May 24, 2008
Good morning, friends. Thank you for coming to our gathering this morning and for the philanthropic spirit that brings you here. In a few minutes we will have the presentation of Class Gifts from our graduating seniors, from the class of 1983, and from our 50th reunion class, the Class of 1958. It will be an extraordinary outpouring of generosity that looks backward in thanksgiving for a St. Olaf education received and looks forward to promise to make that same education available to generations of future students. In making and in celebrating these gifts, we take our place in a continuum stretching back to our college’s founding in 1874 and stretching forward forever. We affirm our commitment to the values of our college, and we provide for its future.
I would like to take a few moments today to report and to reflect on the state of the college that will be supported by the gifts we are going to receive, and I’d like to begin with the vision for St. Olaf that guides us today. We are a very fine liberal arts college — one of the leading liberal arts colleges in America. We draw students from all over America and the world, we are selective in our admissions, and the students who study here go on to lead extraordinary lives of worth and service. Two of our students were selected as Rhodes Scholars this year, something that no other liberal arts college in America could boast. Our students win Fulbright awards at an extraordinary rate. We send more students on to receive Ph.D.s in math and statistics than any other liberal arts college in America. We rank second among liberal arts colleges as the undergraduate antecedent of Ph.D.s in religion and theological studies and fourth among liberal arts colleges as the undergraduate antecedent of students who go on to earn Ph.D.s in the physical sciences, medical science, foreign languages, arts and music. I could go on, but you see my point.
Now, there are 50-60 other liberal arts colleges in America whose president could stand up this morning and make claims similar to the ones I have just articulated, from Bowdoin in Maine to Pomona in California, from Carleton in Northfield to Davidson in North Carolina, from Oberlin in Ohio to Reed in Oregon. But I can count on the fingers on one hand, with fingers to spare, the numbers of colleges whose president can utter the sentence I am about to speak: not only have we secured our place among the best liberal arts colleges in America, but we also have a living, meaningful connection with our faith tradition that influences who comes to study here, who comes to teach and work here, and — most importantly — gives shape and meaning to the campus conversation every day. That, simply, is the vision for St. Olaf: to be pre-eminent in America as the college that offers both an extraordinary academic experience and extraordinary resources, borne out of a living faith tradition, that assists students in their spiritual development and gives direction to their faith journey.
This vision requires us to bring to campus students with ambition, passion and a hunger for spiritual growth. We have just enrolled the Class of 2012, and here is the result: from an applicant pool of 4,000 students, we offered admission to 2,200 — or about 57 percent of applicants. Of those who were offered admission, 845 — or 35 percent — accepted our offer and have enrolled for the fall. For the first time in the history of the college, fewer than half, or 48 percent, of these students are from Minnesota. The rest come from 45 other states. States where we saw an increase in enrollees include California, Washington, Missouri, New York, Oregon and Ohio. Twenty-eight percent of the class is legacy students, meaning that they are the son, daughter, grandson or granddaughter of an Ole, or the brother or sister of a current student. Fifty-five percent are female and 45 percent male. One-third chose to identify themselves as Lutheran on their applications. One hundred and one of them are multicultural students from America and 23 are degree-seeking international students. (We have many more international students at St. Olaf, but the rest are here on exchange programs or are studying for a period of time shorter than four years.) Fourteen percent represent the first generation of their family to go to college.
The academic profile of this class exceeds that of any class ever to enroll at the college — except yours! The average reported grade point of the class is 3.76, and fully 22 percent of them earned a 4.0 in high school.
Our intention is to continue to advance a national recruitment strategy. The number of college-age students will begin to decline in the upper Midwest next year, while it will explode in California, Texas and Florida. A recruitment strategy that would have us hunkering down and competing with less selective, less expensive, regional institutions would be foolish. Instead, we will seek to enroll students from across America who seek the kind of education St. Olaf offers. We will always be a Minnesota college, but I think it’s likely that the Minnesota number will hover in the 40 percents in coming years, while the number of students from outside Minnesota and its contiguous states will rise. The reasons for a national, rather than a regional, recruitment strategy are educational, as well as prudential. There is educational value in diversity of all kinds. You shouldn’t go to college with the same kids you went to high school with, nor with students with the same experiences as yours. Certainly, we will continue to recruit legacy students, students who want a residential learning environment, students who resonate with our history and identity, and above all students who hunger for the support we provide for spiritual questors.
