Heckler to Retire: New President Search

[Just Sayin]

It doesn't sound like that would be the case, as we've been operating off a $30m loss each year for a few years.  I assume that the endowment drive was to counter the expected $40 to $45m loss.  Does anyone have any information tied to the early 2000s, and if we operated with similar numbers?

If you think the cost of higher education is high, just wait until it's free.

[crusadermoe]

Devastating finances.   The legacy of the Presidency is not a good one whether or not the industry as a whole as struggled.  Very tough decisions lie ahead.   And you can't un-borrow money. 

The VU audit could not hide the huge loans we discovered on this board. The Scroggins comments merely confirm for the public what I and others have written about this administration taking $100m in construction loans which gambled on enrolling 6,000 students.  The prudent judgment and financial management of the 2008 version of the board of directors is now a fond memory.  Alan Harre is probably quite disappointed that his careful leadership legacy has been squandered.   Yes, money was cheap after the crash.  But it is still borrowing money against a prediction.

[valpotx]

You can't say that, unless we have an idea tied to how much of a loss VU has traditionally operated.

[vu72]

Devastating finances.   The legacy of the Presidency is not a good one whether or not the industry as a whole as struggled.  Very tough decisions lie ahead.   And you can't un-borrow money. 

The VU audit could not hide the huge loans we discovered on this board. The Scroggins comments merely confirm for the public what I and others have written about this administration taking $100m in construction loans which gambled on enrolling 6,000 students.  The prudent judgment and financial management of the 2008 version of the board of directors is now a fond memory.  Alan Harre is probably quite disappointed that his careful leadership legacy has been squandered.   Yes, money was cheap after the crash.  But it is still borrowing money against a prediction.

This is just more BS.  Please tell us about all those buildings which were built based on 6000 students.

[FieldGoodie05]

Devastating finances.   The legacy of the Presidency is not a good one whether or not the industry as a whole as struggled.  Very tough decisions lie ahead.   And you can't un-borrow money. 

The VU audit could not hide the huge loans we discovered on this board. The Scroggins comments merely confirm for the public what I and others have written about this administration taking $100m in construction loans which gambled on enrolling 6,000 students.  The prudent judgment and financial management of the 2008 version of the board of directors is now a fond memory.  Alan Harre is probably quite disappointed that his careful leadership legacy has been squandered.   Yes, money was cheap after the crash.  But it is still borrowing money against a prediction.

This is just more BS.  Please tell us about all those buildings which were built based on 6000 students.

I'd have to agree with vu72, I just don't see it in practice.  Sure, the future plan probably calls for some of the 6,000 student growth.  But what concrete construction was erected (and loans taken) that currently over serves our head count on campus?  I am only asking because I don't stay as up-to-date on the campus life as some of you.

From reading posts on this forum it would appear that most construction thus far has been on necessities and not more.  If I had to venture an uneducated guess, the administration probably planned what construction has gone up to have "additions" or future land use in proximity to allow for easy growth.  Sort of like a bump out for an extra bedroom, etc etc.  That hardly warrants such strong and angry words from some posters.

[mj]

This is just more BS.  Please tell us about all those buildings which were built based on 6000 students.

Wasn't the master plan to increase enrollment to 6,000? I remember Heckler talking about that goal.

[crusader05]

The strategic plan was to increase to 6,000 which was designed almost 10 years ago. That coordinated with a new Campus Master Plan design which identified potential buildings such as several new dorms as well as just overall the plans to relocate or renovate current buildings.

However, New dorms that did not already replace old ones weren't built and most of the new housing available was leased through Uptown East. (that Lease was just terminated due to both a significant financial cost and frustration with continued mismanagement by the people who owned the buildings).

The initial cost to build the two new dorms (beacon and sorority housing) was through a bond but the cost of living in those residences pays off that portion. Those same bonds were also utilized to build the new Science Center and Arts and Sciences building as well as some other updates such as to Neil's. That also coincided with closing down or tearing down older buildings that were falling apart and maintenance costs were just too money sinks.

Honestly for me, enrollment and retention is more where financial issues arise vs Debt. The university is sitting on so much land that it could sell off or lease out to pay down debt if needed. It's a function of how large of an enrollment do we need to maintain the programs and things we currently have with the ability to do needed upgrades when possible.

