The Pennsylvania Master Plan for Higher Education projected that, to meet the needs of the state in higher education, private colleges and universities, which presently enroll 55% of the state's students, will have to increase their enrollment by 39.5%. However, no provisions were made in the Plan to help these institutions do so. This report analyzes: the position of church-related institutions of higher education in the state; the proportion of the total state resources non-aided institutions provide and the burdens they assume; Pennsylvania's policy on church-related colleges and universities; and implementation problems not resolved by the Master Plan. Legal bases for state assistance to church-related institutions are discussed in terms of the nature of the constitutional problems and the position of the federal Constitution; legislative proposals to help implement the Master Plan, which include the creation of a Higher Educational Assistance Authority; and the economic and social bases for the proposed assistance. Relevant experiences in other states and statistical tables are included in the appendix. (AF)