The administration is discussing how to close another $5 million gap in fiscal 2009 and a $6.9 million gap in fiscal 2010, Executive Vice President and Chief Operating Officer Peter French said at last Thursday's faculty meeting. French also projected a 30-percent decrease in Brandeis' endowment to $480 million for fiscal 2009 after having previously projected a 25-percent drop from $712 million to $549 million at the end of this December.

The administration will meet today with the Senate Council and the Faculty Budget Committee to address the budget gaps, French said at the meeting.

French said that his department is recommending a 3.9-percent tuition increase instead of an original recommendation of a 4.25-percent increase because the vast majority of comparable institutions to Brandeis were under 4 percent. The University also has to increase the percentage of funds going to financial aid by 6 percent, French wrote in an e-mail to the Justice.

"For [fiscal 2009], we do have to move pretty fast," French said at the faculty meeting, adding that the University has some more time until April and May to make decisions about fiscal 2010, which starts July 1.

Brandeis has already undertaken budget adjustments of $9.7 million in fiscal 2009, which ends June 30, French said. This includes $4.7 million in one-time funds such as bequests, "a gift received after death pursuant to a will," French wrote in an e-mail to the Justice, and $5 million in budget cuts and other revenues such as income from the Heller School for Social Policy and Management and the International Business School. By the end of fiscal 2009, Brandeis have will reduced its Academic staff by 5.4 percent and staff in French's department by 9.5 percent, as part of a total staff reduction of 6 percent.

French said that the University previously "felt there would be additional deficits for this fiscal year." In an e-mail to the Justice he wrote, "... now, 9 months into the fiscal year, we have more information about spring-semester revenues and actual income from short-term investments, so that we can make more accurate year-end projections."

French said that there has been a reduction of student-related revenues due to a smaller midyear class this semester. The Faculty Budget Committee's Feb. 26 presentation noted that there were 40 fewer students this semester. French also said that more students opted to leave this semester due to the lower than expected midyear enrollment, students moving offcampus or graduating early. "We've also seen a drop in occupancy in the residence halls more than we've experienced [before]," French said, citing increases in off-campus housing.

French said that there has been a complete elimination of interest from working capital, funds the University moved from money market funds to U.S. treasury bonds last fall. French explained in an e-mail to the Justice that the treasury bonds protect the principal value of the funds while the money market funds were losing value. In prior years, interest earned on working capital was a source of revenue for the University's operating budget, he wrote. "[Now] those treasuries have in essence been paying zero," he said at the faculty meeting. He added that the University is currently readjusting its gift target for both fiscal 2009 and fiscal 2010, projecting a decrease to $11 million.

French said one source of additional funds could be added use of the $85 million reserves, but he said, "We're getting awfully close to overusing them." He said the administration has been in discussion with Board of Trustees about using another $2 million from the reserves. The University is projecting another $1 million in bequests, adding up to $3 million. "We do have need for another $2 million" to fill the rest of the $5 million budget gap, French said.

French discussed a number of preliminary options the University could take in order to close the budget gap. "None of these are great options," French said. "President [Jehuda] Reinharz, the trustees and the senior administration all want to avoid actions that negatively affect our dedicated and hardworking faculty and staff," he wrote in an e-mail to the Justice.

French explained that the University still needs to close a $5 million gap during this fiscal year and a $6.9 million gap in the next year. "The reality is, however, that we must consider such options, just as other colleges and universities are doing in this terrible economy.

French also said there had been discussion about raising parking fees, noting that there were plans to form a committee of faculty, staff and students to consider how to implement such a fee. He projected that the University could earn $700,000 from such a fee.

"We could go back to reducing the operating budgets," French said. He explained that it was too late to do this for this fiscal year, but that for next fiscal year "we'd be looking at 12- to 15-percent [cuts] of all operating expenses."

Another possibility would be to ask for another $2 million from the $85 million reserves, which are projected to run out at the end of next fiscal year. "[We had a] very long extensive discussion with key board members today," he said. "They would not do that; they did not think that was prudent [given] how close we are to exhausting [the reserves]." In fiscal 2010 the University could also sell assets, French said.

Other options the University is considering include staff furlough, where staff members would be out of work with no pay for two weeks this fiscal year and for six weeks next fiscal year, reducing faculty and staff salaries by eight percent this fiscal year and six percent next fiscal year and suspending payments into retirement funds for three months this fiscal year and for nine months next fiscal year. "Our goal is to minimize impact on students and academic programs," he wrote in an e-mail to the Justice.

French explained that an implementation of these options could involve a mixing and matching of these possible options.