Our work in higher education surely never ends. This past year illustrates this truth. It also shows what we can achieve working together in creating an ever stronger University. And I am pleased to share some of the work you have been doing as a university community.
As an aside . . . It was nearly a year ago I told you about the challenge I faced with appendix cancer and two surgeries, and some of you have asked about my progress. I’ve now completed six months of chemotherapy. During this past year I’ve paced myself, prioritized my work to what our Trustees believe are the most important work of the University, and have given it everything I’ve got. But this has called on all my Cabinet to accept ever-more delegation on lots of other matters. While cancer took a toll, I am feeling well, have more energy, am gaining a bit of weight, and am taking stairs two at time. And I can report that CT scans show that I am now cancer free to the best of anyone’s ability to detect. I express my thanks to the entire community who supported me during a tough year.
A mark of a great organization is how it flexes to address a changing environment. 2014 and 2015 were years of transition marked by great change. Over the past 18 months, we have continued our momentum by navigating toward excellence—excellence that is achieved in part through first building a strong team of leaders.
David Fite stepped down as our Interim Provost and Chief Academic Officer at the end of the 2014-15 fiscal year so he could spend more time on his creative writing, scholarship, and his first love, teaching. We have all benefited from his commitment to the University of Redlands, to the ideals and practices of liberal and professional education, and to our shared goals of student learning, development, and success. He has been a supportive colleague. After his sabbatical, David looks forward to continuing to contribute to the University of Redlands in many ways.
In May of this past year, I announced the appointment of Kathy Ogren as our new Provost. In this role, Kathy faithfully brings the whole of the academic mission to the President’s Cabinet, where she will continue to work closely and collaboratively with other recently appointed officers and the core of strong, longtime leaders who collectively are helping to ensure the health and excellence of our University. Few, if any, competitors would be able to match Kathy’s resourcefulness and affability as a leader, her improvisational mind, and her perspicacious thinking about liberal learning and scholarship. And none would match her deep knowledge about and love for Redlands and her seamlessness with our culture. Her most recent endeavor is to lead us in a planning cycle we’ve called “North Star 2020.”
Kathy almost immediately convened faculty leaders to discuss transition plans in the College and to plan for a national search in 2015-16 for the Dean of the College. Departmental chairs and program directors advised Kathy and Interim Dean Fred Rabinowitz about future responsibilities of the College Dean, the structure of the Dean’s Office, a vision of our future, and the impending transition of Dean Rabinowitz back to the faculty in July 2016. As a result, the College has been positioned for new leadership, and we expect to make an appointment soon. Kathy’s leadership of the Information Technology Services division remains unchanged.
Our recently re-structured marketing and communications unit—now known as University Communications—is spearheaded by Chief Communications Officer, Wendy Shattuck. Wendy has accumulated an impressive professional history and great expertise in the field of marketing and integrated communications. Her background blends education in the arts and humanities, and a master’s degree in liberal arts, with high-level leadership and management in education, technology, and general business settings. Wendy has extensive background and accomplishments in designing and executing fully integrated communication. My Cabinet colleagues applaud her commitment to lead us in our desire to better serve the University community, as well as our external audiences, through expert, strategic communications. Wendy’s contributions and vision for the University can be seen in our most recent project, the new University website.
The culmination of a close and highly effective partnership between University Communications and Information Technology Services is coming this month with the launch of the completely redesigned Redlands.edu website. This immense, complex project began nearly 18 months ago. Communications and ITS oversaw three external partners, led the Web Advisory Committee in strategizing and setting goals for the site, and martialed the assistance of hundreds of members of our internal community to build its content. The site is the University’s figurative and literal “front door” for so many prospective students, families, and members of the general public who get their very first glimpse of the University on our site. The best institutional sites represent the kind of partnership demonstrated by ITS and Communications in this project: a partnership that brings skills and experience in higher education Web strategy, technical expertise, creativity, collaboration, and a process that is inclusive of the broader community’s perspective and input.
On June 1, 2015 we welcomed Brent Geraty to our community as the University’s first internal General Counsel following a national search. In this role, Brent reports directly to me as a member of the President’s Cabinet. With his arrival we have brought legal services in house, ending a decades-long reliance on external counsel—reducing costs, increasing efficiencies, and enabling ongoing, close work with the Cabinet, Trustees, and all employees on matters ranging from policy development to risk management to best practices. I am delighted that Brent has joined us. He is sensitive, careful with details, straightforward, has the experience to anticipate our needs, and has a fine sense of humor. We can all look forward to his contributions, not merely as our top legal expert, but as a welcome educator to us all.
We should all be pleased with the progress we have made. Let’s remind ourselves daily what is special about the University of Redlands. Our faculty had another productive year, and the following are updates and acknowledgements of outstanding achievement.
In the School of Education:
We welcomed 2 new faculty members.
Rod Goodyear is the 2015 recipient of the American Psychological Association’s Award for “Distinguished Career Contributions to Education and Training.” We have been fortunate to have Rod as a faculty member since 2008, and in September 2015, the University community honored Rod for his achievement and service to Redlands.
Pauline Reynolds, a new department chair and author who published her first book in 2014, has a new book contract with Palgrave Macmillan. The book will offer a comprehensive exploration of the fictional representation of higher education in a range of media.
Newly tenured professor Susan Porter co-led our reaccreditation efforts and recently had three new publications.
