Faculty union accuses State System of mismanagement

An analysis commissioned by the faculty union and released Tuesday says seven state-owned universities, which claim faculty layoffs are needed, mismanage their budgets and lack accountability and oversight.

The state system, however, says it believes the report is replete with factual errors.

The Association of Pennsylvania State College & University Faculties, which represents more than 6,000 faculty and coaches, commissioned the 164-page analysis of the state universities that claim faculty layoffs are needed to balance their budgets, communications director Lauren Gutshall said. Those schools are Cheyney, Clarion, East Stroudsburg, Edinboro, Kutztown, Mansfield and Slippery Rock.

APSCUF president Steve Hicks said the union is troubled by the mismanagement of public dollars.

"Every university is using a scheme to transfer debt to 'component units,' including the university foundations and student housing associations," he said. "Money that the public believes is dedicated to academics is instead going to these affiliates to pay for buildings."

These entities absorb debt for "new dormitories and other lavish construction," Ms. Gutshall said.

Pennsylvania State System of Higher Education spokesman Kenn Marshall said no public dollars -- tuition or state appropriations -- are used for auxiliary facilities. Such operations are funded solely through student fees, including room and board, he said.

In October 2012, the state system put its debt total at $942 million, double what it was a decade ago. But after factoring in privately financed student housing and other projects built by university-affiliated groups -- a sum estimated by Moody's Investors Service to be nearly $1 billion -- total debt associated with the 14 universities is closer to $2 billion.

"I think it is clear from the actions several universities have had to take, we're facing hard financial times," Mr. Marshall said, adding such steps ensure the long-term stability of state universities.

He said the analysis didn't account for the biggest financial difficulty facing state universities: personnel costs and rising heath care and pension costs.

Boyer & Ritter has also been commissioned by the faculty association to look into the financial statements at Bloomsburg, California, Indiana, Lock Haven, Millersville, Shippensburg and West Chester universities, Ms. Gutshall said.

Source: Post-Gazette