How financially healthy is Tulane?

fallenchemist
Tue, 28 Apr 2015 18:03:28 +0000

The financial health is generally strong, their bond rating is good. I don’t believe that Tulane gets much directly from the state, although certainly if the state cuts the number of scholarships that go to Louisiana students that could affect Tulane indirectly. And while you are right that Tulane’s endowment is smaller than schools like Duke, WUSTL, Vandy, etc. that are similar to Tulane in size and mission, it is still a large endowment in the overall scheme of universities. But there is no question at all that Tulane needs to increase that endowment and what it earns significantly if it is going to both erase the annual deficit and remain competitive with the above mentioned schools and others. Fitts is supposed to be a good fundraiser and that is a lot of the reason they hired him for sure. We will see if he fulfills that expectation.

Obviously $20 million is a lot of money in absolute terms, but it isn’t that terrible for Tulane. I’m not saying they can continue to run a deficit forever, because of course they cannot. They aren’t the Federal Government who can print money. So I would take President Fitts’ move as a long range precautionary measure, which might mean some short term actions. Of course they will focus, like any place these days, on better efficiencies from better systems. Which honestly Tulane could use in some areas. That alone could mean fewer jobs, although one would hope they could achieve it through attrition rather than layoffs. We will see.

So bottom line I think there is little for undergraduates to worry about. I have a hard time seeing anything happening that will be very noticeable to undergrads. Even Harvard cut back for a couple years after the financial crisis hit in 2008 because their endowment earnings went way down. But again, the changes they made were hardly perceptible to the general student population. I certainly wouldn’t base your choice of where to attend on this issue. I take it as just a healthy assessment of how to proceed over the next 10-20 years by a new president. And like most good leaders, he is laying the groundwork for various eventualities.