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From what I've seen, State Universities seem to be awash in cash, and use it for enormous amounts of expensive construction.

• deleted 7y ago
  [deleted]
• sjg007 7y ago
  Well, they raised tuition and have record enrollments due to demographic change.. The construction to take advantage of continued revenue trends (to put it in financial terms)... but maybe I missed your point?
• jldugger 7y ago
  Not exactly. Public uni finance is complicated. They are building, but in many cases, construction is required to compete for research grants. The chemical engineering labs built in the 50s are not always sufficient for modern science, for example. And in general, State Universities should be growing to serve their state's growing populations. Where things get tricky is funding this. By and large, new construction is donor secured -- it's relatively easy to put a name on a building. But those donations come attached with strings, ie the name on the building. you can't reallocate it elsewhere. And donor funding for endowed faculty seats or administrative costs are not so frequent. Ongoing costs of running the university (salaries, utilities, maintenance, public safety, cleaning) are funded via three main sources: state funding (ever dwindling), tuition (ever growing but small overall) and research. Research is where state universities pull in the big bucks, but it also often requires expensive specialty capital equipment and facilities in which to install and run it. A rule of thumb is 30 percent of research grant is handed over to administrative overhead. That is effectively rent to pay for depreciation of the building. tl;dr: expensive construction is required to further the mission of public universities, and doesn't mean general funds are available.