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Money, not students are the priority at the University of Minnesota

The regents and presidents of the University of Minnesota have increasingly been moving more and more assets away from struggling students and into the pockets of overpaid administrators.

University of Minnesota
University of Minnesota

One of the most treasured tenets of the American Dream is that adults will leave to their children a better world than they inherited. The focus was always on the betterment of our children.

Tragically, that aspiration is being assigned to the ash heap of history as instant gratification and greed rise to the fore. Nationally, our adult leaders have not balanced the federal budget in more than 20 years and have been using the tax system to lighten the burden on the affluent while passing on the debt to the young.

Then, of course, our love of sports is so out of control that we use public monies to subsidize billionaire team owners with luxury stadiums while reducing our commitment to education. In Minneapolis, Minnesota taxpayers are still paying off the $150 million of debt plus interest incurred to fund a football stadium for a billionaire owner while imposing draconian cuts to its schools.

Not to be outdone, the regents and presidents of the University of Minnesota have increasingly been moving more and more assets away from struggling students and into the pockets of overpaid administrators. Currently our undergraduates at the University of Minnesota are paying $3,000 a year more in tuition than the national average for public universities, which includes $1,700 more than the national average that universities incur per student in administrative costs.

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The university itself reports that student life is becoming increasingly unaffordable with 43.6% of undergraduates worried “about the ability to pay for housing” and another 20% enduring “food insecurity.” Just imagine the stress and poor nutrition this causes.

And all the while, the regents and top administrators are focused on improving their own well-being. This should not surprise us because previous reports have shown that the university pays its administrators far higher salaries than all levels of government from municipal to county to state to federal. For instance, the general counsel for the university makes more than $200,000 more than our state’s attorney general and $100,000 more than the Chief Justice of the U.S. Supreme Court and some $150,000 more than the United States Secretary of State.

All too typical of this differential was the hiring by the University of Minnesota of Myron Frans, the state’s Commissioner of Management and Budget in August of 2020. Although the positions were comparable, the pay differential was significant. Frans’ compensation moved from $158,000 at the state level to $399,000 plus another $50,000 to $80,000 in deferred compensation along with a far more generous pension. Interestingly, the University of Minnesota was in the midst of a $166 million shortfall at the time.

Since 1991, the school’s president’s salary has soared some 500% from $152,300 to $805,950 not including retirement contributions and other benefits that put the total well over $1 million. Meanwhile, tuition and fees for students has risen from $2,728 to $15,859. Unlike 1991, students can no longer work their way through college and, therefore, many rely on students loans. On the average, this comes to over $25,000 for a four year undergraduate degree.

And, although the university president makes two and a half times more than the President of the United States, that has been deemed insufficient. Now she also serves on the Securian Financial Corporate Board for an additional $130,000 a year. In spite of the fact that Securian manages and oversees the University’s massive multi-billion dollar retirement system, President Joan Gabel and the regents see no conflict of interest. They tell us that university officials who report to Gabel will look after university employee life insurance and retirement accounts with Securian and protect us from any conflicts of interest.

Former Gov. Arne Carlson
MinnPost file photo by James Nord
Former Gov. Arne Carlson
Continuing of this path is destructive. University governance needs a complete turnabout that genuinely focuses on our young. It cannot just be a simple tuition freeze but rather a complete overhaul with major reductions in administrative costs. The regents or the legislature should Set the university president’s salary at a figure that does not exceed that of the President of the United States. This should be a standard for all public entities that receive federal funds. This action essentially trims the excesses of the past and restores a healthier balance.

The Minnesota Legislature should institute an independent commission to investigate the numerous scandals at the university and the enormous costs they impose on the students and public. Currently, the university is “investigating” the allegations of “fraud” that have been brought by the medical/scientific community against the Alzheimer Research Project. The National Institute of Health pegs the costs in the billions of dollars. To assure independence, the Legislature needs to establish guidelines for this investigation and others like it.

Richard Painter
Richard Painter
Suffice it to say, that the University’s management and oversight of these medical research projects has not only been wholly inadequate but they have been severely criticized nationally and internationally from the New York Times headline “The University of Minnesota’s Medical Research Mess” to  Forbes’  “Why the University of Minnesota’s Research Scandal Threatens Us All” to the obvious question raised by Minnesota Public Radio; “Why Do Scandals Keep Happening at the University of Minnesota?”

In essence, the university is paying extraordinary salaries for harmful results.

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The governor should create a council of independent experts to work with the regents and university leadership to steadily lower administrative and other overhead costs while lowering student tuition with the goal of making student loans unnecessary. This also means integrating the athletic department into the solution. Nothing should be off the table.

The governor and legislature should set aside $1 billion in a student foundation fund using the annual proceeds from investment (approximately $50 million) for purposes of lowering student tuition at all Minnesota public institutions now. The state currently has a $17.6 billion surplus. This $1 billion investment would be a one-time expenditure. In addition, this same approach ($1 billion set aside in a foundation and invested with the proceeds going to the program) could be utilized to fund innovative programs in K-12.

The overall goal must be to guarantee to our children access to a quality and affordable educational experience so they are properly equipped to guide us through the enormous challenges of climate change and the restoration of a growing middle class democracy.

Arne H. Carlson is a former Governor of Minnesota (1991-1999). Richard Painter is the S. Walter Richey Professor of Law with the University of Minnesota.