Antioch College cuts costs, jobs
- Published: December 22, 2016
For the first time since reopening to students in 2011, Antioch College is reducing its budget, a move college leaders say is necessary to bring expenses in line with revenues that have grown more slowly than expected.
In meetings with staff, faculty and students last Friday, Antioch College President Tom Manley announced a series of spending cuts that will save the college about $1 million annually. These cuts include salary reductions for 23 college employees and the elimination of five staff positions.
The budget measures are part of an 18-month effort to lower the college’s spending, according to Manley on Monday. Tuition revenue has been slower to grow than the college anticipated, and fundraising efforts fell short in fiscal year 2016, college leaders said.
The hope, added Manley, is to build a firmer foundation for the college’s continued growth.
Because of Antioch’s unique situation of having been relaunched after closure, “it’s especially critical that we pay attention to good financial management … to get into a stable, long-term position,” he said.
The college remains viable, Manley stressed. “In every educational institution, you have an ongoing process of aligning resources with expenses. This is normal. What’s not normal is that the college closed, and started up again in a recessionary environment.”
Any cuts, especially to jobs, are painful, he acknowledged. “Those decisions were really carefully weighed,” he said.
Salary, job reductions
The announced salary reductions affect the college’s highest-paid staff employees. Five executive-level staff members took a 20 percent cut in salary, effective immediately. Those individuals include the president, provost, vice president for advancement, vice president for finance and operations and dean of global education.
In addition, 18 senior-level staff earning between $70,000 and $120,000 annually will see a 5 percent pay cut, effective next month. These staff members include director-level positions and some deans, according to Vice President for Finance and Operations Andi Adkins on Monday. Both sets of pay cuts will remain in effect indefinitely.
“The plan has always been to significantly supplement
gift revenue with earned income from student tuition.
It’s just gone a lot slower
than we thought.”
President, Antioch College
Those positions aren’t the only ones the college has shed in recent months. In an effort to increase efficiency and reduce costs, the college has been trimming its staff for 18 months through attrition and reorganization, according to college leaders. A total of 31 staff positions across the organization have gone unfilled or been reorganized during this time. That figure does not include the five jobs cut last week. Including those cuts, the college’s non-faculty staff has been reduced by about 25 percent since July, 2015.
The college now has 107 staff employees and 33 faculty members, according to Adkins. Faculty positions and pay were not affected by the recent budget measures.
Other cost-cutting measures announced last week include a hiring freeze, a voluntary workweek reduction program, a freeze on professional development funds, a consolidation of dining programs into one facility, a possible consolidation of residence halls and efforts to consolidate accounting, fundraising and other functions across the college.
All of last week’s measures had been discussed extensively by college leaders and budget managers since October, when it became clear that Antioch would need to take additional steps to reduce its operating budget, according to Manley. The 18-month effort to trim the budget through attrition and other means predates Manley, who became president of Antioch nine months ago, on March 1, 2016. He was aware of the financial challenges facing the college when he was hired last November.
“I came here knowing we would be working to help make sure the college was operating within its means,” he said.
No further salary or job cuts are anticipated, college leaders said this week. “I hope this is a resting point for a bit,” Manley said.
Facing revenue realities
Beginning in July, 2015, the college has steadily whittled down its budget, according to Adkins. Antioch’s operating budget for fiscal year 2016, which began on July 1, 2015, and ran through June 30, 2016, was initially $22 million. The 2017 fiscal year budget currently stands at $17.6 million, and college leaders are targeting $15.8 million for fiscal year 2018, which begins on July 1, 2017.
“We’ve been really successful” at reducing the budget, Adkins said. “I feel good about where we are.”
The spending reductions reflect current revenue realities at the college. Antioch reported a $7 million net loss for fiscal year 2016, according to Adkins. That loss was related to the college “missing key targets for fundraising,” an indicator that its fundraising projections were not accurate, she explained. The college has since modified those projections. In addition, Antioch hired Susanne Hashim, a veteran fundraiser, as vice president for advancement over the summer to boost fundraising at the college. Hashim is the wife of President Manley.
Alumni led the effort to relaunch Antioch, and alumni giving remains the mainstay of the college’s revenue. Philanthropic gifts — the vast majority of which come from alumni — currently constitute 76 percent of the college’s total revenue, according to Manley. About 3,000 of the college’s 10,000 living alumni, or around 30 percent, have donated to Antioch over the past five to six years, up from a 2 to 3 percent giving rate when the college started up again in 2009.