James Valadez was awarded the 2016 John Randolph Haynes Foundation Faculty Fellowship Award for his proposal entitled, “School Choice: An analysis of a growing movement in Southern California.”
The School of Education also received a $499,090 grant from the California Department of Education for its 2015 California Elementary Math and Science Professional Learning Initiative. This collaborative project, led by professor Jose Lalas and with the participation from the Moreno Valley Unified School District, aims to increase the mathematics achievement of elementary students. The project will not only strengthen our elementary educators in their knowledge of math-focused content, but will provide our elementary students—especially those of color and from low-income families—the necessary computational skills and number sense they require to build upon for future math achievement in middle and high school.
In the School of Business:
We welcomed 2 new faculty members.
Professor James Pick and colleagues co-authored three journal articles stemming from a large research project on “digital divides” worldwide. The articles were written with Associate Professor Avijit Sarkar and two MBA students, Jeremy Johnson and Tetsushi Nishida. The three articles were:
We also celebrated a double book signing at the Alumni House last May for the School of Business and Department of Business Administration faculty:
In the College of Arts & Sciences:
We welcomed 11 new faculty and academic administrators.
Sawa Kurotani, Professor of Sociology and Anthropology, was appointed Interim Assistant Dean for 2015-16. Sawa works with the faculty and Registrar on all curricular and academic policy matters. She collaborates with Interim Dean Fred Rabinowitz on study abroad and internationalization initiatives as well as first year seminars and advising.
Julie Townsend assumed the directorship of the Johnston Center for Integrative Studies in August of 2015.
Dr. Steven Moore of the Center for Spatial Studies and Professor Gary Scott of the School of Education received a $695,000 grant from the National Science Foundation to educate and empower students for success in STEM courses and careers by improving their spatial thinking and computational skills at the elementary level. The project seeks to develop instructional and assessment strategies that are effective across socio-economic categories and that work particularly well for students who have been found to lag behind in visuospatial abilities at key grade levels.
Lillian Larsen in Religious Studies has been awarded $30,000 from the Wabash Center for a project entitled “Re-drawing the Map of World Religions.” The award is intended to develop curricula aimed at enhancing critical literacy in the religious studies classroom.
Professor and Director of the Truesdail Center for Communicative Disorders, Michael Groher, was a recipient of the Honors of the Association Award, the highest distinction from the American Speech-Language-Hearing Association, recognizing his distinguished contributions to the discipline of communicative sciences and disorders.
The Study Abroad Office, under the direction of its new Director, Leo Rowland, implemented Terra Dotta, a web-based system designed to help students explore potential study abroad destinations, apply for specific programs, and fill out required forms.
Assistant Professor of Business Administration, Scott Randolph was chosen as the 2015-16 Professor of the Year by students of the Mortar Board.
We also celebrated a double book signing at the Alumni House last May for the School of Business and Department of Business Administration faculty:
The History Department celebrated the publication of Patrick Wing’s The Jalayirids (Edinburgh U Press) and Kathleen Feeley’s Mary Pickford: Hollywood and the New Woman (Westview Press) with a book signing at the Alumni House.
The School of Business continues to identify and innovate ways to expand its programs. Included in its work this past year was the roll-out of a shorter version of its standard two-year MBA. In addition to the two-year MBA, the School now offers a new 18-month MBA. Also, the School received approval of a joint MBA and joint Master of International Management degrees with Kyiv National Economic University in the Ukraine. Finally, the planning for an online MBA program is underway as university officials meet with potential online partners.
In November last year, the School completed its self-study providing an updated outline of its goals and mission, with an evaluation of its contributions to the University, its practices, and academic initiatives. In the study, the School also addresses areas of weakness and strategic challenges (from competition and changing expectations). An external committee is scheduled to review comprehensively the self-study and the entire School of Business, providing its recommendations later in the academic year.
The last twelve months have seen much success and innovation in the School of Education. Under the dynamic leadership of Dean Andrew Wall, the School serves as an exceptional example of how this University is on the move. They saw over 30% growth in new students last year, and enrollment is up again this fall. Yet, their success is not simply in enrollment. Pursuing operational excellence, the School has transformed how it is organized through a restructuring into larger, multidisciplinary departments, made changes to its admissions process, and revamped its advising model all to create a stronger and more personalized student experience. Additional highlights include the preparation for and successful completion of the School’s accreditation by the California Commission on Teacher Credentialing, the hiring of two new full-time faculty members, and the overhaul of the School’s web pages.
Just this week, the School received excellent news. The Commission on Accreditation Revisit team reported their recommendation that the School’s accreditation status be upgraded from "Accreditation with Stipulations” to “Accredited," their gold standard. The sentiment in the process and in the reporting on findings relates to the significant progress the School of Education has made in the past 10 months.
This year, the School of Education will be proposing new programs that focus on online degrees (a mix of full and hybrid) with various concentrations—for instance, a Master of Arts in Education with separate thematic areas of emphasis in Human Services, Teaching English to Speakers of Other Languages, Leadership, or Education Technology. These will help integrate technology deeply in the School of Education’s instruction and will further its commitment to exceptional student experiences. To reach this goal, the School is reorganizing its academic advising and fieldwork offices to ensure the very best support throughout each student’s experience. I am confident in the good work and organizational goals being set, and we can look forward as the faculty and Dean Wall continue to develop the School of Education as a center of excellence.
