Cooper Union’s identity crisis: What would it mean for the famously free school to charge tuition?

The Foundation Building at Cooper Union. (Tom Giebel)
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Nancy Scola

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On Tuesday, Oct. 18, the Cooper Union for the Advancement of Science and Art formally inaugurated its new president, Jamshed Bharucha. Outside the main campus building on Cooper Square, a small group gathered to serenade him with a plea: To reduce the rent on a nearby building owned by the school so that another fabled East Village institution, the financially struggling St. Mark's Bookshop, could afford to stay.

In fact, Bharucha had come to New York to save Cooper Union itself, even though many alumni, teachers and students were unaware the institution was in such grave danger.

Just 10 days later, those that didn't know read the following in a report in The New York Times:

Facing serious financial trouble in a weak economy, Cooper Union, the New York City college founded in 1859 to provide free education for the working class, may begin charging undergraduate tuition for the first time in more than a century, its president said Monday.

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In a speech delivered in the historic Great Hall in that main building (called the "Foundation Building" by Cooperites) on Tuesday, Bharucha addressed the swirling controversy over the finances of the school, one of the most prestigious in the country, and a unique one.

Students at Cooper Union, who study in any one of its three schools dedicated to art, engineering, and architecture, don't pay tuition. And that's where the controversy arises: With the school's finances in trouble, Bharucha was strongly reaffirming to his audience that the school was considering changing that and making students pay.

Bharucha told the crowd that charging tuition was a possibility that remains "on the table," despite recent outcry amongst faculty and alumni that greeted the Times article.

Bharucha was firm: Not to consider all options, he suggested, would be as short-sighted as the 152-year-old institution's financial vision has been in recent years.

"As I have sought to learn about the history of Cooper Union," said Bharucha, who was appointed president of the school in July, "there has not been a sustainable budget or financial model for at least forty years, and probably going back further."

At this and other meetings, many expressed exasperation that the situation for the school could have become so bad with such apparent speed. But Bharucha outlined a series of decisions made especially over the last 10 years that had quietly been undermining the institution.

Heavily reliant for years on real-estate holdings (and thus protected from the volatile stock market that had wreaked such havoc on the endowments of many cultural institutions and educational institutions), and with a living network of alumni numbering just 12,000 to lean on for further support, the school, Bharucha said, had faltered.

And its greatest expense, and to many the institution's defining characteristic, was the fact that each of its nearly 1,000 students receive a four-year scholarship valued at upwards of $35,000 a year, was shockingly suddenly in jeopardy.

Bharucha described a $20 million per annum shortfall. The school is expected to decide in the spring how best to get back on firm financial footing.

In charts and figures based on the school's financial forms that were presented at an earlier meeting on Dec. 5, it was demonstrated that the percentage of alumni donating was down to 21 percent from 30 percent in 2002. Worse, lots of money was shown to have been lost in the economic downturn, even as the school was committed to service the debt on a $175 million loan taken in 2006.

Cooper Union was founded in 1859 by Peter Cooper, an American inventor and industrialist who described himself as having "a knack for contriving." The East Village institution was modeled on Paris' École Polytechnique where dedicated students were said to subsist on a daily crust of bread. Some early students did pay tuition, but since 1902, the school has granted its students—numbering nearly a thousand—full-tuition scholarships to study, architecture, art, and engineering.

Fueling the present controversy are fundamental differences of belief among students, alumni, board members and faculty at the Cooper Union about the significance of its free education to its mission.

Bharucha, the newcomer, has described it as "a feature"; school administrators talk in terms of access to quality education. But others see the free-education mantra as the very reason for Cooper Union's existence.

Bruce Degen is a 1966 graduate of the school's arts program and the illustrator of the children's book series The Magic School Bus.

"If they start charging tuition," Degen said in an interview outside the school's Foundation Building following Bharucha's speech, "Cooper Union is done."

He and others, including many alumni and students, argue that Cooper Union's automatic absolution of the yearly tuition technically charged to students (which now stands at $35,000) has created a powerful and invaluable sense of mission and belonging.

"In the 1960s," said Degen, "all the schools were having revolutions. Columbia was occupied. Their architectural division called Cooper Union architects in for a meeting. When my friends came back, they said, ‘The want us to strike against the school. We had to tell them this is not Big Brother. Cooper Union is the most incredible gift. Why would we ever strike it?"

Do away with the full scholarships, and that unity is lost, Degen said.

