Peer institutions scale back budgets

As Penn and peer institutions have continued to battle the tough economic climate this fall, the University “continues to track well” toward the effort to reduce spending by $58 million by June 30, 2010, according to Executive Vice President Craig Carnaroli.

He explained that several University divisions have restructured, which has resulted in staff reductions — but not as many as at peer institutions.

However, Carnaroli noted that this is not the time to become complacent.

“Specifically versus our peers, we have seen less staff reductions and early retirements as the University is not as endowment-dependent to support its operations,” he wrote in a statement.

Still, the economic downturn continues to pose challenges.

“While we are pleased with our internal management during this period, we continued to be challenged by increase financial aid need by our students and families, the substantial reduction by Commonwealth of Pennsylvania to support our School of Veterinary Medicine and reduced philanthropy,” Carnaroli wrote.

Penn President Amy Gutmann agreed that Penn is “lucky to be in a good place” and “proud not to have had to cut back on the quality of student life.”

Carnaroli added that Penn’s endowment is “more liquid” than that of many of its peer schools.

Other institutions, including most Ivy League schools, have had to scale back in many different areas this fall.

In an effort to cut out another $100 million from the budget, Yale University may lay off more staff members, the Yale Daily News reported last week.

Princeton University will lay off 43 employees, while 18 others have taken voluntary reductions in hours. Last April, Princeton announced that departments would face an administrative budget cut of approximately 7.5 percent over each of the next two years.

Harvard University has also laid off about 250 employees, but the Faculty of Arts and Sciences announced on Friday that the school would end its salary freeze. Faculty members will be eligible to receive a two-percent merit-based salary increase.

Harvard made the controversial decision last May to cut most hot breakfast options at upperclassman dining halls, which was met with a critical student response this semester.

At a speech last week in Hanover, N.H., Dartmouth College President Jim Yong Kim said Dartmouth is planning to cut $100 million over the next two years.

Similarly, Brown University is cutting $30 million from the annual general budget, after its endowment lost $740 million in the last fiscal year, the Brown Daily Herald reported. The cuts will be made in three phases — this year, next year and in the fiscal year beginning July 2010.

At Stanford University, administrators are considering cutting sports teams to reduce costs, but Athletics Director Bob Bowlsby would not specify which teams. The athletic department already faced $8 million in reductions last year and has absorbed over $5 million dollars in cuts this fiscal year.

Duke University Athletics is also contemplating cutting certain teams, the Duke Chronicle reported. The department has already cut five percent of its expenses, while the university as a whole has been working on closing its $125 million deficit.

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