The Richmond Register

Local News

March 5, 2010

Berea College finding ways to balance budget

RICHMOND — Berea College has been forced to find innovative ways to balance its budget during these tough economic times.

For a college that relies on its investments for 80 percent of its income, with 10 percent coming from annual gifts and  the 10 percent from state and federal scholarships, trying to make ends meet during a recession has taken careful maneuvering.

“The economic collapse of the fall of 2008 and the winter of 2009 hit all businesses, colleges and home owners very hard,” said Berea College president Larry Shinn. “In higher education, there wasn’t a school hit as hard as us, because of the way we’re funded.”

Berea College found itself in a position where it needed to reduce its budget from $43 million in 2008-09 to $36.2 million by 2011-12.

A task force was put together to find ways to reduce the budget, while keeping alive the school’s mission of promoting Christian values and providing tuition-free education to students with limited economic resources.

The task force presented three scenarios to the board of trustees, but a fourth scenario, which took aspects from all three scenarios, was accepted last Saturday.

The main focus is to have a flexible and sustainable budget, said Shinn.

Among the new ideas was to begin a retirement incentive plan. Of the roughly 500 faculty and staff members, 107 met the requirements of being over 55 and having worked full-time at the school for 10 years.

Forty-three employees took the early retirement.

Of those 43 positions, 16 will be eliminated and the other 27 will be filled at lower pay.

The college, which currently has 1,530 students, will increase enrollment to 1,600 next year. Many of those students will be transfers who will take upper level courses that already are smaller in size than other classes.

Transfer students bring more opportunities for Pell grants, which will bring more money to the school, said Shinn.

Berea also is looking into increasing enrollment to as high as 1,800 by 2013.

Fewer instructors and more students will increase the faculty-to-student ratio only slightly, Shinn said, from 10 to 1 to 12 to 1.

Berea is changing its calendar to include a 15-week semester each spring and fall, adding an extra week to the current semesters. The typical short-term semester will be moved from January to May.

The calendar change alone maximizes access to federal and state dollars and will save the school $300,000 a year, Shinn said.

Another change includes creating larger academic departments, so that instead of 27 departments with 27 department heads, there will be fewer departments with more faculty per department.

That change will open the door for instructors to teach in multiple departments, Shinn said.

With 70 percent of the school’s budget going to employees, the changes in staff, along with the other moves, has helped the school avoid $2 million in budget cuts, Shinn said.

He said the school already has accounted for about $6 million of the $6.8 million that needed to be reduced and is looking at ways to find the additional $800,000 to $900,000 to cover the 2011-12 school year.

Tim Mandell can be reached at or 623-1669 ext. 6696.


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