Trustees Approve 2009-2010 Budget Assumptions
Dear Members of the Saint Mary's College Community,
Last week, the College Board of Trustees discussed the proposed budget for the coming year in light of the stormiest economic times in at least a generation.
Their discussions were sober, probing, focused and purposeful. Their passionate concern for Saint Mary's was evident. The budget scenarios they discussed, previously vetted by the College's Budget Committee, presented difficult choices.
The Board endorsed the institutional priorities I spelled out this fall and which shaped the work of the Budget Committee, viz., to enhance our academic excellence, identify more efficient and effective operating practices, maintain momentum on key strategic initiatives, protect the excellence of the student experience and keep the College affordable for students. The Board also requested that we act cautiously as we respond to very uncertain and unpredictable economic realities.
Undergraduate tuition, room and board fees comprise over three-quarters of our annual institutional revenues. Over the past five years, these fees have risen 7 percent annually; in the current economic climate, we cannot expect students and their families to absorb such increases. At the same time, student financial need has increased, driving up financial aid expenditures. Finally, undergraduate application totals for this fall are approximately 20 percent lower than a year ago, suggesting a somewhat smaller enrollment for the coming year. All of these factors point toward 5.6 percent less in institutional revenue in 2009-2010.
Since faculty and staff salaries and benefits make up more than 67 percent of our institutional expenses, finding a way to reduce those expenses while protecting the quality of our academic programs and student support is required. The approved budget assumptions seek to achieve these objectives by limiting the number of positions to be reduced through targeted cuts in benefits, reductions in non-salary expenses and collaboration between departments and programs. While this budget requires sacrifices by all in our community, I am confident that the 2009-2010 budget assumptions the Board adopted will help us to meet our institutional priorities, remain fiscally sound and ensure that we are strongly positioned for future economic recovery.
The assumptions for a balanced budget include the following:
1) An undergraduate tuition rate increase of 2 percent for 2009-2010. This is the smallest increase in at least 40 years. Room rates will be unchanged while board will rise by 5 percent.
2) Overall undergraduate enrollment is projected to decrease by 4.7 percent from this fall. This reflects a projected 15 percent decline in new students.
3) A 14 percent increase in aid for undergraduates. While this amount preserves the College's current aid commitment to students, it projects slightly lower than fall 2008 levels of aid for fall 2009 new students.
4) Modest net income increases in graduate and adult programs.
5) A reduction in the College's employer pension contribution from 8.25 percent to 2 percent of an employee's salary.
6) Reductions of 3.1 percent in the total faculty salary pool and 5.7 percent in the staff salary pool. These reductions are to be achieved through careful management of vacancies, reductions in non-tenure track faculty and targeted staff reductions.
7) No July 1, 2009 salary increases.
8) A reduction equaling 8 percent of non-salary and other expenses.
9) Increased funding for some strategic initiatives such as continuing library support and development and alumni.
The Trustees also removed the hiring cap established at their October meeting, with the proviso that any hiring decisions fit within the 2009-2010 budget parameters spelled out above. The Cabinet will quickly identify a process for determining which searches will move ahead and which positions will be reduced.
I am grateful for the efforts of the Budget Committee. In the midst of these difficult times, they remained steadfastly focused on the good of the College. I am also grateful for the continued efforts of our dedicated and talented faculty and staff members. Our economic world has changed dramatically in the past year. I am confident that our shared commitment to the mission of Saint Mary's and the students whose lives we change every day will point the way to a brighter future.
Brother Ronald Gallagher, FSC