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.”