By STEPHAN KOZUB
In the heat of the ongoing negotiations between faculty and the administration over health care benefits and salaries, the slew of statements that have been issued can be hard to keep track of.
Just earlier this week on April 24, Robert D. Daleo, Gabelli School of Business ’72 and chair of the Fordham University Board of Trustees, issued a statement to the university community explaining the situation. The same day, Andrew H. Clark, chair of the Faculty Senate Committee on Salary & Benefits, issued a counter-statement rebutting several of the claims Daleo and the Board of Trustees made in their statement.
But what’s really going on here?
In order to help members of the Fordham community break down the myriad and seemingly contradictory statistics and information being provided by both sides, we have compiled a point-by-point analysis of major items in the most recent statements, and what they mean for the university. The deadline for the negotiations is April 28.
The vote of no confidence
Daleo’s letter starts with the faculty’s recent vote of no confidence against University President Rev. Joseph M. McShane, S.J. Held in conjunction with a “Sick-In” protest on April 19. Electronic voting was open to 611 faculty members who are either tenured or on the tenure track between 8 a.m. and 5 p.m. 431 out of 488 respondents voted for “no confidence.”
Following the vote, both McShane and the Board of Trustees issued statements to the Fordham community demonstrating their disappointment in the outcome of the vote.
What this vote will mean in the long run, however, is unclear. Back in 2013, the faculty of New York University voted for no confidence in their university president, John Sexton. Similarly to Fordham’s situation, NYU’s Board of Trustees stood behind Sexton. In 2005, however, a vote of no confidence in then-Harvard president Lawrence H. Summers resulted in the “removal or eventual resignation of leaders at some universities,” as reported by The New York Times.
The statutes and the benefits
The current disputes between faculty and the administration over salaries and benefits began in September, when the Faculty Senate filed grievances against the university for violating university statutes in imposing a salary increase.
Back in 2014, however, were other contentious negotiations between faculty and admin over health care benefits. In September of that year, the Faculty Senate unanimously censured and voted in no confidence of John Lordan, senior vice president and chief financial officer, who had been employed by the university for 14 years. Three days later, Lordan resigned.
Prior to his departure, Lordan proposed replacing Cigna, the University’s health care plan, with UnitedHealthCare, without the approval of the Faculty Senate. Additionally, he proposed increasing faculty cost-sharing to 15 percent across the board.
“the University intends to violate its October 2014 agreement on faculty health benefits.”
At the time, Clark said that the negotiations had been “rather disgraceful, in terms of the types of negotiations that have taken place.” He further stipulated that the Faculty Senate’s ad hoc committee had to refer to minutes of past meetings on several occasions because the administration seemed to change its opinion on stipulations from one meeting to the next.
In October 2014, the Faculty Senate came to an agreement with the administration that cost-sharing would still increase to 15 percent across four to seven years and based on yearly salary increases.
Clark mentions these negotiations early on in his recent letter, stating that “the University intends to violate its October 2014 agreement on faculty health benefits and has pushed to have current benefits replaced by a new healthcare plan that would result in significantly increased costs for faculty and staff and would threaten our health, well-being, and finances.”
“Under the plan, faculty and staff would also see lower monthly premiums deducted from their pay.”
Faculty currently pay 12.5 percent of the cost of their insurance plan, according to Daleo’s statement. He adds that the plan the administration is proposing is largely modeled on and incorporates “significant aspects/component parts” from the current plan.
“As a result, it will still offer our staff and faculty excellent coverage, but would increase some co-pays and deductibles,” Daleo states. “Under the plan, faculty and staff would also see lower monthly premiums deducted from their pay.”
The cost of tuition vs. salaries
A major point in both Clark’s and Daleo’s letters is the debate over how closely linked faculty salaries and benefits are with tuition costs.
Daleo states that “the Board of Trustees has already directed Father McShane to contain tuition increases,” and that “significant increases are inconsistent with Fordham’s Jesuit mission, and are unsustainable.” According to Daleo, 92 percent of Fordham’s income is from tuition and student fees, with 63 percent of spending going towards salary and benefits, “with health insurance being by far the most expensive benefit we offer.” He adds that if no action is taken this year, “our best estimate is that the University will see a 66 percent increase in health insurance costs over the next three years.”
Clark said that while “we share the Board’s concern for the fiscal health of the University, we find this fear-mongering to be unhelpful, at best.”
“If they made no changes to their current plans, they estimate that cost would rise by an average of 6.3%.”
Calling into question these statistics, Clark cites publicly available projections from Mercer, the consulting firm the Board of Trustees hires for information on employee costs. “Employers predict that in 2017 their total health benefit cost per employee will rise by 4.1% on average,” the projections read. “If they made no changes to their current plans, they estimate that cost would rise by an average of 6.3%.”
Clark further stipulates that the average cost per faculty member in 2010-2011 was $21,340, and $22,722 in 2016-17, but “when adjusted for inflation, the cost of faculty health insurance has actually dropped.”
When Fordham was evaluated by the Middle States Commission on Higher Education, the group claimed that the university needed to address financial issues.
“We’ve got to solve the financial resource problem if we want to do the things we say we want to do, which quite frankly was not a surprise to anybody,” said Rev. Robert R. Grimes , S.J., Ph.D., dean of Fordham College at Lincoln Center, in April of 2016. “We’re aware of those things.” At the time, Grimes made a similar statement to Daleo, saying that over 90 percent of Fordham’s income comes from tuition and fees.
“Faculty and staff have received a salary increase every year under Father McShane’s tenure, at his insistence.”
If this statistic is correct, that means that the university has possibly become more dependent on that source of income in the past few years. According to Fordham’s 2015 Tax Form 990, the most recent one available, $573,657,196 of the university’s $662,681,679 in annual program service revenue, about 86 percent, came from tuition and fees.
As Clark notes in his letter, however, Fordham’s publicly available tax data also show that “the salaries of the top three administrators at Fordham between 2004 and 2014 have increased by 90% in comparison to a 23.5% increase in the across-the-board salaries of faculty during the same period.” Additionally, “From 2008-15, instructional salaries and benefits decreased as a percentage of the overall salary budget by 2.3%. In that same period, administrative salaries rose 1.5%.”
Daleo states that “Faculty and staff have received a salary increase every year under Father McShane’s tenure, at his insistence.”
Is Fordham buying SAT scores?
One of the points that Clark makes in his statement asserts that Fordham “spent more than $5M to secure enrollment commitments from students with high SATs.” Citing it as a practice employed by some other universities, he states that “the practice of buying SATs scores in an effort to up one’s rankings is one that some members of the faculty question.”
This issue surfaced in April 2016, when a New America study claimed that Fordham employed this practice. At the time, Angela Van Dekker, associate vice president for student financial services, said that the study’s statements about Fordham were “not true.”
“These practices, not the fact of financial aid, or total financial aid allocations, have come under faculty scrutiny as we believe that the pursuit of higher rankings at the expense of the diversity of our student body is one that requires close interrogation,” Clark asserts.
Update 11:10 a.m.: This article has been updated to reflect that the most recent available Fordham Tax Form 990 is from 2015. The original article stated that it was from 2014. The numbers in the article have been updated to reflect the 2015 tax form. The percentage of annual program service revenue that comes from tuition and fees, however, remains at 86 percent.