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Hard times, tough solutions

SAIC experiences staff layoffs and academic restructuring, major fundraising campaign

“It’s been a really tough year” — that’s the current consensus among staff, faculty, and administration. Some students, including former Student Government Officer Lois Song, found this last May when they arrived at classes to find that their professors weren’t there. And when their professors did come, late because they were attending the three town-hall meetings during which the administration addressed the pressing concerns of the faculty and staff regarding the current fiscal crisis, they were sometimes too distracted to properly focus on their instruction. As Song told F News, “They were reacting to the meeting and they were all frustrated.”

guillotineThe highly charged town hall meetings were called to address the school’s solutions to its two-year deficit. The solution at the center of the town hall discussions was the layoff of about 30 staff members from the SAIC community. These layoffs are part of the school’s academic and staff restructuring, which Dean Carol Becker described as the utilization of departmental “conceptual units that make sense academically first and practically second.”

An effort to “mirror the complexity of what [the school] offers and its interdisciplinary nature,” Becker believes that by grouping together departments with shared administrative and academic assistants, it will decrease the current fragmentation of the school and encourage interdisciplinary work. Becker added that the administration has been trying to implement such a program for years, but has met with much resistance. However, she said, in the last couple of years “there was pressure to make the school work better economically. That was a good incentive [for change].”

Dealing with the deficit

The economic situation that created such pressure was the deficit caused by a two-year decrease in the value of the school’s endowment. F News reported last September that the school’s endowment decreased because of the combination of several factors such as the post-September 11 economy, an allegedly fraudulent hedge fund investment, the city of Chicago’s ordinance that all buildings with terra cotta façades be hand-inspected, and real estate depreciation in the Loop. In the summer of 2002, all SAIC departmental budgets were cut 6.5 percent across the board.

In response to the deficit, according to Vice President of Finance Brian Esker, “the school began its long-range planning process with an ad-hoc committee formed by the board [of Governors and Trustees] to pull together a multi-year plan to address the deficit with the objective of reaching a cash flow of break even by fiscal year ’05. That process was just completed and presented to the board in June.”

Vice President of Planning Jonathan Lindsay said that “a group of us initially sat down and came up with a list of areas that we would like to explore and these were both cost-cutting and revenue-enhancement ideas. In each case we then put together a committee that made sense, with people who knew about that particular area, and we then charged that committee with looking for either cost-cutting or revenue-enhancing ideas. They would report back to us with a number of recommendations and we then went ahead with some or all of those.”

Layoffs cause frustration

For example, Lindsay said, a committee was formed to examine the Continuing Studies Department. After looking at “each component [of the department] as a separate business unit to try to identify which elements were, from a financial view, more successful than others,” the committee “ended up with an understanding that some of these programs were very successful financially and others were not.” The decision was made to “drastically downsize program offerings,” which caused the staff to be consolidated, resulting in layoffs.

Faculty and staff alike have expressed frustration that their colleagues in the Continuing Studies department were given only 48 hours notice that they were being let go. When asked what the Continuing Studies layoffs communicated to the school community, Barbara DeGenevieve, who served as the president of the Faculty Senate last year, said, “We now exist in a corporate environment.” She expressed her own opinion that “to watch the way that people were dismissed was really troubling. You work with these people, some of them have been students, some of them teach at some level in the school. It’s hard to see people treated in that way.”

Christine Sneed, who worked in Felice Dublon’s office and served in the staff senate until leaving SAIC last month to teach at De Paul University, said, “The administration is trying very hard to include staff in their decisions now, but initially, with Continuing Studies, people thought there was very little communication.”

Lindsay defended the way that the layoffs were handled, and said, “There has been a lot of question about timeline for these things ... I still believe that making the process shorter rather than longer was the right thing to do. Once you have indicated to a group of individuals that a decision has been made to downsize a department, I’m not sure that either they or the institution are helped by a protracted transferring to move [from] point A to point B.”

However, Assistant Director of Media Centers Craig Downs expressed a desire to become more of a participant in discussions regarding the future of the school, such as those regarding the reduction of the school’s deficit. Noting that “you have to give [the administration] some room for all sorts of unpredictable things that may or may not have happened,” Downs said, “people need to feel a better sense of involvement.”