[valpo95]

Here's n article from The Torch on the financial state of the University as presented to the Counsel by Susan Scroggins.  It doesn't scream out "MORE FUNDING FOR BASKETBALL".  More likely it screams..."HELP".

http://www.valpotorch.com/news/article_fd78a548-5460-11ea-9974-ef3972147944.html

The article mentioned that more info about Valparaiso's finances could be found by googling "EMMA bond disclosure." I found the site, yet it had nothing about VU that I could see so if someone else has better information, that would be great.

However, I did come across this downgrade of VU's debt from Moody's (from A3 to Baa1; outlook negative) from January 21, 2020.

https://www.moodys.com/research/Moodys-downgrades-Valparaiso-University-INs-rating-to-Baa1-outlook-negative--PR_906277080#

The report notes a, "significant deterioration of operating performance coupled with a spend down of liquidity." It also references an 11% operating deficit for fiscal 2019. It remains to be seen, yet I'm guessing fiscal 2020 will be worse. This is offset by strong gift revenue and other flexibility.

[crusadermoe]

MJ, thanks for pointing out the strategic plan.    Many of you have short memories.   

There was a a masterplan brochure in 2013. It very clearly says that the 6,000 student goal will require us to build this masterplan.  I don't recall the specific language of whether it said "require" or something different.  The link to it has been posted on this board by several different people.  I don't know how all of you can keep denying that linkage.

And ouch, that bond statement is even more concerning. 

Do your homework on published documents before you call BS.

[vu72]

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So you are pointing at the right document.  Yes, the master plan called for getting to 6000 students.  The master plan also called for many new buildings as a result.  The students aren't here and neither are the new buildings.  Again, you said the 100M was spent in anticipation of the 6,000 students and that is just false.  My BS comment related to you saying that building were built without need.  And I again, say which ones?

[vu84v2]

If memory serves me correctly, the Master Plan had a new basketball stadium/fieldhouse being built behind where Porter Memorial used to be. This is one of the many buildings that have not been built from the Master Plan, which is not uncommon for universities. As far as I know, VU72 is correct.

Regarding the Moody's downgrade: this is a legitimate concern, but some of the concern should be tempered by the likelihood that a majority of universities were likely downgraded due to the number of graduating high school students declining over the next 3-10 years and government policies that restrict or dissuade international students.

[78crusader]

Moody's downgraded VU's bond rating, as has been noted previously.  After listing the reasons for this action, Moody's had this to say about VU:

"Despite these challenges, Valparaiso University's Baa1 remains supported by its very good total wealth and recognizable brand bolstering a still very good strategic position.  Philanthropic support is strong with three-year gift revenue averaging over $17 million.  Despite a use of liquid reserves, spendable cash and investments continue to provide very good coverage of debt at nearly 1.0x. An operating base of over $114 million does provide some expense flexibility and potential for operating performance improvement through expense reductions.  Additional credit factors include strong investment returns compared with peers, a sound age of plant, and a high reliance on net tuition revenue to fund operations."

These might be challenging times for VU (and just about every other college in our peer group) but there are some positive factors that haven't been acknowledged very often on this Board recently so I thought I would do so with this post.

Paul

[crusader05]

I agree with Paul.

I'm reserving judgement until I see enrollment numbers for next year and what it looks like when the Law School is no longer on the books.

[valpo95]

Perhaps it was reported elsewhere, yet as of last week, the chair of the Presidential search committee had this update:

As you are aware, three presidential candidates visited campus last month, and the Search Committee subsequently received substantial feedback from the campus community. The Board of Directors met today, received the report of the Presidential Search Committee, and determined that the search will be continuing.

I will continue to provide updates as the search progresses.

https://www.valpo.edu/presidentialsearch/updates/march-17-2020-presidential-search-continues/

[vu84v2]

Perhaps it was reported elsewhere, yet as of last week, the chair of the Presidential search committee had this update:

As you are aware, three presidential candidates visited campus last month, and the Search Committee subsequently received substantial feedback from the campus community. The Board of Directors met today, received the report of the Presidential Search Committee, and determined that the search will be continuing.

I will continue to provide updates as the search progresses.

https://www.valpo.edu/presidentialsearch/updates/march-17-2020-presidential-search-continues/

So, if I am reading this right, it says that none of the three finalists were acceptable. Interesting. I wonder if Mark Heckler is willing to stay well into the 2020-2021 academic year.