The School of Music prepared for its ten-year reaccreditation by the National Association of Schools of Music. The School has made significant changes since the 2006 recommendations, including Watchorn Hall room renovations that incorporate new technology and improved acoustics. Both Professor Louanne Long as the Interim Dean, and Andrew Glendening as the Dean of the School of Music, coordinated the efforts of faculty and staff to complete an extensive and well received reaccreditation review.
2015-2016 is proving to be a banner year for our choral ensembles. Last fall, the School of Music hosted the Southern California Vocal Associations Southern Regional Honor Choirs.
Under the leadership of Nicholle Andrews, the Chapel Singers were one of only nine top university choirs to have given invited performances at the 6th National Collegiate Choral Organization Convention in November 2015. The same ensemble traveled to San Jose, California to perform for the top high school choral and instrumental students in the state at the California All State Music Educators Conference.
The University treble choir, Bel Canto, under the direction of Joe Modica, was invited to perform at the 2016 Western Division Conference of the American Choral Director’s Association in Pasadena. These are highly competitive invitations.
Just last month, Dean Andrew Glendenning spent a week subbing as second trombone with the Chicago Symphony Orchestra. He performed in two different programs with the Chicago Shakespeare Company. One was Mendelssohn’s Midsummer Night’s Dream and the other was all of the versions of Romeo and Juliet—Tchaikovsky, Berlioz, Prokofiev, and Bernstein. This was a series of 8 family and education concerts that, combined, included a total audience of 10,000 people.
The School of Music continues to attract an international audience with the Pokorny Low Brass Seminars. Held during the summer, this workshop allows musicians to engage their wide range of musical, stylistic, and technical skills with unprecedented access to some of the most respected low brass players. This annual seminar is led by well-known tubist of the Chicago Symphony Orchestra, Gene Pokorny, who studied at Redlands and received an honorary Doctorate of Music in 2007.
And just last month the School presented the world-renowned Grammy award winning British a capella vocal ensemble, the Kings’ Singers, for an unforgettable performance in our Memorial Chapel.
This is not merely my annual presidential praise but represents growing national acclaim for the musicians we have at Redlands.
We hosted three University Distinguished Fellows through a program designed to bring public intellectuals into campus residence. Recent Fellows have included nation-leading journalists James and Deborah Fallows and foremost digital historian and NPR personality Ed Ayers.
Ed Ayers completed a two-week appointment just last month as the University’s fourth Distinguished Fellow. During his time on campus, he visited classes, met with faculty, and served as the keynote speaker at the annual Lincoln Shrine dinner, an Esri forum, and the annual Board of Trustees Retreat.
Journalists James and Deborah Fallows spent an extended period at the University in the winter of 2015, lecturing in seven classes, meeting with ten faculty members, giving both a Redlands Forum and a Convocation lecture—all while continuing their reporting for their Atlantic “American Futures” series. Since their departure in May, 2015, they have returned to emcee the first American Futures conference and give an additional Redlands Forum presentation. Deborah Fallows will join her husband as the recipient of an honorary degree from the University at our College Commencement this April.
In addition to the many successes of our faculty over the past year and a half, the University has seen outstanding student achievements.
Three student scholars added to our success as one of the top producers of Fulbright awardees:
Our students also excelled as scholar-athletes in the 2014-15 academic year, with many more noteworthy accomplishments than I can list. Here are a few:
Members of our Greek organizations have maintained a higher cumulative GPA than in recent years, with all twelve groups above a cumulative 3.2. So far this year, the Greeks have tracked over 3,000 community service hours with most groups participating in Relay for Life, card making for veterans, Redlands trail clean up, and the Ronald McDonald pull tab collection. The community focused on member development by hosting a leadership symposium with a national speaker and strategic planning with campus advisors. GAMMA hosted an educational speaker on love, alcohol, legal issues, and Greek Life. Alpha Chi Delta, a potential new multicultural sorority, is creating a new locus for women on campus.
At Redlands, every student is united in service. We remain committed to a mission of recognizing and promoting the educational benefits of learning through service. Celebrating its 25th anniversary this year, the Office of Community Service Learning (CSL) was once again recognized for its programming with President Obama’s Higher Education Community Service Honor Roll with Distinction. College of Arts and Sciences students logged nearly 120,000 community service hours during the 2014-15 academic year. The breadth of outreach is immensely successful as students and faculty continue both to engage our communities and learn through service. A great example of this in practice is the recent work of the students in the fall 2015 Introduction to Spatial Analysis and GIS. Supervised by the instructors David Smith and Nate Strout from the Center for Spatial Studies students, students were asked to create a promotional presentation of the Sustainable University of Redlands Farm (SURF) using maps and other media and the skills they learned in the classroom. Students sought to put the SURF Garden “on the map,”—literally, as the farm couldn’t be found on any map before this project— to provide a basemap for future garden projects, and to provide a promotional product to be used for the 25th anniversary of CSL.
The School of Business just selected Mercilyn Francis as the 2016 recipient of the Lee Steven Bertrand Military Recognition Award. The award is open to all undergraduate and graduate students enrolled in the School of Business who are currently serving in, or have served in, any branch of the U.S. Armed Forces. The award recognizes those who demonstrate the qualities that characterized Lee Bertrand’s life and work: determination, resilience, ethical integrity, intellectual rigor, and responsibility to family and community. Retired from the U.S. Navy, Mercilyn is enrolled in our Bachelor of Science in Business program.
