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3. President's Annual Address to the Faculty 2018

President's Annual Address to the Faculty 2018

September 18, 2018

Apparent to any campus visitor is the construction, as cranes, steel frames of buildings, front loaders, and laborers in hard hats seem pervasive. Not so apparent, but perhaps even more significant, are the many initiatives underway to enhance education, inquiry, and governance at Notre Dame. The laborers for these initiatives, so central to the life of the University, are primarily you, the faculty.

Among these are:

• The Core Curriculum Review Committee, followed by the Core Curriculum Implementation Committee, who have put in place, beginning this semester, the most extensive revision of the University’s core curriculum in 50 years. For that curriculum, faculty have developed new courses which are being taught now.

• The new core curriculum gives students increased flexibility, allowing them to fulfill its requirements over four years and to begin some more advanced coursework in their intended area of study in their first year. Because such flexibility puts the onus on students to make significant decisions about their course of study, academic advising becomes even more important. The ad hoc Committee on Academic Advising reviewed advising across the University and made recommendations for very significant changes regarding the structure, administration and oversight of undergraduate academic advising.

• The required decennial review of the University’s Academic Articles was led by a faculty committee chaired by Michael Desch and Mark McKenna. It has recommended a number of significant clarifications and improvements. The Academic Council will review and vote on these recommendations, and they will then go to me, as President, and then to the Board of Trustees for final approval.

• An ad hoc Committee on Faculty Governance submitted its report last July. After surveying governance structures, consulting with faculty and discussing opportunities and challenges, they submitted suggestions and proposals for further study and consideration.

• There are many more efforts at the departmental and college level. One example is an effort by the College of Science in conjunction with the College of Engineering to assist very capable undergraduates whose high schools may have offered fewer math and science courses. These students, many of them first-generation students and generally from low-income areas, will be given preparatory work and enhanced mentoring that will enable them to be successful.

We are grateful for the new facilities and improvements in physical space on campus. Yet the efforts to enhance the life and work of the University through initiatives like those listed above are even more critical for the life of this University. The success of these efforts is due to you, the faculty, and I want to begin by thanking you for contributing to them, and for your tireless efforts to teach students, conduct research, and run the departments, colleges, centers, institutes, and other divisions of the University. Thank you for doing the work of Notre Dame in such a dedicated and capable fashion.

In these addresses it is necessary to touch on a number of topics, which are not always so neatly connected thematically. I hope some do not suggest that the title of my address might be, “Ramblings by the President about What is Currently on His Mind.” I will touch on our search for a new executive vice president, some new leaders, our Notre Dame Forum, and the obligation we all have to report wrongdoing. I want to spend the most time on several interrelated topics: 1) public perception of higher education; 2) the cost and value of a Notre Dame education; 3) accessibility to a Notre Dame education by admitted, qualified students; and 4) steps we must take to make the University as efficient and affordable as possible.

The Search for the Next Executive Vice President

As Tom Burish mentioned in his introduction, John Affleck-Graves will step down in June of 2019, after serving for 15 years as executive vice president of the University. It is difficult to exaggerate the importance of John’s contributions to any success the University has enjoyed during his tenure in this role. His extensive portfolio included oversight of the endowment; the University budget; the design, construction, and maintenance of facilities; information technology; human resources; campus safety; food services; auxiliary operations, such as the Morris Inn; and many other areas that provide critical support to Notre Dame’s mission. A superb researcher, an award-winning teacher, a former chair of the Department of Finance, a holder of a named chair, John combined the perspective of a faculty member with his great skill as an administrator. He is a valued colleague and a friend, and I along with many others will miss him.

