(PHOTO: In October’s Open Budget Forum, these were numbers presented as part of the $4.3 million budget gap breakdown. However, as we have now learned, the deficit is now at $6.1 million and these numbers no longer necessarily apply. A future Open Budget Forum has not yet been scheduled for Spring.)
*Updated Wednesday, Dec. 14. Some changes have been made to the original print version.*
While Fairfield students spent the past month worrying about the University’s unexpected $4.3 million budget deficit, they had no idea that administrators found additional problems that brought Fairfield’s deficit to a startling $6.1 million for the fiscal year ending in June, 2012.
Some veteran faculty members said this is the first time in 40 years that Fairfield has had such a serious deficit in its operating budget.
“Faculty – and probably most of the University community – really have no good idea as to why we are really in this budget crisis,” said Irene Mulvey, a professor in the mathematic department in her ninth year as the Secretary of the General Faculty. “We don’t know if it’s a one-time thing, as we were originally led to believe, or a long-term problem that will get worse.”
The Mirror asked Vice President for Finance Julie Dolan how the additional $1.8 million deficit, announced quietly last Thursday, was missed in original calculations on the budget for the 2012 fiscal year.
“The original calculations were based on the revenue information available at the time, which included the Fall enrollment figures for undergraduates, as well as the Summer and Fall credit hours for graduate and part-time programs,” she said. This did not include data from graduate student enrollment, and it could not account for Spring registration numbers.
“Even the $6.1 million figure is still an estimate,” Dolan explained. “We won’t know for sure until late January, after registration is completed.”
Dr. Mark Reed, vice president for administration and chief of staff, explained that as a University, “you develop plans to address [budget challenges], but all plans – good and bad – have underlying assumptions, and if the assumptions prove incorrect, then you have to deal with the results.”
To better understand the budget deficit, The Mirror conducted extensive interviews with students, faculty, and top administrators. Each area of the campus community members sees the budget situation differently. While administrators are already looking ahead to next year’s budget preparations, students and faculty are still seriously concerned with how the University will survive the current academic year and are suspicious of the lack of transparency from the administration in budget proceedings thus far. Students worry about how cutbacks will affect their education and why their $50,000+ a year for tuition and University fees can’t cover the University’s needs.
Administrators Struggle to Find Solutions, Savings
Administrators now have to balance the budget for the current fiscal year, which will end on June 30, 2012, in addition to establishing next year’s budget.
“As we look ahead to next year and the years to come, we will be working with more conservative assumptions, given the economic realities we faced this year,” said President Jeffrey von Arx, S.J. in a comment submitted after The Mirror’s deadline (it is not included in the print edition). “We are also actively seeking to develop alternative sources of revenue.” He also mentioned that financial aid to students has been increased to better align itself with the increasing needs of students in the current national economic downturn.
Reed agreed. “I think it is safe to say that the University moving forward will be revising its financial assumptions, exploring all ways to operate as efficiently and cost-effectively as possible,” Reed explained.
This includes “taking a conservative approach in terms of enrollment projections while aggressively seeking to grow enrollments particularly at the graduate level, seeking any and all additional revenue generating opportunities, and adjusting strategic timelines and implementation plans while maintaining positive forward momentum,” he said.
In an email to the campus community, Dolan noted that “less than 25%” of the savings found for the budget so far actually came from the staff cuts in November. Administrators would not directly address why the cuts of nine staff members were necessary when the impact each cut had on the overall remediation of the budget was so minimal. The other 75% of savings in the budget was found by eliminating empty positions from new retirements this year, according to the budget communication.
The University hopes to prevent the increase in the deficit in the upcoming fiscal year, though specific ideas for preventing such a trend from repeating itself next year were not yet available.
“Obviously, we will be taking a close look at all our assumptions for [Fiscal Year] 2013, in light of the reality we experienced this year,” Dolan said. Planning for next year’s budget will occur in early January.
Student Confusion Grows
But despite the seemingly calm mood of administrators, students across campus said they were growing more confused and concerned about the changing budget gap as word spread about the increasing problem.
“I’ve gone to the open budget forums and I have not come back enlightened,” Alicia Bissonnette ’12 said. “I still don’t understand what’s going on.”
Early plans are in place for a follow-up Open Budget Forum to be held next semester, but no date has been set.
Student leaders say they understand the necessity of the cuts, but also feel the pressure of concern for the current budget situation. This past semester, new FUSA President Rob Vogel ’13 sat on the University Budget Committee along with another student representative and a number of faculty and administrators. His biggest focus so far has been interacting with students to see whether their University experience is being affected by the cuts across the University.
So far, no one has come forward saying it has been affected; yet “that does not mean that no single individual has not been affected in some way,” Vice President Reed did note.
While Vogel thinks the administration has “done a solid job this time around impacting [students] as little as possible,” he fears that “unless Fairfield seriously changes their models, and restructures what they’re looking to do financially, I don’t see how it keep up – I think it will be inevitable that they will have to eventually cut programs.”
Vogel highlighted the difference between viewing Fairfield University as a secondary education business and as a Jesuit University – “the two don’t always agree,” he said. “You look at a company that lays off nine people, and it’s understood as a point of business. Nine layoffs in this Jesuit university with Jesuit ideals…and with the nature of the Jesuit institution, it gets blown up.”
