The University of Texas System has closed a unit that works to expand online classes and competency-based education after allocating it nearly $100 million since its inception in 2012.
The action last week was not surprising, given that a reconstituted Board of Regents wants to cut system administration spending to free up more money for the various UT campuses.
In all, the system’s Institute for Transformational Learning has received about $98 million from the multibillion-dollar Permanent University Fund overseen by the regents. Although it had been budgeted for 46 employees last year, the unit was already beginning to wind down with the resignations of the executive director and the chief innovation officer.
The unit’s closing, which was first reported by the Texas Tribune, cost 29 system employees and 13 contract workers their jobs; $23 million left in the institute’s budget will be reallocated, system spokeswoman Karen Adler said.
The development comes at a time when the broad outlines of the system administration are in flux. A task force led by Regent Kevin Eltife is working on recommendations to reorganize the administration to cut costs and thereby free up more money for the 14 academic and health campuses. The task force’s recommendations are due in July and will be considered by the Board of Regents in August for inclusion in the system’s next budget.
Meanwhile, Chancellor Bill McRaven, citing health concerns, announced in December that he will step down by the end of May, and regents’ Chairwoman Sara Martinez Tucker wants to have a new chancellor on board in June so he or she will have six months to bone up for the legislative session that begins in January.
The Institute for Transformational Learning was something of a hybrid — part tech startup and part educational program. Among other things, it worked to expand “massive open online courses,” or MOOCs. By a unanimous vote of the regents in 2012, the institute put $5 million into edX, a nonprofit MOOC platform established by Harvard University and the Massachusetts Institute of Technology.
In addition, the institute led development of a fully online degree program in cybersecurity at UT-San Antonio that became operational in the fall. UT regents allocated “bridge funding” of $4.8 million in December from a nonendowment account to support that program for the next four years. That was an additional signal that the institute’s future was doubtful.
The institute was established under regents’ Chairman Gene Powell and Chancellor Francisco Cigarroa. Chancellor Bill McRaven, who succeeded Cigarroa in 2015, was at first supportive of the initiative he inherited but eventually grew concerned. At the same time, some of the newer regents who replaced Powell and other board members questioned this and other system initiatives.
“Earlier this year, following a review of ITL that showed the benchmarks were not being met, Chancellor McRaven, along with Executive Vice Chancellor for Academic Affairs Steve Leslie, decided that it was in the best interest of the UT System to close down ITL,” Adler said.
Some employees of the institute complained that it was just reaching its stride, according to emails cited by the Tribune.
This isn’t the first time that a startup-flavored investment by the UT regents didn’t work out as intended. A $10 million investment of Permanent University Fund proceeds in an internet startup that helps college students plan their paths to a degree produced no financial return for the UT System when the startup, MyEdu Corp., was acquired by another company in 2014. However, officials said the system received other benefits, including customized websites that at the time were being used by about half of undergraduates at UT System campuses to manage course loads.