Update on Trustee Retreat (Part III)

Jan. 11, 2019

Dear Members of the Brandeis Community,

As the new year begins, I send my wishes for a happy and healthy 2019 to you and your families. I hope your time off during the holidays proved both restorative and enjoyable.

Following each Board of Trustees meeting, I send out a summary of the topics the board engaged as well as the results of any resolutions considered and voted upon. On November 27-28, the board held its annual retreat, which, unlike the three regular meetings it holds every year, focuses on one or two major topics for discussion, exploration, and education. Committees do not meet during these retreats, but official business, including the consideration of resolutions, can be conducted.

At the recent retreat, we focused on the second part of the independent investigators’ external review, which dealt with campus climate, and issues related to Title IX and how the university complies with and manages Title IX processes. Immediately following the retreat, on November 29, I shared the board’s response to the campus climate session in an email to the community. In addition, the board took up the issues of fossil fuel divestment and how the university can reduce its carbon footprint in response to concerns about climate change; I shared the board’s response in an email sent on November 28.

The retreat agenda also included consideration of a proposal from the Brandeis administration to accelerate or advance funding for staffing, program, and capital needs deemed essential to planning for the university’s future and pursuing a major capital campaign. This proposed funding, totaling $73M ($47M for operations and $26M for capital projects) over a three-year period would begin this year and would address gaps in operations that I and my senior colleagues believe must be filled if we are to pursue the university’s reinvigoration.

This funding is not intended to address all of the university’s current and future needs, desires, or vision. That level of investment would require a greater financial commitment than we proposed to the board at the retreat.

Here is an abridged description of what the $47M in incremental operations over the next three years would fund:

For Academic and Student Affairs:

For Communications:

For Institutional Advancement:

For Diversity, Equity, and Inclusion:

For the President’s Office:

For Finance and Administration, and the General Counsel:

Although these investments will not provide what is needed to implement a new vision for Brandeis, we believe they will provide the extra bandwidth, through staffing and program support, to allow us to plan Brandeis’ future and address immediate needs in our academic and student-support programs while carrying out the university’s day-to-day business. Significant additional expenditures, to be funded by a future capital campaign, will be required to implement the recommendations that will come out of the task forces associated with “A Framework for Our Future” that I recently appointed. 

In the interim, these investments will address some of the staff reductions since the 2008 recession that were not accompanied by significant reductions in programmatic commitments. Such staff reductions left the university challenged in the pursuit of new initiatives, or unable to improve or modernize dated processes, systems, and infrastructure.

The $26M in incremental capital expenditures over three years will allow us to begin to close the gap between the annual costs of maintaining our buildings, equipment, and IT infrastructure on the one hand, and what we have been able to allocate to these needs in the past on the other. As most of us know firsthand, the Brandeis campus has significant deferred maintenance, and it will take many years and a successful capital campaign to modernize our infrastructure. The $26M in incremental funds will allow us to address the most pressing issues sooner than would otherwise be the case and will provide greater startup support for newly hired faculty. These funds will come without any additional burden on our annual operating budget. By refinancing a series of bonds, we can take on this additional debt at the same annual cost of our previous debt service.

The $47M in incremental operating funds is expected to come from four sources:

There are risks attached to our request for advance funding to cover what we see as critical and foundational investments in the university. We will be increasing our endowment draw and adding ongoing expenses to our operating budget after the initial funding. We are counting on greater efficiencies in our budgeting process as a result of the new financial system, as well as increases in future fundraising to cover the incremental operating expenses beyond the next three years. And there is always uncertainty regarding the markets, including how well our endowment, which provides about 14 percent of our annual operating budget, will perform.

This is why our proposed investments, especially in Institutional Advancement, are crucial and time-sensitive. Immediate investments in IA will allow for broader, more regular, and strategic engagement with alumni, parents, friends, and past donors. We also believe we have a compelling vision for the university to share that will be of significant interest to donor constituents, including foundations.

Though there is risk to pursuing this funding, there is, I believe, a greater risk in trying to forge a vision and a future for Brandeis without first creating the human and programmatic infrastructure to do so.

In sum: In November, the board approved in principle our proposal, known as “springboard funding.” At the same time, we will still need to balance our budget each year with the increased funding and projected expenditures. The board also approved the increase in the spend rate for three and a half years as well as the refinancing of bonds to allow for the extra funding for capital without an increase in our annual debt service. We are now pursuing the final funding piece of the springboard proposal, which will come from donors whom we are asking to make early pledges toward our future capital campaign. I will keep you posted on our fundraising progress and on the status of discussions within the board’s Strategy and Planning Committee as they relate to the allocation of the springboard funds.

As always, if you have any questions, please let me know.

Sincerely,

Ron