November 14, 2008
Stacey Schmeidel 704-682-2629 /Bill Giduz 704-894-2244
On November 13, President Tom Ross sent alumni, parents and friends the following email about Davidson and the economy.
As we reach the midpoint of the fall semester at Davidson, I wanted to write to our alumni, parents, students, and friends with a few words about something that I know is on everyone’s mind: the economy.
America’s economic crisis is being felt around the world—and despite “the Davidson bubble,” our college is not immune. In fact, fuel, energy and food costs affect Davidson more than many other businesses because we are a residential campus. And, of course, the volatility in the stock market is taking its toll on our endowment; after several years of impressive growth to just over $500 million at the end of June 2008, we anticipate the endowment will be down at year-end, barring a significant bounce in the markets.
That said, Davidson College is extremely fortunate. We have a low debt load, and we currently are not undertaking any major construction projects that would place a heavy strain on our finances. We are used to “doing more with less”; we have always provided the highest quality educational experience for our students while operating prudently, with an endowment that is significantly smaller than those of our peers. We know that the number of students who qualify for need-based financial aid may increase in the year ahead, even as giving to the college may decrease. But our alumni, parents, and friends have always been generous in their support for the college, and I believe that those who know Davidson best will continue to support the college as generously as possible during this period of increasing need.
This is not a time for panic; it is a time for prudent action and continued careful management. Therefore, over the past several weeks, I’ve talked with trustees, faculty, students and staff about what we can all do now in order to prepare for what’s likely to be an extended difficult period ahead. We recognize that we must be even better stewards of our resources, and we recognize that our top priorities must be ensuring the strength of our academic program, sustaining the strong systems of student support that we have in place, and preserving the sense of community that distinguishes Davidson.
To that end, I have asked all divisions of the college to submit plans for budget cuts by the end of this month. The level of cuts to be implemented will depend upon the college’s revenue picture as the fiscal year continues. In addition, I have asked all divisions to submit plans for flat budgets next year—a step that Davidson hasn’t had to take for some time, but one that I believe will be essential in the coming year. As we move forward, even flat budgets for next fiscal year may not be possible. In addition, beginning immediately, I have asked all academic and administrative departments to eliminate all non-essential travel, and we are instituting a hiring freeze—filling only positions that are critical to our educational mission or essential to the operation of the institution. We are centralizing some on-campus events and services in order to operate more efficiently. In the coming months, we will all be asked to make some difficult choices, but making tough choices now may avert more difficult choices in the future. Moreover, given the economic climate, these are the right steps to take and the correct thing to do.
It’s important to note that our ongoing efforts in Davidson’s Year of Sustainability will also lead to cost savings. Already, by reducing the amount of bottled water used on campus, we have saved approximately $10,000 in just three months. Turning off computers at night, turning off lights in empty dorm rooms and empty classrooms, reducing unnecessary printing, conserving water—all of these things save money. Sustainability isn’t just good for the planet; it’s good for the bottom line.
But even as we cut back, we are taking steps to preserve our core values, the things that make us distinctly Davidson. We will not do anything to compromise the quality of education that our students receive at Davidson College. We want to do all that is possible to maintain our commitment to our employees. And, we must maintain our longstanding commitment to affordability and access. As you know, Davidson is one of the few colleges in the nation that remains dedicated to need-blind admission. We made history 18 months ago with The Davidson Trust, a pledge to replace loans with grants in all financial aid packages. Given the current economic climate, The Davidson Trust will be more important than ever to a greater number of students than we originally anticipated. When the trustees voted to establish The Davidson Trust, they pledged that the program would be funded with new dollars, not through tuition increases or cuts in academic programs. Even in this economic climate—especially in this economic climate—we will honor that commitment. We cannot lose sight of our aspirations. The Davidson Trust is the right thing to do.
The next few months are likely to be challenging—for the college, and for the nation. During these unusual times, Davidson remains committed to our purpose of providing our students with an exceptional liberal arts education that develops “humane instincts and disciplined and creative minds for lives of leadership and service.” I am grateful to the many alumni, parents and friends who have entrusted us with this most important responsibility, and I am confident that by working together we can continue to fulfill our noble mission in the months to come. Thank you for your understanding and support.
Thomas W. Ross
Posted By: Bill Giduz