Is the economy good or bad? That answer to that may depend on your perspective – are all those “Now hiring; hiring bonus” signs we see an indication of a robust economy or an economy strangely depleted of workers?
But one thing’s for certain: The economy is going gangbusters for the University of Virginia. Its endowment grew 46% over the past year. Who wouldn’t like to have a rate of return like that?
More to the point, UVa’s endowment now stands at a record $14.5 billion. That’s up from $9.9 billion for the fiscal year ending in 2020, $9.6 billion for the fiscal year ending 2019, $9.5 billion in 2018 and $8.6 billion in 2017. (I should point out that The Cavalier Daily, the student newspaper at UVa, is the media outlet that broke this story, yet another testimonial to the benefits of a diverse media landscape.)
In any event, this is clearly a lot of money. For context, consider this: Virginia Tech’s endowment is $1.69 billion. Over the past year alone UVa’s endowment grew by $4.6 billion – or 2.7 times the size of Tech’s entire endowment. The two schools may both be in the Atlantic Coast Conference for sports but they are not in the same league when it comes to endowment.
There are lots of ways to think about this. The United Campus Workers Virginia, a labor union open to UVa employees, says the university should be using some of that endowment to “benefit workers and students during an unprecedented time of economic insecurity.” (And that was before the latest figures came out.) Richmond-based blogger Jim Bacon of the Bacon’s Rebellion site says this large endowment is actually a bad thing because it makes the university less accountable to the taxpayers and less interested in holding down costs.
Here’s how I think about this: UVa should use some of that money to build an “innovation campus” in Southwest Virginia.
This is not a new idea: I made this case back in April when I was editorial page editor at The Roanoke Times. Now, with this latest news about the spectacular growth of UVa’s endowment, I’ll make it again. So here goes.
Some starting points: Universities today are economic engines, particularly research universities. What would be more economically useful for a community – a university or a patch of land for a business park? Clearly the university, because it might generate spinoffs that may help fill that business park. (See the Virginia Tech Corporate Research Center.)
Back in 2017, when he was running for governor, Ralph Northam advanced an interesting idea – that the University of Virginia’s College at Wise should be turned into a research university, with that research focused on renewable energy. “It’s a great opportunity to have expertise in solar and wind and energy storage,” Northam said at the time. “If you bring in talent, big talent, talent attracts other talent.” That, Northam said, would help the coalfields grow a renewable energy industry as fossil fuels decline. That seemed such a great and obvious idea that I remain shocked nothing has really come of it. I can fault Northam for not pushing the idea more but I can also fault community leaders in Southwest Virginia for not rallying behind this. They ought to be clamoring for this! They ought to be demanding this! The fact that they’re not is perplexing. But their silence doesn’t prevent me from making the case, and the UVa endowment report helps me make it anew.
Here’s the logic: Virginia Tech is in the process of building a $1 billion “innovation campus” in Alexandria. That’s a good thing, one that will surely help accelerate the growth of the technopolis that was already taking shape in Northern Virginia even before Amazon graced us with its HQ2. (Tech promises an announcement of a “significant development” about this innovation campus today, by the way). But while Northern Virginia becomes a global tech capital, we have other parts of the state that are struggling to find a place in this new economy. If there’s any place that needs an innovation campus, it’s not Alexandria, it’s Appalachia.
Yes, there’s a certain amount of “if you build it, they will come” involved in this proposal. Tech’s innovation campus in Alexandria isn’t a risk. Northern Virginia is already a tech center; that will just help it become a bigger one. There’s no guarantee that an “innovation campus” in Southwest Virginia would succeed in jump-starting a tech industry in the heart of the coalfields. On the other hand, it’s not impossible. Las Vegas was desert until some gamblers set up shop. Granted, it’s taken more than a century between that and Las Vegas becoming a rising tech capital, but the point is, there’s no reason why Las Vegas should be where it is – no port, no natural resources, no nothing. Southwest Virginia, by contrast, already has a four-year state college, it has broadband, it has the rudiments of a tech economy already – a start on data centers, a graphene research center and a big solar farm coming down the pike. (It might be more ideal for the coalfields if that pike were the Coalfields Expressway, but I digress.)
I hate to sound like Robin Hood, here but here’s the University of Virginia sitting on $14.5 billion – and here’s a part of the state that desperately could use some help. Why aren’t legislators in Southwest Virginia insisting that some of that dragon’s hoard of wealth be spent there? We’re not talking about some random school here, we’re talking about the University of Virginia. Southwest Virginia is part of Virginia, although the rest of Virginia often has to be reminded of that. What’s UVa done for Southwest Virginia lately? At The Roanoke Times, I also made the case that Southwest Virginia might be better off if Tech ran UVa-Wise. Tech, with its land-grant mission, seems more naturally inclined to local economic development initiatives than UVa is. I fully expected a long response from Charlottesville about all the good things UVa was doing to help Southwest Virginia build a new economy. None ever came, which told me all I needed to know. I’m not the only one who thinks this, either. Retired Blacksburg banker Ed Lawhorn wrote an op-ed in The Roanoke Times that said the same thing: “As a native of Oak Ridge, Tennessee, and knowing the history of how a laser-focused effort there served to create a city and industry that were key in winning WWII, I believe it’s going to take that same effort in building a new economy in the far southwest.”
Lawhorn went on to say the quiet parts out loud: “Without question, it’s glitzier and higher profile for Tech to have an innovation campus in Alexandria than in Wise. But what a statement Tech would be making by having two innovation campuses, one in Alexandria (276 miles from Blacksburg), and one in Wise (165 miles).”
Or think what a statement it would be if the University of Virginia reached into that endowment and used even the spare change to build a research center in the coalfields. Make no mistake: UVa could do this if it wanted to. Why doesn’t it want to? And why aren’t we making it want to?