After a shortfall of just over 100 students for the current school year, the university realized there was not enough money within the 2011-2012 budget. Therefore, cuts had to be made to balance out the difference.
“I’ve described this in some ways as a perfect storm. With a 4.9 percent increase in tuition, and implementing the cost of the CCS [Cross Cultural Studies] trips, we don’t know the reasons, the multiple reasons. There was a shortfall in enrollment. The magnitude of the shortfall has been more significant than before,” said Dr. Betty Overton-Adkins, Chief Academic Officer and currently standing in for President Charles Webb as he recovers from open-heart surgery.
Jerry White, Vice President for Finance and Administration said, “On-campus students were down by a little over one hundred. And there’s many reasons that we could point at, but there’s no solid reason why. We implemented several new projects and some of them did not come into fruition. So we have a shortfall of students; we implemented a new online proposal where we funded some expenses online. Some of our GPS [Graduate and Professional Studies], our adult undergraduate and graduate [students], did not come in at the level that we had anticipated. We do have record enrollment, but unfortunately we predicted more.”
Questions have come up pertaining to the funding of the recently finished soccer complex as well as the current renovations to the Kresge Student Center.
“What we’re hoping for with the soccer field is that it would pay for itself in seven to eight years. Even before the field was completed, we were getting contracts from people to use our field. And then anything after [the seven to eight years] is absolute revenue,” said Overton-Adkins.
There is already fundraising for the student center in progress. Apart from a $500,000 donation from the Weatherwax Foundation and an approximately $2.5 million check from Chartwells Catering Services, Vice President for Advancement and President of the Spring Arbor University Foundation Brent Ellis and his team are working to raise the remaining amount needed to complete the building project.
Overton-Adkins added that the university borrowed money to fund the completion of several projects; however, the money borrowed cannot be used for other things such as salaries for faculty and staff. It can only be used for things that could bring in revenue. The donations made by various foundations and donors are given with specific purposes and cannot be used outside of the donors’ specifications. Therefore, the university cannot borrow or raise money to pay staff and faculty.
Though the cuts are mainly made within the payroll of full-time staff, the cost of using credit cards to make school payments is a direct result of these cuts as well.
“One example that we just received in an email is that we will be accepting credit cards, but there will be a convenience charge. A lot of people don’t understand that when you charge $100 with your credit card, the vendor has to pay around three dollars. And so for us to accept credit cards costs significant dollars. So that would be one change that the students will see,” said White. “Hopefully there won’t be any [other] major items that the students will see.”
These changes are still small in comparison to salary cuts for both staff and faculty, though faculty won’t experience these changes until the following school year. But many faculty members are still upset.
“With any budget you categorize, there’s an attempt to try to equalize some of that. I think the salaries and benefits are a hot button. Compensation is the big term for all of it. And so, sure, it’s miserable to go backwards. In one sense, I think, it’s not completely crazy because across the country people are getting reductions in their pay; people are losing jobs because the companies are shrinking. So there is a broader economic context for it. But we still kind of cringe here because it’s something we haven’t experienced before. I’ve been here 30 years and I don’t remember any pay cuts,” said Dr. Roger Varland, interim Dean of the School of Arts and Sciences and Professor of Art.
Both White and Varland said there wasn’t much that could have been done differently to prevent the cuts from happening.
“I wish I could have seen it coming. What we’re doing is, we’ve implemented two things. One is a budget committee made up of four members of the executive team, two faculty members, a SAPA [Staff-Administration Personnel Association] representative and a business office representative. That team is looking at the budget as a whole preparing for the [2012-2013] school year. Then the board of trustees, just this week, commissioned a task force called the Operational Efficiency Task Force, and we’re going to be looking at ways to do things [pertaining to the budget] in a more efficient manner,” said White.
“Hopefully with the changes we’ve made, we’ll be able to go forward and not make any other adjustments of this nature. When we went into this process we looked at fixing it for the long-term as opposed to just getting through this year,” he said.
Varland said, “Admissions tracks all kinds of [indicators]; they know when people blink. They’ve got apps, deposits, visits; all those numbers looked great until about May. Then all of a sudden, things weren’t tracking right. In the beginning of June, numbers started to fall. So, it was over the summer. Students had come to register, students had put down some deposits and then all of a sudden, ‘Oh, we’re not coming.’ So it wasn’t like early on we saw it. It had never happened at that stage before. If we had low enrollments you could see it coming earlier on. All of those factors make it hard to say, ‘Well, we could have done this, done that.’ Now looking back in any decision most people say ‘Oh, well I would have done that differently.’”
Though there are pay cuts, Overton-Adkins said the executive team did their best to equal the percentages of cuts across the board of staff and faculty payrolls. Those who receive higher salaries received higher percentage cuts and those with lower salaries received lower percentage cuts in order to equal two percent as a whole.
“What we agreed to this year, unless the faculty would agree to have their salaries cut [immediately], [is to make] immediate cuts to the staff, but we will make revisions to the faculty contracts for next year that will equal two percent. What we could do is say the faculty on the lowest end would take a lower percentage and those on the higher end could take a higher percentage so it averages out to two percent,” Overton-Adkins said.
However, Overton-Adkins said there will be some positions hired for next year. “I don’t see it as stopping new positions. We’ve adjusted the salary scale down. Is it going to be harder to attract people to Spring Arbor because our salary is lower? I think salary will be a concern. Our salaries have been lower than some universities already; however, we find that people come here missionally.”
Custodian Matt Cousino said, “We have to make adjustments just like the university had to make adjustments. It hurt us [my wife, Mandy, and I] more than most, since we both work here so it was a four percent cut rather than just two percent. But part of the blessing is just being here.”
“The university is generous with time off. They’ve given us benefits that other places haven’t seen in a long time. Vacation time, they’re very generous with their health insurance; a lot of places don’t have it all. They have a benevolent fund if people fall into hard times. This place is special that way. Even though all these things [budget cuts, retirement funding cuts] are a disappointment, it’s still much better than a lot of people have it. I would much rather my salary and retirement weren’t cut, but I think things will be just fine,” he said.
“I think if the economy improves our [financial] packages will improve as well. We’re all hoping for everything to turn around. I fully expect it to happen that way,” said Cousino.
Despite the setback, Cousino said he still maintains a positive outlook on the situation. “I think we have to be careful about getting discouraged about things. That’s the thief that comes to steal and kill and destroy. I don’t think we as employees should go around moping and whining and complaining all the time, do you? No, we should make the best of it; we don’t have to like it. It’s an opportunity, an opportunity to grow.”