Throughout the academic year, the University staged a number of symposiums and forums, all part of fostering an intellectually stimulating student experience and a more diverse University community. Some of the speakers invited over the past year and half include:
On September 16, 2014, the University hosted Jonathan Safran Foer, author of the bestselling books, Everything is Illuminated and Extremely Loud and Incredibly Close. He has been called one of Rolling Stone’s “People of the Year” and by Esquire’s “Best and Brightest.” He also wrote the non-fiction book called Eating Animals, which documented his travels across animal farms in America, documenting what he observed as an ecological crisis. In 2010, he was included in New Yorker’s “20 under 40” list of best young writers in the U.S.
World renowned environmentalist Vandana Shiva has contributed in fundamental ways to changing practices and paradigms of agriculture and food. Shiva, who visited campus on October 21, 2014, is also known for her contributions to gender issues in her book, Staying Alive, and has been referred to as “a one-woman movement for peace, sustainability, and social justice” by Beloit College.
Author and activist Gloria Steinem spoke to a sold-out crowd in the Memorial Chapel on October 23, 2014. Steinem shared pieces of advice and some insights from her early days as a feminist activist. The crowd roared when she said it was important to remember simple statements from childhood still apt in adulthood, such as, “You’re not the boss of me.”
Journalist, social commentator, and best-selling author Barbara Ehrenreich visited campus on November 5, 2014 as an accompaniment to our Theatre Arts Department’s production of Nickel and Dimed, adapted from Ehrenreich’s book by playwright Joan Holden.
On November 18, 2014, Geoffrey Megargee, senior applied research scholar in the Center for Advanced Holocaust Studies at the United States Holocaust Memorial Museum, delivered a lecture entitled “Cataloging a World Behind Wire: The United States Holocaust Memorial Museum Encyclopedia of Camps and Ghettos,” providing insight on the countless camps and prisons from World War II.
We packed the house at the Memorial Chapel on February 19, 2015 to hear Piper Kerman, award-winning author of the memoir Orange is the New Black: My Year in a Women's Prison. Piper spoke about her life, highlighting the fact that she’s not the typical person who ends up in prison. Piper visited with the students in Sawa Kurotani’s and Bill Rocque’s Sociology and Anthropology courses.
We welcomed His Holiness the 17th Karmapa, Ogyen Trinley Dorje—one of the two top-ranking lamas, along with the Dalai Lama, in Tibetan Buddhism. His visit on March 24, 2015 attracted more than 2,000 visitors to campus in a ceremony at which he was awarded an honorary degree in recognition of his deep commitment to building a compassionate world by illuminating and encouraging the interconnections that unite us across differences of language, culture, religion or worldview. Tens of thousands watched it live-streamed on the Web. We were his featured stop among his only other university visits at Stanford, Harvard, Princeton, and Yale. Prior to his visit to our campus, the Karmapa welcomed 16 of our very own students in 2011 to learn from him at his Gyuto Monastery in India. Our students’ journey to spend time with the Karmapa there was made possible under the direction and coordination of Virginia Hunsaker Distinguished Teaching Chair and Professor, Karen Derris.
The city’s pride, and face of American soccer, Landon Donovan, returned to his roots on September 25, 2015 and to a sold out crowd as he talked about life as a professional athlete. As the most decorated men’s U.S. soccer player, playing on the U.S. Men’s national team and the Los Angeles Galaxy, he spoke about life beyond professional sports.
On October 24, 2015, as part of Homecoming and Parents’ Weekend, celebrated author Elizabeth Gilbert discussed her new book Big Magic: Creative Living Beyond Fear. Gilbert inspired the crowd to have the courage to do daring things, while highlighting the connection between creativity and fear.
Emmy-nominated actress, transgender advocate, and cultural icon Laverne Cox gave an address on November 10, 2015 titled, “Ain’t I A Woman? My Journey to Womanhood.”
Moderated and produced by Disney Creative Director Marilyn Magness Carroll ’75, the University staged on January 16, 2016 a historic song and dance tribute to the beloved composer-lyricist Richard M. Sherman, entitled “A Spoonful of Sherman,” featuring many of his hundreds of original Disney songs and show tunes. Sherman shared stories of his years working with Walt Disney and answered questions, like what it was really like working with Mary Poppins author PL Travers and musical legends Julie Andrews and Dick Van Dyke. At the conclusion of the event, he was awarded with an honorary degree of Doctor of Music.
On January 30, 2015, the University hosted the first American Futures Conference. It was the kick-off of what we seek to continue as an ongoing series of mayors conferences, designed to link the citizens, business people, and civic leaders who are creating the next stage of American growth. Mayoral participants included Donn Ness from Duluth, MN; Ashley Swearengin from Fresno, CA; Knox White from Greenville, SC; Nan Whaley from Dayton, OH; and Rusty Bailey from Riverside, CA. Our Congressman from the 31st district and former mayor of Redlands, Pete Aguilar, and Redlands City Councilmen Paul Barich and Jon Harrison also participated. The event was made possible through the Ken and Lynn Hall Network for Innovation in Public Policy.
We continue to make strides in the area of campus sustainability. In the past year, the University installed two ChargePoint electric vehicle stations that can charge a total of four vehicles. These charging stations are located in the center of campus, north of the Armacost Library, immediately adjacent to the Energy Center. There is no fee for usage. Currently, there are about 14 confirmed campus users, and this program is so successful that it is becoming increasingly more difficult to find an open slot to charge vehicles. The University will consider adding additional spaces.
