News

President Hill's letter on Vassar and the economy

March 27, 2009

Dear members of the Vassar community,

I write to address Vassar’s evolving response to the global financial crisis. Looking back on emails I sent in October, November, and December, I am struck by the acceleration of economic challenges that have a direct impact on Vassar’s budget—reduced endowment resources, greater need among Vassar students’ families, and financial uncertainty facing many generous alumnae/i and friends. These conditions lend further urgency to our efforts to keep Vassar strong now and in the future. We have met the challenge of crafting a budget for 2009/10, which the Board of Trustees endorsed at the end of February. I know many of you were involved in helping to develop this budget, and I thank you for your hard work and cooperation in implementing this budget plan. We now face the steeper challenge of further restructuring the college’s expenditures over the next two years to reach sustainable levels.

Given the fact that compensation represents two-thirds of the overall expense budget, the main focus of our planning to reach a sustainable level of draw on our diminished endowment must be a reduction in the size of our workforce. The trustees have placed their confidence in the faculty and administrative leadership to develop responsible plans over the next months to reduce overall employment at the college by 10-15%, with reductions in the 2010/11 and 2011/12 budgets.

This work will build on the steps we have already taken to reduce employment by 3% for 2009/10. To achieve that reduction, we have taken the following steps. We have not filled 18.5 administration and staff positions as they became vacant in various departments over the course of the year. We have suspended searches for three tenure-track faculty positions, and we have reduced the number of courses that will be taught next year by visiting, adjunct, and emeriti faculty, with a resulting decrease in the overall size of the faculty of 16 full-time equivalents. We have surveyed all student employment to eliminate positions in 2009/10 that are less essential, while maintaining the level of employment we need for our work-study students. We have offered a new retirement incentive for which 65 staff members are eligible, in addition to a previously negotiated retirement incentive for SEIU members, for which 29 service employees are eligible. We are also facilitating restructuring in some areas by offering targeted retirement incentives or offers of phased retirement to some administrators. The various incentive programs aim to generate turnover in positions that can be left vacant and thereby minimize involuntary severance, but we have also notified a small number of employees that their positions will be eliminated as of July 1.

Details of the 2009/10 Budget

The Board has approved an operating budget for 2009/10 of $153.3 million, which is $600,000 lower than the 2008/09 budget. It includes the following:

  • Salaries of administrators earning over $50,000 a year and faculty in the associate and full professor ranks will not increase in 2009/10. Administrators earning $50,000 or less, assistant professors, and continuing contingent faculty earning less than $10,000 per course will receive small raises.
  • The college will honor all union contracts for staff and service employees, including increases ranging from 2.85% to 3.25% for 2009/10. However, overtime and casual/seasonal employment budgets will be controlled as much as possible.
  • Employment at the college will decrease by approximately 3% in 2009/10, as described above.
  • Non-compensation expense budgets have been reduced wherever possible, through the efforts of managers across the college. Many departments’ operating budgets have been reduced by 10% or more.
  • Plans for capital expenditures in all areas have been reduced – technology purchases, equipment and furniture replacement, and facility renewal. Major capital projects on campus will decline markedly, with the completion of Davison in the fall (funded by debt the college took on in 2007) and limited plans for new projects starting later this spring. We will proceed with the long-planned renovation of Wimpfheimer Nursery School, funded by a generous gift from a loyal alumna, and a few other grant-funded projects. Other work on campus in the coming year will be limited to urgent repairs and renovations needed to keep our buildings safe and functional.
  • The comprehensive student charges will increase by 4.5% to $51,470, with a majority of Vassar students receiving grants, campus employment and loans to defray part of that cost. This is the lowest percentage increase in nine years.
  • The budget includes a significant increase in the allowance for financial aid. The increase recognizes that we have continuing students whose families may require additional assistance in order to complete their degrees. It also recognizes that need may be higher in the class we will admit this spring. The budget plan holds to our commitment to making a Vassar education available to talented students from all socio-economic backgrounds. It also takes into account our obligation to meet the demonstrated need of all Vassar students once they enroll.
  • Support from the college’s endowment is limited to no more than $51,650,000, an increase of about 2% over the approved allowance for 2008/09. With an investment loss of 20.8% in the six months ending December 31, 2008 and an anticipated loss by the end of the fiscal year of 30%, this level of support from the endowment is unsustainable. Clearly we must reduce our reliance on the endowment for operating costs as quickly as possible.
  • The budget assumes an increase in the Annual Fund, reflecting our hope that Vassar alumnae/i and friends of the college will give whatever support they can to help the college through this difficult period.

The current financial realities require us to respond swiftly but thoughtfully. We will need to work together in new ways and in a spirit of understanding and cooperation to bring the college successfully through this difficult period. In our response to these circumstances we have an opportunity to deepen our commitment to serving the best interests of our students and thereby to strengthen the institution. I thank you all for your support in helping the college meet this challenge.

— Catharine Hill, President

Posted by Office of Communications Friday, March 27, 2009