THE BLOG

The Real College Financial Crisis

07/30/2014 05:49 pm ET | Updated Sep 29, 2014

The story of one local community college - Wine Cellar, Private Shooting Club, a College President's $500,000 Comp Package, $600 Million in Construction Projects, & much more...

News headlines in recent months lament the increasingly unattainable costs of college tuition and the growing burden of educational debt in a stagnant economy; President Obama extends loan forgiveness programs; educators themselves wring their hands about the predictably negative impacts these forces will have on social mobility. What's happening in American post secondary education?

If you want to understand the real college crisis in rising college costs, you don't need to look to the Ivy League or even your state's flagship university. Simply take a look at your local community college. We did, and the results were shocking. Even junior colleges have become economic fiefdoms that are completely out of touch with their mission and the limits of a sound financial management.

My local community college, the College of DuPage (COD), is a typical suburban junior college. It serves the usual middle and working class strivers - - good young students who are often financially strapped and living at home, single moms, adults looking to bolster their job skills with evening coursework, first generation Americans looking to step up the ladder of opportunity, and commuters who are packing peanut butter and jelly sandwiches and trying to make ends meet.

The College of DuPage is supported by student tuition and local property taxes. At COD, student tuition has been hiked every year in the past fourteen years- in some years tuition was hiked by 20%. Similarly, COD's public funding has increased local property tax rates by 59% since 2008. Like college administrators and educators have done at universities and community colleges across the country, COD passed these cost increases off as inevitable. Inevitable?

Here's what we actually found when we took a closer look at COD's check register:

• We discovered that the total annual compensation of COD president Robert Breuder is $469,345. Here's a quick breakdown: base salary of $292,000 plus 56 paid personal, vacation, "rest and respite," and holidays. Breuder receives paid cell phone, and mostly paid health and life insurance, plus lucrative extra perks: $72,000 in deferred comp; $24,900 into a retirement annuity; $8,400 of car allowance; $8,400 of "personal development" allowance. Breuder personally pays nothing into the state university retirement pension, but COD pays it for him, amounting to approximately $24,000 annually. So in the five years struggling students at this community college have suffered large percent tuition hikes, the President of this public institution dedicated to making education accessible to all has earned roughly $2,100,000.00.

• Yes, it gets worse. We found that the school paid or reimbursed the President Breuder for annual membership dues and fees of at least $27,931 at the Max McGraw private shooting club in Dundee, IL (2009-2013). What public purpose could there possibly be in taxpayers footing the bill for such private and outlandish expenditures?

• Still worse: Searching COD's checkbook, we found that COD has purchased over $192,000 of wine and wine accessories in just the past three years. And no, this does not include the costs to the community college building a wine cellar, which is a part of the school's upscale French restaurant. But it is included in the $560,000 lost by that restaurant in its first year of operation (2012). Losses for 2013 are still unclear. While typical students were packing their lunches and minding their dimes in 2013, COD won an award from Wine Spectator.

• Like many public universities and local junior colleges, COD has become an economic engine unto itself. In just the past five years, COD has spent $600 million in construction funds. This massive expenditure was justified by COD executives by touting "expanding enrollments." The reality, however, is that official enrollment has decreased by nearly 6,000 students since 2000. In fact, current enrollment is still 1,200 students less than in 1995. Citing other "extremely alarming" misrepresentations brought to light in internal board emails we acquired through a Freedom of Information Act request, Illinois Governor Pat Quinn finally suspended all future capital dollars to COD two weeks ago.

• COD is cash rich, a community college with $180,000,000 in the bank. At the same time, COD students are suffering real pain, as 20% of student loans defaulted within the first three years of graduation.

What's the matter with American college education?

Some of the answers can be found in the excesses of the College of DuPage. Similarly outrageous stories can be found at public junior colleges and universities across the country. It starts with administrative educator elites, who are shamefully and embarrassingly out of touch with the mission and the means of public education. It includes clubby public college boards who do not demand accountability and who duck hard questions and hard conversations.

Then, there's our own meek, face-value acceptance of 'inevitable' increases in educational expenses. Spiking college tuitions and property taxes are anything but inevitable. These excesses are irresponsible. While every other sector of our economy becomes more efficient at delivering value and serving customers, universities and even colleges remain in their own economic fantasyland.

We all own our share of that.

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