The University Resources Council held its annual open forum to discuss the budgeting process and how it affects members of the University community Thursday evening.
A crowd of staff, students and faculty crowded into Petterutti Lounge to hear Provost Mark Schlissel P'15, chair of the URC, speak about University funding.
"We're actually a very wealthy university," he said. But budgeting is "a question of making tradeoffs," he said.
The URC begins its budgeting process by examining the current year's budget and projected revenues from philanthropy, returns on the endowment investment and research funding, he said.
The University can count on certain sources of revenue such as research funding, since the government considers it a worthwhile investment to fund, he said.
There is an "incontrovertible argument that it fuels the economy in the long run," he added.
The council then considers expenditures - fixed cost increases, prior commitments, salary for faculty and staff and incremental requests from various bodies on campus.
For example, Schlissel said this year there has been an increase in crime on the periphery of Brown's campus, leading to requests for a greater Department of Public Safety presence.
Schlissel also cited the Center for the Study of Slavery and Justice, for which a building will be constructed, as a potential addition to the budget.
All these components go into the URC's deliberations when crafting their budget recommendation. They make projections and take requests into consideration before submitting recommendations to President Christina Paxson in December or early January.
"We sit there and try to read the tea leaves," Schlissel said.
Brown relies heavily on returns from tuition and student fees, especially in comparison to peer institutions, Schlissel said. About 38 percent of this year's $865 million budget came from tuition, while 15 percent was yielded from the endowment, and 16 percent came in from federal research funding.
Schlissel gave a presentation featuring statistics from peer institutions such as Princeton, Harvard, Stanford, Columbia, Northwestern, Cornell, the Massachusetts Institute of Technology and Duke. Brown is "the most dependent of this cohort" on tuition to fund its budget, he said.
But in the same peer group, Brown's tuition is also in the lowest tier - this past year, room, board and fees increased to $55,016, or 3.5 percent, compared to Columbia's 4.3 percent increase to $58,742.
This causes difficulty when balancing the budget, Schlissel said.
Brown is further disadvantaged by its endowment. Per student, Brown has a $298,000 endowment, compared to Princeton's $2.2 million.
This budget then goes primarily toward salary and benefits - 15 percent for faculty and 28 percent for other staff members, Schlissel said.
Staff members include administrative, technical, facilities and athletics employees, in addition to Brown Dining Services workers and Campus Life, said Beppie Huidekoper, head of finance and administration.
He then fielded questions and comments from attendees.
Gregory Chatzinoff '15, parliamentarian and UCS-UFB liaison, asked whether the University has any plans to improve fundraising.
Pat Watson, who is currently the senior associate vice president of alumni affairs and development at Cornell, will take up the senior vice president for University advancement position at Brown beginning in December, Schlissel said.
"We do really well on annual giving," he added, citing "an enormously generous alumni."
But Brown is disadvantaged in its ability to increase the size of its endowment, partly due to its smaller scale as a university. It "defines how much philanthropy we bring in," he said.
Chatzinoff also asked whether the University ever cuts programs it deems ineffective. Such a process is ongoing within each department, Schlissel said.
During the economic crisis of 2008, the University eliminated around 200 jobs. But 159 of these were voluntary retirements instead of true layoffs, Huidekoper said.
In response to a question about the role of inflation in determining faculty and staff salaries, Schlissel compared Brown to a business.
"I'm trying to maximize the University's mission within the confines of a budget," he said. The University pays what it must "to keep a talented, motivated staff," to keep them here and productive within a competitive labor market.
"It isn't a compassionate answer - it's a real answer," Schlissel said.
Kathy Patenaud, director of undergraduate teaching labs, asked where Brown compares to peer institutions in staff size for the size of the school.
Brown is "lean," Schlissel said. "I think we're low."
"People work really hard here," he added.
The URC consists of members of University faculty and staff, in addition to two graduate students, a medical student and four undergraduate students.
The forum is an integral part of the budget process because it allows the URC "to reach out to our community," Schlissel said.
Schlissel concluded by discussing the impact of the 1 percent return on the endowment this year.
There are good years and bad years, he said, and the URC makes projections with the assumption that these average out.
Though the URC recommendation might project on the lower end of the typical 4.5 to 5.5 percent range of return, there is a distinct lack of certainty. "They really are projections," Schlissel said.
"You do have to have a sense of optimism about the future," he said.
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