ML083090896
| ML083090896 | |
| Person / Time | |
|---|---|
| Site: | 05000157, 05000097 |
| Issue date: | 10/28/2008 |
| From: | Cornell Univ |
| To: | NRC/FSME |
| References | |
| Download: ML083090896 (68) | |
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Dear Cornellians and Friends of the University,
0 he year that ended June 30, 2008, was remarkable for its successes and its 0
0o challenges. First, there is much good news to report:
Our Class of 2012 was chosen from the largest applicant pool in Cornell history, and they are already contributing to the university academically, culturally, and through public service and civic engagement. Our faculty, the core strength of the institution, continues to innovate and excel in teaching, discovery, creativity, and outreach and to attract high levels of research funding in a very competitive environment. Our staff colleagues are a critical part of the fabric of excellence at Cornell, and the university again received several awards in recognition of our efforts to create a.productive, welcoming environment for all Cornell employees. Despite the challenges of the national, state, and regional econo-mies, the alumni and friends of Cornell continue to be incredibly generous, propelling Far Above... The Campaign for Cornell beyond the $2.25 billion mark on the way to its
$4 billion goal.
We have adopted a strategic plan that sets five overarching goals for the university that serve to unite and guide the institution's long-term course as well as specific strategies the university is using to reach them. In addition, we have completed the 2008 Cornell Master Plan for the Ithaca Campus, which provides an integrated framework to guide the campus's long-term physical development.
I invite you to learn more about the ways in which Cornell has demonstrated national and international leadership this year while also positioning itself for continued excel-lence in its core missions of teaching, research and creative work, and outreach.
Best regards, David J. Skorton President Cornell University
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2 In October 2007 Cornell was privileged to host one of the world's foremost spiritual leaders, His Holiness the Dalai Lama, whose message of tolerance and peace speaks directly to the moral thinker who resides in each of us whatever our worldview may be. The Dalai Lama's ethos is one to be emulated, given the disturbing increase of high-profile news stories reporting incidents of intolerance across America and right here in Ithaca.
"Let us remember the Dalai Lama's message: We are brothers and sisters, all part of the same humanity."
President David J. Skorton 2
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Major Themes of the Year Dalai Lama visits Ithaca President Skorton urges Cornell to help reduce global inequities
- new mass casualty unit provides care for up to 100 people Cornell plans to invest $20 million in the local area - a sweep-ing new financial aid initiative is announced Cornell master and strategic plans completed - Weill Cornell Medical College in Qatar graduates first class
- victims of China earthquake mourned 3
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03 Themes Calling international education and research among the nation's most effective diplomatic as-sets, President David Skorton told the U.S. House of Representatives Committee on Science that Cornell is playing an active role by increasing, its presence around the world. Testifying before the committee in July, Skorton echoed a theme from his first com-mencement address several weeks earlier, in which he urged Cornell-and higher education in general-to play a role in reducing global inequities.
am calling for a new national ap-Iproach, with university teaching, research, and outreach at its cen-ter, to address the socioeconomic inequalities that threaten our na-tion and the world, and to spur economic growth through inno-vation and capacity building as the Marshall Plan did 60 years ago through aid and joint planning," Skorton wrote in his 22-page offi-cial testimony before the committee.
When students arrived in September they added a new task to their to-do lists: log onto "Who I Am" and provide emergency contact information. The new service is part of Cornell's ongoing emergency planning effort. During the course of the year four strategies for notifying students, faculty, and staff were tested: text messaging, voicemail, e-mail, and sirens. In addition, the largest mass casualty unit in Tompkins County was made operational in the fall.
The 16-foot-long red trailer carries everything from bandages to generator-powered floodlights and can provide medical care for up to 100 people.
In October President Skorton announced the uni-versity's plans to invest $20 million over the next decade in the Ithaca and Tompkins County com-munities. He outlined six broad areas. in which Cor-nell would work actively with local partners in the years ahead: housing, transportation, economic development, educational services, health care, and the environment. The first projects, to be carried out in 2009, were announced in June.
Investment in Cornell students also received a boost. Building on a long history of need-blind admissions and need-based aid, Provost Carolyn A.
"Biddy" Martin announced in January a sweeping new financial aid initiative, starting in 2008-09, to eliminate need-based loans for all undergraduate students from families with incomes under $75,000.
Approximately 4,500 students will be affected.
"This initiative will strengthen the economic diversity of our student.body and, most important, free our students to pursue studies and careers that match their skills and interests, rather than those that ensure they will be able to repay their loans,"
noted Deputy Provost David Harris.
Having been named the "Hottest Ivy" by News-week magazine in August, Cornell announced in
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Johnson Museum director Frank Robinson, with a tall friend, celebrates the museum's expansion at a community party. RIGHT.
The goals of the Tern Restoration Project are to protect, manage, and enhance the breeding population of common (state endangered), roseate (state and federally endangered), and arctic terns (state threatened) on Seavey Island and protect the population on White Island, New Hampshire.
April a record number of applicants for freshman admission. Some 33,011 high school seniors vied for entry into the class of 2012, a 9 percent increase from 2007 and a 17 percent increase from 2006.
Those were also record years.
n a visit to New Orleans in March, President Skorton shared a stage at Tulane University with former U.S.
president Bill Clinton at the inaugu-ral meeting of the Clinton Global Initiative University (CGI U).
Appearing before student leaders from 40 states and 15 countries, Skorton spoke about the obligation of modern uni-versities in closing the economic divide. He also announced that the Cornell Center for a Sustain-*
able Future will be the university's commitment to CGI U. The center will develop practical solutions to the multitude of problems that pose grave threats to present and future human welfare and develop real-world solutions to sustainability problems.
Two visionary planning documents were com-pleted this year. In March, the first draft of Cor-nell's Campus Master Plan-designed to provide a context for, physical changes on campus, over the next 25-plus years-was approved by the Board of Trustees. Driven by academic planning priorities, the master plan provides a set of guidelines for locating the university's research, teaching, resi-dential, and recreational priorities and programs. It also offers a campus-wide frame of reference for the university's current capital plan and links local and precinct plan goals to the broader plan. The plan is available at www.masterplan.cornell.edu.
In May, the university released its strategic master plan, envisioning Cornell as "the exemplary, com-prehensive research university" of the 21st century.
Just eight pages in length (plus a two-page executive summary and 23 pages of appendices comprising plan summaries from every college and administra-tive unit), the plan sets out Cornell's objectives for building on its stature as a private university with a public mission. The ambitious goals include recruit-ing exceptional teachers, students, and staff; attracting the best students regardless of their abil-ity to pay; and extending Cornell's role in public service in the United States and around the world.
The plan can be viewed at www.cornell.edu/presi-dent/strategic-plan.cfm.
decade ago Cornell set out to become the firstAmerican medical school to offer the M.D. degree at an overseas campus. On May 8, 15 newly minted M.D.s received their degrees from the Weill Cornell Medical College in Qatar. The nine women and six men in the inaugural class came from Bosnia, Nigeria, India, Syria, the United States, Israel, and Qatar.
"As these students become practitioners around the world, they have the opportunity to bring medi-cal care to underserved populations and to encour-age others to seek medical education," President Skorton noted in his address to the graduates.
A week later the Cornell campus community gath-ered at Sage Chapel to remember the more than 21,000 victims killed in the magnitude 7.9 earth-quake that struck Sichuan province, China, on May
- 12. "Time is running out," said senior Mimi Yang, a native of the Sichuan province city of Shifang. "It's been four days since the earthquake struck, but there have still been survivors found among the rubble. There is still hope....
To all the victims of the earthquake, may you rest in peace."
