UConn perpetuates high costs

Recently, UConn's capital budget spending practices have come into question. Aside from bad procurement practices, it is also clear the university has failed to implement reforms in the capital budget that would have reduced operating costs.

First, the university decided not to use UCONN2000 money to build Leadership in Energy and Environmental Design (LEED) certified buildings that would have saved hundreds of thousands of dollars. Instead, the university built inefficient, conventional buildings with high operating costs. Second, the university has failed to gradually upgrade its vehicle fleet. Instead, the university continues to purchase vehicles with excessively high fuel costs. Third, the university has neglected the possibility of establishing a revolving loan fund. Instead, the administration wastes valuable operating dollars to pay for the use of out-of-date capital.

LEED is a voluntary, consensus-based national standard for developing high-performance and sustainable buildings. The program attempts to improve standard construction practices so the owner of the building will face lower operating and maintenance costs through resource efficiency and waste reduction. A number of institutions, including Eastern Connecticut State University, have begun saving thousands of dollars under LEED certification. Even from a billion dollars, the university has not produced any LEED certified buildings.

The university believes LEED buildings have high up-front costs at the time of construction that may jeopardize the number of projects built. However, such a claim is misleading. Yes, LEED certified building do have higher up-front costs. However, the additional costs are minimal - usually an increase of two to seven percent on the building project.

For example, take a Denver building that cost $66 million to build. The cost to make the building LEED certified was just under one million dollars. The result was annual savings of $145,000 in energy costs and $150 of operational costs. The state legislature gave the university nearly a billion dollars to fund capital projects. Certainly, an additional million dollars on a large-scale project is worth the investment. If the university can find a million dollars to renovate President Philip Austin's house, it can find an additional million dollars for each capital project. If LEED certification reduces the number of capital projects available through bonded money, the university is still better off. UConn had the chance to save operating dollars, but lacked the courage to change the status quo.

With regard to the vehicle fleet, the university still uses energy inefficient and obsolete gas golf carts. Many other universities use electric carts that operate at a much lower cost to the university. Furthermore, in a fleet of 500 university vehicles - maintenance, police and departmental - the university has only one hybrid car. If hybrids or more efficient conventional models replace these cars and trucks, the university could save thousands of dollars in gas costs annually.

Certainly, the purchase of new efficient vehicles will have small increased costs. However, when replacing old vehicles the university could buy these models and thus phase in the improved models. The benefits would pay for the increased costs over time. A report by the state of California concludes such logical and gradual purchases will help save operating dollars for other needed projects. Once again, the university had the chance to begin this process, but has knowingly decided to continue to purchase inefficient vehicles that raise operating costs.

Finally, the university has rejected the establishment of a revolving loan fund. A revolving loan fund, like the one established at Harvard, would provide interest-free loans to university groups seeking to make capital improvements. The fund is supervised by professors and distributes money to improve campus infrastructure on the condition that the improvement will pay for itself in the next five years. As the improvements save costs for the university, the savings are paid back into the fund. After the loan is returned, the university continues to reap the benefits of the savings.

By setting up a fund of only $3 million, UConn could save millions in the next few years. For example, an allocation of several thousand dollars to upgrade air conditioners at Harvard saved the university $500,000 per year. At UConn, the fund could be invested in projects such as improving heating, boilers and water piping. These improvements would save hundreds of thousands a year. The greatest part of the fund is that it is self-sustaining and does not require an annual appropriation.

The university also had the opportunity to create a revolving loan fund. Once again, UConn rejected a meager upfront cost that would have reduced long-term operating costs by millions.

UConn is currently struggling to fund its operating budget. Given alterations in state aid and increasing enrollment, the university has struggled to fund the most essential part of its mission - faculty.

After labor costs, one of the largest costs in the operating budget is energy and building operating costs. Because of high energy and building costs, UConn has not had the operating dollars to hire needed faculty. For example, the College of Liberal Arts and Sciences was forced to lower academic standards because of the inability to staff the necessary number of "W" classes. It is estimated they could keep the standards for an additional $544,000 - the amount of one year's benefits from one or two LEED certified buildings.

When debating a one-year tuition freeze, the administration claimed the policy would hurt the operating budget. The university should be honest with the legislature. By failing to implement the above reforms, the administration has freely decided to lower the amount of money that can be dedicated to faculty, while also raising the cost of tuition to students. Yes, a one-year tuition freeze would have lowered the amount of money in the operating budget, but the university's own financial choices, mismanagements and inefficiencies have crippled the operating budget for a period of many more years to come.

Austin often talks about the importance of investment in the capital budget. Perhaps he should investigate the type of investments we are making to our capital. Upon close inspection, it is evident strategic investment could save millions in operating dollars, which could fund more faculty members. When they do, the student body will be much better off. University Vice President and Chief Operating Officer Linda Flaherty-Goldsmith could not return a request for comment.