"Now, Cooper Union is the holy grail, but [by charging tuition], you're putting it in a pool with a hundred other art schools," he said.

Kevin Slavin, class of '95, is a digital entrepreneur who recently sold his company, Area/Code, to gaming firm Zynga, makers of FarmVille.

"The overall sense we had," Slavin said on a telephone call with Capital, "was that we're all doing the best we can with what we've got. We don't have a climbing wall. We don't have a football field. What we have is the ability to educate 900 students on the basis of merit alone."

(Cooper's admission rate is amongst the lowest in the country, hovering in the single digits.)

The school has historically relied upon its real-estate investments, particularly its ownership of the land underneath the Chrysler Building, which they lease out at a rate of $7 million a year. In recent years, the school has actively emptied its holdings of other properties, and finds itself without much left. "There are no obvious assets to sell," said Bharucha yesterday, adding that the school found itself let down by a stock market that had "bailed out the institution for many years."

One place where Cooper Union has aggressively built, rather than sold, is at 41 Cooper Square. That's the site of its striking new Thom Mayne-designed building, a structure that resembles a brushed-steel refrigerator twisting in the wind. Costs have been estimated at $160 million. To critics, the new building represents physical evidence of the administration's folly. To its fans, it's an investment in modernizing an education that stayed static and analog while institutions like Massachusetts Institute of Technology and Stanford University rushed to embrace the digital revolution and its associated patents, start-ups, and prosperous alumni and faculty alike.

The building may have been necessary for the school to upgrade and remain competitive with big, well-endowed institutions elsewhere, but that doesn't help things now, Bharucha said.

"There's opportunity in innovation," he said, "and that's where Cooper Union can be so, so good. There's no reason that in the long term we can't have the kind of innovative entrepreneurial culture that does spin off in financial terms."

"We can create an education that makes the institution more useful in the 21st century," he said, and continued to speak about breaking down a "rigidity" that silos Cooper Union students and faculty into their core areas of study.

But turning Cooper into an incubator of innovation is "a long term strategy," Bharucha said. "We need a short-term and an immediate-term strategy as well."

That Cooper has found itself is in so need of "immediate-term" solutions angers many alumni.

Critics charge that the school's administration has made two big mistakes in recent decades. First, they failed to develop a workable funding model to preserve the school's tuition-free status, including a vibrant alumni base equipped with a valuable 21st century education. And second, they failed to be transparent about the school's predicament.

Slavin pointed to a Wall Street Journal article from the summer of 2009. The headline: "One College Sidesteps the Crisis."

The article, on Cooper's real-estate holdings and other investment strategies, celebrated the institution and then-president George Campbell's strategy for navigating around the economic woes that challenged endowment-dependent institutions.

Meanwhile, those financial underpinnings were crumbling.

"An institution that is based on free tuition has got to work magic somehow," one person familiar with the administration's thinking on financial matters told Capital. "And, well, you start to believe in magic." 

"I don't know whose interests that served, except George Campbell's," said Slavin. "It certainly didn't serve the purpose of [fund-]raising from alumni."

For its part, the board admits that alumni money has been scarce, but turned the problem around: Mark Epstein (Arts '76), chair of the Board of Trustees, said at a recent school forum that he "would blame the lackluster performance of alumni" in the effort to offset the revenue lost to free tuition.

"And then they come back two years later and say, ‘We have two years left, and the problem is you?'" Slavin said.

At the Dec. 5 meeting, Slavin told some 200 current students at a meeting that the board had asked him for a $10,000 donation days before news broke that the school was considering a tuition plan. But he said he felt the finances of the school were not sufficiently transparent for him to feel completely comfortable giving.

As an example, Slavin said his peers found on the school's Form 990, the financial statement filled out by all non-profits, that there had been some $2 million in payments to Jonathan Rose Companies for construction supervision. The company is run by the son of Cooper Union trustee, Sandra Priest Rose.

"So let me be clear," he said. "The Rose family does amazing things for Cooper Union, for New York City, and we, all of us, we actually owe them. They do amazing things. And maybe her son's company does happen to be the very best for the job. And maybe they provided the most competitive bid."

"I'm happy that the Roses thrive, I actually am," he said. "I just want to know. If you ask for $10,000 and you expect it to be spent responsibly, I'd like to get a heads up."