A new match-making service was created during the year to facilitate research collaboration between Cornell's Ithaca and New York City campuses. The service, one of the resources in the newly designed
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David Bathrick, the Jacob Gould Schurman. Professor of Theatre, Film, and Dance and professor of German studies, has retired after 20 years at Cornell and returned to Bremen, Germany. RIGHT:
Students in the Art of Horticulture class pose at the top of the spiral-pathway sculpture they created (and get hosed down in theprocess) on Cornell's turfgrass plots.
intercarnpus initiatives web site (http://intercam-pusaffairs.cornell.edu), allows researchers to enter information about their work and expertise, as well as whatthey're looking for in a collaborator.
Each semester, members of the Mortarboard Senior Honor Society ask a professor to speak as if it were his or her last time addressing the Cornell community. In his "Last Lecture" delivered in April, President Skorton stressed humility and humani-tarianism. Higher education has the potential to enrich lives, he said. Having access to it means we are privileged people with a chance to make a dif-ference. As a leader, he stressed how crucial it is not to be invested in any one point of view. Open-mindedness is the key to successful leadership because, he said, "leaders serve everyone."
As the year drew to a close, the Cornell commu-nity discovered it was losinig one of its most dedi-cated faculty members and administrators when it was announced that Provost Martin would become the next chancellor of the University of Wisconsin-Madison, her graduate alma mater. She was to begin her new position in September after 25 years* at Cornell, Describing her move as "a great source of pride for the entire Cornell community and a great day for Wisconsin," President Skorton added, "Biddy Martin will bring to her new responsibilities a deep academic sensibility and wealth of experience deal-ing with the many issues and constituencies that play such a critical role in the life of the university.
We will greatly miss her intellect, leadership, and friendship."
Student Life The West Campus House System continued to expand in 2007-08 with the addition of the Wil-liam Keeton House. Jefferson Cowie, professor of labor history in the School of Industrial and Labor Relations, was appointed house professor and dean of Keeton House, which was scheduled to open in August 2008. Generous gifts from two alumni this year helped create a vibrant future for students who choose this innovative undergraduate living and learning environment. The first, made by Harold Tanner '52, Board of Trustees chairman emeritus, endows 30 Hunter R. Rawlings III House Fellows affiliated with each of the three houses-Alice Cook, Carl Becker, and Hans Bethe-that opened during Rawlings' tenure as the university's 10th president.
The house fellows-faculty and senior staff-provide intellectual stimulation outside the classroom by expanding students' exposure to research, educa-tional, and cultural opportunities through formal programming, mentoring, and casual discussions.
The second, a gift of $1.5 million to endow pro-gramming, was made by Larry Salameno '66. It pro-vides permanent funding for activities such as guest speakers, field trips, leadership development, social activities, service projects, or even academic courses taught in the West Campus houses.
ne such program is the annual interfaith "I believe in... Dinner" held at the Alice Cook House in March. The evening's 125 guests were assigned seats so that members of different faiths were next to each other. What followed was an eve-ning of cordial conversation about topics often thought too controversial to discuss harmoniously. The event began as an independent project of Lee Leviter '08 but now is a collaborative effort by a newly formed group, the Interfaith Council at Cornell.
Cornell's graduate students are the focus of a new effort that began to gain momentum this year. The Graduate Community Initiative, presented to the Board of Trustees in March, addresses critical and
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Apparel design major Mira Veikley '08 admires her creation, "The big bang,"
Rensselaer Hall. RIGHT:
Apple fans can choose from more than seven locally available
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LUJ constant issues in graduate and professional Stu-dent life at Cornell, taking an integrated approach across schools and disciplines and examining all relevant university services and resources. These include housing, child care, diversity, mental health, transportation and environmental impact, and professional schools and satellite campuses.
everal new student-run media projects were begun during the year. One proj-ect, Slope Radio, a radio station broad-casting around the clock online at http://SlopeRadio.com, has been a huge success. A mix of recorded and live programming includes music, news, comedy, interviews with per-formers coming to Ithaca, and an "open mic" on Friday nights. Shows are archived and available as podcasts; participation is open to all in the Cornell community. Another student project, the Cornell International Affairs Review (CIAR), published its first issue. The journal's mission is to present thoughtful and diverse reflections on forces cur-rently influencing the international community.
Student volunteerism continued to grow in 2007-
- 08. A record number of Cornell students-1,300, up from just 500 two years ago-gave up a Saturday in October to volunteer through Into the Streets at 60 different locations in Ithaca and surrounding com-munities. Into the Streets is just one of several sig-
- nature programs run out of the Public Service Cen-ter, which saw more than 5,000 students this year participate in public service. Elisabeth Stern, a ris-ing senior in the College of Human Ecology, was awarded the 2008 Howard R. Swearer Student Humanitarian Award by Campus Compact for "extraordinary commitment to improving [her]
local and global communities." Stern was recog-nized for co-founding Cover Africa, a student orga-nization dedicated to reducing the global burden of ne of the creations that could be viewed at the "Wearable Art Display" in Martha Van varieties in this vending machine in the Plant Science building.
malaria and organizing a service-learning course on malaria interventions in Ghana. Campus Com-pact is a national coalition of more than 1,100 colb lege and university presidents committed to fulfill-ing the civic purposes of higher education.
These and other student efforts were recognized by the Corporation for National and Community Service, which named Cornell to the President's Higher Education Community Service Honor Roll With Distinction. The honor roll is one of the high-est federal recognitions a school can achieve for its commitment to service learning and civil engage-ment. "College students such as those at Cornell are tackling the toughest problems in America, demonstrating their compassion, commitment, and creativity by serving as mentors, tutors, health workers, and even engineers," says David Eisner, CEO of the Corporation for National and Commu-nity Service. "They represent a renewed spirit of civic engagement fostered by outstanding leader-ship on caring campuses."
-ith generous alumni support, Gannett Health Service and the Dean of Students Office fur-thered the campus-wide approach to mental health that saw so much national media attention in 2007-08 in such outlets as CNN, the Wall Street Journal, and the New York Times. These new gifts are helping the expansion of "gatekeeper" educational opportunities delivered live, online, and in print including systematization of gafekeeper education programs for students; development of mental health handbooks for faculty and staff members, parents, and students; development of a training video for modeling how to talk with students in dis-tress; and creation of a train-the-trainer module.
The always challenging task of entering and track-
LEFT:
Molly Hite, professor and chair, Department of English, and Salman Rushdie share a light moment before Rushdie's reading in Uris Auditorium. RIGHT:
Angela Y. Davis speaks with Africana Center faculty before her lecture "The Prison: A Sign of U.S. Democracy?"
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cy ing student data continued to improve during the year. Student records are now contained on a single database called STARS (System for Tracking Admin-istrative Records for Students). The conversion to STARS has been under way since December 2005. It replaces more than 20 separate home-grown com-puter systems, some as many as three decades old.
The new software will empower students, elimifiat-ing standing in long lines and providing data to help them make decisions about their courses and finances. It will even give them alerts about things they need to do.
t was a banner year for Cornell athletics, as Big Red teams won Ivy League titles in men's and women's basketball, women's outdoor track and field, men's indoor and outdoor track and field, men's lacrosse, men's lightweight row-ing, and wrestling. It was the women's basket-ball team's first Ivy League championship ever.
They fell to No. 1 seed University of Connecti-cut in the first round of the NCAA tournament. The men's team, winning their first Ivy title in 20 years and undefeated in league play, entered the NCAA tournament as a No. 14 seed and lost to third-seeded Stanford, also in the first round. Both Ivy Basketball Players of the Year were Cornellians-Louis Dale and Jeomi Maduka. Maduka was also Ivy Player of the Year for indoor and outdoor track and field, and an All American in track and field. For the second year in a row Cornell had a national cham-pion in track and field-senior Muhammad Halim placed first in the outdoor triple jump and was named Ivy Player of the Year for men's indoor track and field. Adam Seabrook was named Ivy Player of the Year for men's outdoor track and field. Jordan Leen won the NCAA wrestling title at 157 pounds.
For the third year in a row Cornell won a national title in Lightweight rowing, and the Men's Light-weight rowing made the quarter finals of the Hen-ley Temple Challenge Cup.
