Gary Hall and Bonnie Anderson report sharp financial losses for Cambridge school
November 14, 2016
Dear Episcopal Divinity School community members:
From October 27 to 29, the EDS board of trustees met on campus in Cambridge. This was the first opportunity for the full board to meet face-to-face with Interim President Bill Nelsen, who joined EDS in September. He extended a gracious welcome to us on campus and at the deanery, and participated fully in our meetings. We are grateful for President Nelsen’s warm and steady leadership during this year of transition.
Our meeting began with worship. We joined students, faculty and staff for a meditative mid-day Eucharist celebrated by the Rev. Amy McCreath, director of contextual education, in St. John’s Memorial Chapel. Guest musician Ana Hernández led us in song and chant. We were grateful for the prayerful commencement of our time together.
During our public session on Thursday afternoon, we elected officers and new board members. The re-election of current officers (President Gary Hall ’76, Vice President Bonnie Anderson honorary degree ’06, Secretary Anne Howard ’85 and Treasurer Dennis Stark) was unanimous, as was the approval of new board members Karen Coleman ’03, DMin ’10, and the new Alumni Executive Council representative, Bishop John Rabb ’76. We also voted unanimously to extend for one year the term of trustee Warren Radtke ETS ’64, who has served EDS faithfully as a trustee since 2006 and has graciously agreed to continue with us through this year of change.
We look forward to welcoming Karen and John at our February meeting and expressing our particular thanks for their willingness to join the board during this season of transition. John replaces Bishop Carol Gallagher, who resigned in September, and Karen replaces Bishop Doug Fisher of Western Massachusetts, who resigned in July due to time constraints. Bishop Fisher remains a strong advocate for the transition now underway at EDS, and we are grateful for his continuing wisdom and his support both within his diocese and among his fellow bishops.
At our meeting, we also accepted the 2016 audit report which contained the sobering news that EDS’s net assets decreased by $7.9 million (11%) in the last fiscal year. This follows a decrease of nearly $6.5 million (8.5%) in 2015. As the fiduciary stewards of EDS’s assets and mission, we are obviously dismayed at the size of EDS’s losses, but the news has redoubled our commitment to finding a more sustainable and prudent future for the seminary by the end of fiscal year 2017.
As we said in July, the timing of the board’s decision to pursue a new direction for EDS was based in part on having adequate resources for student, faculty, and staff transitions. In September, we approved a generous severance plan that will cost approximately $2.5 million if all benefits are claimed. At our meeting in Cambridge, we also committed to adapting the plan as appropriate to meet the needs of individual employees.
Student transitions are a high priority, and at this meeting, we heard a report from Academic Dean Angela Bauer-Levesque about arrangements for “teaching out” the approximately 23 EDS students who will not have completed their degrees by next May. Based on that report, we have asked President Nelsen to develop memoranda of understanding with the Bexley Seabury Seminary Federation, which is housed at Chicago Theological Seminary, to complete the degrees of distributive learning students and with Boston University School of Theology to do the same for residential students. These arrangements will ensure that students receive full credit for coursework completed and incur no additional costs. A number of the students included in the teach-out are international students, and EDS has retained an immigration lawyer to ensure that their visas are maintained in the transition. Just seven of the teach-out students are Episcopalians in an ordination process; they come from three dioceses. We have asked President Nelsen to be particularly attentive to ensuring that these students receive the education and formation necessary to prepare them for the General Ordination Exams and ordained ministry in our church.
Both the New Directions Committee and the Transitions Committee of the board, whose creation we announced in our August 9 letter, met during our time in Cambridge. In addition to overseeing the terms of the teach-out and adjustments to the severance plan, the Transitions Committee reviewed the restrictions on the endowment and heard from EDS’s legal counsel, Jeffrey Swope, about the process for making adjustments that may be necessary under Massachusetts law as EDS prepares for its future. The committee also began making arrangements to protect and preserve EDS’s student and donor records, the library, artwork, technology, and other physical property.
During its meeting, the New Directions Committee reviewed proposals for EDS’s future from nine potential partners, and unanimously narrowed the list to three finalists based on their ability to carry on the seminary’s historic mission, continue accredited degree-granting theological education, and provide financial strength and stability for EDS’s future. Between now and our February meeting, several board members will join Anthony Ruger, an expert in seminary sustainability who is serving as consultant to the process, on site visits to each potential partner. We hope the process will be complete by February, making it possible for the board to decide at our next meeting which partnership to pursue for the most faithful and sustainable future for EDS.
We are pleased that EDS has attractive options for its future, and are eager to begin the next phase of the transition. We have heard from many EDS alums and friends who are enthusiastic about the future and relieved that a sustainable path for EDS is in sight. However, we know that this sentiment is not universally shared. At the board meeting, we heard from faculty, students and alums who are angry and saddened about the coming transition. Some of these feelings are unavoidably exacerbated because the New Directions Committee, while informed by the broadly collaborative Futures Task Force Report, must conduct its work in confidence due to the information we have requested from each prospective partner. Put simply, the work of discerning a new future for EDS belongs primarily to the board in our role as fiduciary guardians of EDS’s assets—endowments, property, and most of all, mission. Some faithful members of the EDS community may disagree with our understanding of the facts before us and our clarity about the board’s roles and responsibilities, but we believe that we are moving steadily and surely toward a strong and spirit-led future for the seminary we all love.
As this year of change unfolds on campus, we ask that you hold EDS’s students, faculty, staff, and trustees in your prayers.
The Rev. Dr. Gary Hall ’76
Chair, Board of Trustees
Chair, Board of Trustees
Canon Bonnie Anderson (Honorary Degree ’06)
Vice Chair, Board of Trustees
Vice Chair, Board of Trustees