Dean Newcomb’s Blog

Colleagues,

I am writing to update you on the status of the School of Arts and Sciences’ current budget (FY09) and next year’s budget (FY10). As I began to draft this message on Tuesday, that afternoon’s electronic Chronicle had two headlines that caught my eye: Brandeis U. Faculty Senate Asks Professors to Take Pay Cuts and Harvard Freezes Salaries and Suspends Faculty Searches.  If you do a Google search on “University cost saving measures” you will get over 2,220,000 hits. Williams recently cut back on their tenure track and visiting faculty searches and the list of casualties goes on.  Needless to say, no college or university is immune from the current economic downturn.

After consultation with Academic Council, I want to share with you the steps we are taking within the School of Arts & Sciences to address the current economic situation.  In particular we need to:

1. Identify budget cuts of 3 percent , 5 percent , and 7 percent from our FY10 operating budget of $2.5M.  That means for every 1 percent of cuts we need to find $25K.  These operational budget cuts from across the University will likely go to help fund a very modest compensation increase.  Budget cuts must be submitted by January 9th.
2. Plan on how we can best manage the FY09 budget for the remainder of the fiscal year to build a contingency fund. We would use this fund if other cuts are requested or if we run additional unexpected deficits.  If we end up not needing to meet any contingencies, we can fund end-of-the-year needs or husband resources to address FY10 needs.

Budget planning assumptions

Before considering how to address these two points, I ask that you review the budget planning assumptions, which I believe should guide our decision making and that were discussed in Academic Council:

1. All existing faculty and staff lines (including those where we have authorized searches even if those searches are not yet complete) should be protected, and if a search is closed this year, that search should be reopened in 2009-10.
2. Given the likely small compensation increase for FY10 (if there is a compensation increase), I will propose a plan to use this year’s merit rankings in a weighted fashion in future years so that merit rankings across the next few years are balanced out across likely variable compensation pools.  The idea is to make sure that faculty with high rankings this year are not penalized because of a very low, or perhaps zero, compensation pool.
3. The momentum of existing programs should be sustained, especially programs that impact students: the debate team, the Roadmap program, student research, mock trial, etc.
4. Every effort should be made to maintain faculty summer fellowship funding at FY09 levels.
5. In FY10 all non-essential empty faculty lines will be “soft frozen” as a way to absorb some of the impact of the operating budget cuts and as a way to create a funding reserve for nascent programs that do not have an existing hard-lined budget.  I will propose a priority listing of faculty searches for Academic Council to review in the late spring when we hope the economic picture will be better.
6. We will review all A&S restricted endowment payouts to ensure that payouts have been incremented according to the University’s spending formula. Within the terms of the endowment, any additional revenues will be examined as possible offsets for budget cuts in other areas.
7. We will identify a variety of cost containment strategies (see the partial list of potential options below).

FY10 budget cuts

After discussing these assumptions I presented one scenario for making our 3 percent, 5 percent, and 7 percent FY10 budget cuts.  My proposed approach was as follows:

1. The A&S graduate program is being phased out, which makes it possible to capture $25,000 and apply those funds to our budget cuts.
2. Reduce travel allocation for all continuing faculty (tenure-track and directors) from $1,600 to $1,500 and capture $23,100.
3. Reduce lecture funding by 5 percent and capture $4,000.
4. Cut A&S equipment budget and spend down A&S plant fund as needed. Capture at least $25,000 and up to $125,000, if necessary, to make 7 percent cuts.

We had a robust discussion of this plan, and Academic Council advised an alternative approach, which I accepted.  That alternative approach is as follows:

1. The A&S graduate program is being phased out, which makes it possible to capture $25,000 and apply those funds to our budget cuts.
2. There will be no reduction in FY10 travel allocations at this time.
3. Lecture funding will be cut by $20,000.
4. The annual chair and program coordinator professional development allowance will be reduced by $250 to $750, which will provide a budget cut of about $7,500.
5. Cut A&S equipment budget and spend down A&S plant fund as needed. Capture at least $22,500 and up to $122,500, if necessary, to make 7% cuts.

Cost containment strategies

Along with reaching a consensus on the budget planning assumptions and where we should make our budget cuts, we also discussed cost containment strategies. We agreed to implement these cost containment strategies as soon as possible:

1. Reduce the number of searches/visits and practice particular care in limiting entertainment expenses for searches and other visitors.
2. Provide minimal refreshments at A&S faculty meetings, eliminate coffee at Academic Council, reduce department entertainment expenses, etc.
3. In 2009-2010, cancel all classes with enrollments under ten except in cases where the class is absolutely required for graduating seniors and/or in cases where the relatively small number of majors in the department precludes the possibility of enrollments of ten or greater.
4. Optimize schedule-planning to minimize the need for adjuncts and term faculty.
5. Hold a workshop in January 2009 with chairs, program coordinators, administrative coordinators, and other budget managers to review budget-tracking processes and to optimize cost accounting.
6. Engage all schools/programs that provide summer faculty stipends in a conversation about the level of compensation in order to avoid competition for faculty time that could artificially drive up costs.
7. Request an analysis of possible increased pass-through costs, for example, dining hall and catering costs.

Closing thoughts

While things look bleak, and they are, we can handle this round of cuts and still keep things running smoothly.  At the same time, we need to be very prudent because this round of cuts may not be the last, and even once the economy comes back, it is going to take a while to recover from these cuts.

We will use our January A&S faculty meeting to discuss this situation further.  If you have any thoughts before then, please give me a call or send me an email.

Appreciatively yours,

Andy