After years of turmoil and infighting over how to navigate out of a financial crisis, the Cooper Union for the Advancement of Science and Art now has an outline for the future, one that includes more transparency and close monitoring by the state.
And yet questions remain about Cooper Union’s past — specifically, how the engineering and design college in New York City fell into such dire straits that it had to begin charging tuition for the first time in a century.
A court filing on Wednesday by New York’s attorney general, Eric T. Schneiderman, paints a deeply unflattering portrait of Cooper Union’s leadership, especially in the last decade. Mr. Schneiderman’s office says that the Cooper Union board fell down on the job while its last two presidents pursued survival plans that were deeply flawed and ultimately made things worse.
Lawyers for Cooper Union issued a blanket denial of the attorney general’s narrative, calling it “incorrect and incomplete in numerous respects.” Even though the board could not steer the college out of a tailspin, its lawyers said, it had acted in good faith and exercised reasonable business judgment. A Cooper Union spokesman told The Chronicle that the college had no comment on specific assertions made by the attorney general.
With that in mind, here are five damning claims Mr. Schneiderman’s office made against the past two Cooper Union administrations.
1. George Campbell, Cooper Union’s president from 2001 to 2010, made $350,000 in personal bonuses pushing an imprudent plan to build a fancy new academic building.
What the attorney general charges: Mr. Campbell guessed that Cooper Union could raise the funds to cover the cost of the new building while creating new revenue by leasing out the old property to a commercial developer. The president had a personal stake in the plan: His contract stipulated that he’d get $175,000 if he put up the new building, and another $175,000 if he leased the old one.
When fund raising for the new structure fell short, Mr. Campbell insisted on building it anyway, and he persuaded the board to take out a risky loan to do so. (Mr. Campbell did not immediately respond to an email seeking comment on the attorney general’s claims, and he did not respond to The Wall Street Journal earlier this week either.)
2. The board approved an optimistic plan to repay the building loan, with no safeguards in case any part of the plan failed. Every part failed.
What the attorney general charges: In order to repay the loan for the new academic building, Cooper Union needed to cut spending, secure tax benefits that the city was trying to take away, raise an ambitious amount of money, and earn good returns on investments it planned to make with some of the cash it borrowed.
None of that worked out. The spending cuts proved untenable, the city took away half of the expected tax benefits, the fund-raising campaign faltered, and the 2008 market crash scuttled the investment returns.
3. The president and board members hid the college’s financial problems after the loan-repayment plan fell apart.
What the attorney general charges: Rather than sound the alarm, Mr. Campbell tried to paint a pretty picture of the college’s finances. In interviews he made misleading boasts about the stability of Cooper Union’s operating budget and the growth of its endowment. The president also distorted the college’s financial position in reports to the board.
The board, meanwhile, appears not to have asked a lot of questions, at least not on the record, about the consequences of the failed loan-repayment plan.
4. The board hired Cooper Union’s next president, Jamshed Bharucha, before most members ever met him.
What the attorney general charges: Mr. Bharucha’s term as president was a tumultuous period, marked by litigation and infighting, which ended in June when he resigned along with five board members.
This is notable because his term began under unusual circumstances. In 2010, when Cooper Union hired a search firm to help find a replacement for Mr. Campbell, Mr. Bharucha was not on the short list. He was brought in late in the process and appointed in a hurry, one day after having lunch with a Cooper Union trustee in New Hampshire. Most board members did not meet Mr. Bharucha before selecting him as president.
5. The new president tried to force the creation of a new, moneymaking degree program despite faculty concerns about poor academic quality.
What the attorney general charges: Part of Mr. Bharucha’s plan to keep Cooper Union afloat was to create revenue-generating degree programs, beginning with a bachelor’s degree in computer science. But the college’s engineering faculty rejected two different proposals for the program, citing a lack of academic rigor.
The president and his engineering dean submitted the program to the state education office anyway, and started recruiting students to the program. The president and the dean allegedly distorted or withheld information at several stages in the hope of getting the computer-science program up and running. (The board killed the program in April after the attorney general intervened. The engineering dean announced her resignation soon after, followed by Mr. Bharucha and his board allies.)
Mr. Schneiderman opened his inquiry at Cooper Union to resolve a lawsuit against the administration by alumni, faculty members, and students who were upset by the board’s decision to start charging tuition at the college — a decision that will stand for the foreseeable future.
The attorney general’s narrative dovetails with the terms of a consent decree, also delivered on Wednesday, that places Cooper Union under the close watch of the attorney general and the court while granting additional governance power to students, professors, and alumni until 2025.
Steve Kolowich writes about how colleges are changing, and staying the same, in the digital age. Follow him on Twitter @stevekolowich, or write to him at steve.kolowich@chronicle.com.
