Rutgers’ new era starts today with UMDNJ merger
A historic bell — a gift from Col. Henry Rutgers in 1826 to the school that would take his name — will toll on Rutgers University’s Old Queens campus in New Brunswick at 9 a.m. today, marking the official beginning of one of the largest academic mergers in U.S. history.
Rutgers is officially absorbing most of the state’s medical university, a sprawling enterprise that includes hospitals, clinics and institutes, as well as eight professional schools spread across five campuses.
Rutgers’ annual budget will leap by more than 40 percent to nearly $4 billion as it acquires most of the University of Medicine and Dentistry of New Jersey — a deal that will bring the state university coveted medical and dental schools and a renowned cancer institute.
The merger was the subject of months of protests by students and faculty members last year. But Governor Christie and other proponents argued that the deal would elevate Rutgers’ stature and its ability to attract medical research dollars as it grows to more than 65,000 students in 33 schools and colleges across New Jersey.
“This brings them a comprehensive brand,” said Brian Weinblatt, a development director at the University of Miami who has studied academic mergers nationally and blogs about the issue. “The people at the main school get a medical school and the people at the medical school get a football team.”
The merger is part of a larger reorganization of the state’s higher education system that also elevates Rowan University in Glassboro, Gloucester County, to the status of a research university. Rowan will absorb UMDNJ’s School of Osteopathic Medicine in Stratford, but most of the rest of the medical university’s schools, clinics and institutes in Newark, New Brunswick and Piscataway will come under the Rutgers umbrella.
About 10,730 UMDNJ employees will be reassigned to Rutgers while around 1,170 will work for Rowan. Another 3,460 will remain at The University Hospital in Newark, which was part of the medical university but is being spun off as an independent entity, though Rutgers medical students will train there.
Officials have gone to great lengths to call the undertaking an “integration,” avoiding the takeover implications inherent in merger. But a merger it is — a dismemberment, in fact — of the beleaguered medical university, which is laden with debt and, in the recent past, tainted by scandal.
It is by no means a hostile takeover, however, as many employees of the medical university — dogged by a tortured acronym and a lack of recognition — have said they welcome the association with the nationally recognized and generally well-regarded Rutgers name.
“The research enterprise is very excited about the merger,” said Terri Goss Kinzy, a research dean at the Robert Wood Johnson Medical School in Piscataway, one of the medical university’s most respected units. “When you’re competing for grants, you want a high-profile brand.”
Kinzy, who studies infectious diseases, said the association with Rutgers also will allow for more interdisciplinary research and a clearer path to graduate programs in the medical sciences for Rutgers students.
Unlike university mergers elsewhere, New Jersey’s was engineered by politicians after months of wrangling by Christie, the Legislature and the university community that led to a compromise bill passed last summer.
Much of the initial opposition centered on a plan to cede Rutgers’ campus in Camden to Rowan. That plan generated months of protest and the threat of legal action before the bill was amended so that Camden would stay part of Rutgers.
Rutgers’ board of trustees stood up to Senate President Stephen Sweeney, D-Gloucester, in opposing the loss of Camden and many believe a recent bill he introduced that would abolish that board is payback. Sweeney has denied that, saying he only wants to streamline Rutgers governance. The bill, favored by Christie, stalled last week before the Legislature recessed, but may still have legs and could set up another showdown between Rutgers and the state’s politicians even as the merger begins to unfold.
Sweeney sought to beef up Rowan, which is located in his district, by giving it the respected business and law schools at Rutgers-Camden. Following the vocal opposition, that plan was dropped from the bill that Christie signed into law in August 2012.
And while the merger ushers in a golden era of sorts at Rutgers, President Robert L. Barchi still faces considerable challenges, among them a growing chorus of voices complaining that Rutgers’ Newark campus gets short shrift compared with the flagship in New Brunswick/Piscataway.
Governor Christie pushed hard for the merger, succeeding where two of his predecessors had fallen short. But there are still many unanswered questions — mostly about money — as the process continues to unfold.
In the end, Rutgers likely will absorb $76 million of the estimated $100 million cost of the merger. Most of the cost involves professional fees for a legion of lawyers, accountants and information-technology consultants whose expertise is needed to pull off the massive bureaucratic shift.
At Rowan alone, the bulk of its $12 million in merger costs involve making computer software compatible with UMDNJ’s, said the university’s president, Ali Houshmand. At UMDNJ, nearly 1,000 signs have been replaced over the past several weeks.
And officials at Rutgers have spent months working out new contracts and agreements with units of the sprawling medical university.
“I spent last week in Newark with 30 lawyers working out 20 different agreements,” said Christopher Molloy, Rutgers’ integration czar who will serve as interim chancellor of Health and Biomedical Sciences after the merger. “Honestly, this has really been an amazing process.”
Agreements — many of which involved complicated hospital liability issues and debt payments — had to be hammered out for the schools, clinics, institutes and hospitals that will fall to Rutgers. In addition to the Robert Wood Johnson Medical School, Rutgers will also take over The Cancer Institute, both in Piscataway.
The institutions are markedly different. Rutgers gets most of its revenue from tuition while UMDNJ relies largely on revenue from clinical services, Molloy said. There will be no layoffs, at least for now.
“There’s a lot non-overlapping expertise that needs to be combined,” Molloy said. “The state has been cutting the budgets for Rutgers and UMDNJ for years, so there’s not a lot of fat.”
UMDNJ has one year remaining in a corporate integrity agreement that it signed with the U.S. Justice Department, Molloy said. Christie, who was the U.S. attorney for the District of New Jersey at the time, put the school under federal supervision in 2005 after it was found to be double-billing Medicaid and Medicare.
The federal monitoring agreement ushered in changes in policies and top management at UMDNJ, but in some ways the medical university is still dealing with the public-relations fallout from the scandal. It was an easy target for the merger and its politically appointed board put up little resistance, even as many at Rutgers fought for — and won — many changes to the initial merger plan.
The week leading up to the official start of the integration was consumed with getting the details right, changing signs and patches on lab coats, and making sure payroll and student services are not interrupted.
Indeed, the architects of the merger have spent a good deal of time trying to make sure little will change, even as everything changes. Most employees will keep the same duties and report to the same managers.
“The overall thought is that students who walk in here in August won’t find anything that much different,” said Rob Forman, a spokesman for the medical university. “The whole thought is continuity.”
But, in the longer term, officials hope the merger brings big changes. Rutgers says the move, along with its pending move to the Big Ten athletic conference, will elevate it into the top tier of U.S. universities.
At Rowan, Houshmand expects research funding to quadruple to $100 million annually and the school’s endowment to grow to half a billion dollars from $165 million. Enrollment is projected to grow to 25,000 from 12,183.
“The opportunities in front of us are great,” he said. “We dream big.”
BY PATRICIA ALEX
STAFF WRITER
THE RECORD