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Re-imagining Public Higher Education

CUNY Chancellor Matthew Goldstein
CUNY Chancellor Matthew Goldstein
January 12, 2011

In a recent event sponsored by the Center for Educational Innovation-Public Education Association at the Harvard Club in New York City, CUNY Chancellor Matthew Goldstein spoke about the economy’s impact on higher education, and CUNY’s strategies to continue providing educational opportunity despite funding cuts and other challenges.

Developing outstanding students from NYC and across the globe

Goldstein opened his talk by introducing Zujaja Tauqeer, a student in the Macaulay Honors College at Brooklyn College, and one of only 32 Americans chosen this year to be a 2011 Rhodes Scholar.
Pursuing a combined degree in which she studies history and will earn an M.D. from the New York Downstate College of Medicine, Tauqeer was born in Pakistan, and with her family, granted asylum in the United States.  She began her research work in high school and today investigates the neuroscience of autism and history of Pakistan.
“Zujaja’s extraordinary story is also a quintessentially CUNY story,” said Goldstein.  “The University has historically welcomed students from across the globe and encouraged their aspirations.”
He also introduced two former CUNY Rhodes Scholars: Lev Sviridov, one of two 2004 scholars, and Lisette Nieves, a 1992 scholar.
“All of us at CUNY are deeply proud of all of our Rhodes Scholars,” said Goldstein.  “Their talents and their great potential are the reason that we began the Macaulay Honors College in 2001 and why we are so passionate about all of our colleges.”

CUNY’s budget cut by almost 10 percent, as the economy declines

“Every deserving student should get the chance to reap the economic benefits of a college degree—higher lifetime earnings and better job security,” said Goldstein, noting that the jobless rate for high school graduates is twice that of college graduates.
“These opportunities have always been part of the historic promise of public higher education,” he said. “But today, that system is in uncharted territory. Across the country and here in New York, state support for public universities has been declining for the last two decades. And as our recession has deepened, the situation has become more perilous.”
At least 43 states, Goldstein explained, have cut assistance to public colleges and universities, or increased tuition. For example, the University of California has increased tuition by 40 percent, the state of Michigan has cut financial aid to students by over 60 percent, and in Virginia, tuition for community college students has jumped over 18 percent.
“Here in New York, state support for CUNY’s senior colleges has been reduced by over $200 million over the past three years,” Goldstein said.  “Our community colleges have lost about $29 million in state funding over the past two years, in addition to almost $12 million in city funding this year.”
The total reductions, he said, represent 9.5 percent of CUNY’s current $2.6 million budget. 
“Today, about 60 percent of our budget comes from state and city funding combined, and about 40 percent comes from tuition,” Goldstein said. “In the face of these most recent cuts, we have had to enact a five percent tuition increase this spring.  CUNY is still the most affordable quality undergraduate choice in the New York metropolitan area—but there is no question that this is a painful decision to make.”

Facing continued budget challenges

Looking forward, states will continue to face serious budget challenges, Goldstein said, as health care, social services for the poor, K-12 education and corrections demand more state dollars.
“This point was made recently by Peter Orszag, the former director of the White House Office of Management and Budget,” Goldstein said. “In a New York Times editorial, he noted that as health care costs have risen, higher education budgets have been raided.”
According to Orszag, Goldstein explained, governments’ support for higher education 25 years ago was nearly 50 percent more than state spending on Medicaid. Today, however, “that relationship has flipped: Medicaid spending is about 50 percent greater than support for higher education.”
Another recent Times article, Goldstein said, points out that “many states have so much debt—several trillion dollars’ worth, with much of it off the books and hidden from view—that it could overwhelm them in the next few years.” 
In particular, he said, financial analysts worry about the long-term problems of a handful of states, including California, Illinois, New Jersey—and New York, which balanced its budget this year, the article says, “by shortchanging its pension fund” and “delayed payments to vendors and local governments.” 
Next year, Goldstein warned, is predicted to be even worse, as states and cities face their biggest deficits after recessions officially end, and so-called “rainy-day funds”—including federal stimulus money, run out.