His are big shoes to fill, but we begin a search to do so. The executive vice president, along with the president and provost, are positions appointed by the University’s Board of Trustees. Jack Brennan, the chairman of our Board, and I agree that it would be most efficient to appoint a search committee of trustees which will make a recommendation to the full Board. Jack has appointed the following trustees to this committee:

• Jack Brennan, chair, Board of Trustees

• James R. Flaherty II, chair, Stewardship Committee

• Stephanie A. Gallo, chair, Compensation Committee

• Rev. John I. Jenkins, C.S.C., president

• John W. Jordan II, chair, Investment Committee

• Richard C. Notebaert, trustee and former Board chair

• James E. Rohr, chair, Governance and Nominating Committee

• Byron O. Spruell, chair, Audit Committee

To ensure that the perspective of the faculty is considered in this important search, I have, after consulting with Tom Burish, the deans, and the Faculty Senate, asked the following faculty to assist the search committee:

• Craig Crossland, Rev. Basil Moreau, C.S.C., Associate Professor of Business, Chair of the Department of Management and Organization

• Michael Pries, associate professor, Department of Economics

• Jennifer Tank, Galla Professor of Biological Sciences, Director, Notre Dame Environmental Change Initiative, Department of Biological Sciences

Our goal will be to conduct the search in coming months and bring to the full Board of Trustees a recommendation early in the new year.

University Leaders: Coming and Going

We begin the academic year with some new faces among senior leadership.

We welcome Sarah A. Mustillo as the I.A. O’Shaughnessy Dean of the College of Arts and Letters. Sarah is a member of our Department of Sociology and had been serving as chair of the department. We are delighted to have her in this new position.

Thomas E. Fuja, professor in and chair of the Department of Electrical Engineering, will serve as interim dean of the College of Engineering. Martijn Cremers, the Bernard J. Hank Professor of Finance, will serve as the interim dean of the Mendoza College of Business. Searches are underway for permanent deans of those two colleges.

John Gohsman is our new vice president for information technology and chief information officer. John joins us from Washington University in St. Louis where he was vice chancellor for information technology and its CIO after 30 years in information technology leadership at the University of Michigan.

With the election of Fr. Bill Lies, C.S.C., as Provincial Superior of the United States Province of the Congregation of Holy Cross, we are very pleased to welcome Fr. Gerry Olinger, C.S.C., to replace Bill as the vice president for mission engagement and church affairs. Gerry comes to us from the University of Portland in Oregon, where he served most recently as vice president for university relations, responsible for the offices of Alumni and Parent Relations, Development, Marketing, Communications, and University Events.

Chuck Loving has stepped down after 18 years of dedicated service as director of the Snite Museum of Art. Ann Knoll is serving as interim director while the search for a permanent director is underway.

The Arts and Notre Dame's Mission

Central to the Catholic tradition is the encounter with spiritual realities through the sensible media of color, form, sound, movement; through the literary arts and dramatic performance; and through the built environment. Artistic expression has been seen in this tradition as a privileged avenue to the transcendent. We were particularly pleased to announce the imminent construction of the Raclin Murphy Museum of Art at Notre Dame, and we are grateful to Ernestine Raclin and Chris and Carmen Murphy for the lead gift that made this possible. The museum will be near the DeBartolo Performing Arts Center, the new Matthew and Joyce Walsh Family Hall of Architectureand the O’Neill Hall of Music to form an arts corridor at the south end of campus. Such facilities would of course be welcome on any campus, but they have for us a deep and close connection with our distinctive Catholic mission.

The theme of the artistic expression and religious tradition will be explored in this year’s Notre Dame Forum, “The Catholic Artistic Heritage: Bringing Forth Treasures New and Old.” Among the keynote events planned for the fall is a dialogue between Pulitzer Prize-winning author Marilynne Robinson and Susannah Monta of our English faculty, which will take place tomorrow. The former Archbishop of Canterbury Rowan Williams will deliver a lecture on November 26 on the works of Shakespeare, entitled Relieved by Prayer: Power, Shame and Redemption in Shakespeare’s Drama. Our sacred music department will also host several events this fall as will other departments, and we are also working on some exciting events for the spring semester. You can learn more at the Notre Dame Forum website: https://forum2018.nd.edu/

Reporting

It saddens me deeply that I cannot speak of the Catholic tradition without also mentioning the report from the Pennsylvania grand jury on clergy sexual abuse and the finding regarding Cardinal Theodore McCarrick. As I said in my statement at the start of our opening Mass, the stories are appalling. Our gaze, however, must be not on these evil acts but on the work of attending to victims, protecting the vulnerable, and healing the Church. These will be the tasks of coming months and years, and the University of Notre Dame will look for ways to assist.

