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Special Report Dear Friends—and Prospective Friends—of Centre, The holiday season is upon us – a most special time for members of the Centre family. I write to share with you the substance of a report I delivered in mid-October to Centre’s board of trustees and, a week later, the college’s faculty and staff. I share it with you as an update on Centre in these challenging times. I believe you will find it to be a good read; a report that outlines many of the good things that are happening at the College; another signal that there is much for which we should be thankful. We’re all familiar, I’m sure, with the ancient Chinese curse, “May you live in interesting times.” Whether or not they are a curse, these are certainly interesting times. That said, I judged it wise to offer you a report on how Centre is doing during this unsettling period. What I offer will be informative—some may seem hard-hitting—and, I believe much of what I share will be reassuring. I would begin by reminding you that Centre is preparing to celebrate its 190th year. And, while a 190th anniversary doesn’t have a lot of cachet, it does provide us with a reminder that we are part of an organization that has a long, illustrious history. This College has survived the bad times – the Civil War, two world wars, financial panics in the 19th century, and the great depression in the 20th century. And almost all of us experienced together the terror and trauma of 9/11. This College has prospered during the good times, especially over the past quarter century. Centre has for almost 200 years been able to find its way, draw on its strength during all those periods filled with challenge. And, so it will this time. A Position of Strength Our Board has never been stronger, with a combination of senior trustees and newer trustees who have offered their support of and counsel to Centre in unprecedented ways. The senior administration is seasoned, understands what we need to do in such circumstances. Our faculty and staff continue to work hard, achieving at a high level and doing so with a sense of optimism and possibility. We’ve enjoyed five straight years of record-breaking admission results, with our experience this fall setting a new standard. And, our number of campus visits this fall puts us a full month ahead of where we were last year. Thank goodness we successfully concluded our $170 million campaign last December. And, while we’ve experienced a 20 percent reduction in the value of our endowment, a gift of $16 million from Al and Mary Wood’s estate will arrive in a few days and take our total back in the direction of where it was. The rankings—like Consumers Digest #1 value among all colleges and Forbes #13 overall ranking among all colleges and universities—and the college guides continue to be “kind” and generous with Centre. And while it’s hard to measure how much these sources of information matter, let’s agree that they matter. I call attention to these factors, and might mention others, not to impress or “relieve” anyone’s anxieties or suggest that Centre can altogether avoid this situation—I don’t have that kind of magic—but, rather, to make clear that Centre College is well-positioned to navigate this interesting time.
Graduation in Four Years: Guaranteed This is a Centre advantage that offers multiple benefits. The appeal of avoiding extra years of tuition and living expenses is obvious, but the “head start” that Centre graduates enjoy by moving expeditiously into careers and advanced study is often an even greater benefit. The extra years of earning and experience are frequently key factors in the extraordinary career success for which Centre alumni are known. First, the raw numbers—our preliminary read on the endowment balance as of early fall (without many of the private equity funds reporting) was $180 million. With the October meltdown, we suspect that we are around $165 million as of this report. These numbers do not include the Wood’s estate gift of $16 million. If we compare these numbers to our high water mark of $207 million, we show a drop of approximately 20 percent, better than the drop reflected in the DOW during the same period. In looking at the current year operations, we’re on track to have a balanced budget in part because student enrollment exceeded budgeted expectations. We have already begun the process of holding back on current year expenditures, so as to have maximum flexibility in dealing with the uncertainty that will be facing the campus and its community during the next 12-18 months. We’re taking a very conservative approach to the current year’s budget. And while we will look for common-sense economies, the guiding principle in all our financial decisions will be, as always, to preserve and secure the outstanding quality of our academic program. How does this impact some of the more important work accomplished with our most recent strategic thinking and planning effort? Our current financial status will require us 1) to be all the more strategic with those things we can accomplish on the shorter term and 2) to exercise patience with those plans that will be delayed in their execution. We are not talking about laying aside any of the really good ideas that we discovered and the Board approved in our planning process. This is a time when we might well be able to accelerate the advance of Centre’s reputation and perceived prestige as others less well positioned pull back across the board. • Pearl Hall, as you know, opened this fall. It will be dedicated next fall, and, thanks to an exceptional gift is paid for in full. 2008–2009 First, I have asked my senior staff colleagues to look for ways – large and small – to “tighten our belts.” We began several weeks ago to think along these lines, and we know there are targets of opportunity in 2008-09. Some specifics: we have no plans to cut faculty or staff in the current year, though the process for filling vacancies – one that invites a small group of senior staff members to ask the question each time, “Is this a necessary position to fill now?” – will become more rigorous as it did earlier in this decade. We will ask all programs of the College, except admission, to review and reconsider their travel commitments for the current year. We will ask programs of the College to reconsider the purchase of new equipment until the spring. I have asked our winter and spring athletic teams to eliminate one scheduled trip from their schedules. We will introduce an energy conservation program – in line with our commitment to sustainability. 2009–10 and Beyond A Tradition of Success I teach a class each January to a group of first-year or junior and senior students. We read about and discuss in some detail situations in which leadership is tested. One of the quotes my students like best is, “How does the leader do when it rains? How ’bout when it pours? Great leadership shows itself best when the sky is falling and all others around have taken to their caves.” Friends, we find ourselves in such a time – for many it is raining hard. This is an occasion for leadership from Centre’s Board of Trustees, from Centre’s alumni and friends, from Centre’s senior administration, from Centre’s faculty and staff, from Centre’s students. I’m confident that we will be equal to whatever challenges come our way. I’m confident that the intense, personal education offered by the College will continue to give our students the best possible preparation for extraordinary success in navigating and thriving in the unfolding 21st century. And I’m confident that, even in these times, Centre alumni and friends will continue to support the College with the dedication and commitment that has earned them recognition as “America’s leaders in loyalty.” Sincerely, John Roush |