State University of New York chancellor Nancy Zimpher punctuated her speech at the Harvard Club of New York with images of a flustered youth, knights at the roundtable and comic-book superheroes.
While her presentation at a Citizens Budget Commission breakfast in midtown Manhattan elicited a few chuckles, Zimpher's impassioned pitch for more funding while challenging the system from within was serious.
"We're good. SUNY is really very, very good, but you know what? We are not good enough," she said of a system that enrolls nearly half a million students from 170 countries across 64 campuses and employs nearly 90,000 people.
She repeated the "not good enough" buzzline several times during this stop on a whirlwind statewide tour to promote "Stand with SUNY," an initiative designed to generate state support for its public university system, beef up an investment and performance fund, keep board control of predictable tuition hikes and win state legislative extension of the NY-SUNY 2020 five-year capital plan, scheduled to expire at the end of 2016.
The board of Albany-based SUNY last month approved an $8.7 billion
SUNY's board also called for boosting the investment and performance fund to $50 million from $18 million.
Zimpher, SUNY's 12th chancellor, presides over one the nation's largest higher-education systems. Every New Yorker lives within 30 miles of a SUNY facility.
"I like this fact," said Citizens Budget Commission president Carol Kellermann.
State lawmakers reconvene in Albany next month. Against a March 31 deadline, they will begin to hammer out a roughly $137 billion budget for fiscal 2017.
Education funding at all levels is generally a hot-button budget topic.
"Every single year there are always two or three issues that seem to be the sticking point," state Assemblyman Phillip Goldfeder, D-Queens, said in a Bond Buyer
Alan Schankel, a managing director at Janney Capital Markets, said size and consistent state aid are SUNY's biggest attributes.
"Size always helps, but state support is also significant," said Schankel. "About one-third of their revenue is from the state and that has stood over time. There have been slight ups and downs but state support overall has been good."
According to Fitch Ratings, fiscal 2014 operating revenue totaled $9.8 billion, with its largest components state operating appropriations (31.4% of revenues), health-care operations and student-generated revenues (25.5% and 21%, respectively).
"Exposure to their medical sites is a caution, not a problem," Schankel added. "Certainly in a day of $30,000 to $50,000 tutitions, even with the discounting, there's an attraction for a system where the tuition is relatively low and the state support is pretty good."
According to Fitch, SUNY's sale of Long Island College Hospital in Brooklyn's Cobble Hill neighborhood to developer Fortis Property Group – amid heated community discontent --should ease pressure on health-care operations. State Supreme Court Justice Johnny Lee Baynes in July signed off on the $240 million sale to Fortis, which closed on the purchase two months later.
The hospital, part of the SUNY Downstate University Hospital since a 2011 merger, "had been a financial drain on SUNY for the past few years," Fitch wrote.
"Concern over SUNY's reliance on health-care operations is partly mitigated by its strong enrollment profile, which drives steady demand for on-campus housing and solid coverage of dormitory-related debt service."
According to Moody's Investors Service, SUNY's credit challenges include escalating patient-care revenue exposure with a challenging payer mix; ongoing expense pressures including those arising from state-mandated benefits; and its vast capital needs.
"The health-care environment is a little unsettled," said Schankel.
CBC's Kellermann praised Zimpher as an educational advocate.
"She believes in the importance of state universities as collaborators with both K-to-12 educators and with business and industry as an engine of economic development in the communities in which its campuses are located," she said.
Zimpher became SUNY's 12 chancellor in June 2009 after stretches as president and chancellor, respectively, at the University of Cincinnati and the University of Wisconsin-Milwaukee. She has also been an executive dean at Ohio State University.
Earlier in the year, the board outlined a plan to allocate $100 million in an expanded investment and performance fund in support of an agenda that aims to increase the number of graduates from 93,000 to 150,000 annually by 2020.
The system received $18 million in the fiscal 2016 state budget for the investment fund.
Building on that, plus $55 million in bonded capital support through the fifth round of the capital program and an additional $4.4 million designated in the enacted budget from the Educational Opportunity Program for at-risk students, the board identified strategic use of existing resources to bolster the fund.
SUNY issued a request for proposals for campuses and colleges to apply for funds and received more than 200 proposals designed to improve student advising, increase research, enhance workforce development and strengthen K-12 engagement.
It's asking the state to kick in another $32 million to the fund and to renew NY-SUNY2020. It also wants its board to retain tuition-setting authority for the next five years.
Predictable tuitions, said Zimpher, are essential for the system. In 2011, state lawmakers approved a five-year tuition increase plan that enabled the system to raise resident undergraduate tuition by $300 per year.
"We simply cannot go back to a time when students applied to SUNY without knowing what their tuition rates would be year-to-year, when our state-operated campuses faced massive reductions in direct support from the state; and when each new budget further decreased funding per student for our community colleges," said Zimpher.
According to Fitch Ratings, SUNY tuition for in-state residents remains affordable compared with other state university systems.
SUNY finances its capital projects in two ways.
Educational facilities bonds and bonds issued under the state personal income and/or sales tax credits fund educational and athletic facilities.
Residential facilities – the Dormitory Authority of the State of New York is the conduit issuer – are funded with dormitory revenue bonds payable from revenues derived from the residential facilities, with SUNY general obligation further supporting the now-closed dormitory lien bonds.
Bank of America Merrill Lynch priced DASNY's $252 million of Series 2015B dormitory facilities revenue bonds for SUNY. Moody's and Fitch rated the bonds Aa3 and A-plus , respectively, on Dec. 4.