"We together must commit to ensuring that the University of Notre Dame is a place where reports of any ethical or professional misbehavior are taken seriously, reported promptly, investigated professionally, and addressed appropriately."

Unfortunately, it is not only the Catholic Church but respected universities that have had to deal with problematic behavior extending over a long period of time that was not appropriately addressed. Michigan State, USC, Ohio State, the University of Maryland, and other institutions as well have struggled with the consequences of misconduct that went on unchecked and unaddressed for too long.

We together must commit to ensuring that the University of Notre Dame is a place where reports of any ethical or professional misbehavior are taken seriously, reported promptly, investigated professionally, and addressed appropriately. Indeed, the University’s Ethical Conduct Policy requires that every employee of the University—each one of us—report any misconduct that she or he believes has occurred.

There are numerous avenues for making a report:

• The number for the Integrity Line (1-800-688-9918) and more information can be found on the Human Resources website, hr.nd.edu. It is not necessary to leave one’s name, just a description of the behavior or situation in question.

• Mark Kocovski, interim director of Institutional Equity and director of Human Resources Consulting, can be approached on any matter involving discrimination or harassment, including matters involving race or disability.  As the University’s Interim Title IX coordinator, he also receives reports involving discrimination or harassment on the basis of sex.

• The University’s Office of Audit and Advisory Services, headed by Roger Mahoney, our chief audit executive, can be contacted with reports of financial malfeasance.

• Any suspected crime, including crimes against minors, can be reported to Notre Dame Security Police at 631-5555 from a cell phone or 911 from a University landline.

• And every University vice president and dean is also equipped to receive reports of misconduct.

Anyone who tries to retaliate against another person for making a report will be subject to disciplinary action under the University’s Non-Retaliation Policy.

You only need look at the tragic aftermath for individuals and the institutions mentioned above to see why this is important at Notre Dame to report and address misconduct. Yet the most important reason you should report is because it is the right thing to do, and that is what we at Notre Dame should always aspire to.  I ask you to join me in continuing to foster a culture at Notre Dame where doing the right thing—the ethical thing—informs all we do.

Cost, Value, and Accessibility of a Notre Dame Education

While we should be confident about the value of our work at Notre Dame, we must acknowledge the negative public perceptions about higher education. Its reputation—deserved or not—for elitism, political bias, expense, and even irrelevance did real damage to Notre Dame and a select group of other universities last year as tax reform legislation unfolded. For the first time ever, Congress decided to tax the endowments of certain private universities, including Notre Dame. It was a 1.4% excise tax on endowment earnings at universities with $500,000 of endowment per student. That formula captured only 30 universities, among the most distinguished in the United States, but exempted all public universities, including ones like the University of Texas with an endowment of more than twice that of Notre Dame. On the other hand, other well-endowed private universities, like Columbia, were also exempted due to the vagaries of the formula. When Congress first set its sights on private university endowments, it identified 160 universities to tax. By the time the bill passed and various interests had prevailed, Congress had manipulated the formula to bring the number down to 30.

When Congress imposes excise taxes, it generally does so to raise significant revenue, often for specific purposes. The federal gasoline tax, for example, produces about $30 billion annually for highway construction. The endowment tax is expected to generate only $200 million in the first year for no particular purpose, certainly not to address the $1.4 trillion cost of the accompanying reduction in the corporate income tax over the next decade. Proponents of the tax said they wanted universities to spend more endowment dollars on financial aid, but there was no such requirement in the bill. Indeed, it succeeded only in diverting to the federal government money that would have otherwise been available for financial aid. The endowment excise tax is estimated to cost Notre Dame $8 million to $10 million annually.