Budgets equal quality

The result of these dire indicators?  “With funding decreasing and tuition rising, public higher education is in crisis mode,” Goldstein said. “And let’s not forget that the vast majority of college students—nearly 80 percent—attend public institutions.”
In November 2010, CUNY hosted a second “Summit on Public Higher Education,” Goldstein said, which brought together “public system leaders from across the country to creatively consider our financing, our operations, and our mission.”
“Let’s also remember that when we talk about budgets and financing,” Goldstein said, “we’re really talking about quality—the quality of the graduates we prepare and the research we conduct. This is a time when we need more college graduates, educated to higher levels. Instead, we’re losing ground.”

A national security issue—and a time for action

A joint National Academies study, Goldstein said, calls for improved education and research in science and engineering, and points out that the U.S. ranks 20th in the high school completion rate among industrialized nations and 16th in the college completion rate.
In addition, the study says, the U.S. ranks 27th among developed nations in the proportion of college students receiving undergraduate degrees in science or engineering.
“This is nothing less a national security issue,” Goldstein said. “Educating the next generation of innovators is critical to our nation’s ability to grow and compete in the global knowledge economy.”
“This is a time for action,” he continued. “This is a time for re-imagining public higher education.  How can we continue to meet the critical mission of educating our country’s citizens without adequate public support?  I do not pose that merely as a rhetorical question.  It must be answered.”

The CUNY Compact: A partnership between government and the university

“As public higher education is squeezed out of its place in the funding line, public universities often turn to tuition to make up for lost resources—shifting the burden from government to students,” Goldstein said. 
“At CUNY, we became concerned about this pattern years ago. Big tuition spikes were enacted during economic downturns, when students could least afford them. We determined that we needed a more rational funding model—and that became what we’ve called the CUNY Compact.”
In the compact model, he explained, state and local governments cover mandatory costs, and the institution provides resources for investment—through philanthropy, increased efficiency, and modest, predictable tuition increases. 
“The compact is built on incentives,” Goldstein said. “If one partner puts in a share, other partners are more likely to invest, as well.”
He stressed the importance of creative thinking in this model. “Just as university researchers are engaged in inquiry that can lead to new commercialization,” he said, “so, too, can university leaders engage in inquiry that might lead to new revenue streams.”
“This is a time when the same spirit of ‘what if?’ that drives our academic research must also drive our approach to financing,” Goldstein said. “Universities must become incubators of new ideas, re-orienting themselves to a new environment of institutional entrepreneurism.”

Real estate: gaining economic ground through public-private partnerships

For example, he said, one area of opportunity is through CUNY’s real estate. “Public-private partnerships offer incentives to all partners and can enable much-needed facilities expansions or upgrades,” Goldstein said. “Universities across the country have used such partnerships to build research facilities, student housing, medical schools, and many other projects.”
In 2009, Goldstein said, through a complex public-private partnership, CUNY created a new home for the Hunter College School of Social Work and new School of Public Health in Harlem.
“This partnership has enabled an accelerated schedule for the project—two years, as opposed to three to four years—and more flexibility in procurement, generating overall savings of more than 10 percent.”
A continuing challenge for CUNY, Goldstein said, is not only finding space for research and classrooms, but also for faculty housing. “We are working with developers to identify existing residential properties for this purpose. As a university, CUNY has some purchasing advantages, including exemptions from real estate tax, transfer taxes, and mortgage recording taxes, as well as access to tax-exempt financing.”
CUNY’s concept, Goldstein explained, would allow current residents to stay in their apartments, and then as units become available, CUNY would utilize them for faculty, staff, and administration. 
“In addition,” he said, “we’d like to make affordable housing available for New York City schoolteachers and other public employees, such as firefighters and police officers.  In this way, CUNY would advance the goal of affordable housing, develop faculty housing, and build some revenue to add to our endowment—enabling us, ultimately, to build a better public higher education system.”

