Dr. Robert Tudor, interim Provost of the University, presents recommendations for academic prioritization at the November 9 meeting of the University’s Board of Governors.
Faculty & Students Supportive, But Urge Caution
When Shepherd University’s Board of Governors looked at the school’s financial projections in May 2023, there was no question that significant adjustments were needed. Dr. Scott Barton, the University’s chief financial officer, described the key metric of financial stability as “days of cash on hand.” Last spring, that number was projected to be negative by the end of the academic year ending in June 2024. While the “days of cash” metric is not like a scoreboard timer that signals “game over” when it gets to zero, it does set off alarms, particularly with accreditation organizations, when it dips below the recommended benchmarks.
The University’s revenue is a complex mix of tuition payments, grants, loan disbursements, and funding from other sources. The key driver of revenue is enrollment — the more students on campus, the more revenue the University receives. The good news is that enrollment has been trending up for the past two years and operating revenue for the academic year that ended in June 2023 increased by $2 million compared to the prior year.
On the expense side, the University has a lot of facilities to maintain, but it’s the faculty and staff responsible for delivering the core educational functions and services that constitute the largest portion of the budget. The $28 million total for all salaries, wages, and benefits for the year ending in June 2023 represented almost two-thirds of the University’s cash expenses.
The University operating budget is typically in deficit, but that gets made up by funds from grants and other sources. Looking at the numbers last May, the Board determined that the structural deficit had become too large and needed to be reduced to ensure the financial viability of the University. The Board set a target of $6 million in expense reductions, to be achieved over the next two years.
The first part of the structural deficit reduction project focused on changes outside of academic staffing. One of the most visible changes will be the closure of the Martinsburg campus. In August 2023, the University also announced the consolidation of various schools and departments to reduce administrative and support costs.
Dr. Robert Tudor, the interim Provost, is the chief academic officer of the University. He took on the task of reviewing the academic programs, making the case to the Board for the University to perform this analysis in-house rather than outsourcing it to consultants. He presented the final version of the “Academic Prioritization” at the November 9 meeting of the Board (image above).
The revised proposal, which received unanimous approval from the board members, includes the elimination of five degree programs and eight minors/concentrations according to a University press release dated November 10. The revised proposal identifies a total of 14 currently-filled faculty positions that will be eliminated by the end of the 2025 academic year (the November 10 press release and the previous version of the prioritization document had identified 13 faculty positions to be eliminated; a review by the Board’s academic affairs committee two days prior to the November 9 board meeting requested additional changes). The proposal also noted that current vacancies and announced retirements will result in an additional 24 faculty and academic affairs staff postions that will remain unfilled by the end of the current academic year.
Both the faculty and student representatives on the Board noted the necessity of the restructuring to ensure the short-term health of the University but expressed strong concerns that the changes could undermine its core mission and ability to attract students and faculty. Still, the in-house process overseen by Dr. Tudor seems to have generated a buffer of goodwill and is encouraging the University community to rally together. On November 28, the Senate of the Student Government Association unanimously approved a statement thanking Dr. Tudor specifically, along with the other faculty members involved, “for going about this process in a way that aligns with the foundation of our university as a liberal arts institution.”
Shepherd University Updates Strategic Plan for 2023-2028 (The Observer, Dec 2023)Steve Pearson