Published: October 8, 2009

Budget cuts at Fordham University are necessary to keep a balance between rising operational costs and maintaining an affordable cost-of-attendance for students, according to Frank Simio, vice president of finance at Fordham. Higher maintenance, fuel and utility costs, as well as a decrease in gift revenue, prompted the budget committee to make cuts in several departments, like the one that shortened hours at university libraries.

Jeffrey Gray, vice president of student affairs, said that the budget committee tried to “enact reductions where there [would] be the smallest impact.

“[We] looked at the absolute amount of controllable costs and the nature of the costs, and what would have the least amount of impact on the students,” Gray said.

In addition to the library hours being cut, operating hours at Rose Hill’s Walsh gate were also reduced, a move that maintained the operating hours at McMahon’s plaza level entrance, which were also under consideration for a cut.

“[We] decided that because the health and counseling center are right there inside McMahon, that it is too important of an entrance to close. Manning the Walsh gate 24/7 is about $150,000 a year,” Gray said. “We measured convenience versus need.

“We decided [that] we didn’t want to cut ResLife, the counseling center or the health center. We took from places that would have minimal impact on the students,” Gray said.

Another cut has caused the university’s current soft hiring freeze, which, according to Gray, means that when a position becomes available, it will not necessarily be filled.

Simio added that a main concern for the university was to “protect” the financial aid budget, as well as maintain uniform pay raises for faculty.

“We wanted to protect both faculty and students,” he said.

The budget cuts that were made, according to both Simio and Gray, were in response a number of different factors that resulted in the university losing money.

One major factor was a nearly $100 million decrease in the value of Fordham’s endowment. Though Fordham is not overly dependent on its endowment, according to Gray, its decrease in value was still felt. “When the endowment takes a hit, it puts a hole in the budget.  We rely on our endowment much less than Harvard, and they are really in a tough spot right now. But we did have a hole, and it created a lot of challenges,” Gray said.

The maintenance of university technology, Simio added, is a cost that grows every year.

“Every year we spend more and more on technology,” Simio said. “Every time you bring in a new layer [of technology] you have to support it. For example, the new Banner system.”

“Also, student initiatives add expenses,” Simio said. “For example, the students rallied for protection for the security guards, which the university answered and totaled in a $1 million increase in expenses.”

Simio said, “We are a tuition-dependent university. Last year was the smallest tuition increase that we have experienced. Gift revenue was down significantly. After taking this all into account, [we were] over budget, so we needed to make cuts.”

One area in which the university is not losing money, said Patricia Peek, associate director of admission at Fordham College at Lincoln Center (FCLC), is enrollment.

“Undergraduate enrollment has remained strong this year, exceeding goals established for both freshmen and transfers,” Peek said.

Gray described preparing the budget as a “fairly complicated” process. “At Fordham, there are multiple budget committees, [and] hundreds of people have a role in the budget process,” Gray said. “There are about 11 vice presidents here, [and] each vice president has an area with a set of budgets.”

Gray explained that when departments finalize their budgets, the vice president must then approve it and sit down with Simio to approve it into a university-wide budget. “The budget is never balanced [at this point]. [The budget] is always under funded, and expenses are usually well in excess of expected revenue.” Gray said.

He said, “[When this occurs], we have to focus on reducing expenses and adjusting revenue streams. We want to work with students to protect them, but also to protect enrollment.”