Before the 2008 economic downturn, the University had grand plans. President Simmons' ambitious fundraising campaign was on track to surpass its goal of $1.4 billion. Administrators were eyeing a new home for the Alpert Medical School, construction of state-of-the-art brain science laboratories, increases in financial aid and expansion of the University faculty.
Then, in September 2009, the University announced the endowment's $740 million fall, and planners forecasted $65 million in budget shortfalls over the next three years. Still looking to build a new fitness center, establish itself as a research powerhouse and overhaul on-campus housing, University Hall weighed its options.
Further increases in tuition could alleviate some budgetary woes. But Brown has long been more reliant on undergraduate tuition than its peers, and administrators acknowledged there was only so far that yearly sticker prices could increase. Fundraising revenue, too, was approaching a glass ceiling.
"We weren't going to find significant incremental revenue from any of our traditional sources," said Rod Beresford, associate provost and professor of engineering. "We needed something new."
Brown has traditionally competed with fewer resources than its peers, and upping revenue has always been a priority. But the past few years have seen a focus on generating income from new sources, including online degree programs and corporations, with little apparent discussion as to the impact these new cash flows may have on Brown's traditional emphases on liberal arts and the undergraduate experience.
Though stock market rebounds prompted hope for quick recovery, it now appears the University faces a longer period of fiscal stagnation. The link between the economy, federal spending and University revenue is often difficult to untangle, but the current moment represents a turning point in Brown's history.
"What we understand going forward is that we are in for a very sustained period of low-to-no (economic) growth," said President Ruth Simmons. "That has consequences for virtually every revenue stream that we rely on."
Under Simmons' presidency, the institution has attempted to increase revenue while maintaining a steadfast focus on the undergraduate College. But as resources remain tight three years after the initial endowment crash, it remains to be seen if the University can balance the constant need for money with those qualities that make Brown unique.
Leveraging the brand
For the Office of Continuing Education, the endowment's crash in 2009 changed everything. Last spring, the office announced a series of blended master's programs to be introduced in 2013. Part of each course is offered on campus, but the majority of instruction takes place online.
Though the University had previously considered similar professional programs, the endowment's dramatic decline provided the ultimate incentive for their launch. The University "would not be undertaking this project" were it not for that "precipitous event," Beresford said.
These programs will allow mid-career adults to earn master's degrees in subjects including health care enterprise management, data security, information strategy and biotechnology innovation.
When Brown's need to expand its sources of revenue became clear, Karen Sibley knew her office would play a large role. As dean of continuing education, she has overseen the lucrative growth of the Summer@Brown programs for pre-college students, which have more than doubled their revenues in four years — from $1.95 million in 2007 to $4 million this summer.
"It takes a crisis of financial proportions to make us think about (how) can we appropriately generate revenue," Sibley said. "It would be inappropriate to identify (the new master's programs) as being created just due to revenue," but it was "not just high-minded principles" that prompted their creation, she said.
The effort is in line with steps taken by other Ivies: Dartmouth recently introduced a blended master's program for health care professions, and Harvard Extension School provides a way for students to earn undergraduate, graduate or professional degrees while taking a majority of their courses online.
Online degree programs arecash cows for schools. Brown's programs are likely to generate up to one-third their cost in net revenue, according to the provost's report issued last spring. Harvard makes millions off a similar strategy through its extension school, granting degrees to students who do not pass through its rigorous admission processes.
But Brown and Harvard face a very different calculus when weighing the benefits of increased revenue against the drawbacks of brand dilution. Harvard's name is essentially untarnishable, while Brown is still striving to establish its reputation nationally and globally.
In March, the University began a new executive masters program in Spain, offered in conjunction with the Madrid university Instituto Empresa. The program combines 20 to 30 hours of online courses with some on-campus instruction.
Simmons called the master's programs a "legitimate" enterprise, citing other such programs that preceded the financial crisis.
But Jason Becker '09 MA'10, who served as an undergrad on Brown's Task Force on Undergraduate Education, which convened in 2007 to evaluate the success of Plan for Academic Enrichment, said he was "disturbed" by the initiative. He said he saw its purpose as "exclusively for making money."
Other prestigious universities, such as the London School of Economics, have been offering comparable programs for some time, and it would be a disservice for Brown not to make strides in the arena of online education, said Matthew Gutmann P'14, vice president for international affairs.
That being said, it needs to be done in a way that "makes sense for Brown," he said.
"People who are looking at this are saying it could be a disruptive change in education," Beresford said. "But that's never been Brown's approach. Our approach has been to provide an extremely selective experience."
Programs will be no less intense than any other University course, Beresford said.
Yet the instruction for these programs will not come from tenure-track faculty. The University will hire adjunct instructors instead, and the programs will not be affiliated with existing academic departments.