Whenever I recite statistics like these to an audience of alumni, I can see the wheels turning in their heads: “What do these numbers mean for the college I knew? Do they represent change, and — if so — change of what kind?” Well, I can tell you that when I was offered admission to St. Olaf in the spring of 1970 more than 70 percent of those who applied were admitted, versus 57 percent for this class. The vast majority of us who matriculated that fall were from Minnesota and the contiguous states versus 64 percent for this class. I don’t remember what my SAT score was, but our vice president and dean of enrollment looked it up, and he assures me that if I were to apply today with that score I would be wise to have a safety school in mind. These are surely changes but not the kind that change the institution. On the contrary, the Class of 2012 is comprised of highly accomplished young persons, many of whom are connected to St. Olaf by their Lutheran faith or their legacy status, and all of whom have purposefully chosen to come to this college not only to receive a fine undergraduate education but also to receive it at a college where the ultimate questions are always on the table and where the resources are in place to support them in their spiritual quest.
The academic program of the college is robust. We continue to have general education requirements, and they constitute roughly one-third of a student’s degree program, with the other two-thirds devoted to the major and to electives. We require students to take a Bible course, a theology course and an ethics course, with the preference for an ethics course in their major area. We require students to study a foreign language, and we require them to select courses from the major areas of study: humanities, sciences, social sciences and the arts. The faculty of the college have written learning goals for all of our courses, we use a variety of techniques to measure how well we are doing at helping students to achieve those goals and we institute program changes in response to that assessment. As for the students who will graduate tomorrow, there are 707 of them. The Class grade point average is 3.32. Fifty-seven percent of them will graduate with honors. Seventy-six percent of them participated in at least one off-campus study program while at St. Olaf. The top 10 majors are, in this order, Biology, English, Mathematics, Economics, Music, Psychology, Art, Political Science, Chemistry and History.
Faculty recruitment will demand special attention in the next decade. Sixty-four percent of our current permanent faculty members are over the age of 50, and 43 percent are over the age of 55. Colleges are barred from having mandatory retirement ages, but it’s clear that we will be doing a lot of faculty hiring in the next few years, and we will need to be very thoughtful and intentional as we do that to ensure that the values embodied by the faculty giants whom you remember from your St. Olaf days are also embodied in this next generation of faculty. Fortunately, we are very successful at faculty recruitment. We are able to generate large pools of applicants from top graduate schools for faculty positions, and we never have to even consider trading off disciplinary expertise against commitment to the liberal arts and to St. Olaf’s mission.
We have great students, and we offer the academic program they deserve. We also house those students and that program in excellent facilities. Over the last decade the college has invested more than $100 million in facilities, including Buntrock Common, the Tostrud Center, the renovated the Center for Art and Dance, the renovated Boe Chapel and — now — Regents Hall of Natural and Mathematical Sciences. We will occupy that building in August, and it will be ready for classes in the fall. The building was named Regents Hall at the request of the faculty committee that oversaw its design in acknowledgment of the extraordinary generosity of the members of St. Olaf’s Board of Regents, who collectively contributed two-thirds of the $33 million raised in addition to the $30 million that we borrowed to fund that project. When the new science building opens, we will begin renovation of Old Music, which will house the mathematics department. That work will be completed within a year, after which we will renovate the current science building. It will house academic departments and administrative offices, including admissions and the president’s and deans’ offices. The current administration wing off the back of the Center for Art and Dance will most likely be reconfigured to address space needs in the arts. The Board of Regents has taken far-sighted provisions in our financial planning to establish a fund that will enable us regularly to renovate and renew the wonderful facilities that we have. Looking ahead, I want to be especially attentive to our residence halls. We are, and advertise ourselves as, an “intensely residential” college, and there is no doubt in my mind that an essential part of the St. Olaf experience is the opportunity to learn in community with other students and to learn to build community by living in residence halls. Therefore it is mission-critical for us to provide sufficient residence hall space, high-quality residence halls and sufficient housing options for our students. At present, we have more students than beds at St. Olaf, which is a misalignment we need to correct and is a principal reason why we plan to reduce the size of the student body from 3,000 to 2,800 over the next 10 years. Many of the residence halls we have are of an age and type that will require renovation and renewal, and we need to be sure to address those needs in a timely way. The houses we own along St. Olaf Avenue provide excellent opportunities for students to experience independent living within the college’s residence hall system, and we need to be attentive to their care, too.
