The FAS Department of Economics communicates the following serious concerns about NYU 2031:

  1. Costs and financing: The acquisition of 6 million new square feet will be tremendously costly, amounting to several billion dollars, putting a significant strain on the University's finances. The NYU administration has declined to share information with the FSC on the financing of the plan, except to acknowledge that it will not come primarily from philanthropy, but instead from other sources such as debt and dorm funds. The NYU 2031 phasing document implies it will take, at minimum, 6 years for any revenue to flow in from dorms, hotel, etc. Therefore up-front financing costs imply that interest payments alone could be hundreds of millions of dollars a year. We are concerned about financial risks and the possibility of default. We are concerned that these large costs will be paid for by some combination of higher tuition rates, a larger student body, lower teacher-student ratios, fewer tenure-eligible faculty, reductions in real faculty salaries over time, and smaller benefits. These changes would increase the risk that we will lose out on top faculty and student talent to our competitors.
  2. Financial priorities: We have concerns about whether this is the right way to spend such a large sum of money. For example, a recurring difficulty in hiring and retaining top faculty is the absence of a good school and childcare provided by NYU. This could be achieved at a tiny fraction of the cost of NYU 2031. An open discussion of competing priorities is essential for NYU to allocate funds in an effective fashion. We are concerned that the financial priorities are not clearly and explicitly formulated to enhance research excellence and that the current plan will erode the progress NYU has made toward joining the elite research institutions of the world.
  3. Recruitment, Retention, and faculty well being: 40% of faculty live in residences that will be located on a live construction zone for almost 20 years. Once the construction is completed, the residential complexes will be located in far more densely populated areas, surrounded by high-rises, with less green space, less park space, less light. We are concerned that this will have a significant adverse effect both on faculty well being and on our ability to recruit and retain top faculty.
  4. Rationale, faculty consultation: We are concerned that the economic and academic rationale for this expansion has not been well articulated, nor has there been serious consultation with faculty on these questions. Moreover, the University has declined to comply with reasonable requests by the Faculty Senators Council to provide information on the financing of its plan. Other than a proposed new gym, the NYU 2031 plan is vague about the uses of additional non-residential academic space. If the goal of the plan is to provide more academic space per student, we do not understand why such a large fraction of the space is slated for non-academic use (dorms, retail space, a NYC public school, and a hotel). Details on the financing of the plan are insufficient to conclude that it can be paid for without further scaling up the size of the university.

In conclusion,while we recognize that space is tight, we ask that the administration work directly with faculty governance bodies, as partners, to reconsider the current plan so as to fully address these concerns and provide justifications for why the current plan is the appropriate priority for the university. Furthermore, we request that all the financing details of this specific plan (e.g., the estimate of cost, the possible streams of revenue and savings, the impact on the operating budget and debt, etc.) be made fully available.