Op-Ed: A parent’s perspective on the equestrian team

Steven D. Rizzi

Steven D. Rizzi is a Smith College parent and technologist that has worked extensively with higher education in the U.S. and abroad. He has advised the U.S. Department of Education as well as the State of Maryland on education.

On March 31, 2017, Smith President Kathleen McCartney sent out a letter to students, faculty and staff announcing $3.4 million in cuts to next year’s operating budget. This is occurring despite a record-breaking fundraising campaign of $486 million and the backing of an endowment of over $1.6 billion. Those cuts will be followed by another four years of cuts, which could bring the total impact to $15 million.  In her letter, the President called for a dialogue with stakeholders to discuss this “financial challenge,” and I agree that dialogue is greatly needed.

Why are these cuts being pursued? It’s simply a matter of math. According to a review of the last ten years of Smith College Financial Reports, the administration has been committed to a strategy of decreasing enrollment — down seven percent in ten years — in order to increase “selectivity,” while at the same decreasing tuition revenues, increasing the discount rate by over 20 percent in ten years, to set Smith on a path to need-blind admissions. The result of this strategy is less money for operations, yet at the same time expenses have risen roughly 40 percent. The short form of this is: less revenue + more costs = budget difficulty.  This is despite the fact that during that same period, undiscounted tuition and fees increased roughly 50 percent.

For parents that are reading this editorial, you won’t be surprised that you and your students — or should I say, their loans — are supplying nearly 50 percent of the college’s revenue to offset operating expenses every year. I raise this issue because I often feel that parents are left out of strategic discussions at colleges – despite the fact that they are the primary revenue source of the institution.  Parents should be concerned about these cuts. For example, my own daughter’s sport, the Equestrian Team, was just stripped of their varsity status, losing their faculty coach and on-site facility, despite a petition of over 2,100 people against the move, which you can read about at www.savesmithequestrian.com.

For faculty, staff and students, you need to make your voices heard.  Can Smith remain a top-quality institution if academic, co-curricular and extracurricular programs are cut?  When these cuts are handed out, who is going to make those decisions? Will it hit majors that are the least popular?  Sports that aren’t NCAA?  Student services that serve a minority of students? For a better picture, $15 million in cuts is roughly equivalent to the costs for 47 members of the faculty.

For alumnae, I would ask you to look carefully at a broader set of issues. Like Smith’s parents, you contribute to the college’s ability to support operational expenses, about 33 percent of the operating budget, but you also fund investment in its future through capital programs and restricted gifts. When you give a restricted gift, you have an expectation that your gift will be used as you intended, in compliance with Smith’s Gift Acceptance Policy. In that regard, you should know that your fellow alumnae have given hundreds of thousands of dollars to support the Smith Equestrian Team and its facility, only to see the administration abandon that facility and the varsity team as part of these cuts.

At the heart of the college’s troubles are lower revenues and higher costs. While the President seems to focus on cuts, it is also important to have a discussion about revenues.  I am a supporter of the President’s efforts to keep a Smith education accessible to academically qualified applicants across the economic spectrum, but efforts to continue to grow the college’s discount rate in pursuit of 100 percent need-blind admissions are a significant contributor to the budget deficit and should be reviewed.  I make that recommendation in the context of a recent study by researchers at the University of California, Berkeley that ranked Smith as fourth among elite colleges and universities in admitting low- and middle-income students —  considerably better than most institutions that are actually 100 percent need-blind.

With all of that said, how does the President propose to move forward?  In her letter, President McCartney reminds us that 60 percent of the college’s expenses come from faculty and staff salaries and benefits, but she then goes on to commit to increasing salaries next year. She also points out that the college’s outsourced financial managers lost $159 million last year, but they would remain in charge of the college’s endowment.

I would recommend that Smith focus on some revenue stabilizing measures — hold steady at a 95 percent need-blind status, increase enrollment back to 2006 levels and renegotiate or re-compete the agreement with Smith’s hedge-fund heavy endowment management firm, cutting their management fee by a minimum of $1 million, an approximate 12 percent cut in their annual fee. In addition, in those situations where cuts to programs are being considered, the administration should enlist the help of alumnae, philanthropists, students, parents and faculty to create partnerships that leverage donations or new revenue streams to offset costs and retain the benefits of these programs for future generations of students.