“Spending at current levels in the case of reduced income would be irresponsible,” wrote Williams President Morton Schapiro in a letter sent out on Saturday, after a meeting of the Board of Trustees. He then laid out three specific cost-cutting measures. The planned renovation of Weston Field (Williams’ football complex) will be put on hold, as will the remainder of its Stetson-Sawyer academic building renovation project. According to an article from The Berkshire Eagle, these two projects together are estimated to cost about $100 million. In addition, Williams will cut $3 million in facility renewal spending and also limit new hires “except those deemed most essential.”
“You’ll notice that these steps are less like switches that are either on or off, and are more like dials that can be adjusted as the economic situation changes,” Schapiro wrote. He said that in the weeks to come, Williams would look at further ways to adapt to the economic climate, including potentially increasing the size of each entering class, so as to increase the money brought in by student fees.
Middlebury College took similarly bold steps. In a letter to all students, faculty, and staff, as well as an attached question and answer document, Middlebury President Ron Liebowitz described the immediate steps the college would have to take to protect its short- and long-term well being. For one, he announced a hiring freeze on all but the most essential positions. In addition, the college will attempt to cut travel costs by 20 percent and limit significantly the use of outside consultants and contractors.
“Considering that attending a prestigious NESCAC school like Middlebury or Amherst gives the student body a sense of security in the depth and wealth of our endowment, the specific comments the president made on our budget were particularly surprising and upsetting,” said Middlebury junior Nick Martell.
“It was further disheartening to even see a link in the same letter to an anonymous Web page that encourages students to articulate their own ‘budget suggestions’ for the school to potentially implement,” Martell added. “How serious was the blow to our current and future revenues if Middlebury is looking for arbitrary internet help from anyone?”
Both letters noted drops in the college’s endowment returns as one of the major reasons for the spending cuts. Each college lost one percent on its endowment last year. By contrast, two years ago, Middlebury pulled in a 22 percent return.
In addition, the Middlebury question and answer document said that the college had $8 million stuck in the Commonfund Short Term Fund, an investment fund that manages almost $10 billion from 900 colleges and universities. The fund provides returns slightly above U.S. Treasury bills and had been 100 percent liquid until late in September, when Wachovia Bank resigned as the fund’s trustee and terminated the fund. Amherst originally had $25.9 million in the fund, and now has a little over $13 million, according to College Treasurer Peter Shea. He said that the bulk of that sum should be returned in the next six to 12 months as the securities in the fund mature. “It’s freezing up our money, but not enough to make a real impact,” said Shea.
According to College President Tony Marx, how the economic slowdown is impacting Amherst will be the main topic of conversation at this weekend’s meeting of the Board of Trustees. And so a similar letter may for forthcoming to Amherst community members.
“From a college perspective, absolutely from a leadership perspective, the College is going to have to show itself as fiscally prudent,” said Chairman of the Board of Trustees Jide Zetilin ’85. “In good times we ought to be doing it, but particularly in times of uncertainty, we ought to focus on being fiscally prudent and stretching our limited resources.”