"We must make it a priority to make attendance affordable for qualified students and relieve the burdens on students and families who are making such great sacrifices to receive a Notre Dame education."

Why was the tax imposed? I agree with those who suggest the tax was politically motivated, as the Republican majority targeted a relatively small group of private institutions, mainly in Democratic states. These institutions were viewed by some as liberal strongholds routinely critical of Republican administrations, and left-leaning on social values.

This move was made politically palatable, I suspect, because of the negative public perceptions about higher education. These concerns were reflected in a series of surveys conducted by Pew Research Center. In July of this year Pew reported the results of a survey that showed 61% of Americans think higher education is moving in the wrong direction. There are, however, interesting differences between those who are or lean Republican and those who are or lean Democrat. Among Republicans, 75% say higher education is heading in the wrong direction, while 52% of Democrats say so. For Republicans, 79% are concerned that liberal political and social views are favored in the classroom, and 73% believe that universities have gone overboard in protecting students from potentially offensive viewpoints. For Democrats, 92% say the cost of education is the biggest problem, and 56% say that students are not acquiring skills needed for the workplace. These are concerns for Republicans as well, with 77% of them saying that cost if a problem and 73% saying acquisition of workplace skills is a problem.

Whatever the actual motivation for the endowment tax, such negative public perceptions about universities made its enactment politically possible. Though we may strongly disagree with the accuracy of these perceptions, we dismiss them at our peril.

We must counter such perceptions both by what we do and by what we say.

We must continue to ensure that a broad range of views are represented on campus. I am proud of the fact that Notre Dame has hosted controversial speakers, left and right. I know of no case where someone has been prevented from speaking at the University, nor of any invitation to speak that has been withdrawn. I hear regularly from some that Notre Dame is too liberal, and from others that it is too conservative. These are indications, I believe, that we maintain a healthy openness in the marketplace of ideas. I hope we can continue to foster this environment at Notre Dame.

Secondly, we must, institutionally and individually, be prepared to make the case for the value of a Notre Dame education. I have spoken before about the dangers of justifying the value of an education solely in terms of the financial return on a financial investment. Such a justification, I believe, encourages us to view the value of education as the financial rewards, separate from the intellectual, moral, and spiritual enrichment that are the central objectives of a Notre Dame education. Nevertheless, for families considering such a steep financial commitment, we must be prepared to explain why such an investment makes sense.

Nearly half of all Notre Dame students receive some financial aid, and so most do not pay the $71,801 that is the full cost of attendance—which is the average cost that includes tuition, room and board, books, travel, and personal expenses. Even for those who do, the investment makes sense.

Graduation rate is relevant here, for it is a particularly bad investment to spend time and money to attend years of college and fail to earn a degree. Notre Dame can boast one of the best graduation rates in the nation, with just under 96% of students receiving their degree in six years. Numerous studies have shown that the enhanced earning power of someone with a college degree far exceeds the costs of that degree. Bachelor’s degree holders are half as likely to be unemployed as peers who only have a high school degree, and they earn over 60% more. Such earning power translates to roughly over a million dollars in increased revenue over the course of one’s career—multiples of even the full cost of attending Notre Dame. A study by the Federal Reserve Bank of New York, in 2014, showed that, over the course of a person’s career, the annual return on a college education was about 15% compared to a 7% historical average for stocks. There were other demonstrable benefits, of course. College graduates tend to be healthier, have greater job satisfaction, and report higher levels of happiness. They also have higher levels of voting and civic engagement.

The returns on the financial investment are clear, and we must be prepared to make this case to families. But that is not enough. We must do all we can to keep the costs for our students and their families down, while maintaining a commitment to excellence in the central work of education and inquiry at the University. We must make it a priority to make attendance affordable for qualified students and relieve the burdens on students and families who are making such great sacrifices to receive a Notre Dame education.

