As anyone who has been following the news knows, UMass Amherst deal to acquire the Mount Ida College campus in Newton is drawing intense political heat.
As I wrote in a statement for the Newton-Needham Chamber, lost in all the noise is the fact that this proposal would be really good for growing jobs, the economy and entrepreneurship in Newton.
But there’s an added reason why everyone in Newton should hope the UMass Amherst agreement stands. And that’s because of what might happen to Mount Ida’s 74-acre, wooded campus in Oak Hill.
The most likely scenario would be that the property goes into receivership. And if that happens the courts would control what happens next. Yes, the property could end up back on the tax rolls. But it also could end up being a housing development, or 40B, far larger than the eight houses at that had folks so up in arms at Carlson Woods.
For anyone who is thinking “We should just build commercial offices and generate buckets of new commercial tax revenue!,” I recommend spending some time studying development trends. Employers and employees today don’t want their offices located in isolated commercial office parks. They want to be in mixed-use areas with lots of housing, amenities and transit.
Now I’m a big proponent of building more housing. In fact, I think we have a moral imperative to help address our region-wide housing crisis. I also know that many businesses won’t locate here unless we create more places for their workers to live.
But I’d rather see us build more housing at Riverside, on the Northland site, along a revitalized Washington Street where there’s transportation option and solutions available.
The Mount Ida campus would be a fabulous place for UMass Amherst to train our next generation of entrepreneurs, scientists, teach workers and other innovators. (And I’m excited about their plans to offer continuing ed classes too.)
Doing so, will make the rest of Newton’s commercial property more attractive to innovative companies and grow our city’s commercial tax base.
And that’s why you should hope the UMass Amherst plan moves forward.
I guess that if you limit yourself to only caring about Newton’s real estate values, economic growth, and elitism and ignore what’s fair for everyone in the Commonwealth, then you should be all in favor of Marty Meehan’s new project. It fits perfectly into Greater Boston’s social narrative of urban disinvestment, economic segregation, and educational exclusivism that been so painstakingly constructed over the last 50 years.
Do those who attend UMass Boston, often struggling to work and raise children at the same time, really think that they deserve to have a facility that’s not collapsing into its parking garage? Not so fast: they must wait their proper turn, i.e. for a few more decades so that we can shoot $70 mil to “open essential work and internship experiences to students from the flagship Amherst campus.”
It would be laughable if it weren’t so disgusting.
It would have been better had Mt. Ida accepted the offer from Lasell that would have protected their faculty and students, especially those in specialized programs. The Mt. Ida administration acted shamefully and cruelly, to both existing and prospective students, including sending acceptance offers with financial aid packages they knew they didn’t have the money to fund and then not even notifying accepted students that they were closing.
https://www.bostonglobe.com/metro/2018/04/11/lasell-college-deal-would-have-kept-mount-ida-open/87FQXnjnAg2JRkqYV9QrFN/story.html
Regarding the UMass Boston vs Amherst angle, my understanding is each campus has it’s own budget completely independent of the others. Unless UMass Boston was also interested in acquiring Mount Ida they’re not really impacted outside of optics, the money to pay for this is coming out of Amherst’s budget so it’s not like they’re loosing funding.
Mount Ida on the other hand is looking worse and worse, apparently the Lasell offer would have maintained the programs and staff but instead they chose to lay everyone off and kept extending financial aid offers knowing they couldn’t be honored. With all these details coming out now it makes more sense why they were rushing to sell off those parcels. The acquisition by Amherst is better than some of the alternatives, but this was still handled very poorly. I’m hoping the deal does go through due to the uncertainty of what would happen otherwise but the scrutiny that they’re facing is well deserved.
I wonder if Lasell is going to end up in a similar situation in the near future with all the struggles that smaller colleges are facing.
From the article, it sounds like Lasell is in pretty good shape and would have been rescuing Mt. Ida. Looks like the administration there just didn’t want a deal where they’d have to cede control to someplace else (i.e., admitting they’d grossly mismanaged the place) and preferred to just blow it all up.
Patrick, I don’t follow your argument regarding the UMass budget.
