Cooper Union has struck a deal–overseen by Eric T. Schneiderman, New York’s attorney general–that could help solve the school’s fiscal crisis, and might also lead the institution to eventually return to its longstanding tuition-free model. The school’s administration started charging students in 2014, breaking Cooper Union’s long tradition of tuition-free education. This is all according to the Committee to Save Cooper Union (CSCU), an organization that has been involved in a legal battle with school trustees, prompting an investigation by the attorney general’s office.
In a statement, first published in the New York Times, Schneiderman said, “It’s my job to promote and protect New York’s nonprofit sector, but we also have to step in to help institutions like Cooper Union when they face fiscal and governance problems. We’ll continue to monitor the school’s progress to make sure it’s on a path to long-term sustainability—and, I hope, free tuition.”
A Consent Decree, which has been signed by Cooper Union, the CSCU, and Schneiderman, and which is expected to be filed on Wednesday, outlines a plan for fiscal responsibility that empowers students, alumni, faculty, and staff. One provision, according to the CSCU’s website, is that “a special committee of the Board will be dedicated to development of a strategic plan to return the school to its traditional tuition-free policy.” The Board will also expand to include student trustees, additional alumni trustees, and faculty and staff representatives. Once the plan is approved, an independent financial monitor, appointed by the attorney general, “will be responsible for evaluating and reporting on the financial management of Cooper Union,” according to the CSCU.
The school announced that it would begin charging tuition in 2013, sparking protests among students, and a great deal of outside criticism. The decision came from a financial debacle involving the construction of a new engineering building, for which the school took out a $175 million loan. The school, as Schneiderman told the Times, “relied on optimistic assumptions to achieve long-term solvency, including an assumption it could invest $35 million in borrowed funds in the stock market and profit by making returns in excess of the loan’s interest rate.” This decision was met by the market crashing in 2008, derailing the plans and leaving the school with an expanding deficit.
As for helping the school become financially secure, and to hopefully stop charging tuition, Richard Lincer, the chairman of Cooper Union’s board of trustees, told the Times, “It’s going to be an uphill climb[.]”