November 15, 2002: Volume 56, Number 10

Committees examine spending in six areas

President Roger Hull will name subcommittees of the Planning and Priorities Committee to examine six areas of the College's budget.

The subcommittees, each to be headed by a faculty member from the P and P Committee, will look at athletics, benefits, financial aid, printing, terms abroad, and travel. The six areas are the College's biggest annual expenses outside of salaries.

Announcement of the subcommittees was made at a general faculty meeting Monday, where the president and Diane Blake, vice president for finance and administration, presented an overview of the College's financial situation.

The College's finances are strong, the president said, noting that Union's endowment per student is in the top 100 in the country and that a recent analysis shows that the College is in the top 25 percent in endowment performance.

"Overall, we're in excellent shape for this year, and we will be next year," he said. "We're looking farther ahead, since Union – like every college with an endowment – will have less money coming from the endowment."

 The endowment provides about 19 percent of the College's revenue. From a market value of $275 million on June 30, 2000, the College's endowment dropped to about $216 million on Sept. 30 of this year before rising to the current $228 million. Blake explained that the College looks at a three-year pattern to determine how much to draw from the endowment (the College's rate had been 5.6 percent, which was raised to 6.8 percent to accommodate the House System). Because of the decline in short-term interest rates and in the endowment, the College already knows that it will have less money available in coming years.

The president also said the administration will reexamine The Plan for Union, which was put together 18 months ago. "We may have to put some things on the back burner," he said.

Announcing the formation of the special committees, the president said, "What we're seeking to do is to make decisions collectively that will not have a detrimental effect on the academic mission of the College. What we're also seeking is not to balance the budget on the backs of the people who make Union the special place that it is."

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