Facilities Management is sampling the new Stihl battery-operated, emissions friendly landscape equipment on campus in hopes to replace the existing loud and emission-generating blowers, hedge trimmers, and weed eaters. There are also plans to participate in the Southern California Air Quality Management District’s equipment exchange program by turning in four existing old backpack blowers for the battery-operated version at a fraction of the retail cost.
We have taken several actions to cope with the drought by expanding our water conservation efforts:
Facilities Management continues to remove turf areas wherever possible and install drought-tolerant plant materials. Examples of this can be found on the east side of the Hall of Letters and the west side of the Administration Building.
In August 2015, the Energy Center transitioned its cooling towers from domestic water to non-potable irrigation water sources. This change in operating practice has already saved 2 million gallons of domestic water. The University expects an annual savings of approximately 10 million gallons.
We continue to maintain limited irrigation schedules. It should be noted that the campus is irrigated by non-potable water and so is not regulated by state or city ordinances. Nonetheless, Facilities Management is maintaining the limited watering schedules of campus landscape and is following City of Redlands recommendations for watering cycles.
We continue to limit our over-seeding of campus turf to only the quad area of the historic Beaux Arts campus and the athletic fields. Typically the campus lawns are re-seeded each fall with rye grass so that lawns are green year round. Over the next few years we will limit over-seeding, in order to reduce watering that is needed for this process and for watering lawns during the winter months.
In 2015, we re-launched the Sustainability Council under the leadership of Hedco Professor and Director of the Center for Environmental Studies, Monty Hempel. This is a cross-campus committee comprised of students, faculty, and staff who will serve as a coordinating body for strengthening campus sustainability initiatives and self-study assessments. The Council has completed a review of its charter; discussed the list of ongoing initiatives; found some consensus in organization, operation, and mission; and proposed some new initiatives. The Council continues to discuss how to foster pathways for students who want to apply what they learn in the classroom to gain experience and serve our community. You can expect to hear more from the Council in the coming months.
If you recall, we set out to have a slightly smaller first-year class than last year by design, in order to moderate the growth of the College. However, we started the academic year even smaller than we had planned. Of course, there are always many variables that contribute to variance from year to year, but fewer admitted students and their families decided on the Redlands option than in recent years. Within days of identifying the financial impact of the enrollment shortfall, my Cabinet met and identified approximately $2.6M in budget reductions for Fiscal year 2015-16 (i.e., reductions in: administrative and staff positions, marketing expenditures, enrollment contingencies, and specific operating budget projects).
The College of Arts & Sciences welcomed 643 new students (that’s 533 freshman and 110 transfers) coming from 38 states and 11 countries. There were increases in out-of-state students to 30%, international students to 2.3%, Pell grant recipients up to 29%, and under-represented minority students. Some new students, born abroad but having lived in the U.S.A., bring an international influence of citizenship representing 28 different countries.
The diversity of the 2015 freshman class is stronger or at least on par on nearly every measure. Average SAT test scores are 30 points higher than the previous year. The high percentages of first-generation and underrepresented minority students remain relatively constant to last year, as does geographic diversity.
The exemplary area where Redlands outperformed expectations was the Hunsaker Scholarship recipients. Typically, the University would matriculate about 15% of accepted students with the academic profile of our Hunsaker Scholarship finalists. Instead, we yielded 66%. We know some turned down Stanford or full rides to Emory and Pomona College to attend Redlands. Recall that we set out to find future leaders and high-impact citizens in service. Therefore, their intellectual and personal profiles were not driven by grades, scores, and statistics. Nevertheless, talents tend to bundle, and these future leaders have a profile as follows:
The School of Business enrolled 931 new students (slightly down from 946 last year) on a target of 915, including 599 graduate students and 332 undergraduates.
The School of Education enrolled 470 total new students, including 286 for teaching credentials; 72 master’s students; 15 doctoral students; and 97 students seeking professional credentialing or a graduate certificate.
And the School of Continuing Studies for 2015-16 is on track to exceed its goal of 913 enrollments (up from 841 last year).
I am happy to report that we are seeing real results from our strategies to strengthen our financial foundation. For our most recent year ending June 2015, the University’s net operating margin was $8.6 million—a positive 6.6% of our revenues—and one of our best years in history. In fact, this was more than double our margin from the prior year, which was preceded by nearly a decade of operating losses. Our original projections and budget for fiscal year 2015 were structured to break even and contribute to resources, but because of our team efforts, we far surpassed those conservative financial goals.
The improvement in our operating results in the past two years has enabled us to fund some key financial needs. Our budget for the coming year includes salary increases greater than the cost of living for our employees, including contingent faculty for the third consecutive year (after no increases for 10 years for the College and School of Education and 5 years for the School of Business). We also increased our 403(b) retirement plan contribution for eligible employees by 1.25%, to 9%. We continue to focus on renewed progress in these and other critical areas.
In addition, increased net operating margin provided the University with an opportunity to improve our financial stability through reserves. Reserves are funds set aside to pay off outstanding debt, preserve our liquidity, address deferred maintenance needs, and be prepared for uncertainties. Compared to just five years ago, when our reserves were less than $350,000, effective financial management has allowed us to grow them to over $22 million as of June 30, 2015. Nevertheless, our current level of reserves still falls far short compared to our peer institutions.
