Friday, February 7, 2014

UA/UAA| Enough already, the postscript ...

Oddly enough given the popularity of some of the subjects I have written about before, the piece I wrote yesterday ("UAA| Enough already ...") has completely blown past the previous record for most hits in the first 24-hour period after being posted.  The piece hit the 24-hour mark with 700+ hits, which is short of The Drudge Report and maybe even, closer to home, Amanda Coyne's, but is a high number for "oil and fiscal policy nerd" blogs of this ilk.

As those of you reading this follow up will likely already know, yesterday's article was about UAA's request for an additional $2.7 million in state funding to cover the operating costs of its new sports arena, which, unlike every other similar arena built in the United States in the last 20 years, has been built entirely from state funds.  (Most other similar arenas built during the same period have required at least 50% alumni and donor buy-in before turning the first spadeful of dirt.  And, some, like the University of Virginia's John Paul Jones Arena are at the other end of the spectrum, having been built almost entirely with private funds.)

Not unexpectedly given the number of hits, I received a few follow up notes and posts.  Some were critical, saying Alaska is small, unique and its University system is relatively young, and as a result we shouldn't be surprised that the state needs to provide the bulk of the funding for such facilities.

My response to that is simple:  first, the University of Alaska system isn't that young (the University system itself was founded in 1917 and UAA dates from 1970, now nearly 35 years ago); second, UAA didn't even try to raise private funds for the new arena (I recall being at early meetings where I and one other raised the issue of developing an effort to raise private funds, and watching Dr. Cobb, sitting at the end of the table, shake his head and say no, the Legislature will take care of us); and third, if that's true, we should have built a facility more in line with Alaska's fiscal condition, rather than a $109+ million "Taj Mahal" that will likely stand going forward mostly as a memorial to the state's excesses during the early 2010's (the boom before the following bust).

Most writing notes agreed with my points, however, adopting the same basic premise that the University system either needs to develop a supportive revenue stream from alumni and donors or accept that it will receive increasingly lower levels of funding.  One was explicit, suggesting that, in these economic times, other state programs, such as K-12, should not be expected to accept lower funding levels in order effectively to "subsidize" a University system that is failing to help itself by developing the alternative sources of revenue successfully solicited and used by its peers.

And one note in particular was thought provoking.  The comment pointed out that the leaders of both the University system as a whole (Patrick Gamble) and UAA, the system's largest campus (Tom Case) are former military generals, whose careers have continually focused in one way or another on obtaining government funding of various projects.  That skill set, the commentator suggested, is significantly different from that required to raise funds from alumni and private donors.

To a large degree, government funding of the military (or, the reader suggests, a public university) is a given, and obtaining funding is a matter of simply convincing a small group of people to give what essentially is other people's money to your project over another.

On the other hand, convincing alumni and private donors to contribute money is a much different endeavor.  Giving their own (or corporation's) money to a given university is far from a given, and even if they are of a nature to be generous, there is a lot of competition for the dollars among a wide range of institutions.  From personal experience, I can attest that the sales effort required to be successful in a private context is far different, and far more intense, than supporting requests for funding from government.

The writer of that comment ultimately suggested that in order to change the intensity and success of the University's private fundraising efforts, changes in leadership may be required.

That may be the case.  In the same 2011 report to President Gamble referenced in yesterday's piece, the outside consultants he retained had this to say (at p. 63-64) about private fundraising efforts directed toward "major gifts and planned giving effort[s]."  Such targets are the keystone of any successful private fundraising effort:
The Chancellors, in coordination with staff or key volunteers, are crucial to soliciting these gifts and providing careful stewardship and attention to this group of donors.  Planned gifts provide examples for others to follow, and the Chancellors, with appropriate help from the President, must be in the forefront of this fund raising activity.
Certainly, my most recent experiences with Chancellor Case and indirectly, with President Gamble, have not reminded me of past, successful efforts by other university presidents and deans in soliciting my support for their institutions.  I honestly have never dealt before with (or even heard about) an institution like UAA, that takes a donor's money at the same time it takes preemptive actions in secret proceedings.

But that could just be me and Gamble and Case may have the ability, if directed and incentivized, to refocus UA and UAA's efforts on developing external revenue streams.  If so, however, they need to do it quickly.

The commentator who suggested that UA's failure thusfar to develop significant alternative revenue streams is effectively hurting other state programs is correct.   There is a substantial amount of demand within state government for the limited funds that are available.  If UA took less because it was able to rely on another revenue stream more, some other program (or, perhaps more beneficially, Alaska's future generations) would receive the remainder.

Others are going to start reaching the same conclusion soon, perhaps as soon as during this legislative session.  They will want President Gamble and Chancellor Case to have answers.  Either they need to, or the prior commentator may prove right, their usefulness may have reached its end.