Public Universities in Ohio Accrue Debt for Facilities
When universities go into debt, guess who pays.
Cleveland.com reports.
Ohio public universities pile up debt for fancy facilities — and students pay, expert says
Ohio’s 14 public universities owe $6.5 billion for debt mostly created by what some education experts have called unnecessary campus building booms.
College officials say they have been constructing necessary facilities, but some higher education experts say universities have gone on unnecessary spending sprees to lure students to their campuses, the Dayton Daily News reported.
Some debt-financed college projects in the state include an $80 million football stadium at the University of Cincinnati and a $1.1 billion medical center expansion at Ohio State University. The University of Akron, which is $487 million in debt, has constructed 24 new buildings and carried out 20 additions or renovations of existing buildings since the early 2000s.
“We know that we’ve got a substantial debt load that we need to address over the coming years,” said Nathan Mortimer, associate chief financial officer for University of Akron.
Ohio University economist Richard Vedder said students and their families likely are picking up the tab for extra amenities offered by universities.
“Anytime you borrow money and spend that money, you’re using resources, and you’re using dollars for that purpose, said Vedder, who is also director for The Center for College Affordability and Productivity.
“The state isn’t increasing its subsidies to finance all of this,” he said. “I think universities are adding to their annual costs and someone is paying for it.”
An official with Moody’s Investors Service said most public universities across the country have doubled their debt in the last decade, partly driven by a highly competitive environment.
Ohio public universities pile up debt for fancy facilities -- and students pay, expert says (Cleveland.com)