Finally, the increase in net operating margin improves our standing with debt rating agencies and other rankings. One of the key factors that our debt rating agencies consider is positive cash flow. The improvements achieved in the past two years helped us to improve our ratings and outlook, which directly impact our ability to borrow funds as well as reduce the interest that we pay for our debt. Compared to the losses reflected in the eight years prior, the last two years of positive net margin have allowed the University to address budget needs, improve our reserves, and be better positioned for any future borrowing needs. As we acknowledge and share in these positive results, we must also focus still on the many challenges that remain financially.
Just this week, we have once again affirmed our financial health through bond refinancing. The University was able to refinance $30.9 million of existing bond debt. The results were outstanding! We were over-subscribed, with the market demand resulting in $262 million in subscriptions or 8.5 times oversold. Favorable market conditions were certainly a part of the picture, but the positive market response was fundamentally driven by our trend of improved operating margins, cash flow, and financial stability. Investors, some joining with us for the first time, showed a high demand—or, in other words—faith in the financial future of the University. We will pay $3.4 million less in interest. By refinancing the debt, we now have a single, stronger overall Moody’s debt rating for future debt opportunities. These are achievements well worth celebrating, even as we continue our focus on the needs that remain.
The University is a large organization with a complex financial structure, and as we grow, the challenges grow as well. Over the past decade, net revenues consisting primarily of student fees for tuition and room and board have increased 59%, or a little more than $48 million. During the same period, our internally-funded financial aid (really forgone revenue from tuition discounting) has increased 146% or about $36 million—a greater rate of acceleration. Our primary expenditure, personnel, has grown by $22 million or 46%, and non-personnel support costs increased by $21 million or about 73%. Of course, we budget our expenditures to be maintained in line with revenue increases. Our budget as approved by the Board of Trustees for fiscal year 2016 totals $189 million.
As I’ve noted in prior years, the University continues to be heavily dependent on student fees, even as we work to diversify our programs and seek new revenue sources. For fiscal year 2016, less than 5% of our budget is projected to come from non-enrollment based sources. We remain in a position of being extremely dependent upon enrollment levels, and the possibility of lower enrollment in any one school threatens our ability to achieve breakeven results as a University, much less than maintain our positive margin. We must continue to seek out new sources of revenue that do not correlate with tuition. These can be from intellectual property, unrelated business income, outside conferences and programs, the comprehensive campaign, and new philanthropic sources for student financial aid.
One of the less visible but still critical components of our budget is investment return on our endowment funds, and the degree to which those earnings are available for current operations is reflected in the spending rate. Historically our target was established at 5%, but that is unsustainable in current markets, and in fact we exceeded even that target in 5 of the last 20 years. On December 5, 2015, the Board of Trustees approved an endowment spending rate of 4.7% for fiscal year 2016, with further scheduled reductions to eventually reach 4.0%.
However, because the University budget requirements continue to grow and are extremely tuition dependent, a reduction in spending rate relies heavily upon achieving two goals: (1) growth in the endowment itself and (2) optimal investment performance. Generally, a university’s endowment is expected to be at least two to three times the institution’s operating budget. Thus, our operating budget for fiscal year 2015 of $189 million would equate to an endowment of approximately $380 to $570 million. Ours is approximately $154 million. Even as our current campaign focuses on endowment, we know it will take years of significant effort to achieve this target, which remains one of my most critical goals.
Our investment performance reflects the general downturn we have heard in the news since my last report to you. Our 10-year net endowment investment return was 6.0%, only 0.2% below the average from National Association of College and University Business Officers, as based on the most recent NACUBO-Commonfund Study of Endowments from 261 U.S. colleges and universities with assets of $101 million to $500 million. However, total investment return on the University’s investment portfolio for fiscal year 2014-15 was 0.7% as compared to 14.7% for the prior fiscal year. The rate of return was near benchmarks for the portfolio, but the one low year will affect us for years to come. Unfortunately, market instability is expected for the foreseeable future.
To use a finance term, the bottom line is this—although fiscal year 2016 presented budget challenges, fiscal year 2015 was excellent due in large part to growth in enrollment, strategic management, and expenditure controls. Over the past years, we have trimmed millions of dollars in administrative expenditures. As a result, we were able to take steps to address some of our long outstanding needs, strengthen our reserves, and improve our credit standings. However, to improve our stability, balance competing needs, and address our ongoing priorities, we must continue to achieve diversification in our revenue sources, reduce our dependence on program enrollment, while we grow to optimal size in master’s programs and significantly grow our endowment funds. These goals remain a key part of our overall vision.
I am pleased to report that through the generosity of loyal alumni and friends, inspired by their collective work to preserve, enhance, and strengthen our University, we have surpassed $100 million in leadership commitments to our campaign for Redlands during the third year of its “quiet phase.”
You will remember from the last State of the University Address that the campaign began on July 1, 2013, with an initial goal of $203 million over seven years, ending in 2020. The overarching goals remain unchanged—to at least double the size of the endowment while building a more deeply engaged community of donors to faithfully provide annual support for our ongoing operations. To date, $80 million has been designated to endowment, with slightly more than $20 million directed to current use in support of academic and student programs.
Let me share with you a few recent examples of commitments that will advance this campaign toward historic success.
These represent just a few examples of commitments we have received this year in support of our students and the collective work of our faculty. We have a long way to go to hit $200 million. I look forward to working with you and colleagues in University Advancement in the months and years ahead to advance this campaign while engaging an ever-growing set of new philanthropists in the life of our University.
