Appendix: Cutting Costs and Generating New Revenue: Strategies in ActionBack to table of contents
Since the Great Recession, states have reduced their contributions to public higher education; for example, California cut $220 million from the budget of the University of California, Berkeley alone. The Lincoln Project proposes a range of programs, to be adopted in combination, to help public research universities make up the budgetary shortfall, bring stability to their institutions, and ensure excellence in education in the twenty-first century. Many institutions have already created such programs, with great success. Here are a few examples:
- The University System of Maryland’s Effectiveness and Efficiency Initiative yielded $356 million in savings during its first ten years.54
- Through aggressive price negotiations with suppliers, the University of Pittsburgh’s cost saving efforts have saved more than $120 million over the past five years.55
- Miami University’s MU–Lean project, launched in 2009, has identified $37 million in savings and new revenues.56
- The Purchasing Consortium for the Committee on Institutional Cooperation, which includes fifteen Midwestern universities, has saved $7.5 million by negotiating prices with campus suppliers, including Enterprise Holdings, Inc., and OfficeMax.57
New Revenue Streams
- The University of Virginia, the University of Texas at Austin, and the University of California, Los Angeles have successfully launched or completed $3 billion-plus campaigns.
- The University of Wisconsin, Madison completed a $100 million matching challenge from a private donor to support chairs and professorships.
- The University of Texas at San Antonio recently completed its first-ever capital campaign, raising $180 million. The campaign, which also employed matching challenges, provided $62 million for student scholarships and fellowships, $44 million for faculty support, $19 million for research and outreach, and $50 million for student life and facilities.58
- Ohio State University brings in more than $20 million per year from relationships with corporate partners, including through student internships and sponsorships. By leasing out its parking system, the university has also generated $483 million, which was invested in the university’s endowment, generating $62 million annually for scholarships, faculty positions, and other academic priorities, such as research and teaching.59
54 Delta Cost Project, Trends in College Spending 1999–2009, 20.
55 University of Pittsburgh, The University of Pittsburgh—Cost Containment Efforts.
56 Kristal Humphrey, “Lean Training at Miami Gains Weight with a $250,000 Grant,” Miami University Campus News, January 7, 2016, http://miamioh.edu/news/campus-news/2016/01/lean-grant.html.
57 Committee on Institutional Cooperation, 2014–2015 Annual Report: The Power of the Collective (Champaign, Ill.: Committee on Institutional Cooperation, 2015), 11, https://www.cic.net/docs/default-source/reports/cic-annual-report-feb2016.pdf?sfvrsn=6; and Committee on Institutional Cooperation, “Purchasing Consortium,” https://www.cic.net/projects/purchasing-and-licensing/purchasing/introduction.
58 “UTSA Raises $180 Million in First-Ever Capital Campaign, Exceeds Goal by More than $60 Million,” UTSA Today, October 6, 2015, http://www.utsa.edu/today/2015/10/capitalcampaign.html.
59 Data drawn from responses to a survey the Lincoln Project sent to public research universities nationally.