As you are no doubt well aware, higher education across the nation is under serious financial strain. Endowments have lost value, families need increased financial aid, and students are reluctant to incur both tuition bills and debt. Institutions of all types have had to take serious measures to balance their budgets, resorting to strategies such as freezing salaries, laying off staff and faculty, suspending building projects, and cutting programs and services. There have been many excellent articles and analyses of the impact of the current economic turmoil on higher education: the article at http://online.wsj.com/article/SB122420679058043423.html, although a year old, offers a good summary of the forces at work.

Sweet Briar is not, and could not be expected to be, immune from these environmental pressures. We are fortunate to be relatively well positioned financially because of the prudence and careful management exercised over several years by Sweet Briar’s leaders. For example, this fall we have been able to welcome new faculty to campus and to complete major building projects in the Fitness and Athletics Center and the Green Village — significant achievements in the current economic environment. Our endowment was affected less severely than those of many other institutions and is already recovering nicely. Nevertheless, we need to respond thoughtfully and decisively to any challenges to our current momentum.

And so I write to inform you that as a result of lower-than-predicted enrollment, the College is projecting a revenue shortfall in the current budget year. Sweet Briar is not alone in experiencing an enrollment drop this year. This fall, an admissions consultant advised us that “higher cost colleges that have worked hard to keep their discount rates down,” such as Sweet Briar, have been among those most affected in the current economy.

Based on September 30th general ledger results, we now project the revenue shortfall to be in the range of $900,000 to $950,000. To place this number in perspective, I will note that it is approximately 2.25% of the College’s annual operating budget. I would also note that there are some expense reductions associated with lower enrollment which are not reflected in this projection. Nevertheless, there will be a significant gap between our revenues and our expenses this year unless we take prompt and careful action.

On campus, Senior Staff and I have already consulted with Faculty Senate. As an administrative team, the Vice Presidents, Deans, and I have spent many hours analyzing options for reducing expenditures in this year’s operating budget. We have arrived at a draft plan which will be presented to the Board of Directors at its November meeting. Very shortly thereafter the plan will be shared with the entire campus community.

Our first priority in drafting the plan has been to protect the quality of the academic program and of the student experience. In order to do that, we must not only trim expenses but also examine how the College’s business is conducted and how we can achieve both present and future efficiencies and improvements.

The opportunity before us is to begin a process of reshaping the College to make its operations and programs as flexible, efficient, and effective as possible in support of what really matters — the academic program, teaching and learning, and the student experience. I look forward to sharing the specifics of the plan with the community very soon. And I look forward to working with the faculty, students, staff, administration, and Board of the College to make sure that Sweet Briar emerges from the current period of national economic turmoil in an even stronger and more distinguished state.