At the 2015 September Board meeting, I provided our Trustees with an overview of my Cabinet’s planning process. The University has engaged in many planning exercises as a campus, Board, and Cabinet since 2006. The Cabinet consensus was that we needed to take a fresh approach to crystallize priorities for the coming years, but we should do so by synthesizing key themes from existing planning and visioning statements the University community has already worked on. And that is what we have been doing for the past several months. We drafted what we are calling the “North Star 2020.” The words North Star imply an overarching guidance that gives a high-level view. It does not delve into the weeds; rather, it sets us on a pathway to build an implementation plan. Our planning efforts are being coordinated by Provost Kathy Ogren. Kathy has been working with the Deans to diligently solicit feedback from faculty and staff as the plan is being composed. Our Board of Trustees endorsed the concept and iterative process at the 2016 Annual Board Retreat. As we continue to meet with various constituencies across campus, we will evolve the implementation plan. This plan will be constantly revisited, always pointing us back to our North Star. The implementation part of the plan will have specific goals tied to budget, the comprehensive campaign, and a timeline. And, it will hold us accountable for what we are actually doing. You will hear more about North Star 2020 in the months ahead.
In my 2014 State of the University Address, I provided an update on the Redlands Rail and the dream of our own University Village surrounding the train station stop on our South Campus. At that time, we were largely still in the vision stage.
Early this year we consulted with representatives of the Redlands Passenger Rail Project team at San Bernardino Associated Governments (SANBAG) and their design-engineer, HDR Inc., to develop a preliminary design concept for University Station. Our station—the terminus of the Redlands Passenger rail project—will have two 300-foot long platforms on the north and south sides of dual tracks, one with a station pavilion. There will be tree-lined walkways and crossings to connect passengers from the station to our upper campus and the future village amenities south of the rail line. We are now working with SANBAG toward the final design and construction of the station via a public-private partnership agreement in which the University will fund “betterments” to a “base” station that SANBAG will develop with Federal, State, and Measure I bond funding. We expect to complete the final design over the next year, see station construction sometime in 2018, and have operational rail service in late 2019 or early in 2020.
The station will become the transit nexus of what is speculatively envisioned as a new University Village. Our next focus will be to design for eventual connectivity northward via a new plaza between the art and theatre buildings. We are working with the City of Redlands on extending Park Avenue eastward for station access and parking. Even conceptual planning for the rest of any Village would depend on action by the City of Redlands to update its General Plan and finalize the parameters of a hypothesized “Transit Oriented Village” overlay district—a zoning ordinance amendment that would govern the land uses, architecture, and density of the kind of development that would be possible within a quarter- to half-mile radius of the station. The City’s timetable is to conclude the General Plan update early in 2017.
Over the next two to three years we will be working with representatives of our campus community to explore your ideas for ensuring that any new village will best serve the University at the same time it has economic impact on the University’s budget realities. We are also working with the City and The Redlands Conservancy in the hopes of converting Sylvan Boulevard into a greenway trail along the Zanja, which we hope will become another unique amenity for our South Campus area.
Beginning in October 2015, we experienced a reinvigorated discussion of inclusiveness and community. Across our nation, campuses and whole communities continue to be roiled by the painful, often injurious outcomes and raw emotional debates spurred by abuses of language, power, or privilege, and outright violations of human rights. We hear in the national news of feces-smeared swastikas on dormitory walls, racial slurs shouted by students at fellow students, and a busload of fraternity brothers singing a despicably racist song. We read about a swelling tide of discrimination, harassment, misconduct, and retaliation taking place in cities, on campuses, and in workplaces. We hear of the latest shooting of an unarmed person of color, or a prison guard’s abuse of a young inmate from another under-represented minority group. One realizes the potential hype or bias of media. But we are pretty clearly not a “post-racial” society. Despite gains in diversity, society has not made equal strides in inclusiveness.
To the national dialogue, add religious tensions, especially with the conflation of the Islamic religion with the politics of racial/religious terrorist extremists. This was brought home by the San Bernardino mass murders on December 2, 2015. Racial equality and inclusiveness, and religious acceptance, built into our Constitution and laws, have butted up against hateful and repugnant speech, challenging our other Constitutional values of freedom of speech and our institutional value of academic freedom. That’s the way it often goes: in the gray zones of our national and campus strife we see the direct confrontation among conflicting values. What do we say, in response?—that we are an educational institution. Therefore, we will confront repugnant speech with better, educated thought and speech.
Inclusiveness and community doesn’t just happen in one area. It happens in our residence halls, Greek organizations, student clubs, classrooms, offices, on our athletic fields, and in our performing arts venues. I have broadened our own debates on these topics and our University’s responses by naming them as “the work of all of us.” I created and recently launched a University-wide Council on Inclusiveness and Community that is being charged with both action and innovation in creating an ever-more inclusive community at the University of Redlands. The Council has adopted the following mindset: that we are in a process of evolving . . . remaining committed to a rich history of excellence by redoubling and sustaining our efforts in important areas and exploring new ways of being in the modern world. This is not a moment, nor a crisis. Rather, it is an opportunity to be ever better. At our first meeting on January 29th, I coached Council members to bring their whole selves and to be proactive leaders. The Council needs active participants, so that it can gain all the benefit of having such an intellectually diverse group who are anxious to weave our differences into a kind of social tapestry, in order to achieve greater gains in inclusive community. One of the Council’s first tasks will be reviewing the responses to demands received by the President’s Cabinet from what was called “Students of Color and Our Allies” as well as another memo from a sub-set of University Faculty. Initial responses, provided by the Cabinet and those closest to the issues, will serve as a starting point for discussions, and the next steps will be the ongoing work of the Council.
