The State of Baylor

Editor's note: The following interview has been abridged due to space limitations and is reprinted with permission of the Waco Tribune-Herald. To read the interview in its entirety, visit www.wacotrib.com.

Amid mounting concerns over finances, ideology and undercover drug stings on campus, Baylor University President Robert B. Sloan Jr. sat down recently for an interview with the Waco Tribune-Herald. ... Conducting the interview were Tribune-Herald publisher Dan Savage, editor Carlos Sanchez, opinion page editor John Young, senior editor Rowland Nethaway and staff writers Brian Gaar, Jason Embry and Cindy V. Culp.
Waco Tribune-Herald: Dr. Sloan, we have heard concerns from some alumni that Baylor University is under fire from within -- both from the Board of Regents and from the faculty -- that some have expressed reservations about Baylor's 10-year Vision and the general direction of the University. There are also questions over the alumni association and its future role. ... Some of that has been resolved recently, but how important is it that the University as a whole buy into the 2012 Vision? 
President Robert B. Sloan Jr.: Well, certainly there are people who have expressed concerns about various aspects of the 10-year Vision. To me, that's not surprising, whether it's faculty or alumni. But I can tell you that I travel around a lot and I'm with Baylor groups all across the nation. ... I find very strong support for the 10-year plan for the University ... I think Baylor has always worked to improve itself -- sometimes in dramatic ways, sometimes in incremental ways. I think if you look at the history of the University, you can see a great track record of improvement whether it's facilities ... or faculty or research -- whatever it may be. 
I would say that Baylor 2012 is an attempt. It's pretty ambitious and I admit to that. I had town-hall meetings with faculty. ... Five available to faculty, five available to staff. I had between seven to 10 with students. We had them with alumni, with regents of the University, and these were back in the years 2000-01. Drafts of the Vision were made available electronically for months. We received a lot of feedback. So I'm very proud of it as a broad-based document. We asked, in a sense, one question: What do you want Baylor to look like in the year 2012? ... So it doesn't surprise me that there are people, as time goes on, who start worrying about implementation of it, various steps here and there. 
Tribune-Herald: Have there been any changes since it's been enacted to bring these people in and satisfy their concerns? Have there been any alterations to the Vision at all? 
Dr. Sloan: ... Having a collegial environment is important in an academic organization, as it is in any organization. And a very legitimate question is what about faculty members who came here under criteria where teaching was the primary emphasis, not research? ... We developed a system for what we called A and B faculty. Those hired before a certain date -- say, 1990 or 1991 -- were A faculty. They had more of a teaching set of criteria, though they had the opportunity to join the other group. And then those who were hired after a certain date, whatever it was, are what we called B faculty. They were expected to have a research agenda. All promotions, all raises, all evaluations are equally available to both groups. But each would be evaluated by its own criteria. That was an attempt to say, "We've got to be fair to people."
Tribune-Herald: ... [I]s there at least the perception now that Baylor is too pricey for middle-income students? Could that be considered tacit disapproval of the current direction for Baylor? 
Dr. Sloan: ... The reality is we are more accessible today for middle-class families than we were before. The numbers, the facts, are very clear. ... People think if you raise the price of tuition, it means only the wealthy can go there. But we have also significantly increased the amount of money for scholarships. We've made Baylor more accessible to various people of a greater variety of family incomes. Both our mean and median family incomes for Baylor students have gone down since we instituted this change. ... [T]he facts are that you compare Baylor's tuition as a private institution with private institution costs around the country, and it's a pretty obvious story. Tier-one institutions, tuition and fees ... are about $25,000 per year; tier-two institutions are not quite $21,000. For Baylor, tuition and fees are (a little more than) $17,000. Now, again, we are just a great value. 
Tribune-Herald: Some faculty say they are fearful of speaking out against the University's current direction because of the possibility of retribution. Is that a fair characterization of the way that you're running the University? 
Dr. Sloan: Absolutely not. ... Just this last semester, we had a University-wide symposium discussing the nature, mission and character of Baylor and Baylor 2012, and you had a rich disagreement among faculty members on this or that issue. We encourage that sort of thing. Again, you'll always have individuals who will complain about their specific situation, but I can tell you that ... our compensation for faculty and staff dramatically improved in recent years and that's part of the larger trend. ... There's always a trend to improve faculty and staff compensation. ...
Tribune-Herald: We recently learned about changes in the tuition remission policy at Baylor involving faculty and staff. Is the policy change a cost-cutting measure? And, going along with that, along with the delay in staff pay raises, does this speak to any kind of shortage of available cash? 
Dr. Sloan: Let me start in a broader sense. ... Going back to March 2000, the stock market has, until very recently, fallen on bad times. Sure, there's a tough economy. We have engaged in very strategic cost-cutting measures all across the University. ... We have to be sure we are spending our money well and appropriately. So, yes, we watch our pennies, but Baylor University will once again, for the 30th year in a row, our budget will be in the black. It's going to be in the black this year and it's going to be in the black next year. ...
