Leaders at other merged universities see risks, rewards

Risk factors

Those looking to merge Augusta State and Georgia Health Sciences universities should watch out for “unintended consequences” unless there is careful planning and much effort to make it work, said an official who has been through a similar merger in Denver.

The potential risks from such a move were deemed to be too much for the University System of Maryland, which opted last month to pursue a looser “alliance” between its flagship liberal arts university and the university that houses its professional schools. But some reports do show the economic benefits being touted by proponents of the Augusta consolidation.

GHSU President Ricardo Azziz said a model the Augusta universities will study is the merger of the University of Col­o­rado Denver and the Uni­ver­sity of Colorado Health Sciences Center, which contains its health profession schools.

But a key official in that consolidation, University of Colorado School of Medicine Dean Richard Krugman, said he tried to tell officials he thought it was a bad idea and it has been “awkward,” in part because it came in the midst of a decadelong move of the health sciences center to the $2.1 billion Anschutz Medical Campus several miles away.

But there has also been a “mismatch” of cultures between the two that has taken much effort to overcome. UC Denver was mostly undergraduate and operates on the semester system while the health sciences campus is graduate-level and has its own schedule. When health sciences students showed up for class after the merger, the combined student support services weren’t ready, Krug­man said. When officials called the downtown offices, “they said, ‘Well, you’re not supposed to have students now,’ ” Krugman said.

That difference has already turned up in discussions between the nursing programs at ASU and GHSU, with ASU on the semester system admitting students twice a year while GHSU does it once a year.

Risk factors

It is just one aspect of blending different schools. Augusta State has thousands more students, is tuition-driven, and its faculty members are on nine-month terms.

The health sciences campus, however, is full time, dwarfs ASU in re­search and clinical revenue and has higher salaries that are earned through money generated or research awards.

That could create pay disparities among the campuses when hiring, for instance, an associate professor of neurosurgery.

“That’s going to be a different salary than an associate professor of English,” Krugman said.

The potential pay inequity was one of the risk factors cited by the Maryland task force that ultimately recommended an alliance instead. Another was cost. Maryland projected that to make the merger work it would take an investment of $235 million to $285 million, which would include $169 million in new space to house future collaborations, while yielding a short-term benefit of $1 million in savings a year from administrative consolidation.

In a “self study” UC Denver did for its accrediting body, the Higher Learn­ing Commission of the North Central Association of Colleges and Schools, the school cites “multimillion dollar savings” from consolidating administrative and service functions. But Krugman is skeptical of that claim.

“I have no reason to say it is either true or not true,” he said. “But I’m not sure I trust that.”

About 200 full-time positions were cut from the budget around the time the university let go of its custodial staff and contracted out the service, Krugman said.

“And then we wound up with more assistant and associate vice chancellors and other folks who are making a lot more than janitors,” he said.

There are examples of cost savings at successful mergers at other schools, including some close to home. The Technical College System of Georgia consolidated 15 of its schools into seven in 2009, which has saved the system $500,000 a year in administrative costs and eliminated $6.5 million in allocations per year for the state, according to spokesman Mike Light. Officials pushed the merger because the state had too many small colleges providing similar services within close geographical areas, he said.

“We found it to be all worthwhile,” Light said. “The merged colleges are working together in greater cohesion so … they’re doing a better job at providing a better workforce,” to employers.

Economic boon

After the University of Toledo merged with the Medical University of Ohio in 2006, business leaders said the move has had a positive economic impact on the community. John Gibney, the vice president of marketing and communications for the Regional Growth Partnership in Ohio, said research that has been conducted since the merger has grown companies and created jobs as a result.

“Ultimately what we’re seeing is greater commercialization of technology, companies spinning off from research created on campus,” Gibney said.

The consolidated Toledo university now has a $1.1 billion economic impact on the area, although that figure is not much higher than the combined impacts of the individual universities when they stood alone, according to a study conducted by Bowling Green State University’s Center for Regional Development the same year of the merger.

However Gibney said the benefits have outweighed any costs, especially in pushing Toledo to be a more respected, research-driven institution.

“This merger, what it did was make the University of Toledo the third largest institution in the state of Ohio,” Gibney said. “What that does psychologically is it raises the profile of the university at the state level. The bigger, the better type thing. All of a sudden, we’re standing out and being recognized.”

According to documents received through a Georgia Open Records request, the University System of Georgia has not done a feasibility study or an analysis of the economic impact of the Augusta merger. And Krugman said the Denver example might not be an apt comparison because the schools there are much larger and probably more complex. But he is not trying to dissuade Georgia officials from pursing a merger.

“I’m not providing advice, other than to say things like this are complicated and they take a lot of time and thought, which most people don’t give it,” he said. “Therefore, be prepared for unintended consequences and a lot of effort to make it work. And hopefully, it won’t detract from the core missions of both campuses.”

PROS, CONS

Similar mergers have been carried out at schools across the U.S. Leaders at those schools offer some pros and cons:

PROS

• Cost savings

• Economic growth

• Increased stature

CONS

• Cost

• Pay inequity among faculty

• Cultural differences

THE BACK STORY

UNIVERSITY MERGER

BACKGROUND: On Jan. 10, the University System of Georgia Board of Regents voted to consolidate eight colleges, including Augusta State and Georgia Health Sciences universities to create a comprehensive research institution.

 

DEVELOPMENTS:

• Records revealed the system kept the plan secret until just a few days before it was to be voted on.

• An e-mail from ASU President William Bloodworth showed his deep concern about the consequences.

• Twenty-one people were appointed to a committee to help the Augusta schools merge.

 

Complete coverage of the Augusta State - GHSU Merger
Impact Study: University of Toledo merger

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