citing worsening economic and financial conditions, Stanford’s provost, John Etchemendy, has told that University’s faculty senate that deeper budget reductions would be required.
- In a presentation on March 5, the provost announced that Stanford’s $800-million “general funds budget” would be trimmed by nearly $100 million for the fiscal year beginning on September 1.
- Schools that depend heavily on their own endowed funds will, of course, see declines in these revenues comparable to the general funds decline”—which he indicated would be 15 percent across the board.
- Stanford derives $900 million from endowment distributions for its annual operating revenues; at Harvard, the comparable figure is approximately $1.4 billion currently
- The new decision represents an acceleration of plans put in place last fall, when Stanford foresaw a $100-million reduction phased in during the next two fiscal years, and means that the budget is to be reduced about $30 million more in the first year than recently anticipated
- To achieve the goal, Stanford will now impose a salary freeze for the fiscal year, a step it had not previously planned to take.
- Stanford said that its general-funds budget—for faculty and staff salaries, administrative operations, and non-research expenses—would need to be reduced $45 million in the 2009-2010 fiscal year, with further reductions of equal magnitude in the following year
- “Since the endowment is the university’s primary source of investment income, the result will be a long-term decrease in university revenue,” even though Stanford, unlike Harvard, is in the middle of a multi billion-dollar capital campaign (as are Columbia, the University of Pennsylvania, and Yale; Brown, Dartmouth, and Princeton are conducting somewhat smaller campaigns), which has helped bring in significant new cash and pledges:
- Stanford reported raising $785 million in fiscal year 2008.
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