loss or reduction of federal revenue sharing. Revenue sharing funds are the backbone of many city budgets, but the program is set to expire in September unless Congress and the president approve an extension. The borough expects to receive $433,712 in revenue sharing money in 1983. An additional $103,636 was left over from 1982 and was added to the new budget. Much to the dismay of municipal officials, there is also talk in Washington of cutting back on Community Development Block Grants. State College received a $705,000 grant last year and is awaiting a second allocation this year. Friday, Jan. 14, 1983 Vol. 83, No. 104 24 pages University Park, Pa. 16802 Published by students of The Pennsylvania State University student aid - 'B4 budget could cut loan funding By ALECIA SWASY Collegian Staff Writer When President Reagan announces his budget later this month, student aid programs may once again be under attack. Reagan will announce his budget for fiscal year 1984 —which begins in July and includes funding for academic year 1984-85 on January 31. And Reagan's budget plan may once again call for no money for National Direct Student Loans and State Incentive Grants, according to The Chronicle of Higher Education. Reagan had requested no money for NDSL's in his budget for 1983, but Congress appropriated $193 million to the program. "A battle is going on," said John Dean;assistant council to the Committee on Education and Administrative appointees in the Education Department are pushing for a moderate budget, while the Office of Management and Budget is calling for more cuts in social services and education, Dean said. For the Pell Grants, College Work-Study Programs, Supplemental Educational Opportunity Grants and. National Direct Student Loans, Reagan will probably call for cuts, Dean said, and the . House will react poorly. If the figures from 1980 are compared to those for 1983, these programs, due to cutbacks and inflation, have decreased by 25 to 30 percent. Members of the House feel these cuts have been deep enough, he said. . • "Stability needs to be restored aid programs maintain past levels Federal By ALECIA SWASY Collegian Staff Writer Students applying for financial aid for academic year 1983-84 can rest easier knowing that stormy financial aid skies are looking clearer. While most federal financial aid programs remained at their current levels, one program, College Work-Study, has received an increase of $l2 million. Funding for Title 4 funds National Direct Student Loans, Pell Grants, College Work-Study Programs, Guaranteed Student Loans and Supplemental Educational bp, wtunity Grants for next year is in good shape, officials said. Mark Traversa, program analyst in the Office of Planning, Budget and Evaluation in the Department of Education, said for the 1983-84 academic year, Congress has provided: $178.6 million for National Direct Student Loans, same as 1982-83; $2.4 billion for Pell Grants, same as 1982-83; $540 million for College Work-Study Programs, an increase from $528 million in 1982- 1983; $3.1 billion for Guaranteed Student Loans, an increase from Please see BOROUGH, Page 2 to programs," Dean said. Many• institutions have raised tuition and the need for student assistance is greater now, he said Dean said he doubts these cuts will be met with enthusiasm, but some members may support the cuts because of the size of the deficit. Guaranteed Student Loans will also be under attack by the Reagan administration. One change the president may advocate will affect graduate and professional students, Dean said. Under the proposal, those students would still be eligible for GSLs and not have to repay the loans until after graduation. But instead of repaying the loans at the current rate of nine percent, students would be required to repay it at the current market rate. This would be counterproductive because some students, who are as much as $25,000 in debt, would have difficulty repaying the loan and possibly default, Dean said. Interest rates on GSLs for undergraduates may be increased in the proposed budget, he said. As students finish high school and plan for a college education, they see how the GSL program has been cut from year to year, Dean said. The students will wonder what will happen while they are in school and they may have to go to less expensive schools. "We have discouraged students from going to the school of their choice," Dean said. Please see STUDENT AID, Page 2 $3.074 billion in 1982-83 (this is an estimate of government costs and not the total amount available because private lenders handle Guaranteed Student Loans); $355 million for Supplemental Educational Opportunity Grants, same amount as in 1982-83. 'These figures are significant because this time last year, the higher education community had a well coordinated lobbying effort in order to keep programs intact, said John Brugel, director of the Office of Student Aid. The results of this lobbying are "very encouraging and gratifying," Brugel said. While most programs were kept at their current level, the College Work- Study program saw an increase. Parents, institutional offices and students all conveyed the importance of these programs to the nation, Brugel said. "Students who communicated with congressional offices should be encouraged that the system does work, and their voice can be heard," Brugel said. This effort will need to be repeated when the budget for academic year 1984-85 is announced, Brugel said. It will be much more difficult this time. inside • Sen. J. Doyle Corman will reintroduce a bill outlawing de compression chambers.... Page 5 • Tomorrow is Love Ya Lions Day, featuring a parade at 10 in the morning Page 24 weather Partly cloudy and cold today with a high of 33. Increasing cloudiness tonight with a low of 20. Cloudy tomorrow with light snow developing and a high near 30. —by Craig Wagner index Arts Comics/crossword Opinions Sports State/nation/world. Weekend
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