Administrators are gearing up for a tense semester of negotiating $30 million in cuts to next year's budget. But unlike last fall, when the University quickly eliminated approximately the same amount mostly through quick-fix measures such as a hiring freeze, this round of cuts will force decision-makers to find more nuanced and permanent solutions.
Last year's budget cuts, which took effect in July, were decided primarily by senior officers. But the $30 million that will need to be cut from next year's budget will be identified with extensive input from students, faculty and staff, Executive Vice President for Finance and Administration Beppie Huidekoper said.
While next year's budget will still increase from this year's, it will grow by $30 million less than originally planned. Of that, $7 million has already been saved by reducing planned building projects, and $5 to $10 million could be found by changing policies relating to travel and other costs, Provost David Kertzer '69 P'95 P'98 said.
The Organizational Review Committee, which consists of 10 administrators, three faculty members and two students, is responsible for locating as much of the remainder of the savings as possible. The ORC will oversee no fewer than 10 to 15 subcommittees that will each study a specific area of the University for ways to increase efficiency and eliminate redundancies and overlap, said Sarah Rutherford '12, the only undergraduate member of the committee.
"Inevitably, that's going to mean consolidating some people's jobs," Rutherford said, adding that new jobs will also likely be created.
"We're talking about budget reductions, but, at the same time, we're also talking about budget increases," Huidekoper said, citing financial aid and faculty compensation as areas that could potentially increase.
Jason Zysk MA '07 GS, the ORC's only graduate student representative, said the "terminology of layoffs" has not come up. But "one of the consequences of consolidation, of course, is that there are other positions that are going to be eliminated," he said.
The University is hoping that the current hiring freeze will offset potential layoffs, since "the fewer of those (empty) positions we fill, the more we'll be able to reorganize," Kertzer said.
Rutherford suggested that staff members whose jobs are eliminated might be able to apply for alternate empty positions within the University. The University currently has "over 100" vacant positions, according to Huidekoper.
Offering retirement packages is also "an option that has been and is being discussed," Huidekoper said.
Kertzer added that retirement packages could "make it possible for us to do what reorganization we need to do without laying people off."
"It was our hope that we wouldn't have to consider layoffs during this year," he added. If layoffs are necessary, they will be announced in the spring, Huidekoper said.
The University will also closely follow whether or not its peer schools decide to extend their faculty salary freezes for an additional year, since "remaining competitive is a priority with our compensation."
The current vacancy review process, which requires that all vacant positions remain unfilled unless a committee of top administrators determines that a replacement can be hired, will remain in place "at least through the February budget process and a little beyond," Huidekoper said.
Seeking transparency
The organizational review subcommittees will examine areas such as information technology, events management, academic departments and overlaps between the Division of Biology and Medicine and the rest of the University. Though the committee rosters are not finalized, students will be included on every committee that relates to student life and services, Kertzer said.
Over the summer, the ORC gathered and prepared extensive internal data for the subcommittees to use because "until we have the numbers we can't really do anything," Zysk said.
The ORC and all subcommittees will have a general meeting at the end of September, after which the subcommittees will meet on their own "weekly, if not a few times a week," Rutherford said. The subcommittees will report their reorganization suggestions to the ORC, which will then provide budget-related suggestions to the University Resources Committee — the group responsible for submitting a proposed budget to the president each year — and administrative suggestions to top University officials. The ORC's work is expected to be complete by the February meeting of the Corporation at the latest.
Besides looking for areas of overlap between the Division of Biology of Medicine and the University, the ORC will focus on reorganization within the general University, Kertzer said. BioMed — which is less dependent than the rest of the University on endowment payout because of grant money — will only have to reduce its budget by $10 million, an amount that it has mostly achieved already by deciding to renovate an existing building rather than build a new medical education building.
Each committee will meet with "all constituent groups" that are affected by changes in its area, Huidekoper said. Additionally, the Faculty Executive Committee and Undergraduate Council of Students will participate in soliciting faculty and student feedback and suggestions.
UCS also plans to work through its own committee structure to offer suggestions on the reorganization of student-related areas, said UCS President Clay Wertheimer '10. For example, he said, UCS may take an "inventory of student lounge space" to help the administration prioritize which areas would most benefit from renovations.
The administration is also preparing a new Web site about the University's response to the recession, which will go online "once we sort of lay this whole thing out," Huidekoper said. The Web site will include "things we've done and are doing to respond," such as policy changes and the various committees working to find budget reductions, she said.
After administrators meet with Corporation members on Friday to discuss updated "preliminary budget parameters" for the next fiscal year and get the "Corporation's input and blessing," they will send out a campus-wide communication about the school's finances sometime thereafter, she said.
While the administration wants the reorganization process to be as transparent as possible, "obviously there are going to be some confidential discussions," Kertzer said. The main barriers to full transparency are issues of personal privacy, including not publicizing salaries or identifying individuals, he said.
Even so, "the overarching purpose of this is to make Brown a successful place," Rutherford said, and the administration will not "purposefully shut out" comments and criticisms.
Next year and beyond
The organizational changes should only affect student life in minor ways, Kertzer said.
"A lot of the work that the committee is doing is behind-the-scenes things that students don't really experience," Zysk said. "The people who are going to see the most direct results of the reorganization are the faculty, and in particular the junior faculty."
While it took a financial crisis to force the University to reorganize, the process would be beneficial at any time, Huidekoper said. "Over time we just grew up with an organizational structure that is not optimal," she said.
In addition to the budget cuts made to the current budget and those planned for next year's budget, a final $30 million dollars in cuts are still needed to bring the budget to its goal of $600 million in the 2014 fiscal year. The administration and the Corporation will be "watching economic elements very closely and hoping it may be possible to be in a better position" in the next few years, Kertzer said, making the final $30 million in cuts unnecessary.
