Photo by University of Hawaii-West Oahu is licensed under CC BY 2.0
Is there anyone who does not know about the funding crisis in higher education? After headline-grabbing budget cuts in dozens of states with strong public universities, there is even more urgency to find new funding options.
Almost every state in the nation has made significant reductions to public funding for higher education. Between 2000 and 2012, state-supplied revenue per student fell by 37 percent and student populations grew by 45 percent. That is jaw-dropping data!
In this environment where public officials must “do more with less,” well-placed public-private partnerships (P3s) offer an attractive option to university executives. Collaborative efforts between industry and public colleges and universities offer long-term benefits to both parties. The P3 projects have been diverse. Some involved construction of new facilities, research labs, sports stadiums or student housing. Other types of P3s have resulted in revenue-producing development on university campuses.
Other countries are well ahead of the United States in leveraging these types of collaborative efforts. Among developed nations, the UK, Ireland and Australia have the strongest history and the greatest investment in P3s in higher education. Currently, privatized student housing developments are the most prominent form of P3 activity in the U.S.
In May 2015, New Jersey City University broke ground on a $400 million residence hall designed to double the school’s student housing capacity. Texas A&M University in College Station also recently announced a plan to partner with two private firms to develop and manage a 3,400-bed student housing complex.
At the University of California, Davis, a partnership recently secured nearly $7.5 million in grants to explore a project that will involve development of a Zero Net Energy (ZNE) development design. The university also has announced plans to build a photovoltaic plant near campus that will provide 14 percent of the energy needs for the entire UC Davis campus.
Beyond housing projects, public-private partnerships have been successful in a variety of other settings. Metropolitan State University of Denver partnered to build an on-campus hotel that greatly enhanced the school’s hospitality education program. Partnerships with real estate development firms and City University of New York and Stanford University resulted in turning underused university-owned properties into revenue streams, quickly and efficiently. All parties benefited from the results.
Technology firms are also beginning to develop innovative partnerships with universities. Cisco’s Networking Academy uses the P3 model to create the “world’s largest classroom” with more than 9,000 academies in more than 170 countries. The technology sector is also developing research incubators and technology development sites at The University of Texas at Austin, The Greater Philadelphia Innovation Cluster and the University Research Corridor (a coalition among Michigan State University, the University of Michigan, Wayne State University and corporate partners such as Pfizer).
There is little argument about the value of collaborative partnerships. In fact, P3s are among the most attractive funding options for colleges and universities in America. If you are interested in learning more about higher education public-private partnerships, contact our sales team for the latest P3 news and research.
Hats off to visionary public leaders for charting new territory!