Should Community Colleges Build Additional Dorms?

Podcast by Daniel Barwick

I was asked by a listener to discuss the issue of building dorms. Dorms are an expensive proposition and it’s not always clear why a community college, which supposedly exists to serve the community, the local community, would build dorms so that people can live there. Don’t those people already live in the community? At every school that I’ve worked at, we have built dorms usually for very specific reasons and under very specific circumstances. So I will just say upfront that I’m actually quite skeptical of the need to build dorms under many circumstances. And I’m going to talk about the situations in which I think building dorms is appropriate. And likewise, I’ll also talk about the circumstances under which I think building dorms is a huge mistake both financially and from a community relations standpoint.

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Right up front, why don’t I talk about the bad reasons? There are a number of very, very bad reasons to build dorms. The number one reason is simply to boost enrollment. And interestingly enough, in communities that are not large communities, where people are not commuting from large long distances to your school, and might prefer simply to live locally, if you’re in a small community and you don’t have a lot of commuters, you know, you may feel enrollment pressure and you may feel that building dorms is one of the ways to deal with those enrollment pressures under most circumstances. That’s a terrible idea. Dorms are expensive to build. You’re almost certainly going to take on debt to build the dorms. There are some very specific circumstances in which you won’t do that (take on debt). But those are pretty isolated circumstances and I won’t discuss them here. In most cases, you’re going to finance the dorm and that means that you are going to have to make that dorm payment regardless of whether or not the bet you made about increased enrollment comes to fruition.

If you built a dorm with 200 beds and it takes you four years to get to full occupancy, it’s a safe bet that during the majority of that time, you lost money on those dorms. And obviously sometimes you need to make investments, but the fact is that you need to weigh it against what you could’ve spent that money on. And you have to weigh it against the negative public perception when taxpayers find out what their tax money is going for. Nevertheless, my research suggests that the majority of small rural colleges that build dorms are doing so to boost enrollment. This is particularly egregious in a small state like Kansas with a stagnant population, because it really just means that for the most part, you are competing for a finite number of students who live primarily within that state unless they are athletes coming from outside the state.

And in that case, you’ve spent money to provide a dorm, but in fact, those students were likely to get educated anyway. You just successfully competed for their enrollment. And so what happened is the student received an education, but it was at a higher cost to do it because you had to build a dorm to attract them to your campus. And I should point out that even if you managed to reach full occupancy in the dorm that you built and financed, the truth is there’s no way to know whether you will maintain that occupancy. Enrollment at every college waxes and wanes, both due to internal and external factors, which means that some years you may not have very good enrollment, particularly in your residential population. And this means that every bed that is not occupied by student is a bed that you, the college are going to have to pay for.

The second bad reason to build a dorm is to provide what’s often called the “college experience.” There’s a lot of research about this. Traditional age college students really truly crave the college experience. we use that phrase very typically, but I think it’s probably a misnomer. It’s really just parental escapism. If once you talk to students and drill down, what they really want, in the end, very, very many of them will say that basically “I want to live on my own. I don’t want to live with my parents anymore.” My oldest daughter could have gone to community college locally, but the fact is she wanted to feel independent. She wanted to feel like a grownup. And she didn’t associate living with her parents with being grown up and so she went somewhere else.

I’m pretty skeptical about the approach of building dorms even when research shows that students want that college experience. I am not sure where to start, but if you’ve listened to my podcast before, you know that the cost of education is one of my major concerns –  the return on investment for the student, and there’s no question that living on campus increases the costs for the student dramatically versus a more traditional community college enrollment, a structure in which they’re simply living at home and commuting to the community college – they’re going to a community college in their own community. The two costs really aren’t even comparable. There are some circumstances in which this does make sense and I’ll cover those a little bit later. But for the most part, you probably don’t need me to tell you that living at home is far, far cheaper than moving into some housing somewhere where you’re essentially paying rent (and don’t forget that often comes with a variety of other fees). And it comes with the need to purchase food. Food, by the way, that is in most cases pre-prepared – in other words, you’re going to a dining hall, you’re essentially going to a type of restaurant. It’s the most expensive kind of food you can purchase. There are some students cooking their dorm rooms, but very few either are able to make all of their meals or are allowed to do so by their schools. But overall, I would say that philosophically spending millions to provide a dorm, to provide a college experience for potential students. I’m really not sure for the most part, that’s consistent with most of the community college missions that I’ve seen. They’re typically driven by other considerations. Ultimately I would argue it’s not the taxpayer’s job to provide a college experience for anyone who wants it.

