2020-21 Budget reflects short-term strengths, long-term concerns

2020-21 Budget reflects short-term strengths, long-term concerns

Abe Asher, Managing Editor

Vice President of Administration and Finance David Wheaton made his annual presentation of Macalester’s operating budget for the 2020-21 academic year on Feb. 18 in the John B. Davis Lecture Hall.

This was the third and most public of Wheaton’s budget presentations to the campus community. He also addressed a faculty meeting and MCSG on Tuesday, Feb. 11.

The bottom line? Macalester is in a strong financial position — for the moment.

First, the good news: Macalester has managed its finances prudently over the last two decades, growing its annual fund, investing in its campus infrastructure and mainly hitting or exceeding its enrollment targets.

The state of the higher education industry, however, is cause for concern.

Wheaton noted in his presentation that two small, private liberal arts colleges, Hampshire College in Amherst, Massachusetts, and Sweet Briar College in Sweet Briar, Virginia, both nearly closed in recent years and overhauled their educational models in an effort to stay open.

Their struggles, Wheaton said, are likely a sign of things to come for other small liberal arts colleges.

“We are not immune from what is happening in this industry,” Wheaton said. “This industry is going to be an interesting place to be over the next ten years.”

The challenges are myriad and have been documented extensively by industry insiders and journalists alike: rising tuition prices, growing demand for financial aid and a demographic cliff beginning in 2026, all compounded by staggering income and wealth inequality in the United States at large.

In Macalester’s case, the comprehensive tuition fee — which will rise above $70,000 for the first time next year — is expected to hit $100,000 by 2030. Macalester’s peer institutions are largely looking at similar tuition increases.

“[It is] hard to know how that is going to work,” Wheaton said, nodding to the $100,000 figure. “This is a challenge for the whole industry.”

The New York-based credit agency Moody’s has assigned the higher education sector a negative outlook for two years running, noting that while elite colleges and universities are bettering their financial position year-over-year, much of the rest of the industry is struggling.

Macalester is in a relatively positive position, but it has an isolated worry this year: regular decision admissions applications are down four percent, while actionable applications — those that have been filled out completely — are down ten percent.

Much of that drop is attributable to a decline in applications from international students, particularly from China — in keeping with a nationwide trend that has seen the number of Chinese students enrolling at American colleges fall off over the last several years.

“We don’t want to panic, but we’re panicking a little bit, because the drop is a challenge,” Assistant Vice President of Admissions and Financial Aid Brian Lindeman said. “We’re doing everything we can to improve our yield with international students.”

Along those lines, Lindeman expressed frustration that admissions staff are not currently able to travel to China to meet accepted students as they did last year due to the coronavirus outbreak.

Macalester is currently conducting market research on how it is perceived and how it presents itself, and hopes to use that research to increase its applicant pool. What Macalester has going for it, its considerable reputation and resources aside, is its location.

“I personally think this is going to become more attractive over time,” Wheaton said of Macalester’s urban setting. “I think it’s going to become harder and harder to be a small college in a small town… there will always be a market for a small, bucolic experience, but I think that what we can offer here is just terrific.”

Wheaton covered a number of other points during the 45-minute presentation, including granular detail on where Macalester is devoting resources next year and the college’s long-term strategic vision.

The college is adding part-time jobs in the math, statistics, and computer science (MSCS) department and study away office, along with positions in Advancement, Disability Services and International Student Programs (ISP).

Wheaton noted that the Board of Trustees has approved renovations of select residential spaces in Turck Hall, the admissions office reception area, and the procurement of new, updated AV equipment.

He also said that Macalester is moving towards a final decision about how to use the plot of land it has purchased at 1661 Grand Ave. opposite Patagonia. He believes that the plot will be used for a new residence hall, the construction of which would potentially give the college the opportunity to more fully renovate older residence halls like Dupre.

Wheaton highlighted the Weyerhaeuser Memorial Chapel, which is more than 50 years old and not ADA accessible, as another building that might see significant renovations in the coming years.

No major decision about any campus building will be made, however, until Dr. Suzanne Rivera assumes the college presidency in the summer.

Rivera will likely have an opportunity to shape the physical campus, possibly through the drafting of a new campus master plan. The current campus master plan was written back in 2005, at the beginning of Brian Rosenberg’s tenure.

For Rivera, arriving at a time of short-term security and long-term uncertainty, this will be just one of a number of areas to address. 

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