Far Above... The Campaign for Cornell Since the launch of Cornell's historic $4 billion campaign in October 2006, Far Above... The Cam-paign for Cornell has catalyzed passionate involve-ment and leadership from Cornell's alumni, par-ents, and friends. Their commitment led to the uni-versity's achieving its second best year of fundrais-ing. In FY08, new gifts and commitments to Weill Cornell and to the Ithaca campus totaled $614.1 million, while the Ithaca campus garnered $46.7 million, the capstone of an extraordinary and record-breaking year. Overall, the university has raised $2.246 billion toward its goal as of June 30, passing the halfway milestone.
he inspiring generosity of Cornell's alumni, parents, and friends was more than matched by their boundless gen-erosity of spirit. In November 2007 Madison Square Garden sold out seats for Cornell's "Red Hot Hockey" game against archrival Boston University, with Big Red enthusiasm dominating the arena, if not the final score. "Big Red in the Big Apple," a campaign event held in New York City in January 2008, brought together more than a thou-sand regional Cornellians for a faculty panel; an evening celebration at Cipriani, which was inge-niously transformed with signature Cornelliana; and a morning of volunteer service projects at com-munity agencies throughout Manhattan and its boroughs. Similar campaign events are planned for San Francisco and Washington, D.C., in the com-ing year.
The year's fundraising also set other new records.
It was the best fundraising year ever for the human-ities, with $48 million in gifts that included the largest gift to the humanities in the university's history. The College of Veterinary Medicine received
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ProfessorSusan McCouch makes a point with Professor Eswar Prasad, Professor Dan cussion in New York City. RIGHT:
The Kusun Ensemble, a group of musicians and dancers f the largest gift in its history as a result of Janet Swanson's gift for new equipment and wildlife health and shelter medicine. Martin Tang '70 issued a generous $3 million challenge for the creation of new international student scholarships, the largest of its kind. In addition, FY08 was a record-setting year for new Tower Club memberships. In addition, the university's major financial aid initiative, announced in January, has resulted in significant new gifts in support of undergraduate scholarships, with several large gift confirmations pending.
Contributing to the year's success, the Cornell Annual Fund raised $21.5 million this year, a 17 percent increase over FY07. More than 31,100 alumni; parents, and friends contributed to the fund in FY08, representing an increase of 8 percent over FY07. Over the last five years, total gifts to the Annual Fund have increased by 100 percent, dou-bling the dollars raised. Since the public announce-ment of the campaign in 2007, the Annual Fund has already grown by 50 percent.
inally, in order to continue to build*
momentum for the campaign and beyond, the Division of Alumni Affairs and Development has undertaken a comprehensive long-term planning pro-cess focused on strategic growth. Phase One of a division-wide plan was imple-mented throughout the spring, with opportunities for staff-wide input and feedback. Six areas were reviewed: pipeline, development and prospect management, training and professional development, volunteer engagement and leadership, human resource framework, recognition, and infra-structure. During Phase Two, which is already under way, AAD will focus on carrying out recommenda-tions developed during Phase One and plan for sus-tainable, long-term organizational growth.
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Cornell's New York City programs continued to grow in 2007-08. The success of the quarterly "Inside Cornell" luncheons continued with Jeff Hancock, associate professor of communication; Valerie Reyna, professor of human development and psychology; and Janis Whitlock, director of the Cornell research program on Self-Injurious Behav-ior in Adolescents and Young Adults. Attendees of the media luncheon included Teen Vogue, Cookie magazine, Vanity Fair, ABC News, CBS Radio, Work-ing Mother, Woman's Day, NPR, Psychology Today, Ladies Home Journal, the New York Times, and News-hour with Jim Lehrer. Direct media coverage of these speakers occurred with NPR, ABC News, and the New York Times. The ABC feature of Professor Han-cock was picked up and carried by half of the moný itor.-equipped taxi cabs in New York City. The inau-gural Presidential Media Luncheon was held in April. President Skorton was joined by President John Sexton (N.Y.U.) to discuss the current climate in higher education and endowment. Media attend-ees included the New York Times, Newsweek, News-day, and BusinessWeek.
Cornell celebrated the Sixth Annual Poem In Your Pocket Day (PIYP) by partnering closely with New York City mayor Michael Bloomberg's Office of Cul-tural Affairs and the Bryant Park Corporation for the second year. Cornell M.F.A. students and WCMC medical doctor Carlyle Miller read original works at the Bryant Park Poetry Reading. One thou-sand Cornell student poetry and art books created for PIYP were produced and distributed to New York City students. Every student at Cornell partner school Food and Finance High received the books.
The American Museum of Natural History is exhibiting "Saturn: Images from the Cassini-Huy-gens Mission," along with associated graphics and a
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Poet Maya Angelou speaks during Senior Convocation in Schoellkopf Stadium. RIGHT:
A view inside Weill Hall, the new life sciences technology building, which opened in July 2008.
quarter-scale model of the spacecraft. The exhibit, which opened April 26 and will be in place until March 29, 2009, was curated by Joe Burns, Irving Porter Church Professor of Engineering and mem-ber of the Cassini'imaging team.
The 92nd St. Y featured two Cornell faculty mem-bers: Philson Warner, extension associate with Cooperative Extension-NYC, was the guest speaker in February for the adult education series "Myster-ies of Science." In November, Professor Jim Bell, astronomy, was the guest speaker for the "On the Brink" series, an enrichment program for urban high school students.
rofessor Bruce Levitt, Theatre, Film, and Dance, brought The Puppetmaster of Lodz, a play by Romanian playwright Gilles Segal, to New York City in December. Under his direction the play, with four actors and more than a dozen puppets, had a very successful run at the Arclight Theatre.
ILR saluted the arts during its "New York: The State of the Arts" conference in November. A panel of studio and union executives, producers, not-for-profits, and the New York State governor's office discussed current artistic challenges and gains pub-lished in "New York's Big Picture" (a report co-authored by ILR-NYC, Department of City and Regional Planning, and the Fiscal Policy Institute.)
Rounding out the third in a series of multicultural conferences and exhibitions hosted by AAP-
"Portugal Now: Country Positions in Architecture and Urbanism"-convened representatives of sev-eral up-and-coming architecture firms in addition to well-known architect Jo~o Luis Carrilho da Graqa.
ast fall Cooperative Extension-NYC ini-tiated "The Strength Through Diver-sity-Young Professionals Leadership Program" (NYCLP). NYCLP is a joint project with the New York City Depart-ment of Youth and Community Devel-opment, New York Tolerance Center, and the American Friends of Israel League. The inaugural group of 35 young profes-sionals from private and public institutions such as the United Nations, Council on Foreign Relations, Department of Youth and Community Develop-ment, Goldman Sachs, and Time Warner met twice a month for six months to confront critical issues in New York's multicultural society.
In sporting news, close to 13,000 Big Red fans were at Madison Square Garden Thanksgiving weekend to witness Cornellmen's hockey team take on Boston University. In March, women's basket-ball fans cheered the Big Red to the NCAA tourna-ment at Columbia University.
Government Relations This was a critical year for government and com-munity relations: New York governor Eliot Spitzer was forced to resign before the end of his first term, creating uncertainty in state government and in the state higher education community; President Skorton announced a 10-year, $20 million initia-tive outlining areas in which the university would work actively with local partners to support the needs of the university's faculty, staff, and students in Tompkins County; and at the federal level, a presidential election and congressional politics brought budget and legislative action to a virtual standstill.
However, important strides were made in efforts to secure sufficient funding to begin construction
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Dragon Day 2008: Students in the College of Architecture, Art, and Planning burn t RIGHT:
President Skorton makes a point during the opening plenary session of the inau Orleans.
of the USDA/Agriculture Research Service Center for Grape Genetics Research at the Cornell Agricul-ture and Food Technology Park at Geneva. After New York State included $10 million for this project in the 2008-09 budget for the Department of Agri-culture and Markets, Cornell undertook an intense and comprehensive lobbying campaign to secure the remaining federal funds in the 2009 federal budget. President Skorton; Andrew Tisch, chair of the Trustee Committee on Governmental Relations; Patrick Hooker, chair of the New York State Depart-ment of Agriculture and Markets; and leaders of the national grape and wine industry all made visits and personal appeals to lawmakers in support of the center.