Tuition revenue from the programs for the University will go toward the general budget, Beresford said, and will not be funneled back into professional programs. "The point is to support the on-campus mission that Brown cares so much about," he said. "It's faculty, it's undergraduate financial aid — it's everything."
And the new professional master's programs will serve as something of a testing ground for Brown's involvement in online education. Undergraduates may one day have the option to take prerequisite courses online as a result of the experimental online offerings in the new programs, said Provost Mark Schlissel P'15.
But it is yet unproven which force will be more powerful: the revenue funnel
ed toward the budget from the professional programs or the potentially tarnished prestige of a Brown degree. A Brown diploma currently testifies that the graduate has studied in Providence under top-tier faculty. But that indication — like the University's traditional undergraduate-focused mission — may become a relic.
The engineering of expansion
Officially published in February 2004, the Plan for Academic Enrichment — Simmons' blueprint for improving and expanding Brown — explicitly identifies the University's relatively small research profile as an issue and outlines steps toward improvement.
The "overall reputation as a research university, as measured by various national rankings, has not always been as strong as we would think appropriate" the report states. But establishing the University among the nation's research powerhouses comes at a high price. "We cannot be a top-tier research institution without having strong PhD and master's programs," said Dean of the Graduate School Peter Weber P'12. "We recognize that for Brown to achieve its ambitions, we have to pay for it."
Faculty hiring was one of the key tenets of the PAE, but much of that growth has come in research-heavy disciplines, indicating a shift in focus as Brown struggles to compete with its larger Ivy League peers.
The number of faculty in the life and medical sciences has increased more than 33 percent since the 2002-03 academic year, while faculty in the physical sciences has increased almost 19 percent, according to data from the Dean of the Faculty's website. In comparison, faculty has grown 11.7 percent in the social sciences and 8.6 percent in the humanities.
This focus on research inevitably calls into question the role of the undergraduate on a campus increasingly focused on opportunities for graduate students.
"As I understand it, our mission is not just teaching undergrads," Weber said. "It's teaching students."
Administrators stress the benefit to undergraduates of enriched graduate programs, citing expanded infrastructure and facilities and the mentorship graduate students can provide.
But the growth in graduate programs has not come evenly. Yearly enrollment in master's programs has increased nearly 150 percent since 2001, while yearly enrollment in PhD programs has grown by less than 18 percent over the same period.
Most master's students are self-supported — the University does not guarantee their funding as it does for doctoral students. And master's programs receive little University financial aid, making them a lucrative revenue source for the institution.
Weber stressed that a growing demand for master's programs, not just revenue, factored into expansion. But the University's decision to respond to that demand speaks to its priorities going forward.
Expanded program offerings assure the quality of the academic experience for years to come, Simmons said. "Unless we come up with new sources of revenue, we're going to have to live with a lot less than we currently have," she said. "The safest course for the preservation of Brown is the largest possible range of revenue streams — so when one goes down, another can carry the weight."
"If we don't do that, you'll be writing to Brown in 15 years complaining," Simmons said.
Placing priorities
Despite administrative promises that expanded research and graduate programs benefit undergraduates, a prioritization of research programs still threatens to come at the expense of teaching and advising.
Fewer than half of faculty members find teaching to be their most time-consuming task compared to research, grant writing, advising and governance, according to a Herald faculty poll. More than half of faculty members in the sciences — 53.4 percent — listed research as the most time-consuming component of their job.
Almost one-fifth of undergraduates are "somewhat dissatisfied" with their academic advising and another 6 percent are "very dissatisfied," according to this semester's Herald poll.
When recruiting faculty, the University gauges each prospect's willingness to teach undergraduates, Simmons said. "You often see that it gets down to the question of whether or not the person that you're hiring actually is going to be focused on undergraduates in their teaching." During a tenure decision, a junior faculty member's dedication to teaching is examined again, she said.
"I don't know another university in the country — that is a top university — where people get turned away because of their teaching," she said.
But some faculty members worry recent revisions to the tenure process pressure faculty to emphasize research over teaching. The new tenure guidelines increase the number of external letters of support required, placing more importance on the impact of a professor's scholarship in an academic field than on the quality of the candidate's teaching and advising on campus.
Corporations step in
Professors in the sciences spend much of their time applying for grants, and securing these grants has become increasingly competitive as researchers fight a downward trend in federal research dollars.
The National Institutes of Health, for example, has given approximately the same level of awards since 2001, while applications for those awards have increased by more than 50 percent.
Competition for funding poses a challenge for University administrators as well. Brown takes a significant cut of every federal grant a University researcher receives for facilities and administration costs. The funds represent a key avenue by which universities recover the costs of research administration and facilities upkeep.
In part pegged to expansion of research facilities, the University's rate has increased from 55 percent in the 2006 fiscal year to its current level of 62 percent. Sponsored funding currently accounts for about 20 percent of University revenue.