Our colleagues on the faculty from Religious Studies, the Chaplain’s Office, and the Office of Campus Diversity and Inclusion, plus others, have put together an entire year’s worth of symposia, workshops, discussion sessions, panels of experts, and visiting speakers on the broad subject of religious tolerance, with such titles as “Let’s Talk About Religion,” “Religious Violence (and Non-Violence),” and “Re-drawing the Map of World Religions.” They are really ahead of the curve on this topic.
I have often said that colleges and universities are not much different in tone and climate than the rest of society. We mirror what ails our society. We may create our own campus micro-cultures, but we, all of us, bring along our own “ill-fitting clothes” with us—those societal issues that plague us all and that we bring with us every day to our campuses. In a way, we are much more than a mirror. That’s because we have a mission of education and because almost all colleges feature in our mission and vision statements the high value placed on mutual acceptance of differences and diversity; we are a mosaic of differences, and that’s what makes us interesting in the first place as a place to learn. Yet universities are not merely mirrors. We are actually prisms that focus societal problems ever more sharply on campus. This is especially so in a residential liberal arts setting, where we are home for students.
The University of Redlands is wholeheartedly committed to providing a positive learning, living, and work environment for everyone. Welcoming intellectually curious students of diverse religious, ethnic, national, and socioeconomic backgrounds, we seek to develop responsible, global citizenship as part of a complete education. The University’s commitment to diversity dates from its founding. Today, Redlands is strengthened by its appreciation of the differences—from learning styles to social class to gender identity—that make each of us unique, and the ability to find commonalities among these differences.
Let me end by talking with you about the future strategic health of the University, with a 10-20 year horizon. Think of it as “What Keeps Me Up At Night.”
First, I worry about our tuition-dependent state. For the College, I worry about the “End of Robin Hood”—our 50-year love affair with high tuition and high financial aid “discounting.” Every year we say it is unsustainable. And it is. What will we be like in 10 to 20 years? Will it be $90,000 tuition and a 75% discount rate? I agree that this is the definition of unsustainable. It means you’re selling something that people no longer want. Instead, I’d rather think about managing our enrollment away from past assumptions. In the next decade, future growth in enrollment will change and come mostly from students older than 25 and from minorities. Let’s manage those trends as leaders and members of the University community. We will always sustain a mission of the residential liberal arts as our “heart and soul.” But let’s be ready for changes.
Second, I worry about the burden and distraction of regulatory compliance. We could keep a compliance officer and the entire Audit Committee of our Board busy full-time on federal compliance. The statutes and guidances governing higher education from the Department of Justice, Department of Education, Department of Labor, and the Office of Civil Rights, if stacked up, would be more than 10 feet high, more than any one person can read or comprehend. And the guidances are often mutually conflicting. We think it can’t get worse. But it just does. I’m not whining to be unregulated. But in higher education, we often find ourselves being asked by both parents and government to do society’s work for it. We have been asked to tackle sexual assault, epidemics, substance abuse, crime, and international terrorism. The truth is there is little passion ever in government to reduce regulation. My faith is that some few convincing voices will do just that.
Third, I worry about commoditization of higher education. The baccalaureate degree is the new high school diploma. And, no place in American higher education has grown and de-differentiated as much as the MBA. Most of the public, virtually all national politicians, and most of the pundits who write Jeremiads about higher education make two fatal errors: they think (1) college is all about preparation for the first job; and (2) higher education is undifferentiated. The two errors are related. College is a commodity, they would have you believe. But the beauty of higher education is that it is variably sectored into community colleges, small liberal arts colleges, masters universities, comprehensive public universities, large research universities, and other designs. One wonders especially if we can brand our differences as a residential college from all the like-sector colleges with which we compete. If you wanted to consider differentiating initiatives that tweak our mission and policy, we might consider together such things as three-year degrees, dual BA-MA degrees, or a locked-in tuition cost for four years.
Finally, I worry whether we will sustain for another hundred years the core value we have about “Teaching the Mind and the Heart.” By that I mean teaching not the disciplinary details in our syllabi, but I mean teaching the importance of character . . . and transcendent beauty. New York Times Columnist David Brooks recently discussed his desire to be more like people he describes as radiating an “inner light” . . . those who are “deeply good,” “listen well,” and “make you feel valued.” Brooks postulates that “people on the road to inner light do not find their vocations by asking, what do I want from life? They ask, what is life asking of me? How can I match my intrinsic talent with one of the world’s deep needs?” We teach character through role modeling by our most masterful professors and student leaders. And we teach it through an emphasis on learning through community service and international study. Can we continue to afford not merely sustaining the focus on character but investing in it?
Believe it or not, one of the ways we also teach inner light, humane values, and being deeply good is through esthetic beauty. Right now, open your mind’s eye, and visualize: neoclassical buildings, cupolas, domes, the iconic Chapel inside and out, the classical California look of sandstone and tile roofs . . . envision the architectural vernacular fragments you might see in a new train station on south campus . . . think mighty oak trees, succulents and desert scape, mixed with orange groves . . . all the beauty that surrounds one on the Redlands campus . . . and you will understand the esthetics of place and the reason we surround ourselves with beauty when we can. And that beauty is further reflected in our people and principles, which has an impact on our broader communities worldwide.