Long: What is the University of Virginia doing with
$2.3 billion?
By John Long | Long is the education director for the National D-Day Memorial. | Posted:
Thursday, July 14, 2016 2:00 am
I attended the University of Virginia once upon a time.
While it long enough ago that I never googled a single
thing in graduate school, I did not (contrary to the
opinion of my children) meet Thomas Jefferson while
enrolled. Still, I can’t help wondering what he would
think of the latest hubbub in his Academical Village.
The recent flurry at Mr. Jefferson’s University started
last week when Helen Dragas, the former rector of the
school, wrote an opinion piece in the Washington Post
alleging that the school has an enormous, and ominous
sounding, “slush fund,” which was “hidden in plain
sight” from the board she headed until June 30.
And we aren’t talking about a couple of twenties
found in an old pair of pants. The number Dragas
cited was $2.3 Billion. With a B.
SABRINA SCHAEFFER | The (Charlottesville)
Daily Progress
Helen Dragas, a former rector at the
University of Virginia, was at the center of
a controversy surrounding the efforts to
oust UVa President Teresa Sullivan in
2012.
Now, I should note that Dragas’ term as rector was hardly drama-free. She will always be
remembered for leading the abortive charge in 2012 to remove university president Theresa Sullivan
from office, which touched off a faculty/alumni revolt. Sullivan was reinstated within days, but it’s
not hard to imagine that hard feelings have persisted on both sides.
Dragas’ opinion piece was in the Post — no lightweight newspaper — and presumably the editorial
board there would not have considered it for publication if they did not see some credibility to her
assertions. But the use of the term “slush fund” implies — does it not? — a hidden pool of funds with
no oversight and potentially available for illicit purposes. I’m not sure what she describes quite fits
that description.
But at the same time I’m not sure that many outside UVA have a clear picture of what’s happening
with all that money. The current university rector, William Goodwin, issued a statement the day after
Dragas’ piece, clarifying that “All of the board’s actions regarding the . . . long-term financial plan
have been discussed and voted on in public session. The monies have always been included in the
university’s audited financial statements.”
Assuming that’s accurate, it reassures at least me. Normally folks who squirrel away slush funds don’t
open up the books to CPA’s.
The mountain of moolah is less secret stash than a “strategic investment fund” the Board of Visitors
(then headed by Dragas) created in February as part of UVa’s “Cornerstone Plan.” That ambitious
proposal sets the direction for UVa for years to come.
So I don’t think Dragas’ terminology is quite fair. I’m no expert on high finance by any means, but it
seems to me that the university made a conscious decision to take an existing expenditure account,
rename it and revise the purpose from funding university operations to funding strategic initiatives.
You can argue if those initiatives are worth the cost, but I don’t think it was a secret conspiracy.
Other questions remain, however. Dragas claimed the Board of Visitors was unaware of the source of
the monies in this new strategic fund, or of the size. It sounds like info the board should have had. Is
her version accurate? If so, what explains this lack of information for the overseers of the school? Did
they fail to ask the right questions, or did the administration withhold some selective data? Or is
Dragas misrepresenting the facts? I can’t say, but inquiring minds want to know. Someone in
Richmond should certainly be asking some questions, and folks in Charlottesville should be
forthcoming with answers.
Dragas’ column raises another issue: Is this Cornerstone Plan the best use of more than two billion
dollars? As she points out that amount of money could “run the entire University Academic Division
for a year and a half. It would pay the four-year tuition bills for 44,000 Virginia students . . . a
conservative estimate of its annual earnings potential — $100 million — could be used to cut the
tuition of all in-state undergraduates by 70 percent.”
I didn’t check her math on this assessment, but I think anyone who looks into higher education these
days will find boatloads of money spent on things that have little to do with educating students per se.
No top-flight research university can remain competitive without some bells and whistles to lure
students and faculty. But from outside of the Ivory Tower, much of this extraneous spending, as well
as the ever-rising costs of tuition, make ordinary folks shake their heads.
After all, we’re talking about $2.3 billion. How long before donors start asking why they should send
money to an institution with that much money already in its coffers?