State University of New York campus presidents have criticized a proposal by Gov. Andrew M. Cuomo to raid the colleges’ foundations to help pay for his “free college tuition” initiative.
The letter, signed by presidents of the four major universities of the SUNY system, including Stony Brook University’s Dr. Samuel L. Stanley Jr., said “redirecting” their funds not only will hurt their institutions but also “lead to a downturn in giving to our foundations as potential donors realize that their deeply appreciated donations are not being used for their intended purpose.”
The presidents said the campus foundations legally are private, independent organizations that carry their own fiduciary responsibilities to donors.
“This potential action, however, could crack the philanthropic pillars of our support and threaten all of your good work and accomplishments,” wrote the presidents of Stony Brook, Albany, Binghamton and Buffalo campuses.
Cuomo spokesman Rich Azzopardi didn’t dispute that the four universities could be assessed a foundation-based fee but contended it would not be used to fund tuition assistance.
“The cost of the Excelsior Scholarship program will be 100 percent new funding,” Azzopardi said, referring to the administration’s named for the expanded tuition assistance proposal.
At issue is a proposal to effectively force the four major universities of the sprawling SUNY system to kick in money to help cover the costs of the Cuomo proposal to significantly expand the state’s tuition assistance plan.
Assemb. Steven Englebright (D-Setauket) derided the idea of sweeping foundation funds as “illegal,” “destructive” and “grand theft on a breathtaking scale.” But he conceded it might be approved as part of the state budget because the issue was raised very late in the negotiation process and isn’t as high-profile as other matters.
Lawmakers are close to finalizing a $162 billion state budget for the 2017-18 fiscal year.
Cuomo has suggested expanding state financial assistance to create a path to a “tuition free” education at state universities for families earning $125,000 or less per year. Currently, families who earn roughly $40,000 or less can qualify for enough assistance to make state college tuition free.
Critics have questioned Cuomo’s estimate that the expansion would cost the state only $163 million per year. To help cover the costs, the governor wants to levy a 10 percent “assessment” on the value of the four universities’ private foundation funds, legislators said.
The fee would be authorized for just one year, but some fear a precedent would be set. No estimate was given for how much this would raise. Collecting money through an assessment could be a way to get around the issue of taking private donations from the funds.
Assembly Democrats — some of whom were caught off- guard by the proposal — debated the idea for about two hours in a closed-door meeting Saturday, lawmakers said.
“To come in and sweep the money is discouraging and potentially destroying the foundation,” Englebright said. “It could potentially be the end of private donations” to SUNY schools. He added that the foundations run by each of the universities are private, charitable organizations.
The SUNY campuses raced to embrace Cuomo’s idea but didn’t realize there would be other costs, said Sen. Kenneth LaValle (R-Port Jefferson), who chairs the Senate Higher Education Committee.
“They were 100 percent behind the governor’s idea of free tuition and now they are upset that they are part of his funding solution,” he said.
The Republican-led Senate has been skeptical of the “free tuition” idea and costs, while supporting raising the maximum tuition assistance awards. LaValle said the assessments on foundation money “would have to go into the budget to achieve the governor’s goals” unless “some other substitute is found.”