PROVIDENCE – The Rhode Island School of Design said today it plans to lay off staff, trim benefits and shutter its flagship museum for a month to deal with a budget squeeze caused by a shrinking endowment.
RISD’s board of trustees voted earlier this month to keep its annual budget flat, at $124 million, for the next fiscal year, which starts July 1. The school had originally planned to increase the budget by about 8 percent, or $10 million, next year.
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The value of RISD’s endowment has plunged by roughly one-third since December 2007, from $374 million to roughly $250 million now, according to the school.
“Like many other colleges and universities, RISD has been affected by the downturn of the financial markets,” RISD President John Maeda said in a statement. “We have had to make some difficult decisions, but I am fortunate to lead an organization with such clear guiding principles.”
RISD said it is making efforts to reduce the impact of the financial crisis on students and their families, notably by increasing its financial aid budget for next year by $1.2 million and by instituting a smaller tuition increase for the 2009-10 school year.
In 2009-10, tuition, which RISD said is its largest source of revenue, will increase 4.9 percent to $36,371. The increase is less than the 5.5 percent increase that occurred for the current academic year.
RISD said it will lay off between 15 and 20 people, or roughly 3 percent of its 555 full- and part-time staff members. The school said it was able to reduce the total number of layoffs thanks to a voluntary retirement program launched in March and recent attrition.
RISD also will leave vacant two of four full-time faculty positions that had been scheduled to be filled. However, an official hiring freeze has not been put in place; instead, the school said it will be “looking at each position on a case-by-case basis and selectively hiring based on overall strategic and operational needs of the College.”
In another cost-cutting move, the newly-renovated RISD Museum of Art will be closed to the public during August, which the school said “was timed to have the least impact on the public, academic and school programs which are vital to the Museum’s educational mission.” Museum employees’ schedules therefore will be altered.
Wages will be frozen for nonunion employees and members of the faculty and public safety unions, both of which offered the concession, the school said. The school’s other three unions did not agree to a wage freeze, RISD spokeswoman Jaime Marland said.
RISD will reduce by 2 percent its contribution to employees’ 403(b) retirement accounts, in addition to “other modest benefit changes that will affect subsets of the RISD population,” the school said. Employee health insurance, tuition assistance and long-term disability benefits will not be changed.
“We know above all that we must do everything we can to ensure the excellence of our academic programs and to create the best possible experience for our students,” Maeda said. “Our community of creative thinkers and problem solvers have made these decisions with these principles foremost in our minds.”
Additional information on the Rhode Island School of Design is available at RISD.edu.
Correction: An earlier version of this article said all of RISD’s union personnel had accepted a wage freeze for 2009-10. In fact, only two of the school’s five unions agreed to forgo salary increases.