Downs, who is also an alumnus of the school, laughed, and added, “I don’t think any of us are getting rich working at SAIC. I think most of us believe in it for some reason or another ... I think most staff members feel an intense loyalty to SAIC, so it’s been really weird for the staff to watch the institution go through this.”

Brian Esker acknowledged the collaborative nature of SAIC, and commented, “Whenever change is being considered, we need to bring in as many people into the process as one can to make the right decisions. The culture here is one of inclusivity as opposed to exclusivity. We’re practical; the administration is trying to bring in that input. Obviously it’s difficult to bring in the entire community and there’s always going to be some group that was not included but would have liked to have been included.”

He added that SAIC has a stronger value of inclusivity than other institutions with which he’s worked. However, he said, “If there are communication issues that are out there that result in ineffective communication around change, then I think we have to address those.”

Timelines part of the problem

Film, Video, and New Media Chair Dan Eisenberg, who last year co-chaired the Fiscal Committee of the Staff Senate, which functions as “an information arm of the Senate,” said that “the timeline precludes proper communication.” However, he added, “I think we should adjust our processes to adequately compensate for the culture of the institution so that if people need and want to be involved that we find ways that they can be included that are positive, consensus-building, and that don’t result in blame and paranoia.”

Eisenberg, elaborating on the challenge of fiscal timelines, said, “Over the course of the last few years, because of the difficulty around financial issues, all manner of paranoias and distrust have developed partially out of a very simple problem, which is the fiscal year begins July 1 and the bulk of financial planning for the following year begins in the third quarter, which begins April 1. Faculty and students leave in the second week of May probably when ... the most important financial decisions for the following year are being made.”

Adding that most non-profits, including the museum, are on the July 1 schedule, Eisenberg suggested that the school could begin the planning process earlier to better involve more parties in the decision-making process. Through forward planning, Eisenberg said, “you can get a kind of consensus from a process that begins earlier that you can’t possibly get from a compressed decision-making cycle.”

Dean Carol Becker commented that the Faculty Senate’s fiscal committee “was privy to all the numbers [and] the budget situation at every stage,” but added that “how much people were participating is always a question.”

Becker refused to “feel guilty” about an attitude among some faculty at large that there is a communication gap between them and the administration. Stating that “communication is a two-way street,” Becker said, “The people who participate in institutions tend to know what’s happening much more than [those who], because of their life or their work, choose not to participate.”

SAIC President Tony Jones acknowledged that “it’s not a good time for anybody in the non-profit world.” Regarding faculty retention during periods of change such as this, Jones said, “There’s always movement in the job market. ... Some [faculty] will occasionally be poached away — that’s just the way it is in education. But I would hope that they wouldn’t be leaving for any other reason that there was some wonderful thing that’s happened to them.”

New capital campaign

However, although there has been much pain within the institution, there is some good news. The school has embarked on its first major capital campaign that, as Jones explained, is “a single campaign with two objectives” with “a museum component and ... a school component.” The campaign has already brought the school $18 million in the last three months.

A five-year endeavor, the campaign’s objective “is to grow the school’s endowment so we can offer more financial aid, we can improve facilities, we can do better about everything we do.” The school’s endowment, or capital, is critical because it generates interest that is used to cover the school’s operating budget.

Brian Esker said that while unrestricted contributions from individuals only account for two to three percent of the school’s income, those funds go into the endowment, which, in response to the stock market, generates interest. Discussing the deficit, Esker said, “As a function of our principal going down, then our endowment income then goes down in future years.” In other words, if the endowment goes down, the interest that covers the operating costs of the school goes down, and that’s when budgets have to be scrutinized.

Jones explained, “When you have a capital campaign you list what is crudely called products — what [examples] do you have to [prove] the strength of the school? We have a great history, great faculty, great students, great international program.”

Jones said that individuals, who match funds contributed by the board, make contributions to specific scholarships and departments that complement their own interests. A person interested in design might have a chair named after them in Visual Communications after making a contribution to that department.