- eanwhile, President Skorton assumed an even greater leader-ship role in Washington, D.C.,
lending a strong voice to the national discussion of higher edu-cation policy and issues. In early spring 2008 he took the lead on behalf of the higher education community when.he met with Senator Charles Grassley (R-Ia.), ranking member of the Senate Finance Committee, to discuss proposed legislation that would have an impact on university endow-ments. And he kicked off a discussion meeting between a handful of university presidents and members of the Senate Republican Conference on the importance of federal funding for university research.
On Capitol Hill, the Office of Government Rela-tions has taken a leading role in efforts to explain to lawmakers the unintended consequences that proposed updates'to the False Claims Act pose for research universities, academic medicine, and fac-ulty medical practices. We were also a key partici-pant in the successful campaign to roll back a 10 T
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And in the international arena, Stephen Philip Johnson, vice president for government and com-munity relations, represented Cornell at the Busi-ness University Forum of Japan, where he gave two presentations on the role of universities as engines for innovation and economic development.
he 2007-08 academic year was one of significant transition for Cornell's relationship with the state owing to key changes in personnel. Changes in leadership from the executive office to the State University of New York (SUNY) administration created chal-lenges for higher education in New York State. As New York's land-grant university, Cornell relies on the state as an important funding source and partner. During 2007-08 the national and state economies slowed, resulting in mid-year budget *reductions from the state and pessimistic budget forecasts for the coming year.
The Commission on Higher Education, created by Governor Spitzer and chaired by Cornell president emeritus Hunter Rawlings, issued a report recom-mending substantial increases in state investments in higher education and research. The state budget enacted in April 2008 contained long-sought capi-tal funding for Stocking Hall (food science) and increases for statutory college operations. In his first major action upon taking office in March, New York governor David Paterson responded to the worsening fiscal situation by reducing all state spending and lowering expectations *about what state government will be able to do. President Skor-ton, along with other administrators and faculty, worked throughout the year with government offi-cials and SUNY leaders to highlight the import of higher education to the residents of the state and New York's economic future.
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Claire Shipman, senior correspondent from ABC's Good Morning, America was the Spencer T. and Ann W. Olin reunion speaker in Bailey Hall at Cornell Reunion 2008, held in June. RIGHT:
Students work on the 2007 solar house in Washington, D.C.
On the good news front, construction began in the spring on the New York State Animal Health Diag-nostic Center (AHDC). The $80 million center, located at the College of Veterinary Medicine, will be built with a $56 million grant from the state of New York. The new center will provide enhanced capabili-ties to improve the health of food-and fiber-produc-ing animals, companion animals, exotic animals, and wildlife and to advance public health through the diagnosis and control of zoonotic diseases.
During the past academic year, the Office of Com-munity Relations played a key role in developing, announcing, and rolling out President Skorton's
$20 million investment in local affordable housing and transportation infrastructure initiatives. This important development will first and foremost assist Cornell students, staff, and faculty and by extension the community at large.
Community Relations has continued to connect campus and area leaders around three important Cornell initiatives:
Cornell's Master Plan, the transportation-focused Generic Environmental Impact Statement (t-GEIS), and a new version of an Economic Impact Statement designed to include data from Ithaca College and Tompkins Cortland Community College and reflect the important role higher education has in the local economy.
Community Relations continues to play vital town-gown liaison roles in a number of high-profile Cornell-related projects, including Milstein Hall, an expanded university health facility, the transfer of ownership of University Avenue from the city to Cornell, a new monitoring plan for southern Cayuga Lake, the rowing and sailing centers, Col-legetown revitalization, and many other building projects, both big and small, like the Plantations Welcome Center.
The office also continued to build on relationships within the community through Community Rela-tions' oversight of the University Neighborhoods Council, Collegetown Neighborhood Council, and the Campus-Community Coalition, all designed to enhance town-gown relations. A steadily evolving partnership with the Office of the Associate Provost for Outreach, particularly regarding the area's pub-lic schools and resource sharing, brought new opportunities as well.
I ommunity Relations was instrumen-tal in facilitating community discus-sions and actions on issues of race and class through President Skorton's Local Leaders of Color meetings, as well as through active leadership and participation in a Chamber of Com-merce collaboration with other major businesses and higher *education institutions. As part of this effort staff recruited talent and wrote copy for an important series of public service announcements aired on five local radio stations, which received a high-profile award from the New York State Broadcasters Association.
Finally, Community Relations expanded its own outreach efforts with a new local cable access show that complements a staff-generated column now running twice a month in the local newspaper.
Research After receiving its first fresh, full coat of paint in more than 40 years, Arecibo Observatory made its first observation in more than six months at 6:36 a.m. on Saturday, December 6. The telescope focused on the asteroid 3200 Phaethon, which travels closer to the sun than any other numbered asteroid-about twice as close to the sun as the planet Mer-cury. Studying the properties of near-Earth aster-oids is one of dozens of projects under way in the now fully operational observatory.
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U.S. Secretary of Energy Samuel W. Bodman '61 announces the winners of the 2007 Solar Decathlon In Washington, D.C. RIGHT:
Alec Johnson '08, Cornell University Emer-gency Medical Service director, looks through a triage bag outside the new Mass Casualty Incident Unit.
Cornell has been awarded a $26.8 million grant from the Bill and Melinda Gates Foundation to launch a broad-based global partnership to combat Ug99, a virulent new wheat stem rust type that poses a serious threat to global food security. Wheat, which is one of the world's primary food staples, accounts for about 30 percent of the world's pro-duction of grain crops. Scientists estimate that 90 percent of all wheat varieties planted around the globe are susceptible to this deadly disease. The partnership of 15 institutions will focus on devel-oping improved rust-resistant wheat varieties to protect resource-poor farmers as well as consumers from catastrophic crop losses.
A new $6 million Biofuels Research Laboratory will occupy the entire east wing of Riley-Robb Hall by January 2009. The laboratory will convert peren-nial grasses and woody biomass into cellulosic eth-anol and other biofuels. Because biofuels is an emerging program for the whole university and the demand for trained biofuel engineers is skyrocket-ing, the new lab will be shared by faculty and stu-dents from across campus.
A new electron microscope installed in Duffield Hall is enabling scientists for the first time to form images that uniquely identify individual atoms in a crystal and see how those atoms bond to one another. In conventional electron microscopes dif-ferent atoms appear as different shades of gray. In this microscope, which takes colored pictures, each colored atom represents a uniquely identified chem-ical species. One important application will be to aid researchers in their development of new materi-als to use in electronic circuits, computer memo-ries, and other nanoscale devices.
n one of the first studies to look at the effects of trauma on the brains of healthy adults, Bar-bara Ganzel, a postdoctoral fellow in the Col-lege of Human Ecology, found that healthy adults who were close to the World Trade Cen-ter during the terrorist attacks on September 11, 2001, have less gray matter in key emo-tional centers of their brains compared with.
people who were more than 200 miles away. In a preceding study she found that people living near the World Trade Center on 9/11 have brains that are more reactive to such emotional stimuli as photo-graphs of fearful faces. Together the studies give sci-entists clues about the biology underlying the known vulnerability to mental health disorders exhibited years after a traumatic event.
The U.S. legal system has long assumed that some witnesses, such as adults, are more reliable than others, such as children. But studies by professors of human development Valerie Reyna and Chuck Brainerd suggest that children, in fact, are less likely to produce false memories and, therefore, are more likely to give accurate testimony when properly questioned. The researchers say that children depend more heavily on a part of the brain that records "what actually happened," while adults depend more on another part of the mind that records "the meaning of what happened." As a result, they say, adults are more susceptible to false memories, which can be extremely problematic in court cases.
