When big universities set off a public clamor, the reasons too often include these: Dream-shattering fumbles on the 5-yard line, or a record-shattering salary for the football coach.
But a commitment to long-range financial planning? Booooor-ing.
And that’s too bad, because public research universities are only as strong as their accounting.
Their healthiest benefits depend on the health of their books. Benefits like turning gawky freshmen into literate professionals. Researching cures for disease. Cultivating liberal arts, technical innovation, economic hope.
And doing all of this at a cost that ordinary students can afford.
So it was an act of courage and leadership when Washington State University’s incoming president, Kirk Schulz, wrote a letter to his faculty and staff calling for rigorous financial planning. The letter is remarkable for its candid diagnosis of past mistakes, and the path toward solutions.
What were those mistakes? We summarize: Vision outstripped readiness to fulfill it. Facilities expanded, but without a sustainable plan to run them. The football program spent a fortune, failed to generate a fortune in return and now operates deeply in the red.
Overall, in Schulz’s words, “We have been spending more money annually over the past couple of years than has been brought in … we are spending down central reserves at a significant rate.”
What are these reserves? WSU has an annual operating budget of $1 billion. Only 45 percent of it comes from the sources that are most openly disclosed and debated: student tuition and state appropriations. The rest pours into hundreds of special-purpose accounts; it comes, for example, from research grants and the fees students pay to live in campus dormitories or apartments, eat in dining halls or park on campus lots.
The university’s accounting procedures must keep these dollars separate. The dollars are held for years because projects last for years, and the university has to save for the time when each dorm or apartment must be rebuilt.
But when intercollegiate athletics operate at a deficit of $13 million a year, they are borrowing dollars earmarked for student-housing upgrades. Good accounting would require this debt to be repaid.
Consequently, Schulz is calling for plans to stop the hemorrhaging, increase support from donors and solidify university finances.
His candor, together with WSU’s heritage and importance, gives reason for optimism.
Spokane is among the communities with much at stake in the university’s success. Local leaders worked for decades to establish WSU’s branch here, with its emerging focus on the health sciences. The dream of a WSU medical school could further help our economy – and relieve the statewide shortage of primary care physicians.
So the public clamor should reflect the public interest. “Go Cougs” is about more than the sports. It’s about building healthy minds, and healing them.
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