By J Timothy Cloyd, President
Note: These speeches have been digitized from print documents. During this process, formatting and other errors sometimes occur. I am correcting mistakes as I see them, but be aware that these speeches may still contain unintentional errors. I also give special thanks to Helen Plotkin for her help editing and researching these speeches.
I saw a cartoon in the New Yorker a while back that struck me as particularly meaningful in light of this past year. It showed two, what appear to be academics, sitting on a couch at a party.
One of them says to the other “My feeling is that while we should have the deepest respect for reality, we should not let it control our lives.”
This year we have had to respond creatively to the reality of the external economic and market environment.
We have faced some difficult realities this year. Today we will ask you to approve our operating budget for next year.
So I want to spend a moment on the budget and other issues, but today I also want us to dream about the future.
As you know we have had to be responsive to this time of budget challenge, but our response –
the cost cutting measures we have taken and the changes we have made in health care –
resulted in about $1.7 million in savings from the 2003-2004 budget.
You will see that we have held operating budgets flat for the second year in a row and we have held the salary increase pool to 2%. We also radically changed the health plan and beginning in August we will begin requiring everyone to share in the health care premium.
Needless to say people were not pleased with this, but I did want to report to you that the faculty and staff have reacted to these changes and cost controls with a great positive spirit. They are dedicated to this college and to our mission. And we should all be proud of them.
You will hear more about this today when you hear our report on the budget.
In addition we have responded creatively to the challenges presented by the declines in our endowment. That has been a $40 million loss to date in our endowment. This has reduced the amount available in our operating budget by $500,000.
We will experience this decline in our endowment for the next two to three years because of the way we calculate our endowment draw and of course depending on the market.
I also want to update you on the Arkansas state scholarships where we have made some headway.
We have put on an intensive lobbying plan and it appears that there will be a state scholarship program in some form this fall.
Although sadly the state budget was passed too late to help us much this year – If the legislature would have acted in March or April the result may have been more positive for our net revenue.
In addition, the Governors Scholarship will be capped at $10,000 and the Challenge scholarship will be about $2,000.
The GDS previously was full tuition, fees, room, and board.
So this may help us for the 2004-2005 year – although it will not be as generous of a plan as it once was… So we will in all likelihood have to sublement with institutional scholarships to be competitive.
The Governor and the Legislature have been at odds this session in a way like no other over these issues.
We are not counting on any relief in our aid budget for the 2003-2004 year, but it may help us on yield.
I also wanted to draw your attention to the letter from the Governor in your notebook regarding Governor’s School.
The Governor’s School site selection process has become politized and we need your help.
The Governor and the state board of education are critical in this process.
Don’t be surprised if the Governor and the Board move Governor’s School from Hendrix, but we will do what we can to prevent this from happening.
I also want to report to you on enrollment because I am pleased we have responded to this reality in a creative way as well.
In December we thought that we might end the recruiting year with 240-250 students coming for the fall 2003. We don’t know exactly where we will be in the fall but we think it will be 280 students. Our 12 year average is about 305.
In this economy and with the competition from the honors programs at state schools we could have been in a more difficult position.
This is particularly true because our average scholarship and aid package for this class will be much lower than last year.
Rock and the Admissions staff have done a good job.
So back to my cartoon from the New Yorker –
The guy on the couch says “We should have the deepest respect for reality” and in the midst of the realities we face we must respond creatively…But…
The current reality we are in should not control our hopes and dreams for the future of this College.
In the fall at our retreat we will work with the findings from Marts and Lundy and the Arts and Science Group to define the strategic direction for the college.
This will include discussions about our market position, our price, and our new fundraising plans.
We will work with those realities in the fall
But it is good to take a moment to dream and to reflect on what can give Hendrix the strategic advantage.
We need to dream about what can enhance our competitive position and what can help us to continue to be a transforming place for student.
So for right now I want to ask you to dream with me for a moment about the future of Hendrix.