Dear Clemson:

I reported to our Board of Trustees last week that Clemson has gotten off to a strong start this fall.  We enrolled record numbers of undergraduate and graduate students, along with a record number of students in the Bridge to Clemson program at Tri-County Tech.

We accepted and enrolled more South Carolina students this fall than ever before, and Clemson is still the overwhelming choice of the best and brightest students in our state.  Of all the Palmetto Fellows who chose public universities, almost half (49%) chose Clemson.  The quality of the freshmen class remained very high.

We also reported external research funding numbers that remained strong at $141 million, down slightly from last year’s record of $151 million.  But we also announced a new $9.3 million NIH grant to establish a Center of Biomedical Research Excellence for Tissue Regeneration, directed by Dr. Naren Vyavahare.  (This is not included in the $141 million figure.)

Clemson’s reputation is clearly growing, as more and more faculty members are being quoted in national and international media outlets like The New York Times, CNN, Scientific American, USA Today, Time and Newsweek.

Our challenge now is to maintain this positive momentum in a new and uncertain era for higher education.  I call it the “new normal,” and it is the topic of discussion nationwide.  

Here is what I told our Trustees: 

At our Town Meeting in June, we released Clemson’s plan for managing a loss of nearly $50 million in state and private funding.  We spent eight months dealing with this funding crisis, and that’s enough. 

We bit the bullet; we eliminated 450 positions; we delayed major construction projects; and we built a budget that anticipated further budget cuts. Because we made hard decisions, Clemson is now moving forward while other institutions are still grappling with furloughs and eliminating course sections.

It’s time to get back to business, but it is not business as usual.  We are adjusting to a “new normal” but what does that mean? 

It goes far beyond platitudes like “doing more with less” and “tightening our belts.”  It means recognizing that there have been permanent structural, cultural changes, and higher education has to adapt to those changes.

When I survey the economic landscape for higher education, here’s what I see: 

• The economy has begun to recover, but job and real income growth will be slow. Most experts predict the economy will not so much re-bound as re-set, at a lower level of activity and growth. 
• State support for public higher education is dropping everywhere, just as it has in South Carolina. In 2000, Clemson’s state appropriation represented 39 percent of the budget. Today, it’s down to about 16 percent, and I do not see that trend changing.
• Tax revenues of all kinds are down in most states.  Many are predicting revenue further shortfalls in 2009-10.  South Carolina’s unemployment rate is among the nation’s worst, so revenues are not expected to recover anytime soon.
• Families have made major, and perhaps permanent, adjustments in their spending, saving and borrowing behavior.  Despite recent market gains, the shock will linger from the loss of value in 401K’s and real estate.  Americans feel less well-off and less economically secure today than they did two years ago.
• There is growing resistance to higher tuition. Students are looking harder at the value of the degree and the debt they incur to get it.  Quality and value will be paramount.  Permanent change is also coming in the student loan business – and it’s uncertain what impact those changes will have on institutions or families.
• There is also growing emphasis on completion, not just retention. At kitchen tables, in Congress and in the White House, a university’s success in graduating students is taking on greater significance.
• With so many delivery options offered by technology, and more first-year students arriving on campus with college credits earned during high school, the basic format of a “4-year college education” is being questioned. Some schools are experimenting with a 3-year bachelor’s degree, or a bachelor’s/master’s in four years. At Clemson, this fall, we saw triple the number of new students who brought enough AP and college course credit to enter as sophomores.
• Private giving will be increasingly important, but for many institutions, there will be a greater focus on generating support for core initiatives rather than launching dazzling billion-dollar campaigns. More capital campaigns will be looking for unrestricted donations that can be deployed for immediate use rather than mega-gifts that sometimes have expensive strings attached.

These are just a few of the economic trends that begin to describe the “new normal.” It’s an environment that higher education is just beginning to grasp.

States were given a financial lifeline in the American Recovery and Reinvestment Act, also known as the federal stimulus package. Alarmingly, some intend to spend more than 90 percent of all stimulus funds in the first year, which only delays many of the hard decisions about permanent budget cuts.

Clemson wisely chose to apply the bulk of these one-time funds strategically and in a manner that provides benefits for several decades to come -- most notably the renovation of Lee Hall, which is a critically important academic facility that qualified for stimulus funding under the federal guidelines.

Because of the steps we took last year, Clemson’s energy is now focused firmly on the future -- not on short-term “making do,” but on long-term institutional health and sustained improvement. 

We know many more hard decisions lie ahead for Clemson and all of higher education. Discussions of faculty workload, possible outsourcing of services, and realignment and restructuring of departments – all remain on the table. This, too, is part of the “new normal.”

In meetings this fall with faculty, staff, students, alumni and donors, I have asked for feedback on what the “new normal” means to them.  What principles should guide decision-making in this new era?  

There are three recurring themes:

One -- Honest communication and transparency in decision-making are more important than ever.  We listened and we’re responding to feedback from surveys last year of faculty, staff, student and alumni opinion.  I have begun meeting regularly with the presidents of faculty and staff senate, and undergraduate and graduate student government. On walkabouts and brown bag lunches in colleges this year, I seek and expect to hear strong opinions about how to improve Clemson.  Next month I will participate in a town hall meeting sponsored by student government to give students a chance to ask or talk about the issues that are important to them. 

Two -- Always remember that we are dealing with people, not FTEs. If you do the simple math, 450 fewer positions means about 10 percent more work for everyone.  Yet, we know the workload is not evenly divided.  The budget cut strategy protected the academic core, the library, the Academic Success Center, and police and fire staffing, while making deeper cuts in administrative and staff support areas. Everyone is adjusting as best they can to these lower staffing levels, but there is understandably a greater sense of anxiety and uncertainty.

Three -- We must stick to the plan.  Even in this “new normal,” we are continuing to implement our strategic plan – the Road Map that the Board approved last fall  – although it is being scaled to fit the current economy. During a budget crisis, it’s tempting to forget about plans for improvement and quality enhancement. But that’s the time when you need a plan the most – to guide decisions about cuts as well as investments.

This year’s budget reflects Clemson’s priorities.  For example:  We added instructors so that we could honor our commitment to students and offer the courses they needed to graduate on time. Budgeted expenditures for Instruction are up by 2.2 percent, and down by 30 percent in Institutional Support. 

Progress is also being made on our capital plan and economic development initiatives. A new academic building opened this fall – Rhodes Annex – and work will begin soon on an Innovation Center at the Advanced Materials Research Center and on a Bioengineering Research Center at the Patewood campus of the Greenville Hospital System.

We are reassessing the current Road Map and making adjustments in light of the “new normal.” While some specific strategies and timelines will need to be adjusted, the long-term vision and goals have not changed. 

******

This message is longer than my normal Dear Clemson letter, but I wanted you to see exactly what we have shared with our Trustees. 

Thank you, as always, for your dedication to Clemson University. Let me know your thoughts on these ideas.

Sincerely,

--Jim Barker