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New York Attorney General Is Investigating Cooper Union’s Finances

The Cooper Union's 41 Cooper Square building (photo by Jillian Steinhauer for Hyperallergic)
The Cooper Union’s 41 Cooper Square building (photo by Jillian Steinhauer for Hyperallergic)

New York State’s Attorney General, Eric Schneiderman, is investigating the Cooper Union for the Advancement of Science and Art (CU), the Manhattan university that recently began charging students tuition after more than 150 years of operating as a full-scholarship art, architecture, and engineering school. University board members confirmed news of the investigation to the Wall Street Journal.

When CU’s board of trustees decided last year to start charging tuition, its chair Richard S. Lincer claimed that to do so was “the only realistic source of new revenue in the near future.” The Attorney General’s office will be looking into the decisions that left the university in such a precarious financial situation, sources told the WSJ. It will also investigate the decision to start charging tuition itself, which was the subject of protests, demonstrations, multiple occupations, and, currently, a lawsuit filed by five CU alumni and admitted students.

“Parts of this campaign have taken a turn toward the more bureaucratic,” Victoria Sobel, an alumna of CU’s School of Art and member of Free Cooper Union, told Hyperallergic over the phone. “This investigation adds another layer to what’s been going on and brewing behind the scenes. From our perspective, this was bound to happen because of the administration’s many egregious infractions.”

The investigation will look into a number of decisions made by current and former CU trustees. Foremost among these issues is the school’s management of one of its greatest assets, the land beneath the Chrysler Building and the tower itself, which, as of 2009, brought in $7 million annually, according to another WSJ article whose title, “One College Sidesteps the Crisis,” now seems bitterly ironic.

Other decisions that will be looked into by Schneiderman’s office include a $175-million loan, for which the Chrysler Building served as collateral, that the school took out in order to build more than $100 million worth of new facilities, possible inconsistencies in the board’s financial decisions related to the school’s website, and a bonus the trustees approved for former school president George Campbell Jr, who stepped down in 2011 and was succeeded by current president Jamshed Bharucha.

“In the fall of 2011, based on a projection by our investment advisors of our liquidity, I was alarmed to learn that Cooper had only two years of liquidity left, maybe three if the financial markets performed well,” Bharucha wrote in a report titled “The State of Cooper Union” that was sent out to the entire CU community on March 18. “That meant that Cooper didn’t have the resources to graduate the freshmen, or to recruit the next class of high school seniors who were in the midst of applying. Urgent action was needed on a massive scale to avoid the fiscal cliff and, more importantly, to put the institution on a truly financially sustainable path.”

But Schneiderman’s decision to investigate Bharucha and the board’s actions casts doubts on the claims of financial stability and sustainability being made throughout the “State of Cooper Union” report. The document also reveals the forthcoming launch of a new school within CU, the Institute for Design and Computation, and the impending addition of more programs as part of a plan for “broadening the revenue base.”

“All the while that [the protests and occupations have] been happening, the president and the board have continued their propaganda campaign to justify charging tuition,” Sobel said. “Its a narrative rewriting of the school’s history. They don’t want to show that there’s any kind of problem, and that’s been working for four years.”

The case of Cooper Union, though unusual, resonates with many of the issues related to student debt and faculty exploitation that are becoming increasingly prominent in the discourse of higher education in the United States. (These problems and many others were discussed at the school in January, when it hosted the “Artist as Debtor” conference.)

“We started out four years ago literally banging a drum outside the school and yelling ‘what’s going on?'” Casey Gollan, another alum of CU’s School of Art and member of Free Cooper Union, told Hyperallergic. “The next step is, if this investigation is actually looking like a win, what kind of governance model do we want the school to move on with. To what extent is this kind of legal investigation going to be able to get rid of the all the parasitic entities that have plagued the school for the last four years? On a community level we have to ask, if we win, what happens next?”

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