CSU works to turn being green into profit

The historic administration building at Colorado State University. (Photo/Jason Kosena)
The historic administration building at Colorado State University. (Photo/Jason Kosena)

Copyright 2008, The Colorado Independent

It’s trendy being green these days, and Colorado State University isn’t missing a beat.

Since taking the helm in 2003, President Larry Penley has worked to re-brand CSU as a green beacon in an increasingly crowded field of renewable energy research. Hoping a green reputation will lead to increased R&D funding at CSU and more stable financial footing, Penley has incorporated an aggressive public relations campaign, increased political lobbying and a beefed-up marketing effort — including full-page advertisements in TIME magazine and on television stations nationwide.

To pay for it, CSU has shifted money away from the academic colleges and the library system since 2003, while substantially raising student tuition and mandatory fees. As a result students have been hit with a 52 percent increase in tuition over five years, mandatory fee increases of more than 70 percent, larger class sizes and a dwindling number of courses taught by tenured professors.

The end game, school officials say, is a hope that more university research will move to the commercial market and, in the long run, provide CSU with a new stream of revenue — some of which they say can be used to improve the undergraduate program that helped pay for it.

The question is will it work?

Research to market

When Penley arrived at CSU in 2003, Colorado was recovering from a recession that saw drastic funding cuts to higher education. The new president turned to high-paid executives to help the school solicit donors, venture capitalists and corporations to help fund efforts to enterprise university research to the commercial market through for-profit companies.

With the help of a CSU research foundation called CSURF, university officials are creating private spinoff companies in order to benefit from intellectual capital produced through the university’s research. The profit generated by the spinoffs, officials say, will be split among the researcher and the university, which can help cut CSU’s dependence on state funding to operate.

Examples of existing CSU spinoffs include Solix Biofuels, which is working to create alternative energy technology, and Envirofit, a company designed to bring clean cook stoves to third-world countries.

“If a company is started and is successful, then CSURF will hold an equity share in the company, and the university could choose to sell that at any time,” said CSU Provost Tony Frank. “The money gained from the sale, most of the time, would go to pay off the costs associated by CSURF and then also to the university’s general fund, at which point it could be used for academic funding. In the end, I think people can and should take a look at this investment and say, ‘Is it good for CSU?’ But I also think when looking at the entire picture, it’s a fair and balanced approach.”

Although most applaud Penley’s effort to seek alternative revenues amid unreliable state funding, some CSU professors are concerned over the possible long-term impact on the university. CSU tuition has risen dramatically, as have mandatory student fees. Questions about affordability are being raised, as are concerns about using tuition money to fund research-related activities that generate for-profit ventures that ultimately have little impact on CSU’s undergraduate students.

“We have a president who is a former dean of business, so naturally we are engaging in activities which we have not necessarily seen with prior presidents, who were in most cases from a non-business background,” said C.W. Miller, a professor in the biomedical science department at CSU.
“Fresh, new ideas are great if they pay off in a reasonable time, but oftentimes administrators enter an institution, make major changes and then leave before major results have occurred, and in many cases, once the administrator is gone, a new one enters and those earlier programs are canceled.”

Miller acknowledged that a reputation as a well-respected research institution could benefit CSU students and faculty, but also wondered if Penley’s rapid approach to reshaping the state’s only land-grant institution into a quasi-private R&D facility has been done with enough consultation with the necessary people.

“No one to my knowledge has asked the nearly 1,000 faculty what their ideas are about new directions and areas of emphasis,” said Miller, who has been at CSU for nearly four decades. “There are lots of bright faculty in our ranks, and to think that a few administrators could come up with a sound plan that is in the students’ and the faculty’s best interest is amazing.

“One overriding question always should be: ‘How can we improve the learning experience for students so that they leave here better educated than their predecessors?’ That should be foremost in our minds and should guide our main objectives.

A horse of green color

Competition for research grants, faculty and students in the world of higher education is fierce. In Colorado alone there are a number of premiere research institutions, including CSU, the University of Colorado and the Colorado School of Mines, that are all competing for a limited number of grants, faculty and students.

As in any industry, standing out in the crowd brings added benefit.

A green image nationwide, CSU officials say, will better attract faculty, students and research grants to CSU, despite lacking the state support other peer institutions receive. To go green, CSU has increased advertising in recent years, including full-page spreads in national magazines and sleek television ads nationwide depicting windmills in green fields with a Colorado State University logo in the frame.

The PR blitz, combined with renewable energy research already happening, will work to build a new reputation of a green research institution on the run, officials say.

“A good reputation goes a long way,” said Rich Schweigert, CSU’s chief financial officer and director of system operations, in an interview last spring. “Not only can it help you attract research grants and faculty, but it can help all of CSU’s students by improving the value of their degree after they graduate. When people think of MIT, they may not know anything about the school, but they know it’s good and subsequently place value on the degrees that come from there.”

The competition to gain students and the money they bring with them is heavy as well. In addition to constructing a number of new dormatories on campus in recent years, officials have increased state funding going to the Athletic Department by 135 percent. Coming off one of the worst football seasons in recent memory, university officials said beefing up the Athletic Department will help attract out-of-state students (and their big tuition checks) who are looking for a college experience — good sports teams included.

“If you are successful with an athletic program, the value on student recruiting is tremendous,” Frank said. “If you bank on being a Final Four (basketball) team or on (football) Bowl Championship and you don’t make it, did you waste that money? That is a hard question to answer, but time and again the record shows universities with strong athletics programs do well in recruitment.”

Penley’s efforts — ultimately approved by CSU’s Board of Governors, a volunteer group of political appointees — have been made largely out of site from of the state Legislature and governor’s office. Earlier this week several higher-education officials and lawmakers had different reactions when they learned for the first time of the shifts from a Colorado Independent investigation. But all of them said they are interested to see how successful the effort will be in the long run and, most importantly, how much of any future success will end up back in the classroom.

“It is in the nature of things like this, CSU’s initiative to position itself into a leading green research institution, that it’s not an overnight thing, and we will not know how successful it will be in the long term,” said David Skaggs, executive director of the Colorado Department of Higher Education. “The big question in these kinds of efforts is whether or not they will have a direct benefit in the classroom as the CSU administration is asserting it will.”

Ed. note: This is the fourth in a series examining the shifting funds and priorities at Colorado State university.

Read more at CSU’s president triples own budget, strips away cash for academics — the result of a months-long investigation by The Colorado Independent detailing how tax dollars have been shifted away from academic and library programs into mushrooming budgets of central administration and athletics programs.

Read more at Are efforts to go ‘green’ at CSU busting Colorado’s middle class — the result of a months-long investigation by The Colorado Independent detailing how tax dollars have been shifted away from academic and library programs into mushrooming budgets of central administration and athletics programs.

Lawmakers and state officials weigh in on the investigation in Reaction on CSU funding shifts range from dismay to dismissive

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