Agreements between Ohio State and private companies involving the use of university assets and — in the most recent case — education technology aren’t likely to end. But for the time being, the university has no additional partnerships in the works.
Following the more than $1 billion privatization of the university’s energy systems and the announcement of an initiative with Apple to put iPads into the hands of all incoming freshmen, some were left wondering if there was more activity to come between Ohio State and the private sector.
University President Michael Drake put that speculation to rest, at least for the next 12-18 months.
“There’s no other thing,” Drake said Tuesday in an interview with The Lantern. “We’ve had a couple of really big ones this last year, with ENGIE-Axium and Apple. There’s nothing like that that I’m keeping from you.”
Ohio State’s partnership with Apple in October was at least the university’s third such agreement with a private company. In March 2017 the university signed over its energy rights for 50 years to ENGIE-Axium. In 2012, it privatized its parking with CampusParc for $483 million over 50 years.
The ENGIE-Axium and CampusParc agreements were record-breaking deals among universities for contract length and monetary value in the energy and parking sectors, respectively.
Unlike the energy and parking contracts, Drake said the agreement with Apple is not an exclusive partnership — it won’t hinder students or classrooms from using other computer products like Microsoft.
“Apple, we believe, is a company that seems to share our interest in information transfer, and they’re really at the cutting edge of the knowledge acquisition and sharing parts of our society,” he said. “And if we can help them do a better job of that and they can help us do a better job, that would be great.”
Although he said there aren’t current plans for another multimillion-dollar privatization deal, Drake did indicate he sees these opportunities as a way to increase the university’s affordability.
Ohio State announced last March a chunk of the $1 billion up-front payment received from ENGIE-Axium would go to the university’s endowments, part of which is used to fund additional student financial aid.
In February, Ohio State’s Board of Trustees approved endowments funded by Energy Partners, the entity formed through the energy privatization deal. About $328 million was proposed to be given to university endowments — from Energy Partners and from the initial upfront payment.
“I say move the university forward, and affordability is one of the ways that we would see the university moving forward,” Drake said. “So to the extent that a public-private partnership can allow us to do something that doesn’t compromise our values in one way, but provide revenue that lets us support our mission in another way, that would be fine.”
As of now, it is impossible to know the full financial impact of the Apple and CampusParc deals, since the Apple contract is not yet available to the public, and the money earned from CampusParc will not be released because it is considered a trade secret.
However, Drake’s opinion on these partnerships indicates the university’s willingness to monetize more of its assets in the future.
Drake said public-private partnerships aren’t the “be-all-end-all” to achieving the university’s mission. Ohio State and the companies can back out if the partnership isn’t working.
“It’s a means to an end of making us a better university,” he said. “Often a very effective means. And when that’s the case, that’s great. If not, then it’s a deal that we tend not make.”
Update, Feb. 15 at 10:56 a.m.: This article has been updated to reflect the proposed endowments.