As Pennsylvania enters its third month without a budget, more than $83 million in allocations owed to Penn State is still missing -- and the university may have to borrow money to cover the difference if the funds are not received soon.

Each year, Penn State normally receives its updated monthly allocation from the state as soon as the budget is passed in the beginning of July. However, as the budget impasse continues in Harrisburg and state grants go unfilled, the university is now dipping into its reserves to make up for the missing funds.

Penn State President Graham Spanier said Wednesday the university took immediate action when it learned its state allocations were not coming.

"It's frustrating because there's a lot of money at stake, and we're having to cover that," Spanier said.

University spokeswoman Lisa Powers said because Penn State's own financial reserves are currently covering the missing funds, the university is no longer making any money.

"It's costing the university every day, week, month that we are without appropriations," she said.

If the budget impasse continues, the university will have to borrow money from banks, Powers said.

The state -- now the only one in the country to enter September without a budget -- allocates funds to Penn State on a monthly basis. The $83.6 million in appropriations for July and August includes funding for the Hershey Medical Center and $25 million in Pennsylvania Higher Education Assistance Agency (PHEAA) grants.

PHEAA spokesman Mike Rieber said the agency has no funds for grants and is prohibited from doing anything until the budget is passed and signed by the governor.

"The governor and legislators have not agreed that PHEAA should be funded," Powers said.

In Harrisburg, the legislative gridlock is continuing despite its effect on the rest of the state.

Gary Miller, a spokesman for Gov. Ed Rendell, said the governor is working every day to end the impasse and is fully aware of the effect it is having on those who rely on state-funded services.

"Governor Rendell continues to push for a prompt enactment of a final state budget," Miller said. "But the general assembly has not been willing to consider new options that the governor feels are necessary."

Sen. Jake Corman, R-Centre, said it is unfortunate the budget has yet to be passed and understands how many problems the standoff has caused. But Rendell is part of the problem, he said -- the governor vetoed the proposed funding of PHEAA by the legislature.

"I don't think the governor shares our sense of urgency," he said.

Meanwhile, Penn State is still waiting for the impasse to break. Powers said that while the budget crisis hurts, the university recently set one of the lowest percentage increases in tuition in the Big Ten and the lowest in its recent history.

The main focus, she said, is still on the students.

"We are seeking to protect our students from having to bear the greatest burden during this economic downturn," Powers said.