Human Resources In keeping with the goal of the university's strategic plan to "... recruit, retain, and support a diverse and talented faculty, staff, and student body," the Division of Human Resources initiated several pro-grams during 2007-08 that made Cornell more
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Sandra Day O'Connor, retired U.S. Supreme Court Justice, participates in an open dialogue with Cornell provost Biddy Martin on women in leadership. RIGHT:
Students from Professor Bill Miller's Herbaceous Plant Materials course spent a chilly afternoon laying the groundwork for a bulb labyrinth at the Department of Horticulture's Bluegrass Lane-Research Center.
accessible to prospective candidates and new hires, and made it easier for current employees to net-work, meet their personal responsibilities, and develop as leaders. The national workplace awards garnered recently are evidence that these and other enhancements are moving the university in the right direction.
The need to recruit a diverse workforce will be a major priority over the next decade, with Cornell expecting to replace 600 retiring faculty and 2,500 retiring staff. To aid in recruitment, Cornell held.
an employment career fair in August 2007. Over 380 job seekers talked with representatives from Cornell's colleges and units, leading to 46 hires.
Eight of these were under-represented minorities.
ust as critical as successful recruit-*
ment is the retention of those who have been recruited. A new hire's first impressions of Cornell after accepting a position correlate to that retention.
In 2007, a new university-wide orien-tation process was launched.
A monthly orientation program, opened by one of Cornell's senior executives, introduces new hires to Cornell's culture, resources, services, and Ithaca campus. Additionally, newly hired staff and faculty may now enroll online in many bene-fits; an in-person weekly benefit session is also held for those enrolling in the NYS retirement and health plans.
Key to long-term workforce,diversification are the opportunities for networking. To promote these opportunities, Cornell held the second Women of Color and first Men of Color roundtable on May 6, 2008, with keynote addresses by Naomi Cottoms, executive director of a rural health network; Mary Olson, community organizer for marginalized citi-zens in rural Arkansas; and Ronald Walters, nation-ally recognized author, scholar, and political analyst.
This past year the Division of Human Resources and Cornell University Finance and Administration (CUFA) partnered to develop a new leadership cur-riculum of six programs, including the ongoing Harold D. Craft Leadership Program and a new cap-stone program, Leading Cornell, that blends work-shop content with actual university projects.
'Cornell continues to promote the well-being of staff, faculty, retirees, and their families. In 2007, the university launched the Cornell Program for Healthy Living, providing incentives for partici-pants to pursue a-wellness lifestyle and for primary care physicians to manage patient wellness plan-ning. Over 900 Cornell employees and their depen-dents joined the CPHL in its first year. The Wellness Program has seen a 21 percent increase in staff, spouse/same-sex partner, and retiree memberships over last year, with 2,366 staff, faculty, and retirees having joined as of June 5, 2008.
erhaps Cornell's most visible commit-ment to working families is a new child care center, slated'to open in August 2008..The center will accommodate 158 children: 48 infants, 50 toddlers, and 60 preschool-age children.
These life/work initiatives, benefiting people of all ages and family struc-tures, have been recognized at the national level.
Cornell has been named an Exemplary Voluntary Efforts recipient by the U.S. Department of Labor in 2007; a top non-profit employer for women execu-tives by the National Association for Female Execu-tives in 2008; one of the 100 best employers for working mothers by Working Mother Media in 2006 and 2007; the 50 best companies for prospec-tive parents by Conceive Magazine in 2008; the 100 best adoption-friendly workplaces by the Dave Thomas Foundation for Adoption in 2007 and 2008; the 50 best employers for Workers over 50 by
15 EFT. Spe osaWandra fer vcepedent o Uganda, mee0s hCorne nstu comedian andactor stands wit theBig Red Bear beforehsperformance ninarton Hall the American Association of Retired Persons in 2005, 2006, and 2007; and Computer World's 100 Best Employers for Information Technology Profes-sionals in 2007 and 2008.
Cornell Cooperative Extension (CCE)
As New York's land grant university, Cornell's mis-sion extends beyond campus and classroom to com-munities across the state. Supported by Cornell University, a federal, state, and local government partnership, and a national land grant system, CCE's professional staff helps residents build a stronger New York through research, outreach, and education.
More than ever, Cooperative Extension's mission and resources are relevant to local and national concerns. Climate change, increasing energy costs, and rising rates of obesity, among other challenges, all point to the need to strengthen and support sus-tainable approaches to food production, child and family nutrition, environmental health, and com-munity and economic vitality.
Reappointed for a second five-year term as direc-tor of CCE in 2007, Helene Dillard addressed'the system's capacity to help New Yorkers improve their communities in her 2008 State of Extension address on March 13, 2008. The presentation highlighted CCE's work in 2007 and promoted ongoing efforts to foster community-based partnerships that will benefit the state's diverse communities as CCE approaches its centennial year in 2011.
The director also urged stakeholders to think statewide and act locally to maximize the impact of community-based initiatives in CCE's five prior-ity program areas: Agriculture and Food Systems; Children, Youth, and Families; Community and Economic Vitality; Environment and Natural Resources; and Nutrition and Health.
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Stephen Colbert, Colbert has a self-professed fear of bears.
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created in
- 2007, CCE enhanced its local and regional ability to help New York work toward a sus-tainable food system with increased consumption of locally produced food and farm products. A 13-member alli-ance of campus and community part-ners, the LFWG develops and implements strategies to strengthen and effectively communicate CCE's role in creating, supporting, and sustaining state-wide community-based food systems.
In a special collaboration between the 4H Youth Development Program and Cornell's Department of Entomology, CCE launched the Ladybug Project, a citizen science program targeting hard-to-reach youth from rural and suburban schools. Fundedby the National Science Foundation, the project uses ladybugs to illustrate ecological concepts and top-ics, such as invasive species, biodiversity, and con-servation, through activities that connect culture and science. The project also supports extension's commitment to the 4H Science, Engineering, and Technology (SET) Program, an initiative to address A'merica's critical need in the sciences.
CCE's Community and Rural Development Insti-tute (CaRDI) partnered with Cornell's Department of Development Sociology and CCE associations in Genesee and Chautauqua counties to develop the Rural Learning Network of Central and Western New York, a 15-county effort to address commu-nity and economic development issues vital to rural communities in the central and western areas of the state. Local CCE associations, have capitalized on the network's knowledge-sharing capacity to initiate discussions about consolidating municipal services for renewed efficiency in the region.
In 2007, CCE also enhanced its ability to carry out statewide invasive species work designed to prevent
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destructive, non-native plant and animal species from damaging the environment. Recognized as one of the premier aquatic invasive species outreach efforts in the nation, Cornell's New York Sea Grant Extension Program joined the New York State PRISM (Partnerships for Regional Invasive Species Management) collaboration, and it facilitates CCE's comprehensive approach to protecting New York from a wide variety of threats to its environment.
The system continues to affirm its support for a coordinated, statewide effort to help children avoid unhealthy weight gain. In partnership with Cor-nell's College of Human Ecology's. Division of Nutritional Sciences, CCE initiated the Collabora-tion for Health, Activity, and Nutrition in Chil-dren's Environments (CHANCE) Program, which serves the state's limited-income families. Based on an ecological model-that recognizes the role of the environment in shaping behavior, CHANCE empha-sizes the importance of parents and other commu-nity members working together to create environ-ments that encourage healthy choices. It is a pilot project of the Expanded Food and Nutrition Educa-tion Program (EFNEP) in New York State and in 2007 was implemented in New York City and Jef-ferson, Monroe, Suffolk, and Tompkins counties.
Weill Cornell Medical College "At a time of ongoing and even escalating world tensions, the Weill Cornell Medical College in Qatar (WCMC-Q) is a most positive achievement far beyond the world of medical education," Presi-dent Skorton said in his address to the 15 students who received their M.D.s during the WCMC-Q's first commencement ceremonies on May 8 in Doha.
