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After state pledges $25 million for Cole Field House, University of Maryland finds itself in budget crisis

The state government recently pledged $5 million annually for a new football facility in Cole Field House. Now, a state budgetary shortfall has cost the university almost $16 million, leading to hikes in tuition and staff furloughs. What does it all mean?

University of Maryland President Wallace Loh.
University of Maryland President Wallace Loh.
Evan Habeeb-USA TODAY Sports

The reaction to the University of Maryland's upcoming transformation of Cole Field House – from an aging recreation center to a cutting-edge football practice facility and research hub – has been split into a couple of camps.

Administrators and scores of football fans have hailed it as a breakthrough for the program. A feature on this site, by my colleagues Pete Volk and Dave Tucker, noted it could "take the football program to the next level." Randy Edsall said it "helps tremendously in recruiting, coupled with winning on the field." Its $155 million dollar price tag dwarfs what the University of Oregon spent on its own palatial practice complex, and expectations of its correlation to gridiron glory are accordingly high.

On another hand, some – and I use that vague word because it's almost impossible to quantify how many – members of the university community are outraged that the university would spend so much money on a project that, for all its bells and whistles and other utilities, chiefly benefits about 100 students and the school's football staff. (About 30 percent of the 87,000-square foot facility is slated for academic use, per Stubbs.)

I'm a junior at the university, and I've heard a good number of classmates asking variations of the same questions, paraphrased here: "How can the school spend $155 million on football when I have thousands of dollars of tuition debt? Why isn't this money being used to help me?"

These are fair questions, but they've always been at least a little bit misguided. The university is spending serious money on Cole Field House, but only $25 million are actual university funds. More than $105 million comes via private donations specifically earmarked for the Cole project. The uncomfortable notion of a school spending scarce resources on a workspace for a football team instead of, say, research or tuition decreases is fair. But it's much less dramatic than the raw numbers suggest, because the university isn't taking $155 million away from the community to put toward the football team. It's spending $25 million – a lot, but less than anyone would think after only seeing the final price tag. Most simply, 84 percent of the funding is 100 percent private.

However, another $25 million of the project's total cost is slated to come directly from the state government, to be paid out in $5 million installments over five years. That makes some of this month's news especially relevant.

In a Friday afternoon email on January 16, University President Wallace Loh delivered a long-coming but grim report to students, faculty and staff: The Maryland General Assembly's statewide budget plan for the coming year includes a $40.3 million reduction in funds for the University System of Maryland. The flagship university's stake in that cut is $15.6 million, meaning the state of Maryland will give the school $15.6 million less under the new annual budget.

The university will make up the nearly $16 million gap with a couple of measures, none of them fun. Faculty, staff and administrators will be subject to up to three days of unpaid furlough – not crippling for top administrators like Loh, whom The Diamondback reports makes $496,000 per year, but surely harder for the paid-hourly workers who comprise the university's manual labor force. (Loh also announced that the university will seek to limit furloughs for its lowest-paid employees.) The university will pay the state $6 million out of its general fund balance, and it will raise $4 million by hiking semester tuition by either $152 or $279 in surcharges, depending on whether students hail from inside or outside Maryland.

"It's really bad, obviously," said Patrick Ronk, the university's student body president. "The biggest thing I see is that it's only a sign of things to come, and that's the really sad part." Ronk said the new budget – the last one drafted by outgoing Governor Martin O'Malley – would roll back about half of the higher education funding increases O'Malley signed off on over the past four years.

To recap: The university sought and received authorization for $25 million ($5 million per year over five years) of state money to build the new Cole Field House in November. Now, the state is cutting how much money it gives the university for basic operating expenses by $15.6 million, with, per Loh, principles of "shared sacrifice" on the horizon to make up the difference. The state's annual expenditure on the football practice facility, which starts next year, is worth one-third of the annual state funding shortage for the whole university.

Ronk said he was surprised by the magnitude of the higher education cuts. He blamed O'Malley for under-funding higher education on his way out the door and criticized state legislators for finding space, nevertheless, for the Cole project.

