2009-10 Budget Update

February 18, 2009

Dear Members of the Gettysburg College Community,

Though the topic of this letter is Gettysburg's budget for the coming academic year, I feel compelled to begin by saying how delighted and honored I am to have been elected by the Board of Trustees as Gettysburg's 14th president.  I very much appreciate the encouragement and support that I have received from so many members of this community over the last several days, and my desire to help Gettysburg be the best college it can be could not be stronger.  As I said at the campus reception following my election, I take on this responsibility with great seriousness of purpose, with great enthusiasm, and with great joy.  And I invite you to share this responsibility with me.  

Of course a primary focus for me over the last several months, and one that will continue into the future, is to ensure that the College maintains financial strength in this very challenging economic climate.  Earlier this month our Board of Trustees focused on the College's budget for the 2009-10 academic year (Fiscal Year 2010).  I would like to provide you with some highlights of the budget that the Board approved and information about steps we have taken to manage the economic downturn since my letter last fall.

First, in spite of the challenges we all face in this environment, I remain encouraged by the continuing strong Board enthusiasm for the College's fundamental mission. Gettysburg remains in a relatively strong position because of their support and wise counsel and a long-time institutional practice of prudent financial management.

In the new budget we continue to devote resources to build on core programs that support the exceptional educational experience we provide to students.  Reductions in operating costs have been achieved by a comprehensive and strategic analysis of expenses across each of our divisions. We have avoided the across-the-board cuts, layoffs, and freezes that some institutions have implemented in favor of reducing our operating budget in selective areas that will have the least impact on the student experience and protect our human "capital." Also because of the great financial uncertainty we continue to face, we have built additional contingency funds into the budget to help us manage critical needs as they arise.

Operating budget for FY 2010

The operating budget for next year is $106 million, an increase of 0.9 percent over FY 2009. This very small increase makes it possible for the College to support its highest priorities during a period when our revenue from endowment and interest income has decreased.

• Comprehensive fee-Because we recognize that many families have concerns about the affordability of college during what could be a prolonged recession, the Board approved the lowest comprehensive fee increase in more than four decades: 2.9 percent for a total of $48,050.

• Financial Aid-We will continue to provide very competitive financial aid packages and have increased our institutional aid to nearly $38 million, compared to $36.5 million in FY 2009.

• Enrollment-The budget is built on sustaining an on-campus enrollment of about 2,450, which includes a first-year class of 720 new students to be drawn from a large, high-quality applicant pool. To date, we are very pleased with the size and quality of our applicant pool of more than 5,000 students.

• Philanthropy-Our FY 2010 operating budget assumes gifts to the Gettysburg Fund and Orange & Blue of approximately $3.3 million, which is consistent with the past two years' performance. We are deeply grateful for this loyalty and support. Now more than ever, gifts to the College are vital to Gettysburg's continuing success.

• Endowment-Because Gettysburg uses a three-year average of its endowment value to determine the endowment income that will support College operations, the impact of the current market downturn on operations is softened somewhat for FY 2010. However, at the end of the calendar year, our endowment was down 26 percent from the previous year, and we are likely to feel the full impact of those losses into the future.

• Salaries-Our most senior-level administrators have agreed to accept no salary increase for FY 2010. A very modest salary pool increase is built into the budget and will be reviewed as the economic situation unfolds. Salary letters and actual increases may be distributed later in the budget cycle than usual and will be directed primarily towards those at lower-income ranges. Funds to support three new faculty positions have been added as a way of advancing the academic program and providing more students with the opportunity to work one-on-one with faculty on research and other independent study projects.

• General operating expenses-The budget includes nearly $17.7 million in general operating expenses-a figure that is the result of nearly $1 million of savings resulting from belt-tightening initiatives put in place during the budget process. We have reduced spending across the College, with the deepest reductions in support areas such as Finance & Administration, Facilities, and Information Technology. The Center for Athletics, Recreation, and Fitness is still on schedule to open at the end of the 2009 calendar year.

Many individuals across the College have been part of our budget process, and I want to thank everyone for their collaborative spirit and thoughtful deliberation. I am grateful as well to members of the community who submitted several innovative cost-saving ideas. All of these efforts help, and they represent a genuine spirit of shared sacrifice that is characteristic of our community.

None of us can predict with certainty the depth or length of the current economic crisis, but I have confidence that our prudent financial management practices will serve us well.  I would ask our supporters, who are able, to consider making as generous a gift as possible to Gettysburg.  These times call for a well-educated citizenry, and Gettysburg has an important role to play.  Your support is essential to our goal of advancing Gettysburg's potential to offer the best liberal arts experience possible to those who will be taking on leading roles in tomorrow's world.

Sincerely,
Janet Morgan Riggs '77
President