“It speaks a lot about the University that it’s only a few people, but [with] the whole culture this Jesuit university has created and the community we’ve fostered, we’re growing students who actually care about those 9 individuals,” Vogel said. “Other schools might just see it as looking at financials and profit, but at Fairfield – that’s what makes us different. Students actually care.”
Frustrated Faculty
In an effort to find solutions to the budget deficit, administrators recently asked faculty members to approve a cut to their University retirement fund contributions and their life insurance coverage packages. This essentially constitutes a change in the basic contract of the faculty, an agreement known as the Memo of Understanding covering about 250 faculty members.
Never before has the faculty been asked to give back on its Memo of Understanding, one professor noted.
Last Friday, the General Faculty held a meeting to vote on the two motions. Several faculty members complained the school hadn’t supplied enough information on how Fairfield got into a $6.1 million financial hole and how it planned to get out of it.
After approving the cuts to life insurance the General Faculty moved to recess their meeting, as “faculty did not feel ready to vote on the most significant giveback on retirement and so the decision was put off until the next General Faculty Meeting,” Mulvey explained.
At the meeting, Paul Fitzgerald, the senior vice president of academic affairs, told faculty that many other peer schools, such as Providence College and Loyola, also were struggling financially, but he did not supply any evidence to back up the claim.
An online search for articles on each school found no newspaper stories on financial distress or budget problems at these schools.
Many faculty members were frustrated with the lack of collaboration between the administration and the faculty in Friday’s meeting, and throughout the past years.
“We are asked to approve these proposals to avoid creating a “contentious” relationship between the faculty and the administration,” explained Giovanni Ruffini, a professor in the Classical Studies department. “But that relationship is already contentious.”
“The relationship between the faculty and the administration over the last few years has been one in which the administration has steadily chipped away at the rights and benefits the faculty have secured,” he said. “The faculty have been deferential and accommodating, and in my opinion unnecessarily so.”
Regarding the recent cuts of staff members, Mulvey said the “faculty are incredibly appreciative of the staff and think it is incredibly unfair for staff members, particularly those who were laid off, to bear nearly the entire burden of the budget mess that they had nothing to do with causing.”
This sense of disappointment extends to the faculty’s overall sentiment toward the budget deficit.
“In the meeting on Friday and in general, I would say faculty are extremely frustrated at the current budget situation,” Mulvey noted. “Faculty have no idea why we are in this situation. There has been no detailed explanation from the administration as to exactly why we have been thrown into such financial chaos and no attempt at a comprehensive plan to address long-term budget matters.”
Richard DeWitt, professor of philosophy and president of the University’s Faculty Welfare Committee, felt that faculty would be willing to work with administrators, saying, “I am deeply committed to Fairfield University, and am committed to working with others, not just in the administration but in all segments of the campus community, to begin moving us in a better direction.”
However, he said, “I disagree that our current difficulties are the result of a “perfect storm,” as a senior administrator recently described it, and instead see our current situation as a predictable outcome of recent trends” of worsening “institutional health.”
Jocelyn Boryczka, co-director of the Peace and Justice Studies department and an associate professor of politics, agreed, but still noted that, “we would all like some answers – faculty, staff, and even administrators who don’t know [the details] – would like to know!” the realities of the budget situation.
Her question echoed the concerns of many members of the campus community; “Where has the money gone, how are we going to make it back, and what caused the problem?” she asked.
“We’ve had layoffs of staff, cuts to budgets and benefit “givebacks” all designed to close the current budget gap – even as it continues to grow – but no comprehensive strategy to get us back on track to focus on our core academic mission,” Mulvey said. Until given an explanation, it looks as though faculty will continue to be hesitant in interactions with the administration.
Confusion and questions still linger across campus, most of which still remain unanswered by administrators. Faculty and students complain that the administration has not been transparent as to the causes of the problem and suggested long-term solutions, deepening the atmosphere of suspicion and mistrust aimed toward the University administration.
It does not appear that the budget deficit will be solved any time soon, as no solution proposed thus far is capable of diminishing the gap significantly enough to make a real difference in the remaining debt.
“It’s not clear to me why we’re being asked to shoulder a burden caused by administration error,” said Ruffini. “The mistakes are theirs, the punishment apparently ours.”
Boryczka acknowledged the potential for improvement within the University. “We all need to know what the problem is, so we can all get on board with a solution,” she said. “Everybody has problems – just tell us what it is, and tell us how we can contribute to solving it.”
The Road Ahead
DeWitt appeared apprehensive about the future.
“If we do not see a serious commitment by the administration to acknowledge and address what are becoming systemic problems, and to do so in an open and transparent way with meaningful involvement of all key segments of the University community,” Dr. Dewitt said, “then I think it would be in the best interests of the University community to consider how much confidence we can have in our current administrative leadership.”
While questions still swirled around Fairfield, Father von Arx did try to reassure the campus community – almost a week after the original budget update was released.
“I think it is important for everyone to understand that fundamentally, Fairfield is a very strong, competitive, and admired institution, and that our future is a bright one,” he said.