Yet major gifts ($25,000 or more) from just 10 to 20 alumni donors constitute a large share of that giving, Manley said. “Some alumni have given significant parts of their net worths,” he said. And with so much generosity already invested in Antioch, college leaders must activate other revenue sources.
“The plan has always been to significantly supplement gift revenue with earned income from student tuition,” Manley said. “It’s just gone a lot slower than we thought.”
Slow enrollment, tuition growth
That’s partly because student enrollment has grown more slowly than anticipated. This year’s incoming class numbers just 45 students, a significant shortfall from the 80 to 85 students college leaders anticipated recruiting in interviews with the News last June. Retention of students has also been an issue, according a report in the Aug. 10, 2016, Antioch Record, the student newspaper. The college made key hires this fall to address both these issues, with Bill Carter as the new dean of admission and Susan Lee as the new dean of student life.
The college’s enrollment currently stands at 220 students, according to Vice President Adkins.
And the college’s level of aid to students remains high, limiting its tuition revenue. All students admitted in 2016 received at least 50 percent aid through a half-tuition Horace Mann Fellowship. Prior to 2015, the fellowship had covered full tuition.
“Ironically, the small class [this year] helps us,” Manley said. “Students are so highly aided that if we had twice the students … the gap between revenue and expenses would be even greater.”
Yet the college’s revenue picture may soon change. In July, the revived Antioch hit a major milestone, achieving accreditation from the Higher Learning Commission after a rigorous five-year process characterized by ups and downs. Accreditation opens up new revenue sources, college leaders said. Specifically, Antioch can begin approaching philanthropic foundations and those alumni who have waited on accreditation before committing resources to the college. In addition, the college is applying to the federal program that will allow it to recruit international students.
College leaders seemed to agree that one consequence of the college’s intense, yet necessary, focus on achieving accreditation was to grow a little beyond its means of support.
“The staffing growth was necessary to put processes in place for accreditation,” Adkins said. “We’ve used attrition to shrink that a bit.”
The revived college’s business plan was geared to a student body of 600, with staffing appropriate to that enrollment level, according to Manley. With a current study body of just over a third of that figure, Antioch has been spending approximately $80,000 per student, about $20,000 more than other small liberal arts schools such as Oberlin.
“It was a generous budget for a school of 220 students,” Manley said.
But the slower-than-expected student growth is not necessarily a bad thing, he added. “It’s challenging our growth assumptions. There’s an idea that a college has to have a lot of students to be successful.” That assumption is one of many the college is reexamining, he said.
Forward with FACT
Last summer, the college began a set of design-build exercises as part of the Framework for Antioch College Transition, or FACT, an approach introduced by Manley. Those exercises have identified several specific ideas for utilizing Antioch’s “curricular assets” — resources such as Glen Helen, WYSO and the Coretta Scott King Center — to enhance the curriculum and generate new revenue for the college. The first round of small grants, from outside founding sources not tied to the college’s operating budget, will be awarded in January to put those ideas into practice.
All aspects of the college are subject to the design-build process, according to Manley.
“What kind of college do we want? What does it look like and how do we get there? Those are the kinds of questions we’re asking,” he explained. Everything is on the table, he added. “Why does college cost so much? Do we need a college president?”
The recent budget measures do not affect the college’s forward movement with FACT, he said. If anything, they narrow the focus, according to Adkins. “We’re pretty focused on FACT,” she said.
The college is also seeking to engage alumni in new ways through the FACT process. “It’s clear that alumni are not only generous, but gifted,” Manley said. One new initiative is an alumni volunteer work program, which will identify and coordinate alumni volunteers who wish to serve the college in areas such as marketing, information technology and finance.
Antioch remains committed to at least one major new project, Antioch College Village, although the college liaison position, the director of operations and business development, was eliminated in recent cuts. A cohousing pilot for that project was announced this summer, and project fundraising and design work has continued throughout the fall, according to Manley on Monday.
Meanwhile, FACT represents the next phase of what the college seeks to do — and be — now that accreditation is secured. It’s a way to creatively use what the college already has. And that means being prudent and fiscally responsible at every step, “not just kicking the can down the road,” Manley said.
“We will have our 175th birthday in nine years,” he reflected. “Our goal is to lay the groundwork for another 175 years.”