As for the macro-picture: All across the nation, universities are experiencing cutbacks, they are losing personnel ... . We are not doing that. We are going to have a modest increase in our overall budget, a modest increase in personnel, faculty and staff. We did decide to delay the announcement of raises for staff by one month (this fall) ... . We want to see what our class size looks like. Most universities in America, except for Harvard and a few like that who have very enormous endowments -- are all very much dependent on our student enrollment numbers ... . Right now our student recruiting looks very good. We have a record number of applications, we have a record number of acceptances. We are a little behind in our desposits ... but they continue to come in ... .
As for tuition remission, we have ... one of the most generous programs of tuition remission in the nation for private institutions, so, yes, it is a cost-cutting measure. ... It's just gotten to be a large budget item. But it is very important to realize that we have grandfathered every faculty and staff member we have so everyone here was not cut the benefit. But for the future, we will phase (the benefit) in. ... After one year, you get 20 percent, at two years you get 40, so it's a phase-in. Instead of getting it immediately after one year, the tuition benefit is fully available after five years. But, again, that's only for those recruited for the future. We grandfathered everybody else. 
Tribune-Herald: Does this development speak to a larger pattern of money being tight on campus right now? 
Dr. Sloan: Again, all across the nation, people are watching their budgets, from individual families to organizations to newspapers to universities. So, yeah, we're watching our pennies, but we actually have a growth budget in place. ... Donations are very strong. In fact, we are several million dollars ahead at this point in the year in donations compared to this point last year. The last I heard, we are about $4 million ahead of last year's pace. Again, we've slowed our growth a little bit but we (still) have a growth budget. We haven't cut any personnel. 
Tribune-Herald: One report we've heard suggests that while the budget has been increased, that goes primarily to capital improvements, not salary increases. Is that a fair statement? 
Dr. Sloan: No. Our budget over the years has had dramatic increases in faculty and staff. If you look at the Big 12 ... our compensation packages have improved on a comparative basis with other institutions. We have a lot of building going on. ... We are very fortunate to have entered into the building programs when we did because we have borrowed the money at historically low rates. We have those monies set aside for these building projects. ... We spend 4.7 percent of our operating budget on debt service. That is, by every Wall Street financial investment banker standard, a very, very low number. ... We have sister institutions around the state that spend a much higher percentage on debt retirement out of their operating budgets. 
Tribune-Herald: In their letter to staff concerning the monthlong delay of pay raises, Baylor officials stated the endowment, investment earnings and student enrollment were all down over the past couple of years. Can you give us specifics? 
Dr. Sloan: Well, the endowment, of course, is tied to the stock market. I don't have the exact numbers with me, but obviously our endowment is down somewhat. That's leveled out to a certain extent ... Last fall, our freshman student numbers were down by ... a couple of hundred students off ... of our projections. So those are all factors. Of course, low interest rates are a two-edged sword. (In borrowing) we locked in very low interest rates, which is a tremendous blessing for us. Some of those have at times gone below 1 percent, so that obviously was a very opportune time for us to do that. ...
Tribune-Herald: Just to confirm again, how much is the University in debt and what is the payout schedule? Is it the next 10 years? 
Dr. Sloan: The bonds were 30-year bonds. The best way to describe the payout is: We pay 4.7 percent of our operating budget on an annual basis for debt service. It's a very, very tiny percentage. In fact, that's even less than we projected in the 10-year Vision. ...
Tribune-Herald: And what is the total dollar amount of the bonds that have been issued? 
Dr. Sloan: About $247 million. About $40 million or $50 million of that was refinancing debt ... to lower the interest rate because we had the opportunity to do that. But I think about $190 million is actually going for the various projects.
Tribune-Herald: Knowing all that -- the favorable interest rates, the low amount of debt service and those sorts of things -- why do you think it is that so many alumni have expressed concerns that the University has money troubles or is too deep in debt? ...
Dr. Sloan: I can't account for the perceptions of others. The facts speak for themselves. I don't know. People, I assume, just worry. ... We've got 125,000 living alumni and if you hear from a dozen, that's not exactly an overwhelming number. ... [W]e just get as much information out as we can and help people know what the facts are. ... We have a balanced budget. We have a growth budget for next year in spite of (the fact that) all across the nation institutions are cutting their budgets, they are having dramatic increases in their tuition, they are cutting personnel. That's not happening at Baylor. We are very fortunate. 
Tribune-Herald: Another concern some alumni have expressed involves Baylor University's way of doing things. ... How public should a private university's dealings be? How do you try to communicate those to the Baylor family? 
Dr. Sloan: Well, regarding meetings, we do not operate in secret. ... We file reports according to all the appropriate accounting standards. We've even adopted some measures that are not yet applicable to private facilities and not-for-profits, because we think they might well be. ... We meet every standard of openness and disclosure that universities like ours have to meet. 
