COMMENTARY: False Austerity, University Profit, Rolling back Tuition
"Rutgers has no money!" How many times have we heard that? When faculty demands a raise, when students demand affordable tuition, when we all want a robust curriculum … the Administration pleads poverty. For many years, Old Queens argued that rising wages would push tuition and fees up sky high. Then they boosted tuition while freezing salaries for five years. By last year — as faculty fought their way out of the salary freeze — we knew enough to suspect that Rutgers had money hidden somewhere. Unrestricted reserves had gone up from $631 million to $709 million in one year.(Now they stand at $771 million). This money lay outside the operating budget, available for research and other purposes but (obviously) not being spent down. Within the operating budget, the administration certainly wasn’t acting poor as it shelled out mega-salaries to coaches and a proliferating squad of vice presidents. When we scratched below the supposed scarcity, we in fact saw signs of fiscal abundance.
Now, a year later, those signs have grown into a blaring billboard. As part of the requirements of Rutgers’s merger with UMDNJ, the Board of Governors released a new financial report in February. That document cites a surplus on the operating budget for 2014-2015 of $74 million. “Surplus” means profit. Where did that profit come from? Students paid $1 billion in tuition, up 2.3 percent per in-state student from the previous year. The Board of Governors and President Robert L. Barchi justified that price hike on the basis of — you guessed it — austerity. Then, they amassed a 7 percent profit. “Profit” here means an overcharge and more debt. That money rightfully belongs to students and their families. Or, to put it slightly differently, an administration eager to make higher education affordable to the people of New Jersey would either return the overcharge or compensate for it by charging less the following year. Do I hear someone chanting, “Roll back Tuition”?
But even such a restoration of fairness would not correct systemic problems in fiscal management at Rutgers. We are now in the second year of Barchi’s budgeting mechanism, known as Responsibility Center Management (RCM). Borrowed from the private sector, this tool has driven up tuition in invidious, barely visible ways. In an opinion piece on “Back door tuition,” Patrick Gibson documents the sad tale of Dance Appreciation. That course in the Mason Gross School of the Arts has fleeced students with excessive, unjustified fees.
The course also duplicates offerings in the School of Arts and Sciences. That redundancy indicates a deeper problem with the “responsibility” in Responsibility Center Management. More than ever before, deans of schools see students as a resource to be mined, poached from other schools and hoarded jealously from other schools. As a result, schools are increasingly mounting courses outside their expertise and advising students not take, say, study abroad courses that would divert tuition to other parties. RCM doesn’t require deans to maximize tuition flows in these ways, but it certainly creates incentives and encouragement to do so. Indeed, the administration has spent $275,000 for services described as “academic resource benchmarking.” The consultants — from a company called Education Advisory Board — gave a presentation to deans and chairs in January. Their slide deck provoked the audience by asking, “Can’t we just raise tuition to bring in more revenue?” No, not exactly, but the same slide suggests “new course fees” as a work-around. Through the back door, in other words, RCM is now or may soon be driving up the cost of education.
What should students, their families, faculty and staff do about it? We all want Rutgers to remain affordable and accessible to the people of New Jersey and beyond. Indeed, many professors choose to teach in public higher education precisely in order to share our knowledge with people excluded from elite, expensive schools. The administration, however, has been increasingly squeezing and constraining the longstanding inclusiveness of Rutgers. The Board of Governors must step in here. That body will consider tuition and fees at a hearing on Thursday, April 21 at 6 p.m. at the College Avenue Student Center. The Governors know of the $74 million profit from last year. They also know about the piggy bank chock-full of unrestricted reserves. The question for them is: Will you tap the funds on hand? Will you roll back tuition and make Rutgers affordable for New Jersey? After 250 years, that would be truly revolutionary.
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