The graduation ceremony marked a milestone in American higher education, as Weill Cornell Medi-cal College in New York City became the first U.S.
medical school to grant its MID. degree on foreign soil. The nine men and six women represent seven different nationalities.
"We are immensely proud of our first group of WCMC-Q graduates," said Antonio M. Gotto, Jr.,
dean of Weill Cornell Medical College. "I am confi-dent these exceptional young doctors will provide excellent patient care, engage in important medical research, and help to share their experience and knowledge with their peers and colleagues in Qatar or wherever they may ultimately work."
he new M.D.s were highly successful in being accepted by their first-choice institutions for residency training, among them Weill Cornell, Johns Hopkins, Rush University Medical Center, University of Minnesota, and Hamad Medical Corp. (in Qatar).
WCMC-Q is expanding not only in its educational mission but in research and out-reach as well, all up to the same exacting standards set at WCMC in New York. Within five years, more than 100 people will be engaged in basic, transla-tional, and clinical research on the campus in Edu-cation City. Patient care will occur through a 382-bed Sidra Medical and Research Center soon to be located less than a quarter mile from WCMC-Q.
In research at WCMC this year, Dr. Francesco Rubino, building on his previous work, further extended an understanding of diabetes as a disorder of the upper intestine. He found that surgical pro-cedures based on a bypass of the upper intestine (which' can cause remission of diabetes, indepen-dent of. any weight loss) may work by reversing abnormalities of blood glucose regulation.
Outcomes of a nine-month, double-blind, pla-cebo-controlled Phase II trial of GAMMAGARD Intravenous Immunoglobulin (IGIV) for Alzheim-er's disease showed significantly better global out-
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Chris Graybear Burkhardt, a member of the Ojibway Nation and from East Hampton, Mass., competes in the traditional "duck and dive" dance at the ninth Annual Powwow and Smokedance in Barton Hall. RIGHT:
Members of the Cornell and Ithaca communities gather in Sage Chapel for a vigil to remember the victims of the May 2008 earthquake in Sichuan, China.
comes, cognitive performance, and daily function in patients treated with IGIV compared with ini-tially placebo-treated patients. The lead researcher is Dr. Norman Relkin.
esults of a gene therapy clinical trial, in which geneticmaterial was injected into the brain, showed that the proce-dure was both safe and effective-resulting in the incorporation of those genes within cells, that, in turn, pro-duced a protein that is deficient in Batten disease (a degenerative neuro-logical disorder that usually becomes fatal in chil-dren bythe age of 12). The lead scientist was Dr.
Ronald Crystal.
Results of a breakthrough study in mice, led by Dr.
Shahin Rafii and a team from the Ansary Stem Cell Center for Regenerative Medicine, showed that eas-ily accessed and plentiful adult stem cells found in a male patient's testicles might someday be used to create a wide range of tissue types to help him fight diseases-avoiding the need for more controversial embryonic stem cells.
In another study led by Dr. Rafii, researchers showed that the molecular profile of cancer stem cells that initiate metastatic colon tumors is sig-nificantly different from those responsible for pri-mary tumors. Cancer researchers have long believed that a protein called CD133 identifies a population of cancer stem cells (so-called CD133+ cells), the only subset of cells that are responsible for tumor initiation. But in the experiment, in which immu-nocompromised mice were injected with human metastatic colon cancer, the Weill Cornell team discovered that cancer cells that do not express CD133 can also spur metastatic disease. "In fact, metastatic tumors originating with these CD133-cells are more aggressive than those spurred by CD133+ cells," Rafli says.
ewYork-Presbyterian/Weill Cornell Medical Center has created an expanded cancer program to trans-form what is already an excellent program-to treat the second leading cause of death in the United States-into a renowned cancer center, investing in areas of historical strength-such as lymphoma, lung cancer, genito-urinary, and preventive oncology-while establish-ing new programs. The center will be headed by Dr.
Andrew Dannenberg.
Weill Cornell Medical College received a $49 mil-lion grant from the National Center for Research Resources (NCRR), of the National Institutes of Health (NIH), to establish and lead a new Clinical and Translational Science Center (CTSC), creating an ambitious and innovative network for biomedi-cal collaboration on New York's Upper East Side to facilitate new studies that quickly and effectively result in new patient treatments and preventive interventions. It is the largest federal grant ever awarded to Weill Cornell. The principal investigator and program director is Dr. Julianne Imperator-McGinley.
A pioneer in the field of interventional radiology, Dr. Robert Min has been appointed radiologist-in-chief at NewYork-Presbyterian Hospital!/Weill Cor-nell Medical Center and chairman of radiology at Weill Cornell Medical College, where he is also associate professor of radiology. Dr. Min is the inventor' of endovenous laser therapy for treating venous insufficiency-when the leg's veins cannot effectively return blood to the heart. Now 10 years old, the minimally invasive technique is used by thousands of physicians around the world to treat a variety of conditions, including varicose veins.
Dr. Nicholas Schiff, who was named to Time mag-azine's annual list of the 100 "World's Most Influ-
LEFT:
A graduate wears a creative mortarboard at the 2008 Commencement and Procession. RIGHT:
Shehnaz Kahn, left, Valerie Nannery, and Arif Samad, all Class of 1998, take a canoe tour of Beebe Lake and the adjoining gorge during Reunion Weekend 2008.
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--4 ential People," received the Research Award for Innovation in Neuroscience from the Society for Neuroscience, the world's largest organization of physicians and scientists who study the brain and nervous system. The award was for "imaginative, innovative research that will advance novel ideas and have the potential to lead to significant break-throughs in the understanding of the brain and nervous system and related diseases." Dr. Schiff was the lead author of a breakthrough study in the August 2, 2007, journal Nature, reporting that a 38-year-old man who spent more than five years in a minimally conscious state as a result of a severe head injury is now communicating regularly with family members and recovering his ability to move after having his brain stimulated with pulses of electric current. The findings provide the first rigor-ous evidence that any procedure can initiate and sustain recovery in such a severely disabled person, years after the injury occurred.
A renowned hematologist and leader in academic medicine, Dr. Andrew I. Schafer, has been named chairman of the Department of Medicine at Weill Cornell Medical College and physician-in-chief at NewYork-Presbyterian Hospital/Weill Cornell Med-ical Center. Dr. Schafer, who will also be the E. Hugh Luckey Distinguished Professor of Medicine at Weill Cornell Medical College, joins the Medical Center from the University of Pennsylvania School of Med-icine, where he was chairman of medicine. At Weill Cornell, he will have administrative responsibility for the largest and most complex department, which includes 240 full-time faculty, 13 clinical divisions, and two centers-the Iris Cantor Women's Health Center and Cornell Internal Medicine Associates.
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Marxism still offers viable ideas to advance such poor countries as Bolivia, that country's vice presi-dent, Alvaro Garcia Linera, told an overflow crowd in a Labor Day talk. Linera, of the Movement Toward Socialism party, was elected with a large majority in 2005 as running mate and idea man to President Evo Morales, Bolivia's first indigenous leader since the Spanish conquest.
Cornell's Southeast Asia Program (SEAP), which is, in the forefront of assisting the more than 50 Karen (Burmese) refugees who have come to Ithaca after being stranded for the past decade in refugee camps on the Thai-Burma border, offered a two-day work-shop in October titled "Burma, Border Zones, and the Karen People." The more than 60 attendees included teachers, refugee. sponsors, and members of the Karen and Cornell communities. Cornell is the only U.S. university to offer a language course on Sgaw Karen.
ixty years after the creation of the State of Israel, Palestinians are now the "Jews of.the Israelis," said Afif Safieh, the Palestine Liberation Orga-nization representative to the United States since 2005. To change the Pal-estinians' status he advocated a "pop-ular nonviolent resistance" of Pales-tinians against Israel. And he predicted that most Arab states would accept Israel if it "curbed its terri-torial appetite" and returned to its pre-1967 borders.
