Sometimes I have to wonder about the decisions that college and universities make in the face of a crumbling economy. In February, Rutgers University announced that it would spend $500 million in the next three years to expand and upgrade its campuses. For those of you who are not from New Jersey, Rutgers essentially has three main campuses throughout New Jersey – one in Camden, one in Newark, and the main campus in the New Brunswick/Piscataway area. Some of the expansions that the university will be undertaking are as follows:
The projects include tens of millions of dollars in work on more dormitories, a $25 million Institute for Health Sciences in New Brunswick, a $12 million renovation of the recreation center in Camden and an $18.2 million expansion of the student center in Piscataway.
Some $60 million will go toward deferred maintenance across the university. Another $15 million has been earmarked for classroom improvements.
Quote from NJ.com
If you take a moment and read the article where that quote was taken from, you’ll see that Rutgers University is justifying the gigantic expense by saying that 5,000 jobs will be created because of the expansion. However, notice that the article does not state whether or not the jobs are permanent jobs such as a cashier or a janitor or temporary jobs such as a construction worker. That’s a vital piece of information and I would think that the bulk of those 5,000 jobs are temporary.
Further, let’s remember that to create these jobs, Rutgers is spending $500 million. That’s $100 thousand spent per each job created. I’m sorry, but I have to believe that if we’re looking at this expansion and upgrading project from the stance of, “It’ll create more jobs during a recession,” well I don’t think it passes the smell test. That’s just too much money to spend on creating jobs when you know the majority of the jobs are temporary.
But here’s what really bothers me…
Rutgers is going to spend half a billion dollars to upgrade its campuses – that’s fine. But when you get right down to it, how are they going to pay for this work? I can think of two sources. First, alumni donations. As an alumnus of Rutgers University, I do send them a donation once or twice per year. I direct my donation to a particular fund that awarded me a fellowship when I was a graduate student, so I know that the same funds that helped me are helping other students who are studying in my field and were of the same ilk that I was as a graduate student. But once those solicitations start coming in about helping to pay for the expansion – I have no interest in that stuff.
Second (and this is what annoys me), Rutgers is going to have to use student tuition to pay for these expenses. They just have to do it. How else are they going to be able to afford the expansion? I guess what bothers me about this is that I’m a big believer that if money is managed correctly and the best interests of the end user are kept in mind, then you will always discover ways to find cost efficiencies and to lower the overall cost of your service. In this case, I have to imagine that if Rutgers University is doing the right things at all levels and at all times, that the cost of attending college will actually go down.
Sure, I know that anyone who has to manage a budget will tell you that once you have a new revenue source (i.e. higher tuition) you do not give it up. But I’m sorry – if everyone focused on making quality education more affordable for students, then I am convinced that we could lower the cost of tuition.
And suspending half billion dollar expansions might be a way to start that ball rolling.