Other changes at SAIC

In addition to the capital campaign and the academic restructuring, some other areas of the school will be affected by the school’s cost-cutting plans. The 847 W. Jackson space that houses Gallery 2 is currently up for sale. Jones assured that the BFA and MFA exhibitions will continue this academic year in that space, but said that, “After that, I’m not quite sure.” He added, “The building itself needs an awful lot of capital investment.”

The school may rent out space in the building. Jones said, “We would like to take over yet another floor of the building contiguous to the ones that we [have] so we could do shows there. There is a view among faculty that it would be much better if we could do the BFA show and the MFA show together in one show.”

On the academic side, the minimum enrollment in classes has been increased. In the past, classes were required to have 7 students enrolled or else they would be canceled. Now, classes must have at least 9 students. Barbara DeGenevieve said that not only would this cause students to change the way they register for classes, noting that students shop around and drop classes before making their final decisions, but this will also cause the loss of some part-time faculty. Since there will probably classes that will be cut, DeGenevieve said, “There will be faculty cuts, but that will come in the form of part-time people not being rehired.”

Another visible change students and faculty will encounter this fall is that the school is now outsourcing its security staff through an outside company. The school has laid off about 38 campus security officers and six managers, although Jonathan Lindsay said that security officers were encouraged to reapply for their positions through the outside company. He added, “We have guaranteed that their salaries will remain the same. We believe we’ve found a benefits package for them that will possibly be better for them than what we have here at the Art Institute.”

Lindsay said that outsourcing the security staff will save the school money by eliminating the overtime costs that were incurred when a security staff member called in sick for their night shift and a person working the day shift would have to cover it. He said, “It is the only department that is absolutely necessary to replace someone who is out,” and added that when someone in financial aid calls in sick, his or her duties can be absorbed by another person in the office. But, he said, that cannot be done in security when officers work alone at their individual posts.

One student service that has been eliminated is the SAIC shuttle. A safety service, the shuttle escorted students from one campus building to another at night. According to Vice President and Dean of Student Affairs Felice Dublon, in response to low usage, there will now be foot patrols that students can request after 6 p.m. to accompany them as they move across campus.

Students will find that the amount of institutional-based gift aid they receive from Financial Aid will not be cut. Financial Aid Director Patrick James said, “We have increased the amount of gift aid, so if you were in a particular bracket of need last year you should have seen an increase in your free gift aid. ... There are institutes [which] have not been able to do that. ... Thanks to very smart money management here, I think we’re all reaping the rewards.”

James added that federal financial aid funding has not been cut this year, although he said that it might be a realistic fear next year. However, the state-sponsored MAP grants were reduced last year, but SAIC compensated for those funds.

The only internal source of financial aid that has been affected by the current economy is what is called Appeals of Professional Judgment. James explained that this is made available to “families writing to us with backup documentation claiming how they have been hit very hard by the economy and asking for more money and we have been trying to grant those in fair amounts to those who are eligible.” James said that there is not less money within the school for this, but the number of applicants has increased.

On a practical level, the facilities from which students get certain equipment may change. Craig Downs, who said that because of the restructuring, his department, Instruct-ional Resources and Media Services (IRMS), has a broader function, and that Media Centers may absorb some of the equipment that used to be handled by individual departments. That has already happened with the Film and Video Cages. He said his department is still working to figure out how “to get the resources that the Fiber and Fashion and Viscom people need in their classes.”

He added, “How do you go about circulating solvents and dress forms? Do we put those in the Media Center? Is there some other way to do that that’s better? Do you really need to make people go through a new process when they’re used to getting things in a different process?”

“This fall is going to be nutty. And this school year, until we figure out some of this stuff, it’s going to be difficult for us to provide services on the level that a lot of people are used to. We’re going to try to keep it up there,” said Downs.

However, both Downs and the administration see the institution turning the corner. Jonathan Lindsay, who, like Tony Jones, noted the support of the Board of Governors, which the administration reports to, and said, “I think there needs to be an understanding that this has been difficult for all of us. The flip side is that I really do think that we have turned the corner and that as an institution we will be stronger, and will be more successful in the end, having gone through a difficult exercise. We need to be finished, we need to move on, and we need to say that we’re moving forward.”




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