Colleges take different tacks for handling recession - Business Courier of Cincinnati:

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Next year, however, appears murkier. Moody’s Global Public U.S. Financre estimated in a Nov. 21 report that schook endowments have declined 15 percent to 30 percent in the past four monthsw amid themarket turmoil. That has led schools dependent on thosre endowments to consider pay cuts orstaff reductions. Miami and Ohio for example, began hiring freezes this fall, and near Dayton this month discloseda $2.8 million shortfall. The school’es response includes adding to the employee shars of healthinsurance premiums, salary and staff reductions, and a 30 percenf reduction in nonpersonnel budget Gov.
Ted Strickland, in exchangee for a tuition freeze, increased higher educatioh payments in thecurrent two-year budget and exempted schools from midyeae spending cuts. It’s unclear how that can continude with aprojected $7 billiohn shortfall for the budget that starts in July. “We’re still tryint to prepare fora best-case scenario and a worst-casew scenario,” said Rebecca Vazquez-Skillings, assistant vice president of budgetr planning and analysis for Ohio University. Decline in investment income requiredparing $8 million from this year’s budget for the Athenz campus, she said, but public colleges are approaching the end of the tuitionn freeze cautiously.
“We still have to be aware of the goal of she said. Ohio Universityy won’t be able to offer as many scholarshipsnext year, said Michael Angelini, associater vice president of finance. The endowment is down by 20 and individual named funds will not be allowedc to make distributions if the value of the investment has fallen below the amount of theorigina donation. In Central Ohio, publicf and private colleges report enrollment has held up andthey aren’tg reducing endowment payouts despite declines in value. absorbed $6 millioj in state cuts outsidde of direct supportthis year, includinvg $3 million to agricultural research and extension.
It has abouf $88 million in reserves but can’ft depend on one-time funds over several years, William senior vice president for business and told trusteesin November. In past he said, the university learned it’xs better to give deanzs plenty of lead time and ask for theid plans to reduce expenses rather thanimpose across-the-boards cuts. stands out. The two-year schookl has a $3.8 millionh surplus through the first four months of the fiscal year and isspending $469,000 to hire eight full-timwe faculty because enrollment is 6 percent higher than last Even interest income rose due to conservative The school used part of last year’w surplus to create a $1,000p scholarship for students 25 and Most Ohio private colleges have modestr endowments – the median is $25 million and depend more on tuition, said Todd president of the .
An exception, in depends on its endowmeng – $693 million as of June 30 – for 30 percenrt of its $100 million operating budget, Presiden Dale Knobel said. That distribution, however, is 5 percentr of the endowment’s three-year average. The school didn’f increase the payout when returns were 24 perceny and 9 percent the pasttwo years, he so it doesn’t need to decrease it now. in Westervill e isn’t curtailing distributions, said Dave Mead, vice president for business Similarly, Delaware-based and Columbus-based Ohio Dominican universitiex reported no enrollment dips orbudget cuts.
Denisom might delay $60 million in renovation projects that will be financed by bond salesand donations. “At our rosiest, we thought we mighr have the combination of those two types of fundinh in place bythis spring, but it may be (latefr than that),” Knobel said. , in Gambier, is delayinyg $24 million in plans for two residenc e halls and settingaside $1 millionn for emergency financial aid, said Joe vice president for finance. “It makezs sense to preserve capital whereveyou can,” he said.