Keeping a Notre Dame Education Accessible

An area of concern for us in remaining financially sound and affordable to our students is the steady growth in the number of people employed by Notre Dame in recent years. Currently, salary and benefits for those employed by the University are the single greatest percentage of University costs, at 60% of total expenses. In the past decade, staff has grown by 30% and faculty by 14%. Such growth is understandable, for we are doing many more things. In the last decade, Notre Dame’s undergraduate enrollment has remained relatively stable, growing by just 2.5%, while post-baccalaureate enrollment has increased 15.5%, resulting in a student body growth of 6.3%. Research expenditures have grown by an extremely impressive 160%, and such increased activity requires, in most cases, many more people to support the work. We have launched the Keough School of Global Affairs, significantly increased our international presence, and worked with the local community to make our region a better place to live for everyone. We have established the IDEA Center, which will help move the discoveries of faculty and students to commercial viability. Our information technology infrastructure has been upgraded so that it can better support the work of an excellent research university. The Office of Student Enrichment has been added to increase support for our low-income and first-generation students, and we are strengthening residence hall life with several new dorms. We have added 27% more new space, and those buildings require support staff to maintain. For these and many other good reasons, the number of those employed at Notre Dame has grown.

"To the extent that these and other efforts to increase efficiency will reduce costs, we will direct savings to endowment for financial aid, to relieve burdens on our students and families, and make a Notre Dame education accessible for all qualified and admitted students."

At the same time, we have seen a significant shift in the University’s sources of revenue. Where tuition once represented 40% of the University’s source of income, it now represents just 33%. Concurrently, revenue produced by the endowment for the operation of the University grew over the last decade to 38% from 27%. This shift brings Notre Dame more in line with other leading research universities, but it raises concerns for the future. If we sustain for the next 10 years the rate of growth in the number of people employed that we saw in the last 10 years, staff will increase by another 36%, and compensation will increase by 85%. Such growth is simply not sustainable. We cannot expect to increase significantly the number of students or the dollars from tuition. Moreover, while we expect good returns from our endowment, and we hope for continued benefaction and for revenue from other sources, we cannot expect total revenue to increase to a proportion that will cover such a sustained rate of growth.

We believe that, in general, the size of our faculty is currently appropriate, though we recognize that the number of faculty in specific departments or academic units may need to change due to a variety of factors. In addition, as funds for endowed chairs are provided through benefaction, we are able to add a faculty position without putting a strain on our budget.

As I mentioned earlier, however, staff numbers have grown at twice the percentage of the increase in faculty. While we understand the pressure to grow staff in various areas, the rate of growth is unsustainable, and we must find ways to control it. In coming weeks we will announce several steps to do so. We do not foresee layoffs. Our focus will be on restraining growth and, when possible, reallocating to the highest and best use of resources. We hope thereby to make the University more efficient and financially sound in the future. To the extent that these and other efforts to increase efficiency will reduce costs, we will direct savings to endowment for financial aid, to relieve burdens on our students and families, and make a Notre Dame education accessible for all qualified and admitted students.

Conclusion

As I have noted in other contexts, universities are among the most enduring institutions human history has known. Ironically, a key contributor to their endurance is their ability to continually evolve in response to changing social contexts, to emerging demands for learning and inquiry, and to opportunities afforded by new technologies.

While remaining faithful to its mission, Notre Dame has evolved dramatically over the course of its history. That evolution continues today in many new facilities, a new school and many new programs, and in the many initiatives to which you, Notre Dame’s faculty, have contributed to make the University better and stronger.

Don Keough was once the chair of our Board of Trustees, and the generosity of Don and his family made the Keough School of Global Affairs possible. Don had many insightful aphorisms, and one he often repeated was, “Success is a journey, not a destination.” So it is for us, and I look forward to continuing this journey with you. Yet it is good to pause on this journey occasionally, look back at how far we have come and be grateful for the progress. I am grateful for the progress and I am deeply grateful for you, companions on that journey. Let me end, then, where I began, by thanking you for your hard work and dedication to building the University of Notre Dame.

God bless you all.