The administration has asked DePauw University’s academic departments to cut 10 percent from their budgets.
According to Vice President for Finance and Administration Bob Leonard, the University is not in financial danger. “We’re not in crisis mode, so we can put that aside, but we have done some thoughtful benchmarking,” Leonard said. “In comparing DePauw to other schools and other businesses, we feel that there is more efficiency to be found in all the departments, not just academics.”
Leonard said the cuts will not come from faculty and staff salaries. “We’re not talking about human beings here, we’re talking about paper and utilities; things of that nature.”
The overall annual University budget is about $110 million. Compensation accounts for $62 million. The overhead budget, which qualifies for the 10 percent cut, is about $26 million, according to Leonard. The remaining $22 million of the overall budget is used for other items which don’t fall into the overhead or compensation categories, such as building repairs, which is not included in the 10 percent cut.
While the administration encouraged all departments to find 10 percent savings in their operating budgets, Leonard said it is not written in stone. “We’re looking for 10 percent savings; it’s not an ultimatum and we won’t find that across every department. There is a department that we know won’t have any savings. We recently had a budget meeting with another department, and they found 15 percent [savings].”
Though Leonard said he has heard mostly positive feedback about the cut, Melanie K. Finney, the chair of the communication and theater department, said the theater department may feel the effects of the cut.
“We almost always spend our complete budget every year, and on occasion go over,” Finney said. “Our budget for theater has been around $23,000 for the last several years and is used to pay for mounting four main-stage productions, plus assisting with the opera every year.”
She went on to question the impact these cuts would have on her department. “Will we be able to continue to stage our productions in the same way as previously? Probably, but does this put added pressure on us? Absolutely,” Finney said.
Jonathan Nichols-Pethick, director of the Pulliam Center for Contemporary Media, understands the motivation for the cut, but shares Finney’s feelings. “It’s easy for people to feel like being asked to… cut money feels like a budget crisis and there’s also a way it could just be taking stock of things and saying ‘let’s take off the pressure in some places’,” Nichols-Pethick said.
Nichols-Pethick said that those areas feeling pressure include the Pulliam Center. “Fifteen years ago, the Pulliam Center budget was a much bigger budget than it is today. But I think everybody is feeling these are trying times in higher education,” he said, adding that the current budget for the center is $37,000.
Anne Harris, vice president for academic affairs, attributed the 2008 and 2009 economic housing crisis to adding pressure to higher education. “It made higher education harder to afford, especially for the middle class. And one of the populations that DePauw looks to for its enrollment is the middle class,” Harris said.
“I do feel really good about what’s happening this year. And we get great classes every year,” Harris said. “But would it be great to get slightly bigger classes? Everybody says yes to that.”
Statistics from DePauw’s website confirmed that enrollment numbers have diminished since 2008-09. In 2008-09, University enrollment was 2,298 students. In the past 10 years, enrollment topped off at 2,396 in the 2009-10 school year and numbers have since declined even more. This year’s 2017-18 enrollment numbers were 2,158.
In spite of the shrinking student numbers, Harris said the University is up in tenure lines. With the 1999 Holton gift of $128 million, “our academic program just blossomed in the past 50 years,” Harris said.
Harris highlighted the inverse relationship between enrollment numbers and the growth of the academic departments. “When you combine that huge wonderful [academic] growth we’ve really made good on with the 08-09 crisis, with lessening student enrollment, you’ve got something to manage,” Harris said.
No faculty member will experience pay cuts or the elimination of their position because the cuts coming from the operating budget. However, Harris said the University may be “slowing down in how we rehire because we want to be super conscientious…in how one hire can benefit as many academic programs as possible.”
Leonard said students’ learning experience will not be affected by the cut. If anything, the cuts “will affect students positively. We need those savings to reinvest in the student experience. For example, obtaining financing to improve our student housing, and we need to find savings to do that.”
Finney, however, isn’t so sure. “What is especially difficult is all of these funds are to directly support our students’ experience. Will we adapt? Yes, we must. But at some point, the student experience may be somewhat compromised.”
Leonard said nothing is going to be done “that is detrimental to the University and that is destructive to our business. Really, the end game is…a balanced operating budget. The reason for that is we really want to protect intergenerational equity,” adding in an email interview that intergenerational equity has “been achievable during the recent bull market, we need to lower our annual spending draw to a level more sustainable during periods of market volatility.”
Leonard looks to grow the $680 million endowment and to make sure “it will be there for future generations as well, not just those that are here right now. We need to protect [the endowment] and grow it. So you just constantly look for efficiencies and do things that the entire campus needs to do to find that balanced budget.”