Small US col­leges get creative at mon­ey­mak­ing as en­rol­ments fal­ter

Some are rent­ing out rooms, li­cens­ing coffins and sell­ing their own ketchup. Jon Mar­cus re­ports

THE (Times Higher Education) - - CONTENTS -

Some 14 mil­lion peo­ple a year travel to see the nat­u­ral won­der that is Niagara Falls, most of them be­tween July and Septem­ber, when ho­tel rooms in the area are all but im­pos­si­ble to come by.

But there was a sup­ply of rooms just four miles from the falls sit­ting empty and un­used ev­ery sum­mer: the stu­dent hous­ing at Niagara Univer­sity. So this year, the univer­sity de­cided to rent out those rooms on Airbnb.

At $129 (£99) a night for four beds, two baths, and a full kitchen, the dor­mi­tory suites are a great deal for vis­i­tors to the re­gion on the border be­tween the US and Canada. But they’re also a new source of rev­enue for the univer­sity, some­thing that Niagara and other higher ed­u­ca­tion in­sti­tu­tions in the US can badly use.

“We all do need to think dif­fer­ently,” said Mary Bor­gognoni, se­nior vice-pres­i­dent for op­er­a­tions and fi­nance. “We are tu­ition-de­pen­dent. We rely on our en­rol­ment. And you see fluc­tu­a­tions in en­rol­ment.

“If there are ways to bring in other sources of rev­enue, that helps.”

Small pri­vate in­sti­tu­tions are in par­tic­u­larly dire need of dol­lars. Strug­gling through a de­cline in en­rol­ment that is en­ter­ing its sev­enth year, a quar­ter of them ran an op­er­at­ing deficit last year, ac­cord­ing to a re­port from the bond-rat­ing agency Moody’s, which said that ex­pen­di­ture in all higher ed­u­ca­tion is out­pac­ing in­come.

As they near the limit of what stu­dents are will­ing to pay, US univer­si­ties are be­com­ing creative at find­ing new sources of money. They have opened con­fer­ence cen­tres and ho­tels. They rent out their ath­letic fa­cil­i­ties to pro­fes­sional and ama­teur sport clubs. Their din­ing staff cater for wed­dings and other events.

Some univer­si­ties are cash­ing in on the life­long – and be­yond – fidel- ity of their alumni. They are de­vel­op­ing re­tire­ment com­mu­ni­ties on sur­plus land, of­ten for alumni who want to live on cam­pus. Forty-eight of them have li­censed their lo­gos for cas­kets and urns in which alumni can be buried. The univer­si­ties of North Carolina and Notre Dame, among others, even have ceme­ter­ies on their cam­puses where peo­ple can pay to be in­terred.

The rel­a­tive quiet of the sum­mer is in­creas­ingly be­ing filled with money-mak­ing pro­grammes like Niagara’s. Many univer­si­ties charge for sum­mer camps and sum­mer schools for younger stu­dents seeking an ad­van­tage in ad­mis­sion.

This also lets ad­min­is­tra­tors make con­nec­tions be­tween their rev­enue-gen­er­at­ing spin-offs and their prin­ci­pal mis­sion of ed­u­ca­tion.

Niagara’s Airbnb col­lab­o­ra­tion, for ex­am­ple, is be­ing over­seen by stu­dents from its hos­pi­tal­ity pro­gramme. Har­vard Univer­sity has built a prof­itable cor­po­rate train­ing arm. Sev­eral univer­si­ties have added fast-paced, high-priced pro­grammes teach­ing cod­ing. The Univer­sity of Illinois at Ur­bana-Cham­paign sells pro­duce from a farm that it was given as a gift, but which it also uses for teach­ing sus­tain­able agri­cul­ture.

Some are think­ing big­ger, and an in­dus­try of mid­dle­men is crop­ping up to help.

One start-up, Col­lege Con­sor­tium, con­nects univer­si­ties whose stu­dents need par­tic­u­lar cour­ses with univer­si­ties that have room in on­line and oc­ca­sion­ally in-per­son pro­grammes. So far 118 in­sti­tu­tions have signed up, 112 of them small pri­vate ones.

“We have all this idle ca­pac­ity in on­line pro­grammes and, on the other side, we have stu­dents get­ting stuck who can’t get the cour­ses they need when they need them,” said Josh Pierce, the com­pany’s chief ex­ec­u­tive. “So we’re mak­ing use of the de­mand that col­leges can’t serve.”

This not only drives up grad­u­a­tion rates, Mr Pierce said. “Both sides, de­mand and sup­ply, make money.”

It’s the log­i­cal next step of univer­si­ties’ drive to profit from their of­ten un­used space, he said. “The prob­lems col­leges need to solve have be­come way more com­plex. So there’s a re­cep­tiv­ity to this kind of thing that’s been com­ing for a long time.”

That could lead to even more un­usual rev­enue-gen­er­at­ing ideas, ob­servers said. Illinois’ farm, for in­stance, has started sell­ing ketchup that its kitchens pro­duce from toma­toes grown there. Rut­gers, the State Univer­sity of New Jersey, which also has a hos­pi­tal­ity pro­gramme, bought and runs a golf course. The Univer­sity of Wis­con­sin-Oshkosh gen­er­ates energy from food waste and sells it to the lo­cal elec­tric­ity grid, and rents out space on its cam­pus for mo­bile phone tow­ers. Sev­eral univer­si­ties with po­lit­i­cal science de­part­ments have en­tered the busi­ness of polling.

Back at Niagara, those stu­dent suites are sell­ing fast, said Ms Bor­gognoni. At the time of writ­ing, 35 room nights had been booked through to 28 July, when the dorms will be handed back to stu­dents.

That will bring in less than $5,000, a tiny boost for an in­sti­tu­tion whose an­nual bud­get is about $147 mil­lion. But it’s a start, she said.

“It’s been eas­ier to look for ways to save money than to make money,” Ms Bor­gognoni said. But ef­fi­cien­cies go only so far, and find­ing new sources of rev­enue – some­thing that was long anath­ema in higher ed­u­ca­tion – has be­come es­sen­tial.

“You def­i­nitely have to ap­proach this with, ‘what do I have to get this done’,” she said, “ver­sus find­ing ob­sta­cles to it.”

Over­flow Niagara Univer­sity in the US is us­ing Airbnb to rent sought-af­ter ac­com­mo­da­tion to tourists dur­ing the sum­mer

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