The purpose of this study is to explore public-public partnerships between public institutions of higher education and their local municipalities that expand institutional capacity while simultaneously revitalizing urban centers during this time of shrinking public funding. Using a theoretical framework of resource dependency, this study shows how public-public partnerships (PuPs) allow public universities and local governments to combine resources for their mutual benefit. Examples in the study include Arizona State University’s Downtown Phoenix campus, the University of California Davis’s Aggie Square, and California State University Chico’s South Campus Neighborhood Project. The study reflects the advantages of PuPs over public-private partnerships (P3s). Building on literature from public water projects around the world (Hall, et al., 2009) and a highway project in Texas (Battaglio & Khankarli, 2008), this study suggests the advantages of PuPs for higher education and how they may become a new funding model for public higher education infrastructure and urban redevelopment.
Institutions of higher education and the communities in which they are located have become increasingly interconnected since the 1800s (Brockliss, 2000). In urban centers where research institutions have large campuses and strong political influence, “the historical transformations of university and city since the mid twentieth century have been closely intertwined and interdependent” (O’Mara, 2010, p. 235). Under these “town-gown” relationships in the twenty-first century, institutions can have “a positive economic development impact, directly and indirectly, on the community and for the residents” (Kemp, 2013, p. 1).
The Great Recession of 2007-2009 battered resources for public universities and their surrounding communities, making economic partnerships between them more important than ever. During the Great Recession in the U.S., educational appropriations per public college student dropped 24.4 percent from 2008 levels over four straight years to $6,689 in 2012, fueled by 13-percent enrollment growth and “a lack of proportional funding increases” (State Higher Education Executive Officers Association [SHEEO], 2019, p. 19). Although appropriations rebounded for five straight years between 2013-2017, states appropriated almost $2,000 less per student in 2018 than in 2001, and $1,000 less than before the Great Recession, meaning “that ten years after the start of the Great Recession, state funding for higher education has only halfway recovered [emphasis in original]” (SHEEO, 2019, p. 19).
Of course, state and local governments lost revenue, too, because of the Great Recession. Declines in the national economy between the end of 2007 and the middle of 2009 caused state tax collections to fall sharply, reducing aggregate state general fund revenue by 10.3 percent, from $680 billion to $610 billion, between fiscal years 2008 and 2010 (National Association of State Budget Officers, 2013). The significant decrease in housing prices during the Great Recession caused local property tax revenues to drop, albeit with a lag of about three years (Dadayan, 2012). Adjusting for inflation, local property tax collections declined 2.8 percent in the first quarter of 2012 compared to the same quarter of 2011, “marking the sixth consecutive quarterly decline in real revenues” (Dadayan, 2012, p. 6). Public-public partnerships (PuPs) helped public universities and their local communities to share scarce resources to address critical infrastructure needs, establishing a powerful financing model that could be readily replicated.
This study borrows from the literature of public water works and highway projects. This interdisciplinary review is in the spirit comparative education, specifically Alger and Harf’s (1986) definition of “global education,” meaning an emphasis on “values, transactions, actors, mechanisms, procedures, and issues,” including a variety of actors at all levels of government conducting transactions across boundaries and industries (Arnove, pp. 7, 8).
A study of over 130 PuPs for water operations in about 70 countries over a period of
over 20 years (Hall, et al., 2009) reported several advantages over other partnerships that are based on commercial objectives. The advantages included mutual understanding of public-sector objectives; local control over objectives and methods; a non-commercial relationship, with low risk; transparency and accountability; low transaction costs; long-term gain in capacity-building; and the possibility of engaging the local civil society and workforce.
A study of toll roads in Texas (Battaglio & Khankarli, 2008) indicated the advantages of PuPs over public-private partnerships (P3s). P3s have potential problems over accountability and legitimacy, including concerns over transparency of transactions, the use of public resources to benefit private businesses, and the degree of government control over contractors; and the inability of citizens to determine the responsible party for particular services.
This study is a mixed-methods multiple case study of three public-public projects: Arizona State University’s Downtown Phoenix campus, Aggie Square at the University of California Davis, and California State University Chico’s Resilient Cities Initiative that led to Chico’s South Campus Neighborhood Plan. Analytical methods included document review and interviews, as well as quantitative analyses of municipal and university budgets.
This study uses “resource dependency theory” as its theoretical framework. Resource dependency theory posits that organizations are not “self-directed, autonomous actors pursuing their own ends” but are instead “other-directed, involved in a constant struggle for autonomy and discretion, confronted with constraint and external control” (Pfeffer & Salancik, 1978, p. 257). Resource dependency theory indicates that organizations look for ways to increase their autonomy “by making their environment more predicable and favorable,” such as forming coalitions “to gain greater influence” (Bolman & Deal, 2003, p. 235). Public-public partnerships are one such coalition.
