Annual Budget Goes Up
Mr. Edgerton's 1946-47 Report to Trustees Shows Cost of Operating College Has Passed $3,000,000
THE COST OF operating Dartmouth College for one year has passed the three-million-dollar mark. This fact stands out above all others in the annual financial report for 1946-47 which Halsey C. Edgerton '06, treasurer of the College, has submitted to the Board of Trustees.
Operating costs for the year ended June go, 1947, totaled $3,025,765, which exceeded the record figure of the previous year by 1566,938 or 23.1 per cent. Income to meet this unprecedented total would have fallen short by $234,754 if that amount had not been made available from the 1947 Alumni Fund to cover what would otherwise have been a deficit.
The greater part of the increased expenditure of more than half a million dollars came in faculty salaries and other direct instructional expenses, which rose by $380,921. The balance of the increase resulted from higher costs of both services and materials.
The increase in the annual fee to $550 became effective in the fall of 1946 and is reflected, along with an expanded enrollment, in the total of $1,648,164 reported as income from student fees. This figure, representing 54.5 per cent of income for the year, compares with a total of $1,065,919 received the year before from student fees and from the U.S. Navy and Army for training programs. No income from the Navy and Army was received during the fiscal year 1946-47.
Net income from investments during the past year amounted to $885,879, an increase of $46,010 over the figure of the year before. It is interesting to note that the percentage of total income represented by investment returns dropped from 34.2% to 29.3%, despite the greater amount.
On the expense side, costs rose in every other single category as well as in direct instructional expenditures. Comparative figures are given in the tabulation of 1946-47 income and expense accompanying this summary of Mr. Edgerton's report. The increases included $75,566 in plant operation and maintenance, $34,750 in administration, and $33,960 in health service costs.
HOPKINS CENTER FUND GROWS
After the use of 1234,754 of the 1947 Alumni Fund to close the gap between current expense and current income, the remainder, amounting to $111,146, was added to the funds set aside for the Hopkins Center project. The funds for this program now total $1,227,022, having been increased during the past year not only by the 1947 Alumni Fund addition but also by several gifts for the project and by Mr. Hopkins' approval of the addition of the unexpended portion of the Hopkins 25th Anniversary Fund, raised in 1941, and the unexpended portion of the 1942 Alumni Fund, both of which were carried as reserves to be used in such manner as Mr. Hopkins might later designate.
TOTAL ASSETS EXCEED 33 MILLION
Total College assets stood at $33,829,160 on June 30, an increase for the year of $1,438,455 or 4.4 per cent. This grand total was broken down into investment assets of $24,509,208; plant assets of $8,084,104, exclusive of dormitories and service properties carried as investments; and current assets of $1,235,847.
The net increase in endowment funds during the year was $1,346,901, of which $628,882 came from gifts and bequests. The larger of these latter additions included the amount received in settlement of the estate of the late Sherman B. Ward '13, $158,252, bringing the total fund established by him to $608,252; payment of a bequest of Melusina H. Varick for scholarships, $124,815; payment of the James F. Colby bequest for instruction, $45,450; and receipts from the Trustees, C. B. Little Trust, $45,205. Additions to class memorial funds during 1946-47 totaled $44,199, while class additions to the Alumni Fund on the Tucker Foundation amounted to $37,006.
$263,388 ADDED TO PLANT
During the year the value of the Dartmouth plant increased by $263,388. The total of $8,084,104 includes $687,762 for land, $6,629,688 for buildings and improvements, and $766,663 for furniture, equipment and apparatus. If dormitories and certain service properties were included, the grand total of the Plant Account would be $11,058,352. Work continued during the year on the two new wings of the Cummings Memorial Building which houses the Thayer School of Engineering, expenditures on this amounting to $247,069. The cost was partly met with $94,291 received as the balance in the hands of the trustees of the Jeannette I. Cummings Estate and $37,075 additional realized from the disposition of certain properties acquired from the Cummings trustees. The balance of the cost will be met from other College funds.
Completion of the Sachem Village development for married students brought the College's investment in this project to $191,095. Expenditures by the College in connection with the site for the government units at Wigwam Circle have amounted to $33,882. Both of these investments will be reduced by amortization over the period of probable use, but both are expected to show a loss at the end.
RETURN ON INVESTMENTS HIGHER
The average net return from all Dartmouth investments in 1946-47 was 3.71% as compared with 3.62% the year before.
College investments, which total $24,509,208, are divided as follows: Bonds, $10,209,327 or 41.7%; common stocks, $8,498,366; or 34.7%; preferred and guaranteed stocks, $1,114,828 or 4.5%; dormitories, $2,329,001 or 9.5%; Tuck School dormitories and refectory, $365,000 or 1.5%; other Hanover real estate, $1,127,698 or 4.6%; real estate mortgages, $422,719 or 1.7%, and real estate outside of Hanover, $441,167 or 1.8%.
The above figures are all book values, which in most cases represent cost at the time of purchase or market value if securities were received from gifts or bequests, reduced by any amortization of premiums. As of June 30, 1947, market values were 106% of book values, or $1,248,297 more than actually carried on the College books.
During the past year the College made no marked change in the distribution of its security holdings. An increase in the holdings of United States government bonds raised their amount to $3,283,472 or 16.6% of total security holdings. Some increase in public utility bonds and common stocks was effected, while investments in railroad securities were decreased somewhat.
Security investments are distributed as follows: public utility, 24.4%; industrial, 23.!%; governments, 19.8%; railroad, 16.7%; mining and oil, 8.7%; financial, 7-3%.
During the year sales of securities yielded net gains over book values of $262,830. Of this, $221,269 was applied to eliminate the unfavorable balance in the investment profit and loss account of previous years and to give a favorable balance in the account at the end of the year of 8144,816. In the separately invested funds, gains and losses are added or deducted from the principal of the funds themselves. For example, gains realized in excess of losses over the years have increased the Edward Tuck Fund by $1,242,249 and the Albert O. Brown Fund by $319,577.
Printed copies of the financial report for 1946-47, containing detailed schedules of assets and of operating income and expense for the year, may be obtained by writing to the Office of the Treasurer, Parkhurst Hall, Hanover, N. H.
