The University recently announced its intent to cut its budget for the fiscal 2023 year, decreasing funds across several departments by $26.5 million. During a May 2 faculty town hall, President Paul Fitzgerald, S.J., said that these changes are a result of multiple factors, including the University’s low retention rates, a shortfall in enrollment, and enduring financial limitations that have resulted due to inflation and the COVID-19 pandemic.
Fitzgerald explained that the decline in enrollment has put a strain on the University’s state of finances. According to the spring 2023 census data, total student enrollment fell 1.25%, from 9,303 in spring 2022 to 9,188 in spring 2023. Decreased graduate student enrollment was cited in the town hall by Fitzgerald as particularly financially straining; only 3,450 graduate students enrolled, 257 short of the University’s target graduate enrollment of 3,707. “This has resulted in a shortfall of $4 million on our net tuition goal for the current year,” he said.
Retention rates have also lowered along with enrollment. The census message stated that from fall 2021 to fall 2022, the first-year fall-to-spring return rate decreased from 92.3% to 91.3%, with the return rate of transfer students decreasing from 88.4% in fall 2021 to 86.8% in fall 2022.
Fitzgerald also pointed to the cascading effects of recent global events that have contributed to general increasing costs. “The war in Ukraine, the resulting inflation, trailing problems from the pandemic, and logistical supply chain nightmares have made budgeting for the upcoming year quite challenging,” he said. “We’ve seen a great inflation in costs that are unavoidable… all food and the kinds of things that we need to buy.”
According to the World Economic Forum, there has been a general increase in the rising costs of goods and services related to inflation across the country. The Consumer Price Index (CPI) for all items has seen a 7% increase, with the costs of food and energy respectively increasing by 10% and 13% between 2022 and 2023. All of these rises have the capacity to increase operating costs at the University.
Concerns about the increase come amid recent property acquisitions such as the 270 Masonic East building, which Fitzgerald said will take 1.1% of the budget due to facilities management and debt service.
At the town hall, Fitzgerald disclosed that the University’s 2023 budget is estimated to be approximately $5.9 million short of the $499.3 million target budget set by the University in 2022.
Despite the gap, in a February email to faculty and staff, Fitzgerald said, “We do not anticipate wide-scale layoffs and we are committed to seeing through bargaining for our represented employees and ensuring our non-represented employees are fairly compensated.”
Though specifics about which departments and programs will be most affected have yet to be disclosed, the Foghorn previously reported there have been cuts made to the language department. At least one adjunct professor, Portuguese professor Dutra e Mello, will be laid off as a result. The Associate Dean of the College of Arts and Humanities Jeffrey Paris and Dean Eileen Fung of the College of Arts and Sciences made the decision to cut ancient Greek, Arabic, and Portuguese programs for the following fiscal year.
The 2023 fiscal budget was formed with consideration to salary negotiations among faculty. In a breakdown of the University’s fiscal year 2022 operating expenses by category, over half of the university’s $488.9 million operating budget was allocated to compensation. At the town hall, Fitzgerald said that University employees will receive salary increases (though he did not specify how much) as well as an increased value to their benefits. Negotiations with the faculty union are set to continue throughout the summer.
For the rest of the budget, around 25% went to financial aid, and 15% was diverted to general operating facilities and capital. Other expenses included debt service (the amount the University pays in debt each year for things like property taxes), which consumed 3% of the budget, food services with another 3%, and reserves and transfers with 2%.
The University’s budget development authority was formerly under the Office of the Provost for 20 years, though the process has since been moved to the Office of Business and Finance. This decision came as a result of Vice Provost for Budget, Planning, and Strategic Analysis, Jeff Lefkoff, informing Provost Oparah of his intention to leave the University in June. Budget development function is now overseen by Office of Business and Finance President, Charlie Cross.
Cross said, “Budget reductions are distributed proportionally across the University at the Division level. Each Divisional Vice President is making the budget decisions with their respective divisions.”
Sociology department chair Kimberly Richman explained that cuts are mostly made at the dean’s office in the College of Arts and Sciences. Despite the proposed collaboration with program divisions, “The portion of the department budget that we have control over is very minimal, and not enough to make any kind of real contribution to the budget gap, it would be a drop in the bucket,” she said. “We were just invited by the dean to bring budget-cutting ideas to her if we had any.”
According to Richman, this has impacted operations in the sociology department. “We have not been able to hire any full time faculty in years, even faculty we have lost,” she said. “We are extremely short staffed, can offer far fewer classes, and more of our classes are taught by adjunct faculty. As chair, I am constantly having to search for people willing to teach for us part time and fill in the blanks.”
According to Fitzgerald, areas of the University such as mental health support and public safety, which directly serve students, are exempt from cuts.
At this time, it remains unclear as to whether the 2023 cuts will remain permanent. Fitzgerald stated that divisions have yet to be instructed to differentiate between one-time or base cuts, meaning that the proposed budget alterations may yield either temporary or permanent implications. With regard to how this impacts departments ability to plan long-term, Richman said, “Honestly, these cuts have been going on for so long, and we know we have little to no say in how they happen, so we just can’t plan for anything more than a year ahead.”
“Right now, I can’t even plan adequately for what courses we’ll be able to offer in the spring of next year,” Richman continued. “I worry a lot about what will happen when we have more faculty retire or move into other positions, and how we’ll even be able to offer a meaningful degree program without full time replacements.”
The finalized budget proposal will be presented to the Board of Trustees in June. It was initially rejected by the board in March, Fitzgerald said at the town hall. The board “did not pass the budget because we were not yet confident enough to present them with our plan of what we expect next year to fully look like,” he said. “So, we will present a balanced budget to the Board of Trustees at their June meeting, at which they will pass it and watch us as we carefully thread the needle and stay balanced through the coming fiscal year.”