Broke, Really?

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With the latest economic downtown, the poverty cry of universities has become pretty well accepted: endowments down, layoffs, cuts in services, a decline in tenure-track jobs. The schools just can’t afford such luxuries.

But most of this information comes from college administrators. But actual academics are skeptical, however. According to an article in Inside Higher Ed:

Saying they’re unconvinced by bleak financial reports produced by university business chiefs, increasingly skeptical students and faculty are outsourcing number crunching to independent auditors, often with the hope of exposing hidden pots of money in cavernous college coffers.

Administrators say we’re broke? That’s not what our accountant tells us. Such is the sentiment at the University of Maine, where a recently completed audit challenges the notion that the university is in dire straits and will have to cut positions. Drawing primarily upon audited financial statements, an Eastern Michigan University accounting professor issued a student- and faculty-commissioned report last week that found the Maine system’s unrestricted net assets grew to $84 million in 2009, up from about $50 million in 2005.

Of course, as anyone who’s ever done salary negotiations knows, “tough times” are a matter of perspective. Tough times at Harvard University means the school has an endowment of $26 billion. By this standard a school like Vermont’s Green Mountain College is always experiencing tough times.

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Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer