Why does the University of Alaska need a billion dollars a year?

Photo courtesy Jerry "Woody", Flickr, Aug. 24, 2008

Even though Governor Walker, his water carriers in the democrat minority in the legislature, and local media are doing their level best to orchestrate a raid on the Permanent Fund, the dividend, and install as many new taxes as humanly possible, it is up to the rest of us to take a coldly critical look at state spending and ask why we are spending what we are spending.

Do not forget that this very same governor ran on a promise to cut 16% state spending the first year in office. He didn’t get very close last year. He will be even farther away this year.

I will first take a look at the University of Alaska (UA) system and see how it might restructure to meet new educational needs in a time of sharply decreased revenues.

The UA system took a 1.1% hit from FY 2014 – 2015 falling from $853 million to $844 million. However, there is an oddity as the FY2015 Final budget is listed at some $929 million, a 9% increase over a year. Proposed spending for FY2016 and 2017 are both over $916 million, with the Board of Regents request at a whopping $963 million for FY2017, a 13% increase. These guys are demonstrating a real approach to austerity. Not. https://www.alaska.edu/swbir/budget/FY2017_Redbook_Final_Web.pdf

The University system is also a land owner, with around 500,000 acres of land mostly managed to fund an endowment. In 2009, the last date I could find records of, the endowment was worth some $155 million and generated a yearly revenue stream of just over $10 million. http://www.alaska.edu/fund-accounting/land-grant/fy09.pdf

The University system is trying to keep up with new technology, proposing to spend a whole $2 million in FY2020 to upgrade its classrooms for online course work. This is too little, too late, as everyone who shows up at a campus these days has some combination of smart phone, tablet or laptop any of which can handle online coursework.

Today, the technology has progressed to the point where the vast majority of undergraduate course work can be done online via previously recorded, canned courses. The University of Phoenix, MITx and Coursera are particularly outstanding examples of this available coursework. Note that most of these do not require physical classroom attendance. Some are fee-based. Some are free.

Other examples include Kahn Academy which specializes in math education from preschool through post-graduate levels. A commercial outfit called The Great Courses makes popular courses available via DVD and online for a nominal fee.

While outstanding, online training will only take you so far, so there must still be infrastructure and manpower available for lab work, work in the field, and work that has yet to be canned. Interestingly enough advances in artificial intelligence, virtual reality and gaming systems are making large strides to fill those needs.

The educational world is quickly moving to an online presence, something that the University of Alaska system has poorly embraced. This has allowed them time to dabble with feel-good exercises in self-congratulation like tobacco bans from campus, bans of the Mississippi state flag because it is somehow associated with slavery (as an aside they are embracing Islam which is actively buying and selling slaves right now today), and fighting an effort to allow concealed carry on campus.

I would propose that the UA budget be cut 50% over the course of the next few years and they be given clear, unequivocal direction to shift their focus to distance education for undergraduate work. Infrastructure spending would shift from buildings, plant and dorms to servers, storage, broadband and new Alaska-centric content.

The entire educational world is changing fast. It passed the worldview of the current University leadership here in Alaska and elsewhere, who seem locked into a view of the world and educational structure that worked 50 years ago. That world is long gone. And soon so will oil revenues that kept it afloat in Alaska.

The new world will be much more responsive to the needs of the students rather than faculty and administrators.