Tribune-Herald: But do you think you do a good job of communicating all that business to alumni? 
Dr. Sloan: I think we are doing a better job. You can always improve in that area. I think we have more publications available. Probably every issue we've talked about today has been tackled in the University's Baylor Magazine. And I think the Baylor Line (the independent Baylor Alumni Association magazine) has taken on some of these issues as well. Electronically, the Baylor Web site is many times more sophisticated. It's more information-packed today than it was ... .
Tribune-Herald: ... How important will fall enrollment be to the financial future of Baylor? In the University's letter regarding staff pay, it stated that if the enrollment targets weren't reached, Baylor would re-evaluate cost-reduction possibilities. I'm curious what that target is for Baylor this fall and what reduction possibilities will be investigated if that target isn't reached. 
Dr. Sloan: Our entering freshman number as far as our model goes is 2,775. If you're a lot under that, then that is when you have to go back and do some serious evaluation. But fortunately, we have the ability to go back and look at our budget just like we did last year. We looked at our budget and made sure we had ways that met our budget needs. ...
Tribune-Herald: In a similar vein, how do you explain the drop in freshman enrollment? 
Dr. Sloan: ... I do not think it was for economic reasons. Typically, higher education is a counter-economic trend. People either tend to stay in school longer or go back to school. Both (Baylor economist) Tom Kelly and (nationally known economist) Ray Perryman were heard to say that in a public forum on economics ... . So why did we fall short (in freshman enrollment)? Well, I think we just didn't implement our student-recruiting plan as efficiently as we should have. We just missed it. 
Tribune-Herald: ... It used to be that the University was always debating whether to set a cap. Too many students was the concern. 
Dr. Sloan: There's another factor you have to weigh in. That's the SAT numbers. We have plenty of applications. It's a question of how much you are willing to drop the SAT or academic standards to meet your economic or financial goal. We have increased our SAT (score requirements for admission) pretty dramatically over the last six years or so, probably by about 40 points. ... Last year we could have let our SAT score requirements drop three or four points and increased our student numbers, and we didn't do that. 
Tribune-Herald: What do you see as the difference philosophically, or from a theological perspective, between the Baylor as spelled out in Baylor 2012 and top evangelical schools like Calvin College or Wheaton College? 
Dr. Sloan: Well, I think there's a pretty large difference. I mean, we are intentional about our faith identity, there's no question about that. ... Other schools require the signing of a creed. Other schools require participation in a certain denominational tradition. I believe Calvin does that. ... Our vision is that we are, yes, a Christian university in the Baptist tradition that is open to all and so we have a very wide-open standard in terms of student inclusivity. 
Tribune-Herald: What about with faculty? In job interviews, you have had discussions with faculty about their faith, their church involvement, that sort of thing. Isn't that getting close to what you mentioned in terms of having to sign a creed there? 
Dr. Sloan: No, it's not close at all. ... We have a faith tradition that we are serious about, but we have a wide range of participation among our faculty members within their faith traditions. We obviously don't have many Jewish faculty -- one or two, I think. But across the Christian spectrum, you have an enormous range of theological and confessional stripes, and I think that's the way it should be. 
Tribune-Herald: How do you think the way Baylor sees its Baptist identity is different under your administration these last several years than it's been in the past? 
Dr. Sloan: I don't know how to compare it with the past. ... I think that going back that Baptists are more diverse now and Baptist bodies are much more diverse. Baylor used to identify itself as a Southern Baptist institution. That was actually never correct ... people said, "Well, Southern Baptists and Texas Baptists are one and the same." Well, they're not anymore. So I think you can see a clear shift over the years. Baptists have changed tremendously, and I think Baylor mirrors that and reflects it. Then again, I think Baylor also mirrors the fact there is much less denominational identity on the part of families, particularly the younger generation today. ...
Tribune-Herald: You were saying how Baylor used to be described as a Southern Baptist university. Do you think it's accurate or would you want it described now as a Texas Baptist University? 
Dr. Sloan: We are affiliated with the Baptist General Convention of Texas, and I think that's important and appropriate to say. ... The way I like to put it is that we are a Christian institution in the Baptist tradition, and there the word "Baptist" includes the Baptist General Convention of Texas. But it also includes a broader range of Baptists. For example, our regents are all Baptists, but they don't all have to be Texas Baptists to be on our Board of Regents. 
Tribune-Herald: Just to follow that up, is it correct to characterize Baylor as an evangelical university? 
Dr. Sloan: I don't think that is correct. I think we have many evangelicals who are here but, of course, the word "evangelical" is historically a term that comes as a counterpoint, out of the Reformation ... to Catholic. After Baptists, the second largest student groups are Methodists and Catholics. ... I'll never forget the moving comment of a Catholic woman from Mexico who had sent her children here, and how much she appreciated a place like Baylor where there is, on the one hand, a blended inclusivity and yet a commitment to moral standards ... . (She appreciated the fact) that we cared about the students and we care about the moral life.