"Gettysburg College is strongly positioned to weather economic downturns," Interim President Janet Morgan Riggs reported Oct. 28 in a letter to the College community. "I look to our future with confidence."
Riggs, a 1977 graduate of Gettysburg, credited a "long-time practice of conservative financial management" for the College's strong balance sheet and continued ability to aid current and prospective students. Also, philanthropic support of the College has not decreased, indicating the high value supporters place on their Gettysburg experience. However, Riggs said, "during this time, the need for general support for the Gettysburg Fund and for scholarship support, in particular, will be of high priority."
The letter's text follows:
Dear Members of the Gettysburg College Community,
It is not surprising that, as I have visited with alumni and friends of the College this fall, I am regularly asked about how the current economic context is affecting Gettysburg College. It is not a simple question to answer; the volatility of the financial markets continues, and the outcome of the various measures taken by the federal government is difficult to predict. The good news is that Gettysburg College is strongly positioned to weather economic downturns. Thanks to a long-time practice of conservative financial management, we have experienced balanced budgets for many years.
We continue to maintain a strong balance sheet, ample cash reserves, and contingency funds to help us through difficult times.
Many have asked me about Gettysburg's involvement with the Commonfund, an investment fund you may have read about that serves several hundred colleges. This multi-billion-dollar fund was frozen last month, leaving some institutions with liquidity problems when they were not able to tap funds for payroll and other immediate needs. I am pleased to report that Gettysburg College does not invest in the Commonfund's Short-Term Fund.
As we consider the potential impact of the current economic situation on Gettysburg College, we focus on the three major revenue sources: tuition, endowment, and philanthropy.
Because most student loans for this academic year were secured before the credit crunch became acute, we have heard remarkably little from families expressing concern about financing a Gettysburg education. Our peer institutions report the same experience. Although increasing numbers of private lenders are exiting the college-loan market, Congress approved emergency legislation last summer that gave the Department of Education authority to guarantee the liquidity of federal loan programs through the 2009-2010 academic year.
We will work hard to protect current and prospective Gettysburg students and will strengthen our financial aid program, as appropriate, to help families hit hardest by the economic downturn. We offer very competitive financial packages, and we remain committed to work with every family to put the College within financial reach.
Of course it is more important than ever that we demonstrate the value of a Gettysburg education. In our communication with prospective students and families, we will communicate clearly about the benefits of the Gettysburg experience, which prepares our graduates to make outstanding contributions to their professions and communities.
Although our investment portfolio is well diversified, recent market conditions have had impact on the College's endowment. Like the majority of private colleges in the U.S., Gettysburg draws annual operating support from its endowment based on five percent of a trailing 12-quarter average market value. This "smoothing" technique moderates the budget impact of significant short-term changes in market value, both positive and negative. In short, this procedure is designed to help us withstand the abrupt shifts in the market we are currently experiencing.
We are very grateful that our supporters continue to make Gettysburg College a priority. We have not seen any decrease in overall gift support, in gifts to the Gettysburg Fund, or in gifts to the Orange & Blue through the end of October. Interestingly, higher education donations have not decreased significantly during recessions in recent decades, a trend that supports the theory that people continue to give to the organizations they value most.
We look at fundraising over the long term, and although support from some of our donors may be affected by the current economy, others may not be affected at all. We will continue to visit donors and communicate with them frequently. During this time, the need for general support for the Gettysburg Fund and for scholarship support, in particular, will be of high priority.
Gettysburg is fortunate to be strongly positioned to weather this financial storm successfully. During this time, of course, we will continue to manage costs carefully and be good stewards of the College's resources. We have clearly prioritized plans to build upon, and we continue to move forward in several important ways-with the addition of outstanding new faculty and innovative new programs. Construction of the Center for Athletics, Recreation & Fitness remains on schedule with an opening date slated for late in calendar year 2009.
Thanks to the wise counsel of our trustees, the loyal support and continuing enthusiasm of our alumni and parents, and the energy and inspiration of our current students, I look to our future with confidence.
Janet Morgan Riggs '77
Interim PresidentPosted: Sun, 26 Oct 2008
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