I do think that we need to provide an education for example, for anyone who wants it. But a college living experience is really something that if you want that bad enough, I think that you should pick a school that already provides that and decide whether or not you can afford to do that. I view it as a luxury, not as a necessity.

Now let’s talk about some of the good reasons to build dorms. So the first is that building a dorm can provide housing in areas that have no affordable housing. There are people who already live in areas that the community college is located in the same area as the people it serves. But they are nontraditional students. Or they are traditional students who cannot stay in their homes for whatever reason. And there simply is no affordable housing. You find this in many areas, but it’s particularly prevalent on the coasts in urban areas. You will also see it often in small towns in which the housing supply was never built to accommodate any significant number of students. And so if, if the college is growing or wants to grow, there’s no place for them to live. It’s really a significant problem in some areas. And the college can provide affordable housing, and in terms of serving the local constituency, providing housing, affordable housing, that leads to an education is probably going to be a closer to the mission of the college than some of the things that I talked about earlier.

When you provide affordable housing, a second benefit of building a dorm is that sometimes you are supporting the student in very dramatic ways by reducing their commuting time. People who don’t live in areas with long commutes don’t ever fully appreciate this. When I was a college president, I was able to (if I wanted to), I could walk to my job. But in California, there are people who are commuting an hour and a half, two hours each way, and this adds up. This is lost productivity in most cases. It’s true nowadays we can be somewhat productive during that kind of downtime, if, for example, you’re using public transportation, but if you’re in a car there’s only so much you can do with that time that’s worthwhile. And so if you have a total of say, three hours of commuting a day, that’s three hours that you are not at a job, that you are not earning money, that you were not studying, that you are not doing your homework. Whatever it is you needed, you need to get done in your life, you can subtract three hours from the time you have to do that. To the extent that we can create productivity on the part of the student, either the ability to be employed and make money so that they can continue their education or the ability to spend time on their school work so that they can be better students. Either way. Commuting time is, is very, very important. I’m fully understanding that people in Middle America may not be sympathetic to that argument, but I can tell you that in urban areas, particularly on the coasts, the commuting time can make or break a job or an educational experience.

Finally, another good reason to build dorms is that it provides a social network for people that don’t necessarily have one. That doesn’t sound like much or it sounds kind of vague or it certainly sounds kind of touchy-feely, but there’s no question that a robust peer social network boosts retention in schools. I’ve talked before on this podcast about the abysmal retention rates for most schools. The average American does not understand really just how few students actually finish their college education, having begun it. And the anything that we can do to improve that, that we can afford to do to help the student stay in school is, is to the good. And by the way, that’s not just helping the students – it makes financial sense for the school as well because it is less expensive to retain a student than it is to recruit a new student.

So you can probably see a pattern emerging here, which is that new dorm construction at the community college level often makes sense in growing urban areas, and it most often does not make sense in more stagnant rural areas. There are circumstances under which it makes sense, but the case is just much, much harder to make financially and is far more often motivated by a simple desire to compete against other community colleges for the same students.

I would like to talk about something that the public doesn’t understand very well, and honestly a lot of college employees tend not to understand very well when they’re talking about the benefits that a dorm brings to the college and to the community. And this’ll take a second to explain. If you have a small community college and you want to offer a program that it’s very clear is needed locally. And I’m actually going to use an example from Independence Community College. Because it was one of the programs that was used to justify building a dorm. We had a lot of veterinarians locally who were having trouble finding veterinary technicians. If you don’t know what a veterinary technician is, is like a physician’s assistant – there’s, there’s a lot of procedures that they can do that then the vet does not have to do. The local vets simply could not find that, and this was a huge problem for them. In addition, there was only one other vet tech program in the state of Kansas at a public community college. Kansas is a big, big state geographically. The argument was made that we could create a program, recruit people from outside the college. And this would justify offering a program that would supply vet techs to local vets. In other words, we’re a small community – maybe there’s only five that techs needed locally, but you can’t have a program of that size. Let’s say you need to produce 15 annually in order to be running a viable program. Where are those other 10 coming from and where are they going? Well, they’re coming from the outside and then they’re going to leave. In other words, they’re just going to come to your college; they’re going to take an education that is paid for primarily by the taxpayer, the local tax payer, and then they’re going to leave. Now what is the value of that? Well, the argument that was made was that that’s the only model that would allow us to provide a vet tech program locally. In other words, that’s the only model that would allow our local vets to have local vet techs.

