In an e-mail to the Washington University community Wednesday morning, Chancellor Mark Wrighton announced that the value of the University's endowment has declined approximately 25 percent since July.
In the e-mail, Wrighton proposed several cost-cutting measures.
“With the decline in the value of our endowment, coupled with leveling of research support, constraint on the rate of tuition growth, uncertain prospects for philanthropic support, pressures on healthcare costs, and the prospect of increased needs for financial aid, we must take some actions to assure that our University remains strong into the future,” Wrighton wrote. “We will constrain the growth of administrative expenses, compensation expenses, and commitments to new building projects.”
The e-mail did not mention any cuts to financial aid services. Henry Webber, executive vice chancellor of administration, said that the University does not plan to reduce the amount of financial aid given to students.
“I can assure you that the University absolutely expects to continue to provide excellent financial aid services,” he said. “The process that we're talking about is designed to look at the process of financial aid, not the amount.”
Wrighton announced a decrease in wages going into the next fiscal year, as well as plans to “scale back, eliminate, or delay capital projects.”
Although some initiatives will be delayed, Webber said that others will continue as planned, particularly those expected to save money for the University.
“Sustainability planning will continue,” Webber said. “Using our energy resources very efficiently is even more important than it was before this, ensuring that we can be as efficient as we possibly can be on the capital projects side.”
Wrighton’s e-mail stated that the current renovation of Wohl Center on the South 40 will be “slowed,” although the he did not specify how. Wrighton also announced that a planned $20 million expansion of Mallinckrodt Center has been postponed indefinitely.
By contrast, the chancellor proposed no change to the scheduled completion dates of the BJC Institute of Health and the new engineering complex, which are expected to open in late 2009 and the summer of 2010, respectively.
Wrighton proposed a reduction in his salary by 10 percent over the next year—a 5 percent cut as of Jan. 1, 2009 and another 5 percent cut effective July 1, 2009. The school deans and vice chancellors have volunteered to freeze their salaries in the coming year.
In 2006, Wrighton received $490,500 in direct compensation, in addition to contributions to his benefit plan and an expense account, according to the latest available copy of the University’s public tax return.
Despite salary cuts across the University, the chancellor did not call for a hiring freeze or a total freeze on faculty compensation, citing the need “to attract and retain key members of the faculty and staff and to provide financial resources to do so when needed.”
Webber added, however, that several of his employees have offered to take pay freezes.
“Administrative salary increases will certainly be smaller than they were in recent years,” Webber said. “I've received several e-mails from members of my staff who volunteered to freeze their salaries. I do not envision, at this time, a salary freeze for everyone. Our hope is to protect our lower-paid employees.”
In the e-mail, Wrighton also announced the need “to continue our progress in improving gender balance and building greater representation of members of minority groups."
In addition, the e-mail stated the University plans to employ a stricter process for hiring within the administration in non-academic areas, what Webber called a “belt-tightening measure.” He said that the process would be expanded, and crucial positions would still be filled.
“One of the things we have to do is reduce our administrative costs,” he said. “Undoubtedly there will be positions that we would like to fill that we don’t. We will fill essential positions. That’s what a cutback means: things you would like to do but can't do.”
Rob Wild, assistant to the chancellor, said that the administration does not plan to initiate a hiring freeze, as has been done in the University of Missouri System in response to a similar endowment decline.
“I do imagine that as a result of this it may take a bit longer for certain kinds of repairs to be made,” Webber said. “That means working smarter.”
Wrighton: Endowment down 25%; wage cuts, construction delays imminent
In message to community, Wrighton highlights dour economy
Published: Wednesday, November 19, 2008
Updated: Wednesday, November 19, 2008
per veritatem vis--WashU "Elite" Lecturer, [Day] School of Arts and Sciences, 1999-2007, teaching c. 20 courses in 11 disciplines, +/- 4 courses per semester, autumn, spring and fall
--WashU "Rank and File" Contract Adjunct Lecturer, [Evening} University College, 2001-2007, autumn, spring, and summer
--Fontbonne University "Rank and File" Contract Adjunct Lecturer, Religious Studies, Autumn 2006 (Day and Evening School)
--Columbia College in St Louis "Rank and File" Contract Adjunct Lecturer, Autumn 2008-Spring 2009[?], [Religious Studies, Asian Studies, Sociology]
--Webster University "Rank and File" Contract Adjunct Lecturer, Autumn 2008--Spring 2009[?], Interdisciplinary Studies, Cooperative Studies, and Environmental Humanities
--St Louis University "Rank and File" Contract Adjunct Lecturer, Spring 2009[?], Theology
--University of Pennsylvania, Officer, Graduate Student Associations Council, 1991-1998, President [by acclamation], 1997-98; Emeritus President, 1998-99, representing the interests of ALL the Arts and Sciences graduate students, and ALL the PhD students, and the Lecturers as well...
--Community Lecturer (unpaid volunteer), Washington University Cooperative Network, 2003---
per veritatem vis--WashU "Elite" Lecturer, [Day] School of Arts and Sciences, 1999-2007, teaching c. 20 courses in 11 disciplines, +/- 4 courses per semester, autumn, spring and fall
--WashU "Rank and File" Contract Adjunct Lecturer, [Evening} University College, 2001-2007, autumn, spring, and summer
--Fontbonne University "Rank and File" Contract Adjunct Lecturer, Religious Studies, Autumn 2006 (Day and Evening School)
--Columbia College in St Louis "Rank and File" Contract Adjunct Lecturer, Autumn 2008-Spring 2009[?], [Religious Studies, Asian Studies, Sociology]
--Webster University "Rank and File" Contract Adjunct Lecturer, Autumn 2008--Spring 2009[?], Interdisciplinary Studies, Cooperative Studies, and Environmental Humanities
--St Louis University "Rank and File" Contract Adjunct Lecturer, Spring 2009[?], Theology
--University of Pennsylvania, Officer, Graduate Student Associations Council, 1991-1998, President [by acclamation], 1997-98; Emeritus President, 1998-99, representing the interests of ALL the Arts and Sciences graduate students, and ALL the PhD students, and the Lecturers as well...
--Community Lecturer (unpaid volunteer), Washington University Cooperative Network, 2003---