April 5, 2012
Re: Face-off on “STOP” campaign
To the Editor:
I’m writing to respond to the article by Jeremy Adelman in the March 29 Spectator. Several of the figures on which he based his argument are inaccurate. The Hamilton budget for the current year, inclusive of financial aid, is $142,894,000, or $78,860 per student. The total College budget without financial aid, i.e., the actual cash expenses, is $114,746,000, or $63,325 per student. The figures used in the STOP presentation were the amount without financial aid and the actual cash spending per student. Thus the $10,000 “subsidy” for every student is accurate.
Mr. Adelman also questions allocating debt service expenditures to current students. The debt carried by the College paid for the construction and renovation of academic and residential facilities that benefit today’s students. The College takes on long-term debt (generally through 30-year tax-exempt bonds) to spread the burden across many generations of Hamilton students so that the cost for each generation is fair.
The endowment at Hamilton has indeed grown substantially, and I agree with Mr. Adelman that we should thank the person on campus and our alumni volunteers who manage this vital College asset. Typical of most colleges, we use about 5% of the endowment value each year to support current students. That support has grown from $9,715,000 in 1998/99 (the year Mr. Adelman uses as a starting point in the article) to $28,928,000 in the current year. Market appreciation allows us to use the funds from the endowment (about 5%) for current operations and still have the endowment grow by at least inflation (about 3%). This approach allows us to achieve our goal of “intergenerational equity,” the concept of supporting today’s students and tomorrow’s students equally while preserving the purchasing power of the endowment in perpetuity.
The presentation on STOP day used historical and projected data to make several important points. First, the quality of Hamilton’s educational program would diminish without legacy support (i.e., contributions to the Annual Fund and gifts to the endowment). We would have fewer faculty members, facilities and programs. Second, all students, even those who don’t receive a formal financial aid package, essentially receive scholarships through support provided by the Annual Fund and the endowment. Finally, Hamilton depends on the generosity of our alumni, and we will be even more dependent on them in the future. We have deep gratitude for their overwhelming support, and we are committed to preserving a strong institution for future generations of students. Today’s students are the thread that connects past and future generations.
My door is open to any student who wishes to learn about the Hamilton budget. I am always happy to answer questions and hear new ideas.
–Karen Leach
Vice President, Administration and Finance