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Message From The President - Baruch College

August 27, 2010

Members of the Baruch College Community,

As you know, I began my term as Baruch College president on August 2 with a mandate to pursue our historic mission of educating students from the five boroughs of New York City and beyond to become the leaders of tomorrow.  With each passing day, I have become more impressed with the quality of the College’s faculty, staff and students. While I used the period since my appointment as president in March to undertake serious preparation for the job, it has only been since my arrival that I have actually been exposed to the vibrancy of the College’s people and programs. All of this has only reinforced my conviction that we must do all that is possible to protect those things that make Baruch special during this period of budgetary turbulence.

On August 3, the State of New York finalized its budget for fiscal year 2010-2011. The budget included $84.4 million in operating budget reductions for the senior colleges of CUNY. (When combined with the reductions of the past two fiscal years, the University has now sustained over $205 million in state cuts since FY2009.) Based on these reductions, CUNY recently issued allocations reducing our college base budget by $1.4 million. In addition, we are required to set aside 1.25% ($1.3 million) of our base budget to prepare for the possibility that uncertainty in the state’s economic condition might result in further reductions at mid-year. While this holdback remains in our budget, we cannot spend it, at least for now.   

At the same time, the legislature took no action on the Public Higher Education Empowerment and Innovation Act (PHEEIA), which would have given us some flexibility to create a predictable funding stream from tuition and other revenue sources. The legislature also failed to authorize the proposed 2% tuition increase that had been approved by the CUNY Board of Trustees for fall 2010. Therefore, tuition rates will remain the same for this coming semester. You can read the Chancellor’s full message on the state budget here.

The ongoing difficult economic environment that has affected student enrollment patterns coupled with the State’s inaction on a tuition increase contributes to us having a FY10-11 projected revenue shortfall of $3 million. Also, last year’s infusion of $1.6 million in operating funds from the Tuition Reserve Account is not available again this year because the overall revenue situation has erased all reserves.   

Unfortunately, this combination of State decisions leaves us with a large, multi-million dollar shortfall in our operating budget for FY10-11. With 94% of the College’s budget devoted to personnel services, our flexibility to trim expenses is limited. But I want to state clearly that our paramount objective will be to achieve further reductions in our operating costs in a people friendly way. I am therefore working closely with the Cabinet to make strategic cost cutting decisions. Over the next two weeks, Provost McCarthy and I will be chairing meetings with the deans of all three schools and with the heads of all of the other major units of the College and their respective budget managers. Our primary objective will be to preserve student services and academic programs to the maximum extent possible, while at the same time achieving the necessary cost reductions.

Of course, while containing costs we also will be striving to increase revenue wherever possible. For example, we plan to maximize student offerings and enrollments in the coming winter and summer sessions by increasing sections offered and, where appropriate, by increasing class size. We also are continuing our philanthropic fundraising through the Baruch College Fund (BCF), and we are moving the capital campaign closer to its $150 million goal. In spite of the market’s recent performance and the weight of the difficult economic times on donations, the BCF’s proposed budget for the current year at $13.1 million is only a few hundred thousand dollars less than last year — a testimony to the remarkable generosity and commitment of our donors and BCF leaders and the able management of these private resources. 

If the new governor who takes office in January does not implement further mid-year budget cuts and if the state approves a tuition increase of 2% for the spring 2011 semester, the above plan will see us through this fiscal year and position us well for FY2012. In addition, if the state’s overall economic situation does not worsen, CUNY should be in a position to release the portion of our budget that is currently being held in reserve. These funds will be restored to individual unit operating budgets.

Under the leadership of Chancellor Goldstein, and with the support of the committed CUNY team, the members of the Baruch College Cabinet and I are working to make the tough decisions that will enable us to preserve the character and basic capabilities of our institution and position us strategically to move forward once the economy — and hence, the state budget — improves. Because you are the force behind this College’s success, I wanted you to understand clearly what we are doing and how we are focusing on non-personnel solutions that will allow us to emerge strong, to remain highly competitive and to continue our upward trajectory as measured against such important benchmarks as Middle States, AACSB, U.S. News & World Report and The Princeton Review.

Baruch College is making a difference in our students’ lives, in the communities we serve and to the economy of the City and State. You already know this, and this is demonstrated by the creative solutions that you find to students’ problems or how you use your entrepreneurial talents to continue a critical service despite resource constraints. It is this spirit that makes us strong as an institution and that I know will help us to get through the next couple of years.

I intend to provide the College community with continuing updates on the budget during the weeks and months ahead, and I am committed to maintaining transparency throughout the process. I understand that these necessary budget reductions will have real impacts on everyone who works or studies at the institution, and I want you to know that I appreciate your willingness to pitch in and help us get through this difficult period. As I’ve stated previously — and you will hear me say it often in the coming days — there are brighter days ahead for Baruch and for CUNY.


Mitchel Wallerstein Signature

Mitchel Wallerstein
President, Baruch College