The gleaming towers sprouting above the Aurora skyline look like the makings of a medical research utopia, the envy of scientists across the nation and one of the largest training grounds for doctors, dentists, nurses and pharmacists.
But as the University of Colorado Health Sciences Center prepares for a massive $822 million move to its shiny new digs, its operating budget has dwindled so low that administrators say it is on the brink of crisis.
The state is investing $335 million over 25 years, which includes $133 million in interest, to transform the shuttered Fitzsimons Army base into a 21st-century research campus, with money coming out of Colorado’s fund for capital construction. Meanwhile, state money to support operations and salaries within the walls of the Health Sciences Center – money divvied up by lawmakers out of the state’s general fund – has shrunk dramatically.
The striking disparity in funding has some questioning what Fitzsimons’ magnificent research towers are worth if CU can’t afford to hold onto renowned researchers and its reputation as a top-notch medical school.
A mass exodus of faculty worn down by low salaries could lead to slippage in the medical school rankings, though CU president Hank Brown and others are hesitant to discuss that. “I’m not anxious to talk about how we are on the edge in terms of quality,” Brown said.
Brown has begun making his pitch to state lawmakers for more money and hitting the media circuit in a year-long campaign to enlighten the public about the discrepancy between the state’s investment in bricks and mortar and the brutal cuts to the operating budget.
The Health Sciences Center – which includes the medical, dental, nursing and pharmacy schools – has gotten by in large part by subsidizing the costs of educating students through strategies that some say are eating away at faculty morale.
The campus puts pressure on faculty to earn their own salaries through practicing medicine at University of Colorado Hospital and The Children’s Hospital; the state funds just 3 percent of professors’ salaries.
Then faculty have to contribute 10 percent of their clinical practice earnings for a “dean’s tax” that supports academic enrichment and research investments – projects that, in other medical schools, are funded by the state. The “tax” generated about $16 million this year at CU and, in the past, has funded the nutrition and cancer centers.
“We are clearly subsidizing the cost of educating our students,” medical school dean Richard Krugman said, adding that he does not believe CU is spending less to educate students than other medical schools.
Many medical schools have a dean’s tax, but CU’s 10 percent is on the high end, said Lilly Marks, associate dean for administration and finance.
“What it is is an extraordinary commitment by faculty to pay for what other states would pay for,” she said.
Students also pay the price.
The campus has jacked up tuition as high as administrators are willing to go – from $11,966 for a medical student in 2002 to $20,718 last year.
Students also are “profoundly” affected because faculty feel such intense pressure to earn their salaries through seeing patients that they can’t spend more time teaching, said Frank deGruy, chair of family medicine. He called the medical school’s standing “very fragile.”
Another financial tactic used by the Health Sciences Center is the allocation of 25 percent of the nearly $60 million in administrative funds that come annually with federal research grants to pay off debt on the Fitzsimons campus. As a result, the campus is getting far less than it used to for office upgrades and research equipment.
Some faculty say using dollars tagged to federal grants to “pay the mortgage” on Fitzsimons has weakened CU’s ability to compete for grants. The fear is that a decline in the caliber of research could reduce Fitzsimons to a shell. “Many of us decided it was something that was too risky to stick with,” said Robert Schooley, an AIDS researcher who left CU for the University of California at San Diego. “It’s not the linoleum that writes the grants; it’s the faculty that write the grants.”
Schooley, who, along with his wife, brought $6 million in federal grants to CU each year, said it will take the university a decade to “build back what they’ve lost over the last four or five years.”
The campus lost 19 radiologists from January 2004 to last month, some to higher-paying jobs in the private sector. It also has lost top faculty to other universities where there is less pressure to earn their salaries.
When momentum for the Fitzsimons project began building in 1996, the economy was chugging along; it was before the terrorist attacks of Sept. 11, 2001, and before the Taxpayer’s Bill of Rights strapped the state’s colleges.
State funding for the Health Sciences Center’s operations dropped nearly $18 million in four years – from $73.5 million in 2001 to $56 million last year.
Just 7 percent of the Health Sciences Center’s budget comes from the state, compared with about 40 percent from grants.
CU ranks fourth among public medical schools in the amount of federal grant money it brings to its campus. This is despite that the medical school ranks 71st out of 73 public medical schools in the amount of state and tuition support it receives per student.
“For Colorado, with its kind of pauper-ish support from the state, to be as successful as it is speaks to the commitment of the individuals there,” said Jack Krakower, an associate vice president with the Association of American Medical Colleges.
The Health Sciences Center got a significant boost from the passage of the budget reform measure, Referendum C, to $61.3 million for next year, but Brown wants funding at least restored to previous levels.
To compound the financial strife, medical schools are bracing for a more competitive market for grants as the National Institutes of Health’s budget flat lines.
Faculty members say the salary system has deflated morale and that the ones who stick around stay only because they love teaching.
“It’s worse here because we’re being asked to cover our teaching costs through other activities,” said Colleen Conry, family medicine vice chair and president-elect of the Faculty Senate.
Still, Conry said, the majority of faculty don’t believe CU has taken on more than it can handle in the move to Fitzsimons. She says it’s an “opportunity of a lifetime” that has the attention of colleagues nationally.
“The challenge is how do we pay for what goes on inside these walls,” said Conry.
The campus is able to pay its faculty because of the prosperity of University Physicians Inc., which manages faculty members’ clinical enterprise at the hospitals. UPI is expected to bring in $250 million this year.
Tom Blumenthal, head of biochemistry and molecular genetics, is transferring to the Boulder campus, where the state will fund his salary. He said only time will tell whether taking on the colossal Fitzsimons project was an act of mismanagement or the brainchild of visionaries.
“In 25 years, we’ll know the answer,” Blumenthal said.
CU expects to sell the campus at East Ninth Avenue and Colorado Boulevard for about $35 million when it completes the move to Fitzsimons in 2008.
University leaders aren’t expecting any profit – the school still owes more than $10 million for building projects over the years, and it could spend millions cleaning up asbestos.
Administrators, who say it’s pointless to invest in the crumbling Ninth Avenue campus, staunchly defend their decision to divert federal research payments to Fitzsimons debt. Hardly a week passes there without a power outage, burst pipe or some other breakdown.
“It would have been putting money down a rathole,” said Teresa Berryman, the campus’ vice chancellor of budget and finance.
Cost of the move
Here’s the breakdown of the University of Colorado Health Sciences Center’s move to Fitzsimons:
State contribution: $32 million in capital construction; $202 million for certificates of participation or lease purchase agreements sold to investors*
University debt: $345 million, mostly for two research towers, a diabetes center and a parking structure
Cash: $150 million
Donations: $20 million
Federal contributions: $60 million
Contributions by University Hospital and The Children’s Hospital: $12 million
Total: $822 million
*Does not include an estimated $133 million in interest over 25 years
Source: CU