But even if the alumni could be offered more transparency, there might still be more prosaic fund-raising challenges. At the Dec. 5 meeting, one person testified that the school lacked working email addresses for some 6,000 of the school's 12,000 alumni.

President Bharucha has his own plans for the future. During yesterday's speech, he described the creation of a "Revenue Task Force," to come up with ideas for generating cash.

The group will be chaired by Phil Weisberg (Electrical Engineering '89), C.E.O. of the electronic trading platform FXall. Vice chairs will be famed graphic designer and New York magazine co-founder Milton Glaser (Art '51), known, in part, for his creation of the "I ♥ NY" logo; and Bank of America's Eric Hirschhorn (Mechanical engineering '89). The group is meant to report back in March. An outside consultant will review the school's administration.

"I will make some very hard-nosed assessments," said Bharucha, "to make sure we have the leanest, meanest, most effective, most catalyzing administrative structure that enables our students and faculty to do their creative work."

Bharucha will also, he said, lead an academic review of the school's curriculum, focused on excellence and making sure "that we're teaching the kinds of things that students in 2011 should be learning to make them the most innovative and effective citizens."

Describing those review processes, Bharucha had, in his understated way, some strong words for some critics.

"Leadership is about choosing," he said. "Leadership is about evaluating a situation thoroughly and having to make a tough choice. It's easy to jump on a bandwagon. It's easy to fan flames of rage and rancor. It's much more difficult to actually assess the challenge and opportunities and come up with a plan or set of options that are not wishful, but are sound [and] based in experience and seasoned judgment."

"The current mood of the world, as you know, is argumentative and angry," Milton Glaser had said at the Dec. 5 meeting. "And these days, every institution seems to be at odds with itself and any atmosphere of common purpose seems to very difficult to find. Many of us are outraged that our beloved school might become a school that will charge tuition."

Glaser said Bharucha had personally assured him charging tuition would only be in the table if there were truly no solutions.

"For all of us, I hope we can shift our focus from what went wrong, to how we could shift our talent and energy to help this wonderful and unique place. Like most emergencies it can be a great opportunity to reconsider the entire school and its objectives and I look forward to achieving that result."

But to a degree this raises the question whether "reconsidering" the school means reconsidering its scholarship policy. Slavin has a very firm answer.

"This isn't about just keeping the lights on, or keeping anyone employed," he said. "We all know what Cooper Union means, and that's an undergraduate education that is based only on merit. For over a hundred years, it has been tuition free. There's no one alive who remembers it any differently. It's like saying, ‘Let's still have America, only it won't be a democracy anymore.'"

If the tuition is free, the school is Cooper Union; if it isn't, it isn't.

“It’s either true or it’s not,” he said.

The school's crisis has prompted alumni to innovate on their own. Cooper Union Commons is a site for sharing, including information that alumni have acquired on the school's financials. Alumni have also set up a website called "Free as Air and Water," drawing on a phrase of Peter Cooper's, to serve as an organizing hub. It's operating an online campaign called Money on the Table.

Those identified, on the Money on the Table site, "pledge our full financial support to the Cooper Union as soon as the administration states publicly and unequivocally that Cooper Union's undergraduate schools of architecture, art and engineering will remain completely tuition free."

The site claims $184,000 in donations from more than 320 people and organizations (as of this writing).

Earlier this month, Hope Gangloff, a painter and illustrator who graduated from the school in 1997, was selling shirts and prints in the lobby of the building. She said screen printing, ironing and dying the shirts took her four days.

Gangloff said she started the night with 114 shirts, which sold for $20 each, and there were around 30 left as the crowd began to leave. She said the money would be donated to the new website and would, at the very least, create awareness of the issue.

"We're an art school for Chrissakes," she said. "Let's make some T-shirts."

Standing outside Cooper's Foundation Building Tuesday following Bharucha's speech, Christine Degen (Arts '68, and Bruce's wife) argued that the school had stayed tuition-free through tough times before.

"It's been free through World War I, World War II…" Added Bruce, "The Great Depression." "The Great Depression," she seconded. "Is our country poorer now? Where are all the people who through all those generations supported this kind of unique education?"

Both Degens float the idea that perhaps Cooper Union should be hunting for a latter-day Peter Cooper, a wealthy American who sees the value in educating a core group of people in the arts, architecture, and engineering, and doing it at no cost to them. "What's his name?," asked Bruce Degen. "Bill and Melinda…"

"Gates," Christine answered.

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