This is a public university system that receives more than $700 million in annual appropriations from the Commonwealth, which is then apportioned among the campuses. Tuition covers only about one-fourth of expenditures. The individual campuses aren’t self-sustaining.
The money UMass Amherst is going to borrow to finance the Mount Ida purchase are not taxpayer dollars and are not available to UMass Boston.
What Michael said.
Well said Michael.
@Michael – Some of the editorials made it sound like UMass Amherst was funding the Mount Ida purchase at the direct expense of UMass Boston. While ultimately they do both (along with Dartmouth) draw from the overall UMass system the funds Amherst is using for this weren’t taken from Boston’s allocation. It’s not like these funds would go back into a pool for Boston to draw on if Amherst backs off the purchase.
Actually Patrick, it’s not funds. It’s credit. But otherwise you are correct. UMass Boston can’t use it.
@Greg, I saw that Marty Meehan talking point too:
UMass Amherst will borrow to acquire Mount Ida’s physical assets and offset that borrowing with revenue supported by its growth. There are no state appropriated funds involved in this transaction.
…and it’s a completely irrelevant statement, coming from an institution whose budget “relies on certain system‐wide assumptions regarding State investments (>$700 million), student tuition and capital planning.” A decision to raise debt through the UMBA has a systemwide impact.
PS If Marty has discovered some amazing new risk-free, organic revenue source then first of all could he please identify what it is (his forecasts have been well of the mark in the past), and then could those revenues please be earmarked toward reducing the systemwide appropriation request to the legislature, before he embarks on new endeavors.
So basically an anonymous commenter here is saying that he knows more about what financial resources are or aren’t available than the folks who’ve actually secured the loan.
Is it possible that this will become the new norm across the country? It’s no secret that many colleges are struggling. Yield rates have plummeted over the last 20 years. Expenses continue to rise, as does tuition. The bubble has to burst, and a correction needs to occur. The fallout of this is that some colleges just won’t make it through. Failing businesses are sometimes bought out when the economics work, and sometimes they just fail and dissolve. This process becomes more personal with an educational institution by nature, but at the end of the day it’s still a business, and is therefore subject to the same harsh realities that lead to the collapse of your favourite coffee shop, restaurant, or hardware store.
I think Greg is reading the writing on the wall and is trying to get people thinking about a massive parcel in Newton becoming bank owned in the near future. While a new development there can be a mixed blessing, the size of the parcel means that regardless of what goes in there, the impact will be felt in many ways.
My Ida has been struggling for years, as have many other small, private colleges. It’s administration has tried for years to find solutions that would keep their campus open, it’s faculty employed and it’s unique programs filled but in the long run they failed. Although they offered many students financial aide, the tuition is high, $30,000, plus fees, room and board. UMASS Amherst has been interested in purchasing it for a while but still Mt Ida diligently tried to find another way and only began working with them after other avenues failed. They negotiated for their students to receive guarantees of continuing their education.
When large changes are made to an established area or institution, conflicts almost certainly arise but if Mt Ida had not engaged in finding some solutuion, they would have closed anyway but Newton would be dealing first with banks and then with an unknown entity who purchased the property. The restrictions on Mt Ida’s sale to education institutions or religious entities would be lost.
With those being the conditions, Mt Ida’s purchase by a Mass public university is the best outcome for Mt Ida’s students, with a much lower tuition and advantages that come from being in the UMASS system and for the Newton regional area which needs to retain graduates.
UMASS Boston needs more funds to continue to provide a quality education regardless of Mt Ida’s purchase. It’s a beautiful campus, right on the water, with good professors. It has an outstanding education Masters program. Thers also a web of traffic to get there from here and a terrible parking situation.
Greg, if the Mt. Ida transaction is not self-sustaining and if it will incur costs in excess of its revenue, then the accounting methods used to structure the loan within a publicly-funded entity are irrelevant. That debt will have to be serviced somehow, and it will need to come from elsewhere in the heavily-subsidized system budget. It’s disingenuous to claim that a transaction like this will have no impact on the resources of the rest of the system.