In 2007-2008 the Einaudi Center for Interna-tional Studies welcomed five speakers with posi-tions of prominence in international affairs to address topical issues from a variety of perspectives as part of their Foreign Policy Distinguished Speaker Series.
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The three winners of the 1996 Nobel Prize in Physics at the Robert Richardson Symposium. From left: Douglas Osheroff, David M. Lee, and Robert C. Richardson. At the time of the discovery Osheroff was a graduate student at Cornell working with Richardson and Lee. RIGHT:
French-born chef Michel Roux, center, oversees and instructs during the plating of the first course in Taverna Banfi's Back-of-House during the Hotel School's Guest Chef event.
Hanan Ashrawi, founder and executive commit-tee chair of the Palestinian Initiative for the Promo-tion of Global Dialogue and Democracy (MIFTAH) and member of the Palestinian Legislative Council, spoke on the topic "Peace in the Middle East: Who Needs It?" moderated by President Skorton. The event was co-sponsored by the Department of Near Eastern Studies, Alice Cook House, and the Office of the Vice Provost for International Relations.
arry Kuiper from Wageningen Uni-versity and chair of the Scientific Panel on Genetically Modified Organisms of EFSA, the European Food Safety Authority, spoke on the topic "Genetically Modified Crops in Europe: Regulation, Risk Assessment, and Public Attitude." The event was co-sponsored by the Institute for European Studies and the Delegation of the European Commission as part of the EU Speaker Series.
Carlo Trojan, European Commission ambassador to the international organizations in Geneva until early 2007, gave a talk titled "EU-U.S. Trade Rela-tions, WTO, and the Doha Round." The'talk was co-sponsored by the Institute for European Studies and the Delegation of the European Commission as part of the EU Speaker Series.
Anthony C.. Zinni, retired general in the U.S.
Marine Corps, former commander-in-chief of U.S.
Central Command and Frank H.T. Rhodes Class of 1956 Professor, delivered a talk on the subject "The New World Order."
Francis Fukuyama, Bernard Schwartz Professor of International Political Economy and director of the International Development Program, the Paul H.
Nitze School of Advanced International Studies, John Hopkins University, spoke on the topic "Amer-ican Foreign Policy after the Bush Administration."'
Land Grant As a land-grant university Cornell is charged with the missions of applied research and public service, of using its resources for the public good. Once that "public" meant citizens of New York State, but today it means all the world's citizens. Areas of research that particularly apply to the global com-munity include sustainability, human health and infectious diseases, food safety, nutrition, and social and economic policy.
Economist Chris Barrett, professor of applied eco-nomics and management,.is focusing on solutions to end poverty at the confluence of policy, technol-ogy, markets, risk management, and finance to cre-ate partnerships that leverage markets and technol-ogies to improve productivity and quality of life.
project to share skills and knowledge with Hondurans for building drink-ing water treatment systems in rural.
areas has brought national recogni-tion for Cornell engineering stu-dents and instructors. Engineers for a Sustainable World has awarded AguaClara-Spanish for clear water-its Best Project Award. In the program 7 students research and design the technologies and then train Hondurans to build and operate the water treat-ment plants.
Closer to home, a group of former Cornell opera-tions research and information engineering stu-dents developed a computer system that Ithaca's Foodnet can use to plan routes and adapt them to changes in client population-saving the local Meals-on-Wheels program thousand of dollars.
A study by a team of Cornell professors shows how Tompkins County can cut its "carbon footprint" by two-thirds. Among the recommended strategies are
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acuity in the Colleges of Engineering and Agriculture and Life Sciences are using high-performance computing-to figure out how to increase the efficiency of bacteria that break down pollutants (hence more* quickly clean up the state's polluted land and waters) and help farmers fine tune their chemical inputs (hence cut down on the amo unt of nitrogen put into soil).
A bacteria called Dehalococcoides ethenogenes, dis-covered in Ithaca sewage sludge in 1997, is now widely used to detoxify such carcinogenic chemi-cals as perchioroethylene (PCE) and trichioroethyl-ene (TCE). This is done by removing chlorine atoms from molecules and leaving less-toxic compounds behind. Ruth Richardson, Cornell assistant profes-sor of civil and environmental engineering, is using computer modeling to boost the power of these bio-logical cleaners and extend their effectiveness in.
remediating other pollutants-PCBs, dioxins, chlo-robenzenes, or chlorophenols.
Soon farmers will be able to enter information about their farm on a web site and receive recom-mendations for how much nitrogen fertilizer to apply to a corn crop tailored to the farm's location within 5 kilometers -or less, thanks to high-perfor-mance computing that will pull together weather data from hundreds of sources every day, year round, and sort out just the part the farmer needs.
These programs illustrate how a broad spectrum of initiatives across Cornell, many interdisciplinary
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Matthew Wadden O08 of the Nany ROTC at the Veterans Day ceremony held at in nature, deliver services for the public good and practical benefit of New Yorkers and those to whom they are increasingly linked around the world.
Outreach Community service has now become a key part of pre-orientation programming. This year more than 50 freshmen and transfer students spent the week before orientation painting, weeding, and cleaning in community projects around Ithaca as part of Cornell's. Pre-Orientation Service Trips (POST) pro-gram. Projects included preparing meals at Loaves and Fishes, a local soup kitchen; landscaping at the Ithaca Sciencenter and the Longview residential senior community; and removing invasive species and improving trails for the Finger Lakes Land Trust.
planned community. with plug-in hybrid cars, an electricity-saving microgrid, and many other green features will soon sprout up on the Big Island of Hawaii, thanks to a group of Cornell students and fac-ulty who have spent a year designing it. The 13 students-from such var-ied disciplines as mechanical engineering, electrical engineering, earth sciences, architecture, landscape architecture, urban planning, and business-are members of CU Green, a group that links academia with industry. They are assisting a development partnership consisting of financier Charles Schwab, Hunt Development Group, and developer Guy Lam in creating Palamanui, a 725-acre cutting-edge community.
Cornell has forged a partnership with New York City's United Federation of Teachers to form a Sci-ence Leadership Academy providing professional development opportunities to educators teaching science in grades 6 to 8. Cornell's Department of
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to enlist in the Army as a medic-two weeks before Sept 11, 2001. Major: Government; Z
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Half a century after most of Cos ta Rica's rain for-ests were cut down,. researchers from the Boyce Thompson Institute for Plant Research (BTI) are seeing success in a project to restore a tropical rain forest ecosystem. Researchers planted mixtures of local tree species on worn-out cattle pastures in Costa Rica in the early 1990s,. (This is the opposite of commercial companies, which, for decades, have planted entire fields With a single type of tree to harvest for wood or paper pulp.) A remarkably high number of native plant species have migrated to the shade of the decade-old trees and begun to flourish there, raising hopes that destroyed rain forests could one day be replaced.
he 2001 World Food Prize laureate, nutritional sciences professor Per Pin-strup-Andersen, is pioneering a pro-gram to take issues of hunger and pov-erty to their global grassroots through a combination of 63 online case stud-ies of -real-world policy issues and workshops for educators in Africa and Asia on how. to use them along with a new textbook written by Pinstrup-Andersen and Fuzhi Cheng.
The goal is to help motivate teachers and replace lectures with a participatory social entrepreneurial approach. "Entrepreneurship education helps stu-dents become leaders, innovators, and creative problem-solvers by teaching them how to apply what they've learned in class to developing practi-cal, innovative, and sustainable approaches to ben-efit society, with an emphasis on thos6 who are marginalized and poor," Pinstrup-Andersen says.
was a student at the University of Southern Maine studying philosophy when he decided College: Arts and Sciences; Hometown: Peaks Island, Maine.
Students, staff, and faculty in theAmerican Indian Program (AIP) are helping high school students in LaFayette Central School to succeed, with a weekly tutoring program that began this year. The goals are to establish relationships as mentors to the younger Native American students and help to open the way for them to go on to college. The LaFayette school district has about a 23 percent Native enrollment, drawing from the nearby Onondaga Nation.
