new budget
Edit: as has been pointed out in the comments section of this post, the Source article has been updated to clarify what was meant by a “net gain” of positions. One position was eliminated from IT, but there are plans for 4.5 new positions in the bookstore-run computer purchase program. I’ll try to maintain the relative objectivity of this post and refrain from commentary except for in the comments.
An announcement has been posted to The Source about the Board’s approval of the budget for next year. It’s kinda depressing. Not that I thought it wouldn’t be. There are already rumors flyin’ around, none of which I have heard substantiated on the record. So far, all we have to go by is the announcement, which gets pretty vague near the end (perhaps just from uncertainty rather than intentional omission).
Here’s what I’m seeing (let me know if I misinterpreted something):
- tuition increases, especially in the law school.
- $500,000 decrease in budget support from endowment
- salary freezes for faculty and non-union staff, 2% salary increase for Law School faculty and staff
- computer purchase program moved to bookstore’s jurisdiction (net gain of 3.5 positions).
- one new Law School position
- 1% reduction in institutional contribution to employee retirement plans
- $500,000 Strategic Initiatives Fund held as contingenc
- elimination of the vanpool
- a tighter policy on College cell phones
- lower insurance and workers compensation costs
- implies that there will be no layoffs
The Board of Trustees has unanimously approved the 2010-2011 budget, which maintains faculty and staff salaries and wages, maintains positions, and reduces by one percentage point the College’s contribution to employees’ retirement funds.
Under the financial plan voted on by the Board at its meeting last Friday, CAS and Graduate School tuition will increase by 4 percent and 2 percent, respectively; Law School tuition will rise by 9.75 percent for new students, and 4.9 percent for returning students. “Over time, the Law School’s tuition has fallen significantly below other comparable schools,” said Carl Vance, vice president for business and finance. “Even with this increase, Law School tuition will still be thousands of dollars less than peer schools’ average.”
In presenting the budget to the Board, Vance stressed that uncertainty from the recession continues to cloud the institution’s financial situation, as it did in last year’s budget process.
“Because net tuition revenue remains the primary source of income for all three schools at Lewis & Clark, each will be tested in 2010-11 by students’ ability and willingness to pay for private higher education,” Vance said.
At this point in their admission cycles, both CAS and the Law School have matched last year’s applicant pools both in size and quality. (For the Graduate School, it is too early in the process to make any judgments.) Despite those positive signs, operating budget margins are being substantially increased for all three schools as a hedge against possible net tuition drop-offs.
In addition to the effects of the recession, the budget must absorb the impact of the reduction in endowment spending rate enacted last year, which will mean a $500,000 decrease in budget support from the endowment for the 2010-11 fiscal year.
As one major response to the financial challenges, wages and salaries are being frozen for faculty and non-union staff in the Graduate School, CAS, and Common Services; a 2 percent compensation increase is budgeted for Law School faculty and staff. “The Board of Trustees specifically noted that these are tactical decisions in response to the recession,” Vance said. “The Board remains committed to increasing salaries in the future so Lewis & Clark is competitive with peer institutions.”
By moving to a self-operated bookstore CAS plans to add a net of 3.5 administrative and staff positions. The new bookstore will assume responsibilities from Information Technology (IT) for campus computer sales, which will require changes in several IT positions. The Law School plans to increase its faculty by one. No new positions are planned within the Grad School.
Additional savings are being realized through the one percentage-point reduction in the institution’s contribution to employee retirement plans, from 10 percent to 9 percent. Vance explained that those involved in the budget process preferred lowering the retirement contribution over the other two logical options for reducing compensation costs—layoffs or salary reductions.
“Of the three options, cutting retirement benefits has the least impact on employees,” Vance said. “Most employees with discretionary income still have the option of taking money out of salary and putting it into retirement. And those staff members who would prefer maintaining take-home pay will be able to do so.”
Just as in this year’s budget, the $500,000 Strategic Initiatives Fund—normally allocated for select one-time projects—will be held as a first-line contingency against enrollment deficits. In addition, the new budget reflects decreases in operating costs achieved through the planned elimination of the vanpool, a tighter policy on College cell phones, and lower insurance and workers compensation costs.
With an eye toward greater cost efficiencies in the future, the College is engaging Pappas Consulting Group to study current administrative structures and make recommendations for possible improvements to the next president.
“We’ve been living under the cloud of this recession for roughly two years now, but next year is probably when private higher education in general and Lewis & Clark specifically will be hit the hardest,” Vance said. “Fiscal year 2010-11 will be the real test. I’m hopeful we will start coming out on the other side of this challenging period it in 2011-12 and will find ourselves on more solid footing in the years to follow.
“With this new budget, the Board, Executive Council, and I are confident that we have realistic projections for revenues and expenditures, and that the necessary contingencies and margins are in place to get us through the year with our financial health and workforce intact, and while continuing the highest quality education for our students,” Vance added. “We have weathered the financial storms up to this point, and I feel very strongly that we will continue to do so in the year ahead.”
[Administrator]
Cary
kennner
dshack
maishaparadox
angelalc
The “maintains positions” part of the source article is a not true. Positions have been cut. The board may not have required it, but cuts were so deep that departments had to decide to eliminate positions. Information Technology lost one. Seeing this article a couple days after finding out we were losing someone is pretty infuriating. It’s also quite disrespectful to those who just lost their jobs.
That’s exactly what I’d been hearing, but I hadn’t heard it officially confirmed so I didn’t include that info in my post. If that’s the case, and I’m sure it probably is, I fully agree with you.
From my observation, I think this situation is not unlike the student workstudy debacle from earlier this year… a governing body makes a sweeping decision, and then is able to wash its hands of the responsibility (make claims like “retaining jobs,” etc.), since it’s the people in the middle and the bottom that are actually making the hard decisions about what specifically to change. It’s easy to cut down a departmental budget and say “sorry, that’s how it is,” but it’s much harder to be the manager who has to actually figure out how to make the new budget work. Perhaps the Board itself didn’t axe anyone, but they placed department heads in a position where there wasn’t much choice. The least that could be done is rather than glorify the Board’s individual decisions, acknowledge the rippling consequences.
The Source article has been edited to acknowledge that someone involuntarily lost their job. The “maintains positions” is in tact because the eliminated position will be offset by a new position in the bookstore. Technically correct, even if it is no help to the person who is now collecting unemployment.
I will give the Source credit for responding to the concerns of some of us in IT. The edited article is an improvement.
I’ve been away from campus the first three days this week. Now that I’m back I thought I should offer my perspective. …
In writing that Source article, I used the word “maintains” (as in “maintains positions”) to convey the important point that, unlike many colleges, we are experiencing no net loss in positions. This is something for which I am personally grateful, and even pleasantly surprised, and it struck me as something I really wanted to highlight.
That said, I realize I should have been clearer and indicated explicitly that I was talking about *the number* of jobs. I regret wording that was insensitive to the staff member whose job was eliminated, and to that person’s colleagues.
Tom Krattenmaker
Associate Vice President
Public Affairs and Communications
Thank you Tom. Your job must be very difficult in times like this. I appreciate that the article was quickly corrected and that you explained how it happened. It’s quite challenging to balance the global and local perspectives in these issues. I too am grateful that we were able to keep the number of jobs that we did. I think the challenge for IT right now is to keep the global perspective in mind when we have to walk past an empty desk every day.