Via TitusOneNine:
Presiding bishop will appoint advisory group
By Mary Frances Schjonberg, March 31, 2010
[Episcopal News Service] Facing what some have termed a financial crisis, the board of trustees of the General Theological Seminary has suspended its search for a new dean and president and is looking for ways to cover the expense of the 2010-2011 school year.
Meanwhile, at the request of the trustees, Presiding Bishop Katharine Jefferts Schori will convene a small group of advisors outside of General to address the seminary's financial concerns. The group is meant to provide "fresh eyes and will serve in an advisory capacity," according to the Rev. Dr. Charles Robertson, canon to the presiding bishop.
A roundtable discussion will take place this spring in an effort to "offer additional possibilities for General's board of trustees to consider," Robertson said in a news release due to be posted here.
The members of the group have not yet been chosen and their names will not be released prior to the meeting, he said.
Dean and President Ward Ewing announced in December that he would retire when his successor was hired. The trustees decided March 29 to hire an interim executive director, according to seminary spokesman Bruce Parker. The duties of that position and how it might affect Ewing's plans to retire have not yet been determined, Parker and Ewing said.
The decisions came during a special meeting of the Manhattan-based seminary's board of trustees, six of whom are elected by the Episcopal Church's General Convention.
Earlier in March a consultant for the search process told the trustees' executive committee that the seminary faced a projected shortfall in operating funds, a news release from the seminary said.
General has the money to cover operating expenses for the near future, but will require an influx of revenue to cover the next school year, Parker told ENS March 31. Trustee chair the Rev. Canon Denis O'Pray said during a briefing of General faculty, students, and administrative staff on March 29 that the seminary needs between $2 million and $4 million, according to Parker.
"Immediate steps are being taken to secure these funds," he said.
Ewing told ENS that General's financial situation did not come as a complete surprise to him and the trustees. "We have been aware and even have had a special task group working on the reality that our income for variety of reasons will not presently cover our operating costs and the costs on our loan payments," he said.
The seminary earns income from its annual and capitol fund raising, endowment, tuition, housing, food service and other fees and pre-school payments as well as from the Desmond Tutu Center, recently opened on campus, according to Ewing and Parker.
An outside group was brought in to study the situation, Ewing said, "and what came out of that is this looks more long-term than what we thought."
"We thought that it would be a couple of years; it looks like it could be longer than that," he said. "That's gotten folks anxious."
Ewing cited unexpected delays in opening the Tutu Center as a major factor in the changing forecast. General lost $1 million in anticipated revenue from the center last year because it did not open as predicted, he said. The school expects to make $400,000 from the center this year and expects to net $2.5 million annually within three to four years, according to Ewing.
"The problem is how we get from here to there," he said.
The school is seeking to reduce its loan payments by conversion to lower interest rate bonds, Parker said and "is seeking to develop the financial resources to that serve as a bridge to future revenue streams that will cover all expenses." A conversion plan is due to be launched next week, according Ewing.
The dean said the General community was "very anxious" when he, O'Pray and other trustees met with the members following the March 29 meeting.
"The students are anxious that they will graduate. Obviously staff are anxious about jobs and faculty are anxious about their positions. I think they're a little over-anxious," Ewing said. "The chair tried to assure them that we will be here. We think we see the money. Given all the things I've dealt with here, this not does feel as big a problem as several of the ones we have dealt with. Part of what makes a bigger problem is that nobody knows what the leadership will be and that makes everybody nervous -- and I am not sure, either."
Ewing added, however, that he would never have announced his intent to retire "without thinking that we were fine" and said, "if need be, I will stay here until it's clear that the future is solid."
When Ewing, 67, announced his retirement plans, he cited three recent developments that he said were milestones in the seminary's effort to achieve financial stability.
In August 2009 GTS successfully refinanced all of its debt. In November, it received the necessary approvals from New York City to operate its Desmond Tutu Center as a hotel and to rent guest rooms to the public when they are not being used for seminary conferences.
Ewing noted in December that the school had recently received two major gifts from Polly Keller Winter (widow of Arkansas Bishop Christoph Keller) and their son, the Rev. Canon Christoph Keller III, which, together with a sizable grant from the William Wood Foundation, would enable General to complete a new library and to fund a new professorship in Christian education.
Annual giving and major gifts to GTS have risen markedly during Ewing's tenure, the release said, and he led the development of new program offerings, particularly for lay persons.
In April 2009, Ewing told the seminary community and the rest of the church, according to a news release, that General had refinanced its debt and closed on a $22 million loan with M&T Bank to pay off existing debt, construction cost overruns and provide working capital for the next two years.
"The agreement from M&T Bank to refinance the seminary's loan, including additional working capital, is a strong testimony to the basic financial health of GTS," Ewing wrote.
In July 2008 Ewing told the seminary community that "decisive action" was needed to face the school's "major financial and programmatic challenges," adding that "the immediate future of General Seminary is not imperiled."
Ewing's announcement was set in the context of all Episcopal and other mainline seminaries, which have faced rising costs and stagnant or declining enrollments for the past 30 years, while the cost of all higher education has accelerated..
Ewing said then that General's annual expense budget had held steady at around $8 million per year with annual revenue of just about $5 million for most of the past decade. The difference is made up by withdrawing funds from the seminary's endowment, he said.
Ewing noted that General's largest financial asset is its land and buildings in Manhattan, "but it was also our greatest liability in that we faced a rapidly deteriorating plant with over $100 million in deferred maintenance."
During its recent six-day retreat at Camp Allen in Texas, the House of Bishops discussed the challenges facing theological education, especially "the financial crisis of the General Theological Seminary," house secretary and Diocese of Pittsburgh Bishop Kenneth Price told reporters during a post-meeting news conference March 24.
"The house expressed its concern and particularly asked that a committee that the presiding bishop has appointed to look into theological education continue its work and that it be in touch not only with General Seminary but other seminaries as well," Price said.
Diocese of Kansas Bishop Dean Wolfe, House of Bishops vice president, added during the briefing that "it was noted that in the midst of great crisis there was also great opportunity for creative solutions and re-visioning theological education."
Diocese of Arizona Bishop Kirk Smith, who reported via Twitter and his blog from the closed gathering, said in a March 24 tweet that the bishops passed a "resolution calling for restructuring of seminary system. Most are in serious financial trouble."
Ewing agrees. "Theological education in the Episcopal Church is in the midst of a huge transition and we're not doing very well with that yet," he said March 31. "I really hope that if this is a crisis we don't waste it and that Bishop Katharine is able to pull together a group that will do some creative thinking about seminaries and theological education in the Episcopal Church."
The 11 Episcopal seminaries in the U.S. have very few official ties to the Episcopal Church, beyond General Convention's authority to elect six of GTS trustees.
Meanwhile on March 31, GTS's admissions team reported on its Facebook page that it had spent the morning of March 30 at the Episcopal Church Center, uptown from the school in Manhattan, "mapping out initiatives that reach ten years into GTS's future. Let that sink in."
-- The Rev. Mary Frances Schjonberg is a national correspondent for the Episcopal News Service and Episcopal News Monthly editor.
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