Mike Lurie, a spokesman for the University System of Maryland, said in an email that the level of the overall cut to higher education – as it was first set out by a public works board on January 7 – was "very unexpected and surprising." The university's current shortage is $16 million, but Lurie said officials expected it to be $8 million.

The parties involved with the project have touted its non-football benefits. Seventy percent of the building is purposed for the football program, but Cole Field House will also offer a sweeping sports medicine center, innovation academy and strength and conditioning facility (meant for student-athletes, according to the school's announcement of it in November).

"The state money earmarked for the Cole project was pledged largely because of the academic component and the new research center, the collaboration with University of Maryland at Baltimore," said university spokesman Brian Ullman in an email. "It's the intersection of academics, research and athletics that makes this project so compelling."

Ronk took a different view. "We're a university. The number one thing should be education, and I don't think anyone can really explain spending $25 million on football. They can say there's a medical facility, they can say it's for innovation and entrepreneurship, but it's a football facility," Ronk said. "To me, it's really ridiculous that the state is more than happy to spend $25 million on football, but when it comes to education, they're willing to cut us $15 million."

None of this is to say that the university could have avoided ever raising tuition or furloughing employees had the state agreed to spend $25 million on school projects other than Cole Field House. Funds are doled out over years at a time, and financial and political forces can quickly alter the way state money is spent. The money for the new facility, in fact, came out of a different fund than the one being slashed for the University System. The university couldn't use the Cole money for operating expenses even if it wanted to, Ullman said, and even diverting the $5 million annuity for the project would leave the school with approximately a $10.6 million state shortfall – less, but still plenty.

"The state money to support Cole cannot, by law, go to operating expenses," Ullman wrote. "In other words, that money has no bearing on the recent UMD budget adjustments."

More than that, it's entirely possible that Cole Field House becomes a cornerstone of the university's fundraising effort and pays for itself, albeit years into the future. And the early word is that new Maryland Governor Larry Hogan will push for some restoration of higher educational funding next year, which could mitigate some of the pain the university is now feeling. That notwithstanding, university tuition is set to keep going up on the state's account.

On the whole, it is clear that the funding of the Cole project or general operating expenses for the broader university was never an either-or proposition. But the juxtaposition of $25 million for the new facility against $16 million in immediate budgetary hardship will raise more questions for legislators and those who pushed for this.

"There's a misconception that if we weren't building the Cole Field House renovation, the money would have gone to the university. It's more of a $25 million bonus just for football," Ronk said. "But it does show the priorities of the powers that be in this state."

Lurie said two system Board of Regents members had "initial concern" about the budget allocation but were swayed "given the project's mix of academic and athletic pursuits." Endorsements of the new facility by College Park's engineering dean and the medical school dean at the university's Baltimore campus helped with the decision to seek funding, Lurie said.

It is not news that college football costs states money. Tom McMillen, the Maryland basketball legend and former congressmen, told The Washington Post's Roman Stubbs in November, "We are in the football business. That's the choice that was made. We need to make it work, and so we have to be competitive."

This project, by all accounts, pushes the Terrapins in that direction. If they're to regularly compete in a conference against Urban Meyer's Ohio State and Jim Harbaugh's Michigan, it's hard to imagine this new fortress not playing a key role.

Whether it delivers on its promised benefits or not, the project marks a major state expense. Whether the money legislators approved for the facility would have been better off in the hands of students or professors is an important question, even if the complexities of state budgeting are far beyond practically everyone (including legislators) asking it.

The $25 million the state agreed to spend on Cole Field House is a drop in the bucket of the state's approximately $750 million budget deficit, but it's roughly 160 percent of what the state has forced the university to make up at the expense of virtually everybody on the campus, student-athletes included. The $5 million per year the state is set to direct toward the Cole project is more than the university projects to raise this year through either tuition increases or furlough days.

"It's showing that the priorities of the state government," Ronk said. "They are going the extra mile to ensure we have a good football program and good athletics, but at the same time, they're not going to go the extra mile for the education part of it."