Brandeis University, under a great deal of criticism for its announced decision to sell many of the works in its Rose Museum has announced it will halt retirement payments beginning in July. It is a sad day when an institutions decides to shutter a museum, but this decision really highlights the grim financial reality facing the University.
From Tamar Lewin’s piece in today’s NYT (via the Art Law Blog):
While universities across the country have taken a wide range of actions to confront their financial problems, including layoffs and the suspension of capital projects, freezing contributions to retirement accounts is rare. Financially troubled corporations have been taking such action, but faculty and staff members at colleges and universities have traditionally enjoyed stable, and generous, benefits — and expect no less.
“There is this perception that the nonprofit world is maybe a gentler, kinder world than corporate,” said Roland King, vice president for public affairs at the National Association of Independent Colleges and Universities. “So some people seem to perceive this as a breach of faith, especially since many people go into nonprofit work at less salary, because the benefits are so good. But we are absolutely at a point in this economy where these sort of things have to be on the table.”
Suspending Brandeis’s contribution to retirement plans from July 1, 2009, through June 30, 2010, will cover $7.4 million of its projected $8.9 million deficit, the university’s president, Jehuda Reinharz, said in an e-mail message to the faculty and staff. In the message, Mr. Reinharz said he had planned to share the news of the suspension at the end of the week, but was pre-empted when it was announced in the May 19 edition of the student newspaper, The Justice.