How do we pay for all of this, and what’s the plan going forward? The fundamental challenge of private colleges like St. Olaf is that we offer an experience that everybody wants but for which few are both able and willing to pay the true cost. Our operating budget this year is $100 million, but the amount that we collect from the comprehensive fee, once we subtract the cost of our financial aid program, is only $70 million. The average student at St. Olaf , because of the financial aid we offer, only pays 66 percent of our published comprehensive fee. That’s an average, so obviously there are some students paying far less than that while others pay the entire cost, but fundamentally students and their families pay 70 percent of the cost of delivering a St. Olaf education. Each year the college has to find the revenue to fund the other 30 percent of our budget. This is the fundamental challenge facing St. Olaf College, and it has been since the day we opened our doors in 1874. We know who we are, we have a storied past, we have charted a clear path for the future, our values are intact, many students are eager for what we offer, we have a rich academic program, a dedicated faculty and staff, fine facilities — but we do not generate the revenue from our operations that enables us to pay for them.
St. Olaf has not been shy about increasing its price in recent years to address this challenge, but you are doubtless aware of the national dialogue about the cost of higher education in America and the serious issues related to equity and access that are raised by that cost. I think it is likely that we are approaching a time when we will not be able to push price much further to help us with our revenue needs. Obviously, another way to come at this problem is to control costs, and we are always on the lookout for ways to do that. Our new wind turbine that generates about one-third of the electricity we need to run the college saves us $250,000 per year. We have created a small telephone company that meets our own telephone and data needs, and we sell telephone and data service to other entities in Northfield, including the hospital and our friends at Carleton. We have merged some of our business operations with Carleton, and we are in discussion about how to extend those savings. But pushing price and cutting costs will never alone be sufficient to cover the gap between what it costs us to be St. Olaf and what students and their families pay for that experience.
That is where philanthropy comes in. The best way to close the gap between revenue and cost is to build an endowment that generates sufficient revenue each year to close that gap. Our endowment is valued at $331 million today. The investment committee of our Board of Regents has done awesome work. Our endowment has performed over the last 10 years in the top 5 percent of all endowments in the nation of our size. This past year the endowment contributed $10 million dollars to the college’s operating budget to help close that $30 million gap that I described earlier. Without it, we would be forced to drastically reduce the richness of our offerings or to drastically reduce the financial aid that makes St. Olaf possible for our neediest families. We are blessed to have that resource, but the plain truth of the matter is that there are almost no colleges of our quality in America who operate with such a small endowment relative to their number of students.
Put another way, St. Olaf College spent, in round numbers, $30 million on financial aid last year, and that number is roughly equivalent to the gap between what we collected in tuition and fees and the cost of the operating budget. For the endowment to close that gap entirely, it would need to be roughly triple in size or — again in round numbers — $1 billion dollars. Now, we are not going to reach that number this year or next. But the No. 1 thing St. Olaf can do to preserve its quality and to ensure its longevity is to build its endowment, and we will do that while I am president.
Another significant source of support for the budget is Partners in Annual Giving, our annual fund program. Unlike gifts to the endowment, which the college invests and then spends a portion of the interest earnings, gifts to Partners are given in a particular year to be spent in that year. The goal for this year is $3.7 million, and I’m pleased to say that we are within $100,000 of attaining it. That’s a good thing, by the way, since we have only eight days before the end of the fiscal year. But again, to be brutally frank, a college like St. Olaf, with 33,000 living alumni who express appreciation for their St. Olaf education and a passion for the college, ought to be able to generate more than $3.7 million in its annual fund. So growing that fund is another thing that we are going to do while I am president.
Now, I don’t want you to think that I am lecturing you about giving. Your presence here this morning testifies to your philanthropic spirit, and the Class Gifts that we are about to receive speak for themselves. You are exemplary Oles. I encourage you to share with other Oles the analysis I have just shared with you about price, revenue and cost. This is the conversation that the St. Olaf family needs to have.
I have been describing for you the state of the college, talking about our students, our academic program, our facilities and our resources. But you know from your own experience at St. Olaf that to truly grasp the state of the college, you need to experience its people. You would need to see Professor Todd Nichol, who holds the King Olav V Chair, and his student band playing accordions lustily, if not well, at the first annual Nordic Bash this spring, a talent show and celebration of community at the college. Or you would need to be at the summer science symposium, when students who spent 10 weeks at St. Olaf in the summer doing mentored research with a professor presented the results of that research in a poster session. Or you would have had to hear the chapel talks given by an absolutely marvelous group of seniors in the closing weeks of the semester. These talks are archived, by the way, on the St. Olaf website, and you can download and listen to them when you get home. I recommend it. Or you would need to be at any of the concerts given by one of our musical organizations where the excellence of the performance is exceeded only by the worshipful purpose of the music making. Or you need simply to talk with any student at the college about the rigor of their studies, the quality of their friendships or their affection for this place. Or you would need to be here, today, at Sammenkomst, this gathering where each of us affirms our commitment to this college and to each other.
I thank you for your attention, and I look forward to the rest of our program.
David R. Anderson ’74