Three years ago, President Ruth Simmons found herself at the helm of a University navigating a stormy financial climate unlike any since the Great Depression. As Simmons prepares to step down at the end of the academic year, she said she is proud of the University's handling of the $740 million hit to its endowment and its weathering of the economic downturn, a defining chapter of her presidency.
"First of all, I'm proudest of the fact that we didn't panic," Simmons said.
She cited several areas in which University Hall focused on maintaining current levels of operation despite the 25 percent drop in the endowment during the 2009 fiscal year. "We understood our role in the community here and decided that we did not want to see drastic cuts in the number of employees," she said.
Simmons also said she was proud of the decision not to cut financial aid, a choice she said "would have been easy in many respects … because people would have understood it."
"But precisely because families were going to be challenged to reap the costs of education, we thought it was the last time in the world to cut financial aid, and we didn't," Simmons said.
Beppie Huidekoper, executive vice president for finance and administration, said Simmons' calming influence and experience proved vital in the University's immediate response. "(Simmons) set the tone in saying, ‘We're not going to make changes that are going to hurt the student experience or negatively impact our faculty's ability to teach and do research,'" she said.
Huidekoper also credited Simmons with "a general sensitivity toward preparedness" that influenced the "day-to-day management" of the University's finances.
"I think we had been a little ahead of our peer institutions in having a good sensitivity to risk management," Huidekoper said. "We were probably a little better prepared in facing some of the challenges because we had done the ‘what ifs' earlier."
"What most people are shocked by" is the decision to carry on with the University's capital projects, Simmons said. "Most places sidelined projects. But at the worst possible time, we made the decision to move ahead with all of those projects," she said. "And now, we see the benefit of them."
Thomas Tisch '76, chancellor of the Corporation, the University's highest governing body, agreed that the handling of construction projects was a major part of the successful management of the downturn. "We were very lucky at Brown that when the convulsions hit … we only had one building — Rhode Island Hall — under construction," Tisch said.
Five other buildings — the Perry and Marty Granoff Center for the Creative Arts, the Stephen Robert '62 Campus Center, the Medical Education Building, the cognitive, linguistic and psychological sciences building and the new fitness and aquatics center— were in the planning stages at the time.
"We looked at all our projects in the pipeline and thought about which ones we could abandon and which ones we should not," Simmons said. She said the administration "agreed that only projects that were funded should continue."
Construction of the Granoff Center and the Campus Center proceeded as planned, and the other buildings "were reconceived to fit our funding capacity and became in every case better projects at a substantially lower cost to the University," Tisch said.
To make these decisions, the University approached the campus community for advice. Simmons said she was "very pleased" with the process, which allowed the community "to help us decide what we could live without."
Decisions were made "in a very thoughtful way," Huidekoper said.
"We didn't bring in outside consultants — we did it ourselves, thinking about how we could reorganize and find savings in our operations," she said.
The University's smaller endowment forced administrators to quickly formulate a plan and stick with it, Simmons said. "We knew we didn't have the luxury of waste that so many other institutions had … every dollar counted, every goal needed to be met with the most stringent conditions."
Though the University was forced to trim down — cutting a combined $60 million from its 2010 and 2011 budgets and about 240 staff — Tisch said it came out of the downturn in a stronger position than some of its competitors.
"The history of the world has been that when the very endowment-rich institutions caught a cold, the relatively less wealthy schools would catch pneumonia," he said. "In this case, what they caught was certainly much worse than a cold, and we did not catch pneumonia."
Simmons, meanwhile, credited the team of administrators around her for steering the University through the crisis.
"Some presidents are economists — they're not all French professors. But I would say no single individual, certainly not a president, has the ability to deal with the complexity of a very significant shock to the system," Simmons said. "We had this incredible array of people who were very smart and dedicated to Brown who took the time to get us through that period."