This whole fiasco could have been avoided had the purchase not been made public prematurely. UMass had no time to appropriately inform elected officials who represent its campuses or Mt Ida. No PR strategy was undertaken so that from the beginning all stakeholders would understand the same reality, which is that UMass will issue bonds (i.e., borrow) to cover the cost, that said borrowing has nothing to do with the operating budgets of any UMass campus (i.e., UMass Boston is not losing funding that it might otherwise have received), and in the end the entire UMass system would benefit because UMass Amherst would have a presence in the Boston area just like other non-Boston colleges do. The benefits to Newton are obvious. So truthfully, instead of griping about the poor optics caused in large part by misinformed media and ignorant elected officials, we should all be getting onboard with this project as it’s good for our state and good for our city.
Gerry and Greg, would you kindly offer more details about these bonds, since Marty and UMass haven’t been able to?
How would “said borrowing have nothing to do with the operating budgets of any UMass campus”? How will this loan be serviced?
Could you provide a link to the prospectus please? TIA
Michael, I’m no finance expert, but the issuance of bonds is a common way for large institutions to acquire financing for various projects. I’m no Internet researcher either, but a quick search regarding this practice revealed the simple explanation quoted below. If you seek more info, I’m sure you can search for it yourself. As for a prospectus, I have no clue if one is yet available because of the premature sale announcement, but surely one is coming, and surely you’ll get to see it once it’s available.
“The university raises money by issuing bonds to institutional investors that can then be traded on the Stock Exchange. Each bond obligates the university to pay the bondholder the principal amount of the bond when it reaches its maturity date and to pay a fixed interest rate throughout the life of the bond. This funding method is common in the corporate world.
Bonds enable universities to raise large amounts of capital over a very long period and at a low fixed cost. While they cannot be easily repaid before the end of the term, there are typically fewer obligations and ongoing restrictions attached to a public bond issue than a bank loan.”
Thanks Gerry – just to elaborate, these transactions are usually funded through the UMass Building Authority (UMBA). The UMBA finances building projects through its revenues, which primarily includes:
1) Rent that the UMBA charges the UMass campuses, and
2) “Capital contributions” (subsidies) from the Commonwealth.
In 2017, for example, the Commonwealth gave $62 million to UMBA, which was then apportioned for projects in Amherst, Lowell, Dartmouth, and Boston.
Needless to say, any capital project initiated by one campus takes away resources that could have been apportioned to the others.
Anyway, my silly “social conscience” which is so worried about the fairness of this project and the growing economic chasm between the urban and suburban population needs to very quickly shut up, because we’re putting our home in South Newton up for sale and if this project goes through successfully, then it will probably net us an extra $200k. I’ve changed my mind and I’m with Greg on this one. TTFN
As a Newton resident, I’m angered and heartbroken for the students, faculty and staff of Mt. Ida whose lives were upended through no fault of their own. They have been failed by the college, who obviously knew this was coming. I find it hard to believe they couldn’t find a way to at least let the current student body finish their degrees without so much collateral damage.
As a UMass-Amherst graduate, however, I’m more hopeful that the sale and expansion will be good for the university, the city and the region. Even as the flagship, UMass Amherst has been the forgotten and neglected stepchild in the state’s higher education hierarchy. I’m hopeful that having a Greater Boston location will reverse that stereotype in today’s reality.
YOUR OPINION & ATTITUDE WOULD
CHANGE GREATLY IF YOU HAD A CHILD ATTENDING MOUNT IDA AND IS NOW BEING FORCED TO CHANGE THEIR MAJOR OR DEGREE !!
GET YOUR FACTS STRAIGHT !
THEY DID NOT NEGOIATE FOR STUDENTS TO BE GUARANTEED TO CONTINUE THEIR EDUCATION.
MANY STUDENTS ARE LEFT WITH NO OPTIONS AS UMD DOES NOT OFFER THEIR PROGRAM OR DEGREE.
GET THE REAL FACTS STRAIGHT !
