In Washington, higher education is the vanguard of innovation, biomedical research and the attendant spinoff technology. The University of Washington and Washington State University are the pipeline (with a human face) for in-state entrepreneurs, scientists, attorneys, engineers, even the occasional scribe. As the UW and WSU track with an evolving demographic and high-tech culture, however, its investment policies are gummed in amber, a freeze-frame from the early 20th century. This November, voters have an opportunity to change that.
Senate Joint Resolution 8223, a constitutional amendment that passed with near-unanimous, bipartisan support, will establish a narrow exception to antiquated investment restrictions by permitting the UW and WSU to dedicate specified public funds as authorized by the State Investment Board. This includes investing in stocks and private companies.
The key phrasing is “specified public funds,” a narrow cross-section of fees and research grants which sit idle in university accounts like twenties stuffed in a mattress. It’s a no-higher-return policy at the pivot where the UW and WSU require more resources for a swelling student population. The state recognized the inanity of the mattress-investment approach when voters amended the Constitution to open the door to some higher-yield (read: any kind of yield) investments for state retirement and pension funds.
Public universities have salient, public-value reasons to maintain hyper-conservative portfolios; no one wants to gamble with uncertain investments or financial strategies that could chip away at academic departments or student services. SJR 8223 meets that hyper-conservative acid test.
The appeal and logic are crystalline: Washington needs to advance higher-ed funding to meet the rising tide of students. The unprecedented cuts to WSU and the UW that flowed from the Great Recession curtailed course offerings and made college more difficult and expensive for Washington’s next generation. Allowing a return on investment without raising taxes is a prudent antidote that merits voter support.
Bill Gates, Sr., state Sen. Lisa Brown and other amendment advocates underscore SJR 8223’s import in the online voters’ guide. “With state cuts threatening access and quality of higher education, SJR 8223 is common sense, responsible reform that mitigates increased reliance on tuition,” they write. “Supported by students, the State Treasurer and bipartisan elected leaders, this amendment allows existing, dedicated non-state funds to be invested responsibly for maximum benefit. The State Investment Board — not universities — will invest funds, guaranteeing independent oversight. To prepare the business and civic leaders of tomorrow requires taking action today.”
It’s a compelling argument to elevate the fiscal health of our state’s critical high-ed institutions. The windfall is an educated workforce, an informed citizenry and a more vital higher-ed community in Washington.