Academics The 2007 New Student Reading Project started the academic year off with lively debates around Nadine Gordimer's novel The Pickup. Identity, along with a host of other complex topics, was the focus of much of the discourse at a large Barton Hall gathering on August 19 and more than 260 small-group discus-sions of Gordimer's book held across campus the fol-lowing day. The gatherings marked the seventh year for the program designed for first-year students.
Some of those students will no doubt go on to exceptional academic achievement. Cornell stu-dents received 21 Fulbright U.S. Student awards and four Fulbright-Hays fellowships in the 2007-08 academic year. Cornell tied Harvard University for sixth place among American universities for the number of Fulbright U.S. Student awards received this year.
Other students will opt for careers with an inter-national focus. In its third year, the undergraduate major in China and Asia-Pacific Studies (CAPS) continued to enjoy increased participation as the program graduated its first students. CAPS majors study for three years in Ithaca and then spend a semester in both Washington, D.C., and Beijing to expose them to the language, culture, history, poli-tics, and foreign policy of the world's largest emerg-ing economy.. Graduates are expected to be in
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Slope Day 2008. RIGHT:
The DVM Hooding Ceremony at the College of Veterinary Medicine's 2008 Commencement.
demand for positions in business, government, public service, diplomacy, journalism, and other fields.
ttracting the best students will con-tinue to put financial pressure on the university. In her second annual Academic State of the University address in March, Provost Martin reported that while Cornell strives to remain competitive with its peer institutions by offering enhanced financial aid packages, government pressure to sup-port more of this aid from the university's endow-ment can take a toll on investments in research and teaching. Martin also cautioned the audience in Kennedy Hall's Call Auditorium that although the way Cornell is perceived through popular rankings published by U.S. News and World Report is impor-tant, more weight should be placed on qualities that cannot be reflected in such narrow analyses.
Cornell's goal, she said, should be to remain a world-class research university that offers both undergraduate and graduate students a top-flight education. Her wish is not for Cornell to be uncom-petitive, she emphasized, but for it to compete on the basis of its unique strengths and not to worry so much about external factors.
Cornell faculty brought their expertise to a num-ber of important conferences last year. "Closing the Minority Achievement Gap in Higher Education," a two-day conference in New York City in October explored strategies for improving retention and achievement among minority college students.
About 75 percent of white and Asian students who enroll in degree programs earn a college degree within six years. For blacks and Latinos, however, the number falls below 50 percent. Attended by educators from leading universities and liberal arts colleges, the event was sponsored by Cornell, the Teagle Foundation, and Credit Suisse, which hosted the event at its Madison Avenue offices. President Skorton, who attended the conference with other senior administrators, pointed out that Cornell still has much to do in this area. Although the univer-sity has been devoted to providing access for all stu-dents since its founding, "we have approximately the same proportion of African American students in.2007 that we had in 1986," he said.
In June, the inaugural Cornell Faculty Institute for Diversity was held near Canandaigua, N.Y.
Organized by the university's Diversity Council and the Center for Learning and Teaching, the institute was designed to help participants incorporate ele-ments of diversity into new or existing courses across a broad range of disciplines.
Diversity and bias issues within the hiring process were also examined. Last fall, a new National Sci-ence Foundation-funded center at Cornell dedi-cated to recruiting more women to engineering and science faculty positions hosted two sessions on equity in hiring. Department chairs and hiring committee members were invited to performances of the Cornell Interactive Theater Ensemble (CITE) that depicted a fictional search committee meeting.
CITE actors portrayed five faculty members in the midst of a discussion that revealed the implict, unconscious biases that can affect the hiring pro-cess. A discussion between audience members~and the actors followed. In the session's closing remarks, Deputy Provost David Harris encouraged the audi-ence to be aware of implicit biases, not only in fac-ulty searches but in decision making within their own departments..
Plans were announced during the year that will expand Cornell's international partnerships. A new program between Cornell and King Abdullah Uni-versity of Science and Technology (KAUST) in Saudi Arabia promises to strengthen Cornell's research
26
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0cco Senior profile of Catherine Elder at the Hartung-Boothroyd Observatory on Mount Pleasant Road. Her true passion is studying the icy satellites of Jupiter and Saturn. Major:
Astronomy; College: Arts and Sciences; Hometown: Boston, Mass.
efforts in energy and sustainability. KAUST, whose, core campus will be located on the Red Sea at Thu-wal, is scheduled to open in September 2009. A $25 million award to Cornell will help create one of four KAUST centers for science research through the Saudi university's Global Research Partnership program. The partnership will focus on a new class of hybrid nanomaterials recently discovered at Cor-nell. Termed nanoparticle ionic materials (NIMs),
they hold potential for applications in emerging technologies for water desalination, carbon cap-ture, and solar energy.
raduate student support also increased with new National Science Foundation funding designed to strengthen communication and col-laboration between disciplines in two Cornell centers. A $2.9 million grant to the Cornell Center for Mate-rials Research and a $3.2 million grant to Cornell's Nanobiotechnology Center were awarded by the NSF's Integrative Graduate Educa-tion and Research Traineeship (IGERT). The grants will provide graduate student fellows with training and research experience under the mentorship of faculty members in different fields. Thirty IGERT fellows will participate during the program's five-year term.
Two of Cornell's critical new initiatives were strengthened with the addition of outstanding researchers during the year. In April the Cornell Center for a Sustainable Future (CCSF) named three new associate directors, all current Cornell faculty members, who will use their expertise in key areas to head initiatives and connect Cornell's research and scholarship related to sustainability.
Associate Professor Anurag Agrawal will oversee programs focused on the environment, Professor Chris Barrett will head the center's economic devel-Students Receive Scholarships and Awards Three Cornell juniors received the 2007-09 Morris K. Udall Scholarship for U.S. students with excellent academic re-cords and an interest in careers in environmental public policy, health care, and tribal public policy. And a sopho-more and a junior were honored with 2008 Barry M. Gold-water Scholarships for academic excellence in math, sci-ence, and engineering.
Jessie Comba (College of Agriculture and Life Sci-ences), Katherine McEachern (College of Human Ecology), and Ryan Walter (College of Engineering),
all class of '09, were among the 80 students sele(ted na-tionwide from among 510 candidates nominated by 239 colleges and universities for the Udall scholarship. The Udall scholars garnered awards up to S5,000 each. The students' selection places Cornell among only three U.S.
institutions (the other two are American University and the University of Montana) to have three Udall scholars this year. Since 1998 Cornell students have won 28 Udall scholarships.
Parbir (Parry) Grewal '10 (College of Engineering) and Anna Owczarczyk '09 (College of Agriculture and Life Sciences) were among 321 Goldwater scholars selected this year from 1,035 candidates. The one-and two-year Goldwater scholarships cover tuition, fees, books, and room and board up to $7,500 per year. In the past 12 years, 35 Cornellians have'won these scholar-ships.
Elisabeth Becker '06 won a 2007 Marshall Scholar-ship that she used to attend Oxford University, England, starting in October 2007. Becker, who is from New York City, is studying forced migration as a graduate student in development studies at Oxford. She also is interested in global governance and diplomacy as a possibility for a dual master's degree. She ultimately wants to influence refugee resettlement policy, either with human rights or-ganizations or the United Nations.
The Marshall Scholarship, established in 1953, covers the recipient for two years at any university in the United Kingdom, including living expenses, travel and grants for research and books. Applicants are reviewed by eight re-gional committees nationwide. Forty-three scholarships were awarded to students across the United States in 2007.
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U opment programs, and Professor Sidney Leibovich will direct the center's energy programs. CCSF serves as an umbrella organization for Cornell's diverse sustainability resources, including insti-tutes, centers, and some 300 faculty members focused on green issues.
n May, Scott Emr, director of the Weill Insti-tute for Molecular and Cell Biology