The Stern School of Business communicates the following serious concerns about NYU 2031:
-
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.
- 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.
- 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.
- 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.