Re-imagining the traditional community college

Likewise, Goldstein said, a public-private partnership built on incentives will enable CUNY to gain space for a new community college, set to open in 2012 in Manhattan. 
“The new college re-imagines the traditional community college structure in order to improve students’ graduation rates and their career prospects,” he said, and introduced the college’s founding president, Dr. Scott Evenbeck, who was recently recruited from Indiana University-Purdue University at Indianapolis and is a prominent expert on education assessment and initiatives to boost student success. 
Goldstein also introduced CUNY’s new Vice Chancellor for Student Affairs, Frank Sanchez, who comes from the University of Colorado and has extensive experience in fostering student leadership and degree completion. 
“To find a home for the new community college in the crowded Manhattan landscape, we are in the early stages of initiating a new public-private development,” Goldstein said. 
The project, he said, would be housed in a building called North Hall on the John Jay College of Criminal Justice campus, and move from North Hall to a new facility now under construction.
“Under the proposed partnership, CUNY would sell a portion of the North Hall site to a private developer and retain the balance of the site for the new community college,” Goldstein said.
“CUNY envisions a mixed-use building to be built by the developer—the University would own the lower portion of the building and use it for the new community college, while the upper floors would be developed as residential or commercial units.”

E-books: “E” for “electronic”—and economical

Real estate isn’t the only area where possibilities for entrepreneurship exist for public universities, said Goldstein, pointing out that a couple months ago, Amazon, the online retailer, sold more e-books than paper books. 
“As e-readers take firm hold in the marketplace, we are looking at them as one way to address the rising costs of textbooks,” he said. “E-books are generally about one-third the cost of traditional textbooks.”
Through a partnership with the New York City Department of Education and IBM, Goldstein said, CUNY is also exploring the use of e-textbooks in K-12 classrooms. 
“Next month, a pilot program will test the use of selected textbooks on Kindle readers with ninth graders at Stuyvesant High School,” he said. “Course textbooks in world history, biology, and geometry will be downloaded onto readers used by each student.  Eventually, CUNY will develop programs to supplement the e-textbook material and market them to school districts throughout the country, with the goal of improving learning and generating a new revenue stream for the University.”
By fully utilizing available technology, he said, the three partners—CUNY, IBM, and the DOE—will be able to hold down costs and offer students tools that will better prepare them for college-level work.

Developing an applied science research facility—to increase employment in NYC

Goldstein described another opportunity for partnership that CUNY is investigating at this time, one that involves applying the sciences to fields that lend themselves to commercialism—and an expanded job market.
Just last month, he said, New York City Mayor Michael Bloomberg, Deputy Mayor for Economic Development Robert Steel, and Economic Development Corporation President Seth Pinsky released a Request for Expression of Interest, seeking responses from a university, applied science organization, or related institution to develop and operate an applied sciences research facility in New York City. 
“The City is looking to strengthen its applied sciences capabilities,” said Goldstein, “particularly in fields that lend themselves to commercialization—including quick job creation from innovation.”
CUNY, he said, will be initiating a conversation with the leaders of Columbia University, The Cooper Union, Mt. Sinai School of Medicine, New York University, and Cornell to coordinate a response to the city’s request.

Preparing the next generation of New Yorkers—and securing intellectual capital for the future

“I offer all of these ideas today as stimulus for thinking—a few ‘what ifs?’ in re-imagining CUNY’s finances and creatively building our revenue streams,” Goldstein said.
“As in any robust research enterprise, many ‘what ifs’ are necessary. Some will fail; some will flourish.  But all ideas that incentivize revenue are urgently needed, especially now, as both governments and families struggle to regain ground.”
He pointed out that securing the health of New York City’s public higher education system is essential to the state and country’s health. “We desperately need the inventors, creators, and entrepreneurs of the next generation,” Goldstein said, “not just a few, but an entire citizenry with the skills, knowledge, and drive to generate a constant flow of ideas.”
“We need many more Zujajas, Levs, and Lisettes,” he said, referring to the CUNY Rhodes scholars he introduced in the beginning of his address, “students who, given the opportunity to be challenged by a rigorous public education, are prepared to be the next global leaders.”
“What better way to secure the intellectual capital needed in our rapidly transformed innovation economy than through education?” Goldstein added. “As CUNY prepares to deal with its significant financial challenges, we must also prepare the next generation of New Yorkers.  And that means that we must secure the core of our enterprise.  We cannot gamble with the talent that will drive New York’s competitiveness in the decades ahead.  It’s the most important investment we can make in New York’s future.”
EDITOR’S NOTE: Special thanks to the CUNY Office of University Relations for the Chancellor’s remarks in their entirety: 

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  • To offset an almost 10 percent budget reduction, CUNY is exploring innovative partnerships
  • These include the CUNY Compact, a partnership between CUNY and government
  • They also include partnerships creating funding through real estate, e-books and applied science research

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