Closing a University Golf Course; Monetizing Institutional Assets

BY MARTIN KICH

Writing for Cleveland.com, Karen Farkas reports

Kent State University is closing its golf course because of declining revenues and increasing operating costs. . . .

The university bought the 18-hole par 70 course on Ohio 59 in Franklin Township, in 1966. The course includes a putting green, chipping area, snack bar, banquet room and pavilion.

“For much of its longevity, the course played an important role in the local golf community – from university and community leagues to a training ground for high school teams,” the university announcement said.

“As the Northeast Ohio golf industry continues to experience financial challenges, the university determined that the Kent State Golf Course could not reverse a five-year trend of declining revenues and mounting operating losses,” the [university’s] announcement said.The university’s budget for the course this year is about $500,000. . . .

“The university assessed the viability of the 40-acre course in response to the Ohio Task Force on Affordability and Efficiency, which required universities to look at ‘non-core assets’ to determine their market value if sold, leased, or otherwise repurposed.

Kent State said it is looking at all options for future use of the property.”

 

It is hard to argue against a university’s eliminating a gold course, especially one that is losing money.

But, in Ohio, as elsewhere, there has been an increasing emphasis on “monetizing the assets” of public institutions. The most notable example in Ohio has been Ohio State’s multi-billion-dollar leasing of its parking facilities. And that university has subsequently been exploring similar deals for the management of its utilities and other services.

The trickle-down effect has been that the administrations of other public universities have publicly expressed interest in similar deals. But, of course, any such deals will be considerably smaller in scale and likely much less profitable.

Indeed, after the initial moratoriums on fee increases that are typically negotiated to forestall organized opposition to such deals, students, faculty, and staff will almost certainly be paying higher fees for parking and other services as the corporations that have made these deals start to recoup their “investments” in earnest. So, unless the university invests the up-front money to provide scholarships, this privatization amounts to just another way that costs are being increasingly off-loaded onto students and, to a lesser extent, that faculty and staff compensation is being eroded.

At my university, which is dealing with self-created budget issues, any monies created by “monetizing assets” is likely to be used to address those immediate issues. So, given the current interest rates, it might be less expensive all around if the university simply borrowed the money.

In most cases, privatization of public institutions and services has not saved taxpayers much, if any, money. But it has reduced the wages and benefits of those actually working for the institutions and providing the services, and it has been profitable for selected corporations that increasingly do not straddle the private and public sectors but, instead, exist primarily, if not solely, to cannibalize the public sector.

Given the nominees for cabinet positions in the trump administration, this trend will almost certainly accelerate.

 

Karen Farkas’ complete article is available at: http://www.cleveland.com/metro/index.ssf/2016/12/kent_state_university_to_close.html.

 

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