Monday, June 20, 2011

 

Fundraising

The always-interesting Tenured Radical has a worthwhile post on the priorities that “development” (that is, fundraising) offices tend to have in higher ed. Her particular focus is high-profile athletics, and she asks the time-honored (and still valid) question of why development offices are much quicker to raise money for bigtime sports than for, say, English departments.

In the community college world that I know, half of her question doesn’t apply. The sports programs here are small, cheap, and low-profile; in budgetary terms, they’re negligible. No skyboxes or six-figure coaches’ salaries here. (For that matter, there’s no football team at all.)

But there is a development office, and there are serious budgetary challenges. Is it realistic to assume that we can offload faculty salaries onto “endowed” positions, and use the savings to plug the budgetary gap?

Um, no. Not by a long shot.

The first issue is legal; in my state, as in many others, community colleges are legally forbidden from carrying endowments. We work around that, to some degree, with a dedicated “foundation” that can set up endowments, but the foundation isn’t allowed by law to pay for operating expenses (that is, salaries) of the college. It mostly endows scholarships, and occasionally covers buildings or lab equipment. (Those are considered ‘capital,’ as opposed to ‘operating,’ so they’re fair game.) Scholarships are of great value to the students who receive them, but from the college’s perspective, they don’t help much. They probably reduce financial aid outlays somewhat, but we charge students less than the cost of educating them, so enabling more students to attend tends not to solve major financial issues.

Capital outlays certainly help. The foundation here has picked up the cost of some fairly expensive lab equipment that probably would have otherwise come out of general revenues. That’s welcome. And naming rights for buildings can generate significant donations that help defray the cost of their construction. These are to the good, but they don’t pay for faculty. It’s easier to raise money for a building than for the people who would work in it.

Even if the legal issue were lifted, though, there’d still be the issue of donor preference. Donors tend to respond to success, rather than to need, which is why philanthropy often results in the rich getting richer. They also have a strong preference for making a difference that they can see. That tends to favor conspicuous and name-able things, like buildings and scholarships, and tends to disfavor something as squishy as the operating budget.

There’s also a question of incentives. If donors started contributing to operating budgets in significant ways, I’ve got ten bucks that says that the state would cut our appropriation even faster than it already is, and would tell us to make up the difference with donors. In other words, rather than actually solving the problem, we’d dig a deeper long-term hole.

All of this, of course, assumes that donors’ preferences don’t do anything to influence academic decision-making. At this level, that has been true, but that’s because the funding remains at a safe remove from operations. Once they start covering operations, well, he who pays the piper will sometimes try to call the tune. Build whatever “Chinese walls” you want; over time, the force of economic gravity will work its will. It always does.

I’m trying to identify ways to use donor funding to offset certain operating cuts without ignoring the raw facts of visibility and difference-making. Some colleges have a “Center for Teaching Excellence” model, in which donor funding covers professional development funding -- travel grants, mostly -- for faculty. I’d like to get something like that running here. It wouldn’t make an overwhelming difference in the operating budget, since travel funding is thin to begin with, but it would at least insulate travel funding somewhat from the whims of the legislature.

These are sensitive issues, since nobody wants to disparage or discourage what are, at the end of the day, acts of voluntary generosity that do real good. But just as I don’t believe that we can reverse the adjunct trend just by yelling indignantly at administrators -- if that worked, it would have worked by now -- I don’t believe we can make fundamental changes in donor preferences just by telling the development office to drop the football fetish.

Comments:
My suggestion was going to be the use of foundation resources to endow faculty development, like you mentioned. Perhaps something visible, like a "young scholars" grant to support new t-t faculty attending something like NISOD.

However, just because your current Scholarships are of great value to the students who receive them, but from the college’s perspective, they don’t help much is no reason to ignore their value.

You can use scholarships to improve retention by targeting some of them at top students who might be considering you before transferring to a nearby university that you "feed". That might even target a particular major or three where you have a complete, fully articulated, set of courses that feed directly into the junior year. That can help get or maintain the critical mass needed for minimum enrollment in, say, organic chemistry for pre-health majors.

You could also take a page from the playbook of athletic programs, which endow scholarships or equipment in a particular area. Get local doctors to fund named scholarships for nursing.
 
Thanks for sharing Tenured Radical’s perspective, which I have read with mild amusement, specifically because of the post’s self-serving bent.

I donate where I choose, and if others are green with envy, get over it.

