Calling Uncle: Is UVA seeking a federal bailout?
The double-page ad in the Washington Post, New York Times, and Boston Globe December 16 is a lengthy letter to President-elect Barack Obama that starts with a high-toned "Statement by Public Higher Education Leaders Convened by Carnegie Corporation of New York." Way down at the bottom of 2,000-word epistle, the 54 signees get to the point: Public universities want a bailout, a cut of the new chief executive's stimulus package, and among them is the financially battered University of Virginia.
"I think it's totally unreasonable," says former city councilor/radio host Rob Schilling. "That means they're asking for money out of my pocket, and my wallet is a little thin right now."
Certainly it's tough times in the world of public education. UVA's endowment has lost around 20 percent– nearly $1 billion– and that's before the fourth quarter report. Governor Tim Kaine announced December 17 that his plan to keep the state from going broke from its nearly $3 billion shortfall includes taking $23 million out of the $160 million in state monies UVA normally would expect receive.
Schilling suggests belt tightening. "If they want more," he says, "they should ask delegates or legislators to carry a bill to get them an extra penny in sales tax. To funnel it through the feds hides this."
But George Soule with the Carnegie Corporation of New York, an Andrew Carnegie-founded philanthropic arm, defends the request to Uncle Sam, pointing out that increased innovation fuels job creation. "An investment in public education," says Soule, "is an investment in the economy."
And UVA says it's already been tightening its belt.
"We're feeling the effects of the national downturn," says chief operating officer Leonard Sandridge in a December 17 conference call. "The state reductions and general economic downturn have forced us to look at every aspect of our operation."
While the university has vowed that layoffs are not part of its effort to reduce costs, even Sandridge says he's never seen a period in the economy like this one since September 1. "We don't have layoffs in our plan," says Sandridge, "but we don't know what the next six months will bring."
Sandridge points out that the federal economic stimulus package targets infrastructure and capital expenditures, not any university's operating budget.
Will universities get some of the federal funds? UVA prognosticator Larry Sabato isn't sure. He is sure, however, that asking early is a smart move.
"You want to get that idea on the table," says Sabato. "There's a near 100 percent certainty that a large–- and I mean very large–- stimulus package will be passed."