Emory Report

March 6, 2000

 Volume 52, No. 24

Budget meets '00-'01 goals

By Michael Terrazas

For the past few months, Provost Rebecca Chopp has been advising campus groups that the University's budget for FY 2000-01 would be one of more "constrained growth" than those of recent years. Recently the Board of Trustees proved her right, approving a budget designed to further Emory's academic goals but in a more constrained fiscal fashion than in earlier years.

While Emory still claims an endowment that is the envy of almost every educational institution in the country, the University's days of truly phenomenal growth--1997-98 saw an increase in endowment spending of 33 percent--are probably behind it, according to Chopp. Emory will continue to grow, but spending increases will be channeled more selectively.

"We have enjoyed some recent years of tremendous growth, and we now return to a more 'normal' growth pattern of what we expect to be around 7 to 8 percent in our endowment per year," Chopp said, adding that next year's spending plan could be characterized as "judicious choices in the context of strategic direction combined with a more constrained budget."

"Because our growth was slow this year, we had to establish our priorities very clearly," she continued. "We decided to fund new faculty lines across the University and new scholarship programs."

Emory held the line on market adjustments for salary and benefits, again funding a basic 4 percent increase across the board for faculty and staff, along with a 0.5 percent increase in the fringe benefit rate, Chopp said. In all, salary and benefits absorbed 41 percent of incremental spending. Chopp added that the University hoped to make salaries more competitive in certain areas-technical positions, along with clerical and facilities management jobs, for example--but was only able to partially fund programs toward this end.

"We were unable to fund approximately 50 percent of our market adjustments, the full amount of the requests for security in Information Technology or additional new resources for acquisitions in the library," Chopp said.

"Because of these difficult choices, we also decided to slow down the progress we are making on our Campus Master Plan, especially in relation to the attempt to move toward a beautiful, pedestrian campus. This year we will block off some of our streets, but we will not spend the money to pave them with bricks."

The 2000-01 budget projects incremental spending of nearly $26 million or 7.3 percent; these numbers are down from $27.2 million and 8.3 percent in 1999-00. $7.7 million of the incremental spending will go to general expenses and the University's divisions, and the remainder of $18.3 million will be spent on the schools, with Emory College and the medical and business schools netting the largest portions.

Charlotte Johnson, senior vice provost for administration, said faculty appointments in the physical sciences and performing arts--many of them related to capital projects tied to those disciplines--accounted for much of the college's incremental budget. Funding was also provided for planned faculty growth in the business school.

"We requested authority to hire eight new faculty in the arts and sciences next year," said college Dean Steve Sanderson. "We believe we need a minimum of 24 new faculty over the next three years to staff our performing arts departments, international and comparative studies, and Science 2000 programs and departments."

Funding was also provided for enhancements and other support in medicine, public health, theology, law, nursing and at Oxford. The budget not only provides direct school support but also investments in research and new facilities, equipment and systems.

Some schools will see substantial tuition increases as they "rethink their tuition strategies," according to Johnson. Emory College tuition will increase 5.99 percent to $24,240 annually, and Oxford tuition will go up 7.23 percent to $17,640. Johnson said the latter adjustment was made because the gap between the two tuitions was growing to the point where Oxford students were experiencing "sticker shock" when they arrived on the main campus.

With a new building soon to come online, the School of Nursing is adjusting its tuition rates to be competitive with the nation's top schools. Incoming nursing students, both undergraduate and graduate, will pay 28.25 percent more in tuition (an increase of $5,340) than this year's students, who themselves will pay $1,900 more (10.05 percent) come fall. Currently Emory's tuition is at $18,900, more than $1,000 behind the average ($20,349) for the top U.S. nursing schools.

Johnson said increases in scholarship programs roughly matched the tuition hikes.

Chopp said rather than view the more constrained growth as a negative impact, she accepts the changes as a prompt for Emory to "use the budget to invest in our academic goals and not simply let spurts in the growth of the endowment dictate our growth in programs."

One thing that will not change significantly, she added, is the relationship between Emory's endowment and The Coca-Cola Company: "Endowments are about the long-term stability of an institution. Our holdings in Coca-Cola have resulted in great wealth for this institution that will be beneficial for many years to come."

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