So far, University administrators insist that the so-called Initiatives for Academic Enrichment, which were approved by the Corporation last year, remain on track. But they also admit that a prolonged economic downturn could create a drag on their implementation, slowing the rate of progress and eventually forcing Brown to confront painful choices.
“We are assuming that things aren’t going to be great over the next year,” says Executive Vice President for Finance and Administration Elizabeth Huidekoper, “and if the economy doesn’t turn around, then it’ll be tough to do all the things that we want to do in future years.”
Whatever the long-term outlook, Huidekoper and her colleagues have their hands full trying to balance this year’s budget, thanks to the emergence of $7 million in unbudgeted expenses. About $3 million will support both a growing pool of needy students (a product of the recession’s strain on parents’ pocketbooks) and an unusually large number of accepted applicants agreeing to attend Brown. Beefing up campus security and improving the campus computing infrastructure added another $2 million in costs. A number of smaller items, such as an improved tuition-reimbursement package for employee children and a lower-than-expected return on working capital, account for the remaining deficit.
In December, University officials responded by implementing a hiring freeze for all nonfaculty positions. The move, combined with a policy that recaptures salaries from departments with vacancies, is expected to save $4 million over the current academic year. Greater than anticipated research support and the additional tuition captured from the large freshman class should close the remaining gap, Huidekoper says.
These measures have made administrators optimistic that they will be able to draft a budget for next year that will keep the academic-enrichment plan on schedule. The real difficulty is likely to come later, however. Because future spending is tied to ambitious fund-raising goals and to equally bullish endowment growth, a sustained bear economy could undercut the initiatives two or three years down the road. In the meantime, says Richard Spies, executive vice president for planning, the University will have to take a close look at trimming expenditures in areas that are not as “central to the [University’s] overall academic goals.”
“It would be very easy,” he points out, “to just say, ‘All right, we should cut across the board, and we should postpone all of those things we are doing.’ I think what people here realize is that it’s so important to do these things for the future of Brown that we should not take the easy way, we should do it the right way.”