Tuesday, May 25, 2010

A Warm, Spring Day in New Concord

Yesterday, Government Relations Director Dustin Holfinger and I visited Muskingum University for a meeting with president Anne Steele and the president of Marietta College, Jean Scott. We made the most of a delayed meeting and had a chance to see what the construction crews have completed over the winter.

When I meet with legislators, the initial connection for most is that John Glenn graduated from there. He did, of course, in the class 1962 after delaying his final classes to serve the country in two wars and the nation's military-air and space programs. His wife Annie ('42) is also a well known alumnae.

In other conversations with state officials, I note that the last two Directors of Natural Resources both graduated. The current Democratic director, Sean Logan ('88), was preceded by Republican Sam Speck ('59), who also happened to precede Dr. Steele as Muskingum president from 1988-99. But even I was surprised at the number and range of notable graduates from what is still a small, rural liberal arts institution. (You can see a less authoritative, but longer, list here.)

Dr. Steele is a genial host and greeted us with pastries from the village's relatively new coffee shop/cafe, Uppity's. Later, she took us to lunch there, and we can't recommend it highly enough.

The highlights of the trip for me were large and small. On the big side, the university's new Otto and Fran Walter Hall Music Building is nearing completion. Situated on the "east campus," it makes a somewhat more modern architectural statement than neighboring Montgomery Hall and Brown Chapel.

More modestly stood a small statuette—an Emmy award. One doesn't typically expect to see that kind of award in a president's office, but Agnes Moorehead ('23) received one in 1964, and it resides with the script for the episode she performed. (And no, it wasn't for Bewitched. It was for an episode of The Wild Wild West.)

A tip of my hat to Dr. Steele for her hospitality on a fine spring day.

—C. Todd Jones

Wednesday, May 12, 2010

Calculating Foregone Revenue from Endowment Losses

On this week’s graph we estimated a loss of more than a quarter-billion dollars over two years in expendable revenues from our member institutions’ endowments.

That’s a pretty big number, but we did not pluck it out of thin air. Here’s how we calculated it:

First of all, endowments are a source of revenue as campuses normally allot five percent of their value to the various purposes for which the endowments were established. An endowed chair for a professor typically has an endowment of at least $500,000 supporting the holder’s teaching or research; endowed scholarships could have nearly any amount above a few thousand dollars. Why five percent? In normal times, the value of endowment funds usually increase by more than that, and in some recent years much more. Reinvesting any additional growth into the fund is a hedge against inflation, as it increases the next year’s base for calculating spending, and also, over time, limits losses during bad years like 2008 and 2009.

So, using $7.9 billion at the end of the 2007 fiscal year as a base, the loss of $1.9 billion in endowment value during fiscal 2008 means that the campuses didn’t have five percent of that, or about $96 million, to spend from their endowments that year; and the cumulative loss of $3.3 billion resulting from the additional losses during fiscal 2009 resulted in almost $164 million in spendable revenue lost in that year. Add them up and you get a loss of almost $260 million over the two year period.

You can see how strapped our member campuses have become, and how deeply they had to dip into their own resources to support their students this year, especially when the drastic cuts in state financial aid came this past fall.

— Bob Burke

Wednesday, May 5, 2010

Primary Election Results Are In

The results are in from Tuesday’s Primary Election and the proposed state constitutional amendment (Issue 1) on the May 4 ballot that authorizes the State of Ohio to issue up to $700 million in bonds for the Third Frontier initiative over a four year period passed with a 61% approval rate.

For a list of all candidate, issue, and judicial results, please click here.

AICUO would like to congratulate all of the candidates who won their election and also thank those in Ohio who supported Issue 1. Renewal of the Third Frontier Program is an important piece of Ohio’s rebuilding plan.