Education Monday: Selling Off The Assets
Now Virginia's Supreme Court says Randolph College may not sell off its valuable paintings to try to claw its way out of financial crisis.
The struggling private, liberal arts college in Lynchburg--a good example of how most colleges are closer to the fiscal edge than to the unfathomable riches that Ivy League schools hoard--figures it can raise at least $32 million by auctioning off a chunk of its collection of 20th century art. But some alumnae, students and parents are seeking to get the courts to prevent any fire sale of the school's assets. For now, anyway, the court is indeed playing that role.
Randolph is far from alone in the Great College Sell-off. Most colleges, especially public ones, have few assets that they can easily sell to raise money to build their endowments or cover their operational costs. But as states have cut back on support for universities, and as many private colleges have found that the only way to attract students is to give them such huge discounts on the official tuition rates as to make it impossible to maintain services and staffing, administrators increasingly look toward art collections, radio stations and land as stuff they can sell. Public colleges generally don't have the ability to sell their land, so their options are even more limited.
Locally, at least a couple of colleges have looked toward their radio stations as potential sources of easy money. The University of the District of Columbia was forced by the city's congressionally-imposed financial control board to sell Washington's only jazz station; the money C-SPAN paid for the station went to the city, not the university. Columbia Union College in Takoma Park, a struggling Seventh Day Adventist college, this fall came right to the edge of selling its Christian-oriented radio station to Minnesota Public Radio before a rebellion by trustees and alumni forced the school to pull out of the deal.
But around the country, the most controversial sell-offs have been of art. Many rich alumni pass their collections on to their alma mater as a way of giving back--and avoiding big tax bills. Now the descendants of those alumni tend to get royally miffed when their dear old university decides to sell Daddy's gift to the highest bidder. Art curators don't look on the practice terribly favorably either:
As Suzannah Fabing, director of the Summer Institute in Art Museum Studies at Smith College, told the Chronicle of Higher Education, the trend toward sell-offs is "frightening. When a college professes to teach the liberal arts, its leaders should look at these art collections as a strong asset in their ability to do so. An art collection shouldn't be viewed as a cash cow."
Fisk University in Nashville is trying to sell a Georgia O'Keefe painting that could fetch $25 million for the struggling school. And Brandeis University is looking to unload 14 paintings that could bring in $5 million or so.
Inevitably, these efforts to raise cash lead to lawsuits, particularly from angry alumni who don't like to see their gifts be cast away by administrators more interested in making ends meet than in preserving great (or not so great) art. Courts tend to struggle over whether colleges are really eternally bound to fulfill a donor's highly specific wishes. And in truth, it's really not the courts' business. These matters ought to be left to the colleges, which, in turn, should show some responsibility both to the ideals of learning and to their ability to keep at their work. There will be times when selling off assets makes sense; the Columbia Union College example is a good example of a school that faces really rough going and could, by selling off an asset that has little to do with its educational mission, improve both the college's fiscal picture and the quality of broadcasting in the region.
And there are times when a selloff makes no sense: Neither UDC nor the overall community got anything out of the sale of that school's radio station, an asset that served an enormous public value and helped students as well.
In Randolph College's case, there are legitimate questions to be asked about whether the college is worth saving. Its accreditation was threatened for a time, it had to drop its historic status as a women's college this year, and it still faces a difficult financial future, even if it ultimately is permitted to sell the paintings. Not every college is necessarily a permanent institution. Certainly, the need for colleges will only grow with time, and that means there's likely a buyer out there who might turn Randolph into a success with a different concept.
But maybe Randolph's own administration can make the necessary pivot. And if selling off some paintings is the way to get there, fine. There's nothing inherently sacrilegious about selling art. And a gift from an alumnus is just that--a gift. If you exchange or regift a present from a friend, that in no way diminishes your gratitude to that friend for the generous gesture. As for the alumni, too bad--once you give a gift, that's the end of your part of the transaction. A college that willy-nilly sells off its gifts won't get as many such donations in the future, and that's the market at work. But a college cannot be prisoner to the whims of its donors. When you give something away, it's not yours anymore.
By Marc Fisher |
November 26, 2007; 7:23 AM ET
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