As higher education shakeup approaches, experts warn of challenges

As Connecticut moves to consolidate its higher education systems, experts are warning that the transition is likely to be rocky and savings elusive, at least at first.

“The evidence that changing a system will make a measurable difference in performance and cost-effectiveness is so weak that it makes much more sense to try to make an existing structure work,” Aims C. McGuinness, a senior associate at the National Center for Higher Education Management Systems, wrote in an analysis of Connecticut’s plans.

“Governance change is the bluntest — and least effective — instrument to solve specific problems such as mission drift, transfer, ineffective leadership of a particular institution or system or other issues,” he wrote.

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Higher Education co-chairs Sen. Beth Bye and Rep. Roberta Willis

McGuinness provided a scathing 3-page analysis of Connecticut’s plan to the co-chairwoman of the Higher Education Committee, Rep. Roberta Willis, D-Salisbury. Other national experts also say that the transition will be difficult and time consuming and will require strong leadership.

“I’m not saying a merger won’t work. But I think there will be an evolving process before it would stabilize,” said Richard Novak, senior vice president for the Association of Governing Boards of Universities and Colleges based in Washington D.C. “The question for Connecticut is it worth the time for transition?”

The state’s plan will merge Connecticut’s 12 two-year community colleges, the four universities of the Connecticut State University System, the online Charter Oak State College and the State Department of Higher Education into a single system under one Board of Regents. There are nearly 100,000 students at the various institutions. The reorganization does not include the University of Connecticut.

Although both co-chairs of the Higher Education Committee voted to move a compromise plan to the House and Senate for a vote, their reactions to the experts’ opinions differ.

“This whole thing is a tremendous leap of faith,” said Willis, who has brought the NCHEMS report to meetings to share with top officials while they draft the final legislation. She said she hopes the final version addresses some of the concerns raised.

Sen. Beth Bye, the other Higher Education co-chair, said she has read the input from national experts, but isn’t troubled by them.

“What I took away from that is no one state is the same. Sure, you can compare us to other states, but no one state is the same,” she said. “There is no one recommended [governance] structure.”

Legislators in Connecticut have considered several proposals to merge higher education institutions over the last four decades, including a 1992 law that consolidated the state’s community colleges and technical colleges. However, various other proposals to reorganize the state’s higher education institutions have gone nowhere. This year is different, with legislative leaders agreeing earlier this month to merge the institutions.

Cost savings were a major selling point when Gov. Dannel P. Malloy announced this plan back in February, promising it would save “tens of millions of dollars over time.” Higher Education Commissioner Michael Meotti later told legislators the merger would save $4.3 million over the next two fiscal years through the reduction of central office employees.

But McGuinness said merging administrative systems, such as information technology and financial services, is certain to cost money. Decreasing staff at the system offices would also be problematic, given the enormous effort needed to merge the colleges, he said.

“Most of these reorganizations are done with the assertions of cost savings. The truth is that maybe this can save money long term, but this is really going to cost money up front,” he said. “I would never say to a state a major reorganization is going to save you money.”

Willis said she never expected the merger to save money.

“I never felt this was a money savings initiative,” she said. “I think in the future you are going to see efficiencies but that’s going to take a while. That’s something you can’t do overnight.”

In other states, reorganizations similar to the one planned in Connecticut have mixed results. Even in Minnesota, which two decades ago implemented a higher education reorganization that has been cited as a model by Malloy, the consolidation got off to a rocky start.

“It was pretty contentious,” said Linda Kohl, a spokeswoman for Minnesota State Colleges and Universities, a sprawling system of 25 two-year colleges and seven state universities.

The Minnesota legislature passed a law in 1991 merging the states’ universities, community colleges and technical colleges, but the law did not take effect until 1995.

“One of the mistakes we made was the four-year waiting period,” Kohl said. “What actually happened is that the next four years people spent trying to undo the reorganization.” The system also underwent a series of leadership changes, with a half dozen chancellors overseeing operations until the hiring of James H. McCormick in 2001.

A report last year by Minnesota’s legislative auditor said the system’s goals “are clearer and more accepted by institution leaders than they were in 2000” but added that the services provided by the central office are receiving mixed reviews.

The report also said that central office expenses have grown faster than the system’s other expenses in recent years, mainly because of an expansion of information technology services. Between 2002 and 2009, central office staffing grew from 318 staffers to 385, the report said.

Nevertheless, McCormick, who is retiring this year, said the merger has created a more efficient operation. “We have one legal department, not three; one board staff, not three; one chancellor, not three,” he said.

He also cited advantages such as stronger accountability measures, an expansion of campus building projects, improved data collection and better student transfer arrangements among campuses.

In addition, the merger has allowed for collaborations among various institutions, such as “centers of excellence” focusing on manufacturing, engineering, health care and information technology, he said.

The auditor’s report said campus officials see value in centralized functions such as legal and financial services but question the value of other services, such as centralized fundraising.

The question of what services should be centralized is key, said McCormick.

“Finding this balance between local autonomy and system direction is always a challenge,” he said. “You’ve got to find a way that one size doesn’t fit all.”

Aside from the costs and the lengthy transition period, McGuinness warns that Connecticut’s reorganization does not address the real problems facing higher education: performance outcomes.

“What does this particular structure do to get Connecticut there? I don’t know,” he said. “When there are limited resources there needs to be a plan of where those resources go. There needs to be performance goals if you want your colleges to improve. If you hold people accountable to getting more results they will achieve them.”

Willis agrees, which is why getting a strategic plan that looks at incorporating these aspects was key to getting her support.

State legislative researchers are also unsure which governance model works the best. In a report released last December, the non-partisan Program Review and Investigations staff found there is no one proven governance structure that works the best.

While they took no recommendation on which type of system would best suit Connecticut, they recommended more accountability of the state’s public institutions. The public colleges and universities have complete autonomy of the state money they receive and this merger does not change that, according to preliminary drafts of the reorganization.

“An accountability system based on statewide needs, strategies to address those needs, and performance incentives has not been a priority,” the PRI report says.

While legislative leaders and the Malloy Administration announced a deal to shakeup higher education governance earlier this month, legislators await the final details. Officials say the merger will begin July 1.