[NotBryceDrew]

How interesting. I feel that it cannot be that common to have three finalists and decide not to move forward with any.

[FWalum]

Not really sure how I feel about the "substantial feedback from the campus community" appearing to be such a major factor. I am not sure that the campus community really knows what the university needs in a president and I am not sure that I want a president that feels he needs complete approval from that community.

[78crusader]

I agree with FWalum.  The Board carefully chooses three well qualified candidates, only to be overridden by members of the "campus community," none of whom know more than the Board about what it takes to be an effective president, and most of whom would find fault with just about any candidate. 

One possibility that has not been raised is that one or more of the candidates may have withdrawn their name from consideration.  I hope that is not the case; that would be a troubling sign.

Paul

[valpo84]

There is a search committee that selects the candidates for interviews, then the Community, including the Board and others provide feedback from interviews to determine who will move on, if any.  It appears the first three did not make it through.  This can happen.  The next President needs to understand how to run a business in a rapidly changing marketplace and turn around the finances.  As FW indicates, the whole Valpo community may not be the best judges of who best can do that.  This next President needs to be a "strategic change agent," and it will require tough choices and someone who isn't an appeaser but able to live with them notwithstanding what the whole "community" thinks. 

[sfnmman]

I can't help but to think that continuing to look may ultimately be the best for Valpo.  Obviously the search team felt so.  All those who have input into the decision (selection committee, head hunters, board of directors, faculty, administration, students and staff) will have a better understanding of the possible candidates that are available, their strengths as well as their weaknesses.  I would expect that their expectations of the candidates will be sharpened and become more realistic.  The perfect candidate that meets everyone's expectations is probably not out there, let alone willing to apply.  So it will be a matter of finding the strongest candidate that currently can meet the most critical job requirements or can quickly adapt to them.  Maybe the current virus crisis has focused the job requirements in a slightly different direction than was originally spelled out.  Don't know this for certain but just speculating.  Nevertheless, I can't see that looking more is a negative situation, it just means the selection committee needs to do more work to find the most ideal candidate currently available.

[vu84v2]

A good move may be to move to a closed search. This is not because of concerns and issues with feedback from the community, but instead is due to the quality of candidates that you get with a closed search versus an open search. While I am all for open communication and involvement, the reality is that you are far more likely to get strong candidates in a closed search because you do not release the names of any candidates until the hiring announcement is made. People who apply are not at risk of their current employer knowing they are looking to leave unless they actually leave.

[vu72]

A good move may be to move to a closed search. This is not because of concerns and issues with feedback from the community, but instead is due to the quality of candidates that you get with a closed search versus an open search. While I am all for open communication and involvement, the reality is that you are far more likely to get strong candidates in a closed search because you do not release the names of any candidates until the hiring announcement is made. People who apply are not at risk of their current employer knowing they are looking to leave unless they actually leave.

I certainly am no expert in the academic recruiting process, but it seems to me that people in this world are always available for the right opportunity and it is probably a well accepted fact with no concern about repercussions.  As an example, our Provost, Mark Biermann, has been a candidate for the Chancellor position at the University of Wisconsin-Stout.  It was announced in November and I am not sure if the process has been completed or not.  It could be that he is looking because the new President may want his own person in this spot or because it was an opportunity too attractive to pass up.

[usc4valpo]

I think you must be diligent to get the right person for the job. If candidates remove themselves from the job, that is a good thing because they were not the right candidate. Also, if some blowhard students make statement and they do not take the heat, then they need to get out of the kitchen. The Valparaiso student body is overall tame compared to most.

Also, perhaps a phone call to Cheryl Schroeder would be good. She did a superb job at Missouri S&T and cleaned up a mess at Wright State.

[vu84v2]

Actually, it is Cheryl Schrader not Cheryl Schroeder (those of us who went to school with her realize that confusion on this is more than just a typo). And I wholeheartedly agree that she should be contacted (if she has not been already).

I agree with the comments about needing to be able to handle 'the hear'. My comments on going to a closed search were more related to increasing the quality of the candidate pool.

[94Alum]

"Cheryl Schrader not Cheryl Schroeder (those of us who went to school with her realize that confusion on this is more than just a typo)"

What does that mean?