Definition of “Public-Public Partnerships”
Public agencies increasingly recognize the need to partner with other public agencies to share resources to address issues that neither entity alone can tackle. Public-public partnerships are a strategic response to resource dependency, allowing individual agencies to combine technical, managerial, and financial resources to reduce risks and transaction costs while entering major projects (Greasley, Watson, & Patel, 2008).
Simply put, public-public partnerships are “partnerships between public authorities (government) and any part or member of the general public,” such as communities, NGOs, and other government actors (Hall, Lethbridge, & Lobina, 2005, p. 4). Unlike public-private partnerships – which are entered between local authorities and a private entity “motivated by commercial gain” – public-public partnerships are based on “a peer relationship forged around common values and objectives, which exclude profit-seeking” (Lobina & Hall, 2006).
Research Findings: Higher Education Examples of Public-Public Partnerships
In the United States, three public universities recently partnered with their local communities to maximize public funding and mutually meet each other’s needs. They are Arizona State University, the University of California Davis, and California State University Chico.
Arizona State University, Downtown Phoenix, and “The Central Idea”
Arizona State University (ASU) enrolls over 42,000 undergraduates, the sixth-highest in the U.S. (Kowarski, 2018). Based in the city of Tempe and with two other branch campuses, the university partnered with the City of Phoenix, about 10 miles west of Tempe, to create a fourth ASU campus to revitalize downtown Phoenix and provide more facilities to enable ASU to serve Arizona’s growing population (Fischer, 2006).
Funding sources. On March 14, 2006, Phoenix voters by a 2-1 margin approved seven bond issues totaling $878.5 million for citywide projects, which included $223 million to develop ASU’s Downtown Phoenix campus (Fischer, 2006; Hardesty, 2006-2007). ASU’s investment was reflected in its commitment to relocate to the new downtown campus its academic programs and schools that the university considered would benefit most from an urban setting. The first, in 2006, included the College of Nursing, the College of Public Programs, and University College, and later the School of Global Health and Medicine, the Walter Cronkite School of Journalism and Mass Communication, the Thunderbird School of Global Management, and the Sandra Day O'Connor School of Law. Campus enrollment was planned at 15,000 students.
The Central Idea. In addition to ASU’s needs, the City of Phoenix needed to redevelop. “Having a relatively empty urban core in the fifth-largest city in the United States was not helpful in the attraction of new companies or research talent. Accordingly, both parties were motivated to fix the problem,” said Wellington “Duke” Reiter, executive director of ASU’s University City Exchange and senior advisor to the president (Walker, 2018).
The solution to the problem was The Central Idea, focused on the potential of Central Avenue, the “fundamental organizing boulevard” of Phoenix (Reiter, 2017, 11). As Reiter explained:
By deliberately concentrating meaningful investments—public, corporate, and philanthropic—this singular spine can provide an authoritative narrative tailored to this place, and become a center of gravity for a region asserting itself on the national stage. In the process, we imagine the emergence of an extraordinary urban vernacular which is responsive to our climate, an elevated role for arts and culture, and a population fully representative of our diverse heritage (p. 11).
For the City of Phoenix, public investments included new police and fire stations, improved parks, expanded libraries, upgraded streets and sewers, and the Valley Metro light-rail system, which connects Mesa to northwest Phoenix by way of downtown. Since the Phoenix campus opened in August 2006, the light rail has contributed significantly to redevelopment. Private sector development on parcels within a short distance of the campus and rail line since 2008 has totaled $8.2 billion, and the rail line is planned to extend 66 more miles by 2034 (Reiter, 2017).
University of California Davis’s “Aggie Square”
The University of California Davis, 15 miles from the state capitol building in Sacramento in northern California, enrolls over 37,000 students, including 30,000 undergraduates. Its largest graduate programs are in Health Professions and Related Programs, including Medicine and Veterinary Medicine.
On April 12, 2018, the City of Sacramento and UC Davis announced they would build a technology and innovation campus called Aggie Square on 25 acres set aside by the university on its Health Campus for a research and innovation district (Lillis, 2018a). The university will gain a research center and teaching space, while the city anticipates a job generator (Lillis, 2018a). Sacramento Mayor Darrell Steinberg said, “The direction is clear and cannot be repeated enough: as we grow a dynamic economy and take advantage of all of our institutions and assets, that growth must be tied to our neighborhoods, our communities, especially our communities of color” (Lillis, 2018a).
