Colleges as economic engines

Back in the middle of January, Gov. David Paterson proposed the Public Higher Education Empowerment and Innovation Act.

Its main thrust is to spin off the SUNY and CUNY systems from state lawmakers who would automatically raise tuition to fill a budget gap.

The governor”™s plan would enable the school systems to set tuition and become centers of job creation, such as by leasing the land for private enterprise. (Leasing the land to make money; more on this later.)

“Currently, Albany micromanages everything from the chalk campuses purchase to the cost of tuition that students pay,” Paterson said when unveiling his plan. “This burdensome overregulation threatens the ability of our public higher education systems to promote economic development and successfully adapt to changing educational and fiscal circumstances.”

Six-and-a-half months later, even after the budget was finally approved, the proposal is being used as ”“ what else ”“ political leverage by the state Legislature.
But the concerns of the sides might be misdirected.

The sticking point apparently is letting SUNY and CUNY schools set tuition.

State Sen. Ruth Hassell-Thompson, whose district includes part of Mount Vernon, is concerned the plan would make the state”™s higher-education system unaffordable.
That is not necessarily true.

The governor”™s plan points out that state campuses are “statutorily blocked from setting differential tuition levels that take into account their unique missions and cost-structures.” Other public colleges in the nation are allowed to do so.

Under his plan, colleges could raise tuition “up to an annual cap of two-and-one-half times the five-year rolling average of the Higher Education Price Index.”

As a result, New York”™s public colleges have among the lowest tuition in the Northeast.

In academic year 2008-09, the average tuition and fees at SUNY”™s university research centers were $6,053 or 55 percent of the average non-New York tuition ($10,904), according to the 2010-11 Executive Budget.

Tuition is a minor issue.

The larger and more important aspect of this legislation is letting state colleges become economic drivers.

Under his plan, Paterson also wants to give the colleges “the freedom and flexibility they need to drive development both on campus and off, preparing our students for the new economy jobs that will propel New York forward.”

Empowering schools that had been under the economic grip of lawmakers with such operational autonomy needs to be watched over carefully, according to the governor, that”™s why he wants the Legislature to continue with some sort of oversight.

But we don”™t envision the schools dropping strip malls or other objectionable sorts of development on their grounds ”“ and they do own a lot of real estate.

The real property assets on SUNY”™s 29 state-operated campuses encompass more than 2,300 buildings, 79 million square feet, and 20,000 acres of land, according to the Executive Budget. SUNY campuses represent 25 percent ”“ yes, 25 percent ”“ of all state-owned assets. That, of course, does not include roads and bridges.

The current value of all that real property is $27 billion.

Under current state law, SUNY has to seek special legislation to lease any of its properties. The governor says with his plan SUNY “could expand public-private partnerships to promote commercial and community-based activities, such as conference centers, student and faculty housing, health care facilities, business incubators, food service, telecommunications and retail facilities.”

Instead of letting a hotel and conference center drop anchor across the street from a SUNY campus, the governor says, “why not lease excess campus property for this purpose and capture funds that benefit the school?”

Valid point.

Maximize your assets.

But this sounds suspiciously familiar.

Purchase College President Thomas Schwarz has been advocating for this sort of maximization of assets for several years. Yet Paterson vetoed the legislation after it passed both houses.

Schwarz, with the support of the SUNY board of trustees, proposed building a 385-unit retirement community on about 40 acres that was the site of an ill-fated project from several years back to create a summer home for the New York Metropolitan Opera Orchestra.

Back in 2007 it had passed in the state Senate, but was rejected by the Assembly”™s Higher Education Committee with opponents calling it a nonacademic venture.

Nonacademic indeed.

In an interview with these papers two years ago, Schwarz said the retirement community would be a perfect fit for the campus. The senior residents would serve as mentors bringing an intergenerational learning experience for the students. In addition, the school would have a ready-made audience for its performing arts center. And it would also make use of the 60-plus dormant acres.

Retirement communities are popping up on campuses from The Village at Penn State to Capstone Village at the University of Alabama to Dirigo Pines at the University of Maine.

A new bill for the senior learning community was presented to the Legislature in February.

However, if the lawmakers intend to pass a SUNY empowerment bill once they reach a compromise, then Purchase College”™s bill should prove moot.

And then these campuses can begin thinking of creative uses of excess land ”“ and generating additional, and much needed, money.