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Budget forecasting error led to St. Anselm layoffs, college president takes responsibility

Union Leader Correspondent

June 12. 2018 10:42AM

Steven R. DiSalvo (Saint Anselm College)

The president of St. Anselm College said a $1.5 million budget forecasting error and an increase in operational expenses made it necessary to lay off 13 people recently, and he is concerned some donors are now threatening to pull their support.

Dr. Steven R. DiSalvo, in an interview, said he does not believe the college is having financial problems but he admitted that the situation required swift action on the part of the administration.

That action has led to some criticism and unrest among alumni, with more than 1,000 people signing an online petition demanding more transparency and threatening to withhold contributions.

The forecasting error centered around financial aid the college gives to students, which DiSalvo said can be difficult to forecast because they carry through for a student’s four years of school.

“You can’t take it away from a student after you give it to them as a freshman,” he said.

But DiSalvo said the discovery of the error led the college to speed up actions it needed to take anyway.

“We were well aware before we discovered this formula error that we were going to have an expense to revenue problem,” said DiSalvo. “We are still ending the year with a balanced budget. So, we don’t have financial difficulties. Enrollment for next year is strong, the endowment is strong, fundraising is strong: This college is in very good shape.”

Asked who or what was responsible for the error, DiSalvo was quick to take ownership.

“Ultimately, I’m responsible for it,” DiSalvo said “I run the college. There were many people involved in creating this financial model and I would not place blame on any one person. That thing got vetted through several iterations and there was one formula error.”

DiSalvo also said the college had purchased a new cloud-based financial modeling software to prevent a similar error from occurring in the future.

According to minutes from closed-door Faculty Senate meetings, DiSalvo had decided that the focus of addressing expense reductions would be on institutional policies, academic programs, and people, with “personnel changes in administration” being the most important reduction. DiSalvo informed the Union Leader that the 13 eliminated positions were decided by the administration with input from the institution’s vice presidents.

“Each VP is responsible for a particular area of the college. Every VP looked at their division and they looked at cost savings within their area. And that involved policies, programs, and personnel,” said DiSalvo. “Each VP then sat with myself and the CFO to talk about recommendations on how we would achieve the budgeting goal for their division.”

While these decisions were made over the course of several months, the affected employees were only informed on the day they were being laid off. DiSalvo contends that the notice was so short because the administration was working to make as many policy and program cost reductions as it could before eliminating any staff.

“We were doing our best to manage the cost reductions on the non-personnel side. So that takes some time. So, when you look at, whether it’s HR policies, or benefits, or healthcare, to reduce those takes a little bit of time to negotiate these things,” said DiSalvo. “Had we not been successful on those, we could have been talking about a larger number of people. We didn’t want that to happen.”

DiSalvo said he did not believe that giving employees more notice would have been helpful.

“The benefits we provided, I think, were extremely generous, and allowed them the time they need to figure out what’s next,” said DiSalvo. “So, two weeks ahead, three weeks ahead, it doesn’t change the outcome, and I think that the ability of the college to go forward was what was at stake.”

Since the layoffs became public, a group of current St. Anselm students and alumni have started an online petition calling for, among other things, “greater transparency and communication between students and administration.”

“Regardless of any financial issues the college faces, we believe that a different course of action would have been more appropriate,” reads the petition. “Firing members of the community with very little notice is unjust and does not follow the Benedictine values of hospitality, justice, and respect.”

Many petition signers have left comments critical of DiSalvo, with some promising to withhold donations to the college until demands for greater transparency are met.

“This administration is not following the heart of what St. Anselm intended. I am an alumnus and I am appalled,” said Danielle Calabro on the petition. “I won’t be investing any of my donating power into the college until transparency occurs and there is accountability regarding the latest shady and unethical ‘business’ decisions that have been made.”

DiSalvo did not mention plans to change communication practices with students, but did acknowledge that he was concerned about the threats to withhold donations.

“Any time people make comments like that, it’s a concern,” said DiSalvo. “I think people give to an institution because they believe in the institution and they believe in what they see and the growth that the institution (has) undertaken. They may be personally hurt by some of this and it may take time to heal those wounds.”

But Hayley Lyons, a member of St. Anselm’s class of 2019, made clear that she disagreed with DiSalvo. “Although I logically understand that the school had to make cuts due to the anticipated financial challenges, the way that it was done was incredibly disrespectful to those involved,” said Lyons.

“Firing someone and forcing them to leave their office in the same day strips the individual of their dignity and destroys decades-long connections. Additionally, this decision has strained the relationship that St. Anselm College has with its student body.”

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