Administrators hoped President Obama's stimulus funds would herald an uptick in stagnating federal research dollars, but instead they simply provided a momentary hold on long-term declines. Now, a general fear of this trend's continuation — reflecting a thrifty climate in Washington and ongoing fiscal woes — has resulted in a shift of strategy. The University will increasingly look to private sources to supplement federal funds.
"Corporate research is a pretty important part of the portfolio of research sponsorship at most top schools of engineering," said Lawrence Larson, dean of engineering. "It's something that we will be increasingly exploring in the coming years."
"We don't do as well as many of our peers in getting corporate sponsorship," said Beppie Huidekoper, executive vice president for finance and administration. "It's just something we should do."
But if corporate sponsors overtake the federal government as the primary funders of research, academics may frame their studies differently to attract private money. Though administrators agree the University should and will increase corporate sponsorship, some are concerned about a resultant degradation of research integrity. The University is currently revising its conflict of interest policy to address these concerns.
"The thing that we have to be very sure of is that we never compromise the quality or the independence of the research we do here," Larson said.
Patents may also become a significant revenue source for the University in the future. It takes only one exceptional patent to generate large sums for
the University, Schlissel said.
Under some corporate sponsorship frameworks, corporations negotiate to retain patent rights, leaving the University less able to benefit financially. But Brown has a policy to retain intellectual property rights. At most, a corporate sponsor would be offered access to the research findings prior to other corporations, said Clyde Briant, vice president for research.
Though corporate sponsorship of research will "grow tremendously," Schlissel said the University will "insist when we receive research support that the faculty are free to publish their results."
But despite official administrative guidelines, researchers can still feel pressure from corporate sponsors. Professor of Psychiatry and Human Behavior Martin Keller stepped down as chair of the psychiatry department of the Med School in 2009, after his study was accused of misrepresenting a medication's side effects. Keller's research received funding from GlaxoSmithKline, the company selling the drug under study.
The University has not publicly investigated Keller or responded to external accusations condemning Keller's research.
Opportunities abroad
Simmons and other top administrators visited India in 2010, one of many stops on the president's ongoing global tour. Her numerous trips in recent years aimed to forge ties and establish Brown's brand internationally.
The University has created advisory councils in China, India and Latin America and has aggressively targeted Asia as a potential source of fundraising support. The councils are comprised of high-profile alums and parents, Ronald Margolin, vice president for international advancement, told The Herald in September 2009.
While not solely tied to revenue, the University's increased focus on internationalization has been seen as a potential opportunity for revenue diversification.
"We're paying a lot more attention as an institution overall as to where we can make the best connections with foreign scholars and universities," Gutmann said.
A lot of the pressure to establish ties abroad comes from alums and potential fundraising sources, Simmons wrote in an email to The Herald in March. "Our presence in China will certainly grow, and demands from our alumni to have meaningful programs and relationships in China will continue," she wrote.
The current Year of China on campus is a "stepping stone" to help the University achieve its goals of a broader presence and increased fundraising in China, Chung-I Tan, professor of physics and director of the Year of China, told The Herald in March.
In addition to improved philanthropic relationships, recruitment of more international students — who do not receive need-blind financial aid as students from the United States do — presents a financial incentive.
Just over 30 percent of international students are currently receiving financial aid, compared to 43 percent of the overall undergraduate student body.
Revenue from international sources is a by-product of the University's desire to establish its reputation abroad, Simmons said. "It's imperative that Brown have a place in the international sphere."
Simmons has been pushing for more financial aid for international students, and the University hopes to increase the socioeconomic diversity of its international students going forward, Gutmann said.
"Sometimes when this discussion comes up people think we're just looking for money," Gutmann said. "That's not the case, in that we want to develop programs where there is a demand."
"Brown is a nonprofit for a reason," he said.
But while there is certainly a demand on campus for international engagement and discussion of global issues, it is less clear whether these specific initiatives are motivated by University scholarship or by alums and donors abroad.
Past theme years of Africa, Latin America and India did not engage much of the student body, Tan said in March. And only around 20 people attended the University's kick-off Year of China event in September.
Drifting from a mission
Recent initiatives call into question the University's traditional undergraduate focus. As the University courts professional degrees and shifts its research scope, administrators continue to expound Brown's unique qualities and stature in the academic community.
Many of Brown's peer institutions have long engaged in similar pursuits, and the University's corporate research profile and international presence represent its attempts to compete in a difficult economic climate.
But in recent years, competition has come to look more like imitation. The University's prestige and ethics could be damaged by its forays into online education and corporate sponsorship of research without careful safeguards.
With Simmons' impending farewell in June, the University stands at a crossroads. It will remain to be seen whether the 19th president will look outward, toward revenue streams and U.S. News & World Report rankings, or within, toward the traditional undergraduate center of the institution, before deciding the most appropriate next steps for Brown in the coming decade and the dawning century.
