Vice President for Student Life Eddie Ade Knowles, along with Grand Marshal Kara Chesal ’09 and President of the Union Rob Odell ’09, hosted a forum January 21 where students were able to speak with members of the administration about the financial crisis. Knowles addressed a full McNeil Room about where the Institute currently stands, the layoffs that occurred prior to winter break, and what other proactive steps are being taken to protect RPI from the economic downturn.
Knowles started by stating that the aim of the forum was to clear up the misinformation that has been circulating in the external media and to have an open discussion about the financial situation affecting RPI. Knowles proceeded to summarize some of President Shirley Ann Jackson’s remarks made during her meeting with the faculty on January 14, detailing where the Institute’s endowment stands in relation to other schools’ and what steps these other schools are taking to respond to the economy.
With respect to RPI, Knowles enumerated what the Institute has saved by the quick measures has taken so far, totaling $24 million: $11 million from implementing a hiring freeze on 180 positions, $7 million from reducing the operational budget, and $6 million from a reduction in force of 80 staff members and 31 separations not related to the targeted reduction.
“The early steps that we took to protect the Institute kept staff reductions to a minimum,” Knowles said. He explained that Rensselaer leadership did explore many other alternatives, but they just did not work. “After careful considerations, it was determined that a staff reduction was necessary.”
Each vice president and dean made the final determination within his or her respective portfolio, and reductions were carried out in as compassionate a way as possible, according to Knowles. “We worked hard with the Office of Human Resources to protect individuals, but it was still painful for everyone within the Rensselaer community.”
The Institute decided on a reduction in force to minimize tuition increases in the coming year and to address the additional financial need of students who are impacted by the current economic crisis. The measure was also intended to enable continued faculty recruitment and meet required increases in contributions to the defined benefit pension plan. Knowles emphasized that the preservation of financial aid and protection of the academic enterprise were the highest priorities, stating that, given the choice between an increase in tuition versus layoffs, he was “absolutely confident that [the decision] was in the best interest of the students and school.”
Knowles addressed some of the misconceptions that have circulated through the community, such as the questions of salaries within the Institute. He explained that Jackson’s salary is set by the Board of Trustees, that the Board uses a variety of factors to determine salaries, such as fundraising and research generated under the president and the fact that Jackson has met and exceeded expectations of the Board. To “broaden the understanding of compensation within the Institute community,” he also mentioned that some professors earn over $1 million.
Following his comments, Knowles took questions from the student audience. The first question was dealing with the extent to which the budget cuts will affect classrooms and facilities. Vice President for Administration Claude Rounds noted that Public Safety, Facilities, and Environmental and Site Services had no positions affected by the layoffs, and said, “We prioritize the importance of the work they do to maintain campus facilities. We did everything we could to avoid impact of reduction of staff in those areas.” Knowles added that the Institute is working to ensure that reductions are not obviously affecting students, although they cannot guarantee this in all cases.
Rounds also mentioned that there are no major plans construction-wise for this fiscal year. “The fact that we will not have any capital plans is not going to have a significant impact on where we’ve been or where we’ll go,” Rounds said, stating that the financial crisis will not impact the ability to manage new facilities, such as the Curtis R. Priem Experimental Media and Performing Arts Center.
In response to a question posed by Eric Allen ’10 as to why “communication was so thin,” Provost Robert E. Palazzo said that the actions, though well thought-out, were taken very quickly and that the department heads were tasked with notifying the faculty.
When questioned about the donation made to the Clinton Foundation, Chief of Staff and Vice President for Policy and Planning Laban Coblentz said that some organizations and professional societies require a membership fee, which is what the donation was for. Coblentz said that there is “a specific calculus on how we get a return,” and in the case of the Clinton Foundation, it allowed RPI to get leveraging with other institutions and it was of benefit to the Rensselaer Engineering Education Across Cultural Horizons initiative launched last spring. He also mentioned that a Rensselaer alumnus donated money to a five-year program in which students from Rensselaer and Africa can engage in projects together.
Also discussed was the compensation of Resident Assistants and Directors, which will be lowered this year. Knowles stated that it was found that several RAs were compensated beyond the cost of attendence, and it would be a prudent place to cut back. Therefore, the discussed compensation is currently $5,000 per year. Knowles said that any students that were met with a financial hardship due to the decrease would be taken on a case-by-case basis and reviewed by the Office of Financial Aid.
Later brought up in the discussion was the Institute-owned retreat home in Lake George, which Secretary of the Institute and General Counsel Charles Carletta explained was a restricted gift, picked out by a donor. Knowles also mentioned the amount of money that Jackson has given back through the United Way as well as the capital campaign, noting that every member of the cabinet has made a multi-year pledge to give back to the Institute as well.
The members of the administration could not say for sure whether more layoffs were going to be necessary in the future, stating that it would be dependent on what happens to the economy in the coming months. Knowles said, however, that the Institute’s leadership would “go to great lengths not to go through the pain again.”