For TR, I mean no harm by saying that it sounds like some are of the mindset that our government should take more of peoples hard earned money in the form of taxation, to redistribute in ways they see appropriate (i.e. salaries to fund government jobs). Shame on them.

Here’s a concept worth considering: Take some raw materials, and manufacture into a saleable product. Then, sell it on the open market. Perhaps then one might begin to develop a sense how hard people have to compete and work for what little they have, after the federal, state, and local municipalities each take their cut.

I have the reasonable self-expectation to spend (donate) a portion of my remaining disposable income where I choose, without all noise from government employees who seem to have little enlightenment about fundamental economics.
 
@Adam:

I think you missed the boat on TR's post.

TR never suggests in her post that more taxes should be used to support education. And while she may *believe* that, her personal beliefs aren't relevant to her discussion of fundraising.

TR is not a government employee.

The thrust of TR's post is not that donors shouldn't be able to direct their giving however they want; her point is that development officers assume that donors won't give to support the core mission of the school, but will only give to support athletics or similar fringe matters. (She also makes the secondary point that if schools got rid of money-losing sports programs, they wouldn't need so much private money).

Now I think she might be wrong about the willingness of donors to donate for more mundane purposes; I think development offices probably do have a pretty good handle on what's possible. But I (and they) might be wrong. But I don't think she does any of the things you accuse her of.

As an aside, perhaps some schools should offer endowed "stools" for adjuncts. The "Peter W. stool for English Comp II" sounds pretty good...and I'm sure it's a bargain compared to endowing a chair. :-)
 
@Adam, libertarians should not be lecturing anyone on "fundamental economics," thanks.
 
In my R1 we have endowments that partially pay for faculty salaries in the form of named chairs, but the other missing piece is that an endowment has to be pretty damn big to pay for an entire salary + fringe (fringe is heading toward 50% of base salary around here). That's assuming that you want the interest from the endowment to pay for the faculty line, rather than paying for it by eating the principal. For an entry-level Assistant Professor position in a relatively inexpensive department, you're looking at an endowment of at least $1.5 million, maybe more. That is a lot of money that, from a donor's perspective, might generate more prestige chiseled on the outside of a gymnasium.
 
Adam, you are hysterically funny!

You see, TR is a professor at a private non-profit university, not one of those left-wing public universities that get 25% of their income from the taxpayers. Funnier still, TR's private university benefits immensely from "tax cuts" in the form of deductions for things like donating a scholarship or building in your name or that of your company. You know, the same way you get to write off as much as a third of what you pay to rent a skybox at your favorite R1 football stadium. Tax cuts (deductible gifts) are our very best friends in academia!
 
some are of the mindset that our government should take more of peoples hard earned money in the form of taxation, to redistribute in ways they see appropriate (i.e. salaries to fund government jobs). Shame on them.

Government jobs don't really exist. Government employees do. They are people who perform tasks that serve the public good - like policing the streets, fighting fires, writing and enforcing regulations, and yes, teaching. We have agreed as a society to pay these people something for their work (30% less than they would make in the private sector, on average). In exchange, they serve us. Speaking as someone from California, a state with moderate levels of services and low taxes (and yes, we do have low taxes - because our commercial and residential properties are largely exempt from property tax increases and the fees we charge for things like car registration are at 20 year lows)I can tell you that the “taxes are evil” approach to government has gutted our schools, destroyed our public health system and left thousands of people sick or starving. The idea that all government jobs are unnecessary is ridiculous. The a priori assumption that more taxes would be like theft or would be wasteful is absurd.

But Adam, I have a solution for you. If you don't want to pay taxes to support the services that support other Americans, you are welcome to leave. I have friends that did that (they moved to New Zealand.) I also know that the free wheeling style of government that most libertarians long for exists in many 3rd world countries. The Philippines for example or Belize; In either place, English is widely spoken in both countries and if you have enough money you can buy pretty much the life you want for yourself. They don’t bother with pesky things like public health and education. Aside from the tropical diseases, I hear they are both rather nice.

Frankly Adam, your attitude is an insult to all of us who sacrifice money and time to serve the public - to educate the doctors, nurses, scientists, cops, lawyers, dentists and other professionals who will take care of you. Think of it like a homeowners association fee. You have a vote at the table along with everyone else and right now, we’ve voted to educate our kids, give healthcare even to people who can’t pay and to prevent homelessness and starvation to the extent that we can. If you don’t like it, move out.
 
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