And it’s actually a good model. The people who come in from the outside because we have different tuition rates, whether in our taxing district or outside of it, you’re going to pay more of your share of the education if you live outside of the taxing district. And of course you, there’s the economic activity you generate while you are at the college. Of course, you wouldn’t build an entire dorm for those students, but you’re going to use that model for say six programs, eight programs, ten programs, and the result of that will be first of all, by doing it with multiple programs, you’ve spread the risk over the financial risk more thinly. You haven’t put all your eggs in one basket and you’ve created a greater diversity of students. You’ve figured out a way in some way to create occupancy in the dorms.

And what you’ve done is you’ve leveraged the interests of people outside the college in a way that produces local graduates and opportunity for local students to take a program that wouldn’t exist unless there were also students from outside who wanted to come in and take that same program. Does it work? Yes, it works under a specific set of circumstances, and those circumstances won’t be too surprising. It has to be a well-conceived program to start with. There has to be a clear need – there has to be an obvious market for it. Because of the cost to support technical programs, there typically need to be donors willing to step up. In the case, for example, of Vet Tech, we had a very small focused capital campaign just to outfit the vet tech facility. And so what we were able to do then at the start of the program, we had not spent hardly any of the money out of the college’s budget to actually begin the program itself. The only thing we were really paying for were the personnel costs. And so if all of those ducks are in a row, you can create something that really can serve a very limited number of local people but still remains a viable program.

in a case like that, the reason I give that as an example, is because without additional dorm space so the people coming from the outside who want to take that program without additional dorm space, without additional dorm space you can’t have that program – notice that that program is not being introduced simply to boost enrollment. It’s being introduced in response to a local need. You’re trying to actually satisfy a demonstrated need across the state of Kansas, a specific workforce skill. Those are the kinds of circumstances that create success in both creating a program, funding a program, and then building the dorm – the supporting infrastructure for that program. In that particular case, we went a step further because we weren’t even willing to absorb the construction costs of the dorm. We contracted with an outside company to actually build and operate that new dorm so that we were simply paying them a certain percentage – an operating fee that was a certain percentage of the occupancy.

In summary, what I’m sketching is an approach that is quite skeptical of claims that enrollment will go up if you build a new dorm because your dorm will be so gorgeous that no one will be able to resist living there. The fact is that many colleges build beautiful dorms and that simply falls into the same facilities arms race that I’ve talked about in earlier podcasts. For the same reason, it’s a mistake to build a dorm where you’re really just trying to provide that kind of traditional college experience.

Both of those things – the increased enrollment and the college experience – the flaw that they both have in common is they tend not to connect very well to the actual mission of the school. Even though those missions vary widely, I’ve rarely seen a mission that would actually directly support building a dorm for either of those two reasons. A dorm is expensive. It should be approached very, very cautiously. It tends to make sense in growing urban areas, but honestly, in many, many cases there’s a very, very thin case that can be made for building new dorms in small community colleges in stagnant rural areas. And the reason why is because if you look at the needs of a stagnant rural area, whatever the underlying reasons why that area stagnant, it’s very unlikely that a college dorm is going to effectively address whatever the underlying issues that need to be addressed when a population isn’t growing, when the economy of the area isn’t growing and so forth. I think that given the cost of a dorm, you need to be very careful about considering the opportunity costs – the lost opportunities where you take a certain amount of money and you use it to build a dorm, when there are other perhaps more effective things that the college could have done with that money.

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