PEA Budget Strained By Response to Misconduct
The Academy is projected to exceed its budget by 3.5 to 4 million dollars in legal and reformatory expenses this year as it responds to the sexual misconduct cases that have surfaced in recent months.
Last year, the school hired Attorney Holly Barcroft to serve as General Counsel overseeing attorneys and law firms working for the Academy, interim directors of student well-being Tina Sciocchetti and Jane Stapleton and the law firm Holland & Knight to conduct the external investigation into past and current cases of sexual misconduct.
In addition, the school is covering legal settlements and survivor therapy expenses, as well as implementing increased sexual culture education on campus. For example, two Assembly speakers, educators Cindy Pierce and Eric Barthold, visited Exeter in the fall to discuss how to cultivate open conversations about sex and amplify voices from all genders to end sexual violence. The Academy has also hired private investigators and public relations intermediaries.
“Sexual misconduct is a very important issue and I believe that it would be a serious liability to the safety of students if Exeter did not acknowledge it.”
Most of the spending regarding sexual misconduct reception is transitory, but some expenses will be ongoing. Legal dues will decline as the investigations come to a close. However, the General Counsel position currently held by Barcroft will be a permanent role at the Academy, one that the Trustees were considering even before the sexual misconduct reports emerged last year.
The Academy funds these expenses by tapping into reserve accounts established over the years to enable the school to counter unforeseen financial burdens when they arise. These accounts were secured from capital and contingency reserves, operating budget dollars and quasi-endowment funds. By using these compiled reserve funds, the school will not have to reduce staff positions or financial aid offerings.
While this multi-million dollar expenditure will comprise a significant portion of the school’s annual budget of $100 million, President of the Trustees Eunice Panetta believes that the costs are feasible and will not have a negative impact on salaries, headcount or student experience.
In fact, Panetta reckons that the spending will improve current Exonians’ experiences and perhaps ameliorate those of affected alumni.
“We believe the student experience will be a better one as we add staff in counseling and student safety and expand programming on sexual respect and healthy relationships,” she said. “As trustees, we have no higher priority than the wellbeing of our students, and we also feel a profound duty to try to assist any of our alumni who have been harmed in the past.”
However, the school’s sexual misconduct liabilities may affect department spendings for the coming year. Chief Financial Officer David Hanson warned that departments must be cognizant of their investments in the coming year.
“We’re asking everyone to be especially mindful of their spending this year,” Hanson said. “I’ve asked people to be very prudent because we don’t want to add to that projected deficit.”
According to Science Department Chair Alison Hobbie, the science department has been asked to keep its spending “flat” by not appealing for a larger budget than requested in the past. Hanson said that this was not necessarily due to extra spending, but rather to ensure that all departments are managing their budgets well.
Some departments in the school did not have their budgets adjusted due to the endowed funds supporting them, such as the Behr Fund for the Classics Department. These funds are separate and unaltered by the Academy’s financial transactions.
The school’s independent endowments and donations have allowed many activities and agendas to continue without monetary obstacles. Campus amenities like the Class of 1945 Library and athletics facilities will be unaffected by the Academy’s recent financial strain.
“We are very lucky here at the Class of 1945 Library in that our budget is somewhat independent from the Academy’s finances,” said Library Systems Coordinator Melinda Dolan.
Athletics Director Shane LaPointe also expressed her gratitude for the external financial support that will allow Exeter athletics to continue without fiscal burden. “We have enjoyed being sequestered from these matters thanks to the good work of finance,” she remarked.
Lauren O’Neal, Director and Curator of Lamont Gallery, is unsure of the expenses’ impact on the gallery’s budget for the coming year. Despite her uncertainty, she is confident that the gallery will be able to continue developing innovative exhibitions and programs.
“Any time there is the possibility of diminished funding, we become very skilled at prioritizing what is most important,” she said. “We are fortunate to have the tremendous creativity and energy of students and employees.”
Chief of Planning and Facilities Roger Wakeman reported that major construction projects begun over the summer, like the Field house and the theater, will not be impacted by the school’s deficit. On the other hand, some annual projects have been adjourned until final decisions are discussed at the Trustees’ meeting in a couple of weeks.
The most significant project postponed by the Facilities Department is replacing faculty residence Porter House, which was demolished last fall due to structural defects and repair costs. Rather than rebuild it immediately, construction of a new housing has been put off until further analysis of the school’s financial extensibility.
Despite the fiscal strain, students voiced their appreciation of the Academy’s efforts towards a safer sexual atmosphere on campus.
“I’m sure the school is spending very conscientiously because sexual misconduct is something the Academy needs to be aware of,” lower Anna Clark said. “Sexual misconduct is a very important issue and I believe that it would be a serious liability to the safety of students if Exeter did not acknowledge it.”
Senior Gracie Williams, Chair of Policy and Student Involvement for student organization Exonians Against Sexual Assault, agreed with Clark. “This money is being used towards a necessary and quite frankly long overdue effort to make every student feel comfortable on campus,” she said. “The newly implemented programs and the new position of legal consults and directors of student wellbeing are unprecedented and essential to stopping assault culture and mishandling of assault cases.”