What did happen was Ferpa was violated 1555 times by trying to seal the deal with unauthorized student records and left hundreds of kids with no guarantee to continue their degree ! THATS REAL NEWS ! Print that !
@Lynn: It’s totally understandable why people are angry about the way Mount Ida’s closing has unfolded. My focus here is have a conversation about what happens to this 74 acre property AFTER Mount Ida.
@Brian: It may not make “sense” to you but every credible report says that Amherst’s ability to borrow for this acquisition is indeed entirely separate. As for which schools should or should not have offered to automatically accept Mount Ida students, please see my comment to Lynn.
@Jane: I used the word “all” in the context that this is a Newton blog where issues of and about Newton is our sole focus and the readership is nearly exclusively people who live and/or are connected to Newton. What happened to Mount Ida’s students, accepted students, faculty, staff and other stakeholders is not unimportant or insignificant (and has been discussed in other threads). But Mount Ida is not coming back and what happens next to this campus matters too.
@Marti – what you say might be correct had there not been a perfectly good offer from Lasell that was rejected because, after finding out the true state of Mt. Ida’s finances, Lasell insisted on having more control. Had the Mt. Ida administration accepted the Lasell offer, their students would have been able to stay on campus and pursue their majors in fields that are useful to society and hard or impossible to major in at other schools, and their faculty would still be employed.
In what world is that a worse outcome than the current situation? You lay it out as if they would have closed either way, but there is mounting evidence that there was malfeasance as well as serious fiscal mismanagement and dishonesty (i.e., making offers to students that included financial aid they KNEW they had no way of paying for.)
More public higher education, less private higher education. Good!
Meredith, it’s truly a shame that Mt Ida didn’t handle student notifications more quickly particularly for incoming students.
That doesn’t necessarily mean that Mt Ida did anything shady. I wasn’t in the negotiations and don’t know if Lasell College would be able to assume all of Mt Ida’s debts or if a bonified offer was refused just because Lasell wanted more control. Nor do I know if all financial aid offers would be upheld, if all the programs would continue to be run or a number of other things. There might not be enough enrollment in these unique majors to continue them. Offers to merge with an entity in financial trouble are rarely perfect. I doubt this one was.
It doesn’t seem feasible that Mt Ida turned down a good offer like the one you describe because of loss of control but instead chose to accept UMASS Amherst’s offer, which is still being negotiated, loosing all control. It was more like the last resort.
@Marti – while no newspaper reports are perfect, I did find the Boston Globe article detailing the situation I described credible. BTW, I never said all financial aid offers would have been upheld – what I said is that it was clear malfeasance that Mt. Ida made them when they KNEW they didn’t have the money to provide them. It is also true that as of the Tuesday after the news of closing was announced, they still hadn’t notified accepted students. That too is malfeasance.
As to your last comment, it seems perfectly feasible to me that the Mt. Ida administration would turn down an offer that would lead to more scrutiny of their mismanagement in favor of one where the campus would be bought and no one would care what they’d done in the past.
It makes no sense to say that repayment of a substantial (tens of millions of dollars) debt would have no impact on the finances of UMASS. It’s totally unfair that the current Mt. Ida students were not kept informed of the future, particularly of the custody of their student records. It makes no sense to say that you need a presence in the Boston area when you’ve already got a CAMPUS in BOSTON. It’s totally unreasonable to limit the choices MT. Ida students in the UMASS system to UMASS Dartmouth which may be inacessible to low-income students that the University serves. Why couldn’t an arrangement been made to guarantee their access to the Boston and Lowell campuses as well? Do the campuses of the UMASS “system” not communicate with each other ?
One troubling part of this thread is the use of the word “all” in the title – why we should ALL be concerned about the Mt. Ida transaction. As it turns out, the “all” includes only residents of Newton. It doesn’t include current Mt. Ida students left in the lurch, admitted Mt. Ida students who were kept in the dark about the failing institution, or the UMass Boston community that’s in serious need of increased funding.
Clearly, this is going to happen but to think only of the benefit to Newton and disregard the extreme hardship it will cause thousands of others feels kind of, I don’t know the right word – icky comes to mind but I guess distasteful is probably the more appropriate word.
