By Walter Hickey
Presenters at the Board of Visitors Committee on Financial Affairs Thursday proposed a series of initiatives to salvage the College of William and Mary’s balance books in light of dwindling state support and a fractured economy.
Investment managers indicated that in the past nine years, the College’s investment worth swelled from $35 million to $55 million, mollifying some concerns regarding to endowment investments. Because the group pursued a strategy of asset diversification, the College’s portfolio was designed to withstand market shocks such as the 2008 credit crisis.
Vice President for Finance Samuel Jones ’75, M.B.A. ’80 presented the College’s six-year plan, including strategies on how the College can proceed despite the recession. The revised six-year plan seeks to identify expenditure priorities, find the money to fund salary increases, and reduce the impact on student costs.
“We have been behind the curve,” BOV member Timothy Dunn said.
Jones noted that Governor Bob McDonnell’s Higher Education Opportunity Act of 2011 impacted the College’s strategy. The law called for maintenance of undergraduate aid levels and increased aid to graduate students in the science, technology, engineering and math disciplines. The College plans to fully implement the marine science major and develop, finances permitting, a Center of Energy and Environment.
“We take the governor at his word and assume he wants to invest in higher education,” Jones said.
According to Jones, a big issue plaguing the budget is the state-mandated 35 percent cap on out-of-state students, which limits the College’s ability to increase income without increasing fees. Were the College able to accept more out-of state students, the increased revenue from the higher tuition would help in mitigating costs.
The Vice President for Finance indicated that an annual increase of five percent for out-of-state tuition was an option. While some meeting attendees worried that would discourage students from applying, Jones said Richmond policymakers support shifting costs from the state onto non-Virginia residents.
“We think five percent is as far as we can go, and we wonder if that is a sustainable number,” Jones said.
Some BOV members expressed concern that tuition increases would decrease the public’s perception of the College’s value.
“William and Mary has always sold, ‘great school, great value,’” BOV member Todd A. Stottlemyer said. “That’s in question.”
One solution would be to make more financial aid available, as many private institutions do.
“If we can put more aid in the pot, we can drive the sticker price up,” Reveley said.
Reveley advocated fighting against lawmakers’ efforts to lower the 35 percent cap, which they threaten to do in order to please constituents who want their children to attend the College.
“We fight like hell on the 35,” he said.
Another option called for an incremental, annual five percent increase in tuition for in-state students.
These costs are most prescient in the professor salary portion of the budget. Jones reported that the College has lost much of its bargaining ability when it comes to recruiting and maintaining professorial talent.
Because the College has not given raises in three years to faculty or staff, it cannot make counter-offers when faculty members are poached by private institutions that better weathered the recession.
“I reviewed this data. I thought our position had remained constant during the contraction. It had not,” BOV Secretary Dennis Liberson s
