The University is projecting a $9 million deficit instead of a $7 million deficit for fiscal 2011, in part because the rate of faculty retirements, which are part of the University's academic restructuring plan, has been slower than expected, Senior Vice President for Finance and Administration Jeffrey Apfel said at a faculty meeting last Thursday. In addition, the financial projections for fiscal 2010 and onward are uncertain as senior administrators are not sure that fundraising goals can be met, in part due to the announcement of University President Jehuda Reinharz's resignation the night of Sept. 24.

The main factor in projecting a higher deficit for fiscal 2011, Apfel said in an interview, was that implementation of the University's curricular restructuring plans relies not only on "the retirement of 35 faculty, but you have to make certain assumptions in your budget planning, . based upon the rate at which those retirements take place."

Last May, Provost Marty Krauss e-mailed faculty with options for either reducing their workload and remaining at the University or agreeing to retire at a fixed date after at most five years as part of the University's Curriculum and Academic Restructuring Steering committee's plan, which proposes a decrease in faculty over five years by 10 percent, or 35 positions.

Dean of Arts and Sciences Adam Jaffe added that historically, the average rate of retirements has been about five faculty members per year.

"The theory was that we would either keep that historic average or maybe even increase it because we're announcing a [retirement] program, . but actually the number has dropped," Apfel said. He attributed this decrease to the suspension of the University's retirement contributions.

At the faculty meeting, Reinharz stated that "right now we have two people who have signed up [for the retirement plan]." However, Jaffe declined to confirm this statement.

"The original estimate was really just a guess; we had no way of knowing how quickly people would be departing," Jaffe said. He added that faculty have until December to sign up for the retirement plan. "So, in the first week of October, I think it's frankly premature to conclude that the response hasn't been a good response."

Apfel said that the expectation now was that the 35-member faculty reduction might occur by 2016 instead of 2014.

At the meeting, Faculty Senate Chair Prof. Sabine von Mering (GRALL) addressed any faculty considering retirement. "Why don't you lead the way and suggest how we could meet the retirement goals?" she asked.

She added that faculty should consider "What would you like to see happen with your legacy at Brandeis?" and think about how emeritus faculty could be honored and still contribute by writing the history of Brandeis or archiving institutional memory. This approach, she said, would be a sign of cooperation between faculty and administration, showing "that this is something the faculty can direct from within us, and not be told from above."

In an interview with the Justice, von Mering added that "many people, including myself, lost a lot of money in the retirement plan last year, and so . the faculty need to guide this process and they need to say, 'Here are the conditions that have to be met.'" Von Mering also said that the Faculty Senate was considering ways that there could be more faculty oversight of the CARS implementation to ensure its success.

In a presentation at the faculty meeting, Apfel said that under the assumption that the goals from CARS were met, the University had estimated a $7 million deficit for fiscal 2011. In addition, those estimates projected a $6 million deficit for fiscal 2012, $4 million for fiscal 2013 and $2 million for fiscal 2014. The revised estimates foresee a $9 million deficit for fiscal 2011, $8 million for fiscal 2012, $5 million for fiscal 2013 and $2 million for fiscal 2014.

The deficit for fiscal 2011 could also go as high as $12 million, both Reinharz and Apfel stated at the meeting.

The financial situation "has deteriorated some from an already difficult situation," Apfel said, referring to the earlier $7 million projection which was already challenging.

Both Reinharz and Apfel said the University would consider multiple options to close the gap, after one-time measures taken for fiscal 2009 and 2010 in consultations within the administration, as well as faculty and the Brandeis community.

The University plans to present options at the October Board of Trustees meeting so that a decision can be reached at a special Board of Trustees meeting in late December or January.

Reinharz added that Provost Marty Krauss would put together a committee of faculty to consider entrepreneurial ideas to help improve Brandeis' situation.

To help faculty gain a sense of the magnitude of the financial situation, Apfel said the budget office had put together a list of examples to help faculty understand "what any given [dollar amount] is equivalent to in terms of actions" the University could theoretically take to adjust the budget. He emphasized strongly that these did not represent options the University was considering.

For instance, a 1.5-percent pay reduction for faculty and staff, additional reduction of seven faculty members or an additional 0.8-percent tuition increase are among the actions that would yield a $1 million gain for the University.

At the meeting, Apfel stated with regard to the option of selling or monetizing assets, "to some extent, that's a reference to the Rose."

Apfel emphasized at the meeting and in the interview that the University's reserves should not be thought of as the main answer to the budget problems.

Apfel stated that the University currently has about $70 million in reserves, which are unrestricted funds in the endowment that the University can access. The total endowment is about $580 million, the largest portion of which is restricted toward specific purposes and so most of it cannot be used for closing the budget gap, Apfel explained.

Taking money out of the reserves to solve the budgetary problems would negatively affect the cash flow of the University, Apfel explained. That money would add to the University's yearly 5-percent draw from the endowment as a whole for operations, a situation exacerbated by the fact many funds in the endowment have fallen below their original value and cannot be legally accessed.

Senior Vice President of Institutional Advancement Nancy Winship said that the expected fiscal 2010 target for unrestricted funds going from fundraising to the operating budget has been lowered from $11 million to $8 million, in part due to the realization that fundraising always slightly decreases during presidential transitions at any institution.

Since 1994, she said, Reinharz has been successful in bringing "people to Brandeis to learn about Brandeis and to support us," emphasizing that unlike other institutions, a larger portion of money comes from friends of the University than from alumni.

Many of them, she said, "were dismayed about [Reinharz's] resignation because they expected him to be here through 2014."

"If you were thinking of making a gift and being able to watch that gift be executed, you might want to wait now because you're not sure of Brandeis' direction," she said to describe donors' potential reactions.

Winship added, however, that she remained optimistic, and that both she and Reinharz had heavy travel schedules planned to raise money, mainly for financial aid.