Health care and other STEM research top the list of projects at Aggie Square. Aggie Square’s first project is a $60 million, 40-bed rehabilitation hospital for stroke and brain trauma patients (Lillis, 2018b). In its request for qualifications announced by UC Davis on June 11, 2019, the development of Aggie Square called for 500,000 square feet of science, technology and engineering space, 250,000 square feet of classroom, office and coworking space, 250 multifamily residential units for university affiliates, and 40,000 square feet of community space on the ground floor (Moleski, 2019).
Funding sources. Funding for Aggie Square will come from several public sources. From the state, California’s FY2019 budget included $2.8 million for community engagement and outreach, internal planning staff, external consultants, technical experts, and legal experts (Topousis, 2018). Mayor Steinberg expected Sacramento to contribute, and UC Davis Chancellor Gary May indicated that the university would raise money for the project (Lillis, 2018a). Assemblyman Kevin McCarty, who represents Sacramento and sponsored the $2.8 million planning grant in the state budget, described Aggie Square as “a quadruple win” for the State of California, UC Davis, the City of Sacramento and the Stockton Boulevard Corridor. “The partnership will allow the University of California to accommodate more students, support small businesses in our community and foster economic development throughout the Sacramento region,” McCarty said (Topousis, 2018).
Cal State Chico and the “South Campus Neighborhood Project”
In 2016, the Institute for Sustainable Development at California State University (CSU), Chico launched the Resilient Cities Initiative (RCI). The RCI connects expert faculty and students with municipalities and communities across the university’s service region on sustainability and resilience projects identified and funded by partner agencies (Alexander & Pushnik, 2017). The RCI first collaborated with the City of Chico in a two-phase study of the South Campus Neighborhood, which focused on a 42-square-block residential area immediately adjacent to the university and downtown Chico, with the goal of assisting in the development of a Neighborhood Improvement Plan (Alexander & Pushnik, 2017).
The city’s initial priority was transportation and public-right-of-way issues in the South Campus Neighborhood. After a car struck and killed a man walking across a local street in March 2015 (Pincus, 2015), nearly 1,200 students signed a petition to address safety in the South Campus Neighborhood (Ottoboni, 2019).
Funding sources. CSU Chico’s public-public partnership reflects two distinct contributions of funding: dollars, and donated talent. The City of Chico dedicated $50,000 to Phase I of the South Campus Neighborhood Plan, with the city’s director of Public Works managing the project. Ultimately, the city intends to use the South Campus Neighborhood Plan to apply for grant funds for the final design and construction costs. The city also plans to ask CSU Chico to partner on potential match funds, “as it directly affects the safety and accessibility of their students adjacent to the university campus” (Ottoboni, 2019, p. 2).
CSU Chico provided the talent of its faculty and students across a variety of academic disciplines. Nine faculty members from seven departments and over 400 students in 16 university classes participated in data collection, analysis, and conceptual designs (Alexander & Pushnik, 2017; Ottoboni, 2019). For example:
Analysis and Discussion
The PuPs examined in this study have several characteristics in common. First, the projects helped to redevelop urban areas and serve growing populations or populations of color. The universities benefitted academically, either through new physical spaces for teaching and research, or pedagogically through experiential learning. Health and safety in the communities improved through facilities like a nursing school or new hospital, or upgrades to traffic patterns and streetscapes.
The financial resources for the partnerships were exclusively public, either municipal or state. The magnitude of the financial support varied widely, however, from the City of Phoenix’s $223 million bond issue to the State of California’s $2.8 million grant to the City of Chico’s investment of $50,000.
The CSU Chico project on the South Campus Neighborhood highlights the broad nature of resources that can be shared. Beyond dollars, other resources can be:
The study finds that in this time of scarce public resources, public universities and their host municipalities mutually benefit from public-public partnerships (PuPs). Universities gain new facilities that might not otherwise be built, such as classrooms and research centers. Municipalities, after an initial investment of public dollars, see long-term benefits in economic development and improved public safety. Expanded downtown businesses and campus-based business incubators create jobs. Improvements to transportation infrastructure and traffic safety attract more businesses, generating a virtuous cycle of investment from corporate and philanthropic partners, which helps to expand venues for arts and culture.
This study has significance for both public institutions of higher education and for their surrounding communities, especially as some economic data point to the next recession (Ip, 2019). First, public-public partnerships are an effective model to finance university facilities, helping institutions stretch scare resources to support their educational enterprise. Second, public-public partnerships help cities improve their residents’ quality of life and redevelop in ways that might not be possible without an anchoring university. While not quite as dramatic as the benefits of a real puppy described by Rudyard Kipling (“Buy a pup and your money will buy/Love unflinching that cannot lie”), PuPs may become an increasingly important source of funding for public higher education and municipal development as central government funds remain dogged by economic uncertainty.
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