Unable to Pay To Maintain Current Buildings, Kentucky Universities Ask For More Buildings to Be Funded

In the 1980s, Dave Smith had an extremely successful computer consulting business he owned in Winchester, Kentucky. As a compulsive smoker, sadly, in the late 80s he was diagnosed with lung cancer. He went through treatment at the University of Kentucky Medical Center. Even while being treated, he would ask visitors if they would go to the nearby convenience store to buy him a carton of cigarettes. Dave Smith was a good man, and it was a shame to see him continue to hold onto the vice that had wrecked his health.

Kentucky’s universities and the construction loving officials in Kentucky are in a similar position—holding onto the construction spending vice that has for decades wrecked their health. Although the presidents said they would forgo the construction, the lip service seemed half-hearted. Bricks and mortar trump books and brains every time in Kentucky. And even while college tuition at Kentucky’s public schools have been pushed out of the reach of many average Kentuckians in the past 20 years due to decreased state funding for higher education, the budget always has the capital construction items, even if students can no longer afford to fill those new buildings because of the skyrocketing tuition costs.

Ryan Alessi reports:

While taking their turns facing a legislative budget panel, university presidents have had to say publicly which they’d rather have: money to construct buildings or funds to operate ones about to open.
The clear message is that they’re unlikely to get both.”With this current budget climate, I don’t see that there will be enough money,” said Rep. Arnold Simpson, D-Covington, who is chairman of the House panel on the postsecondary education budget.
Lawmakers will decide in the coming weeks whether to fund the $37 million over two years in utility bills for university buildings set to open or make debt payments on up to $583.8 million in new projects on the campuses — or in the worst case scenario, neither.
Simpson pressed three university presidents at a hearing last month on the issue, and all three struggled to answer.
“That’s a tough question, Mr. Chairman,” said James Votruba, Northern Kentucky University’s president. He said the organization that oversees college nursing programs has told NKU it has “severe problems” with its nursing building and needs a new one. NKU is seeking to build a $92.5 million “health innovation” building.
On the other hand, the General Assembly decided not to fund maintenance and operations for new buildings in 2008 for the first time, shifting that burden to the universities.
“That’s the equivalent of a budget cut,” said Morehead State University President Wayne D. Andrews. Morehead had to find $2.4 million to cover its new buildings’ utilities and maintenance in the past two years. At NKU, it was $4 million, Votruba said.
What the legislature chooses could be felt long beyond the 2011-2012 biennium. Leaving maintenance and operations money out of one budget, as lawmakers did last time, could have been construed as a one-time desperation move. But dropping it from two increases the risk it will be gone forever, said Robert L. King, president of the Kentucky Council on Postsecondary Education.
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“The consequence is that in order to open a building you just built and furnish it and operate it, you’ve got to take the money from somewhere.”
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Still, now is a tempting time to build with that domino effect that construction of multi-million dollar structures can have on local economies, the low interest rates and contractors offering better deals.
“It will never be cheaper,” Eastern Kentucky University President Doug Whitlock told lawmakers.
Perhaps no university project better encapsulates the operations versus construction debate more than EKU’s new science building, which is being constructed in two phases.
Since April, the five-story steel and concrete shell of the $64 million first section has risen out of a hillside on its Richmond campus.
When it opens by fall 2011, the 174,195-square-foot building will cost well over $1 million a year in maintenance and utilities despite energy efficiencies being built in, said James Street, associate vice president for capital planning and facility management.
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The construction equipment already is in place and the switch from the first part of the building to the second part, which could cost an additional $65 million, would be seamless and efficient, Street said.
Even for Frisbie, the choice between the state finishing the complex or paying the building’s bills is like an unsolvable physics problem.
Frisbie said his first instinct is to push for the second part of the building. But as scientists often do, he later challenged his hypothesis. Losing forever the maintenance funding could force the university to resort to pay cuts or layoffs to balance the budget, he reasoned.
“It is cruelly ironic that a down economy sends more people to school at the same time universities and colleges are forced to reduce their budgets”, he said. “So it is, indeed, a Sophie’s Choice.”

Unfortunately, if the past 20 years are any indicator, the public universities will slide around Sophie’s Choice, and instead balance the budget by sharp tax increases imposed on the ultimate consumers at educational institutions—the students who must pay for tuition.

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