Higher Ed Challenge Fund Should Be Renewed Only With Oversight For Universities, Foundations

During the 2013 legislative session lawmakers authorized $29 million to match donations to the state’s institutions of higher education. The funds come in the form of grants, and every $1 in taxpayer dollars must be matched by $2 in privately-raised dollars.

Supposedly it’s all been a rousing success, which the Grand Forks Herald editorial board applauds.

I’m dubious. Raising a lot of money for the universities is all well and good, but how is that money being spent? Many, including this observer, are growing weary of being told that pouring money into higher education will improve education for our students. What it seems to have accomplished more than anything else is a culture of decadence on campus.

The payrolls at our university have grown, but we’re hiring more administrators. Not more instructors. Taxpayer appropriations to the schools have grown much faster than enrollment, yet tuition rates have increased aggressively while the mediocre academic outcomes our universities produce have stagnated.

Most alarmingly, it seems the campuses themselves are being allowed to rot. At NDSU alone there is a chemistry building which is a borderline fire hazard and a research lab without running water. Across the university system there is apparently $800 million in deferred maintenance.

What assurances do we have that these Challenge Fund grants are being used to improve education for students? As opposed to, say, funding a chauffeur for the university president?

The Challenge Grants seem to come with no such assurances. It’s just the same old, same old. Give more money to higher education, and somehow it will magically improve everything (NDSU President Dean Bresciani has an ode to this shallow thinking in the Herald today as well).

But even setting those misgivings aside, there is another reason to be concerned about these grants. The foundations which receive the grants, supposedly private entities which are separate from the universities themselves, are neither transparent nor accountable to the public.

Already Lt. Governor Drew Wrigley, who chairs the Challenge Fund’s board, has had to withhold dollars from the Dickinson State University Foundation due to financial irregularities. In the past foundations at other state institutions, such as the NDSU Development Foundation, have tried to block public inquiry into their finances by claiming they are exempt from open records laws. In fact, the NDSU Development Foundation has made headlines recently with a series of staff resignations attributed to inner turmoil dealt with in a behind-closed-doors meeting (I’ve filed an open meetings complaint challenge whether or not that meeting should have been closed to the public).

The concept behind the Challenge Fund is a sound one: Maximize private giving by incenting it with taxpayer dollars. But after years of scandal and controversy which have inundated the university system, can they be trusted to be the recipients of these dollars? More specifically, should we be pouring dollars into their supposedly private foundations when those foundations have fought transparency and public oversight?

The state’s lawmakers will be considering whether or not to re-authorize the challenge fund for the 2015-2017 biennium. “If the program has been as successful as reported, why would state leaders let it end?”

They might let it end because there’s little evidence that the universities are using the massive infusions of cash legislators have directed at them to benefit students. They might also let it end because there are serious questions about the oversight and accountability of the university foundations.

But they might also use the Challenge Fund as a carrot to lure the universities into dropping their hostility to oversight by elected leaders. The university system is currently searching for a new chancellor, and the oft-expressed hope by observers is that whoever the new chancellor is can lead the university system away from the incessant scandals they find themselves mired in. But a new chancellor will fix nothing. The real problem with the university system lays with arrogant university-level leadership who resist oversight from the State Board of Higher Education and elected leaders.

Lawmakers should use the Challenge Fund as bait for university presidents. Agree to more oversight, agree to participate in a unified system, and drop the hostility to public accountability and receive your Challenge Fund dollars.