Maybe as part of the deal, chickenhawk and political hack extraordinaire Marty Meehan will forego some of his $869,000 annual compensation package to help out Mt. Ida’s 280 faculty and staff members.
@Greg, your statement:
…doesn’t make “sense” to anybody with a basic understanding of how a public university is funded.
Seriously, could you tell us how do you think this debt is going to be repaid? Minuteman t-shirts?
@Michael: We get it, you don’t like Marty Meehan but bankers aren’t stupid. They wouldn’t agree to finance it without believing there’s a credible plan and that the borrower is credit worthy.
@Lynn: sorry but I don’t see where the “facts” were “reported” incorrectly on Village 14.
Maybe you are referring to a reader comment?
All I said was report the correct facts !!! There was no negotiation for all students to continue their education !! So many students are left with no where to go as their degrees and major will not transfer !!!
So if your reporting facts. KNOW WHATS TRUE !
@Greg, I agree that the lenders believe that UMass, and/or the UMass Building Authority, are creditworthy – because they both receive hundreds of millions of dollars of public money. UMass gets a lot of it directly, and UMBA gets a lot of it indirectly via the rent that it receives from UMass (in addition to a sizable direct capital contribution from the legislature).
If you pay close attention to the comments that Marty and his fantabulously overpaid posse have made in lieu of hiring a PR firm, you’ll notice that they never directly say that this transaction won’t end up costing taxpayers a lot of money – instead, they stress that from an accounting standpoint, the debt will be assumed (or mortgaged) directly by UMass Amherst.
Big whoop – however this transaction is structured, the people who will ultimately be on the hook for paying off this debt will be the taxpayers – many of whom (including me) would’ve sooner preferred to see financial commitments to allow UMass Boston to deliver an education lives up to its students’ basic expectations, rather than the acquisition of a sylvan campus for better-to-do students’ internships and job interviews.
Anyway, this was an awful, awful deal on so many levels and yes, I do hold Marty Meehan in high contempt for this (and for his absurd salary, and for his charlatanism, and for his political hackery, and for his cowardly vote to authorize the use of force in Iraq – all of which should clearly distinguish this person as someone not to be trusted in any situation of consequence). UMass should have agreed to continue Mt. Ida classes, offered Mt. Ida students immediate admission anywhere in the UMass system, and hired the faculty and staff who will be losing their jobs. Anything less is shameful, especially in the context of a $70 million transaction.
But I’ll admit that apart from the monumental unfairness of this transaction vis-à-vis UMass Boston, how unnecessary it is, and the disgraceful and possibly criminal treatment of the Mt. Ida community, then yes, the creation of UMass-Newton will be a tremendous boon for the community over the long term, and from an N2 perspective this is a grand slam. A Barry Bonds grand slam, but a grand slam nevertheless.
Lynn, I believe your referring to a comment I made that included “They [Mt Ida] negotiated for their students to receive guarantees of continuing their education … “ among other things. I didn’t say “all” of their students but I see how it could be interpreted that way. I was not speaking for V14. I was making a personal observation.
I understand the anger at Mt Ida and feel compassion for its students and faculty. V14 is as good a place as any to express that anger but claiming that V14 is spreading false news isn’t true.
I try to stick to the facts I know without too much speculation or assumption. It’s factual that Mt Ida handled notitification poorly, that they were in financial hardship, that UMass Amherst is not continuing their programs or hiring their faculty and that many students and their families got the shaft. What I don’t know as fact is the workings of the agreement continuing to be negotiated or why UMass Amherst isn’t doing the things mentioned above. The Globe and other media reporting and opinions expressed have been contradictory so I’m waiting to hear the final result.
I read this post not as a report on Mt Ida’s bungling or on UMASS Amherst’s and UMASS Boston’s finances but as a continuing report on the acres of land Mt Ida is selling. I’m pleased about this outcome for the land and that multi million dollar homes won’t be built there. Instead Newton gets an outpost of a public university. I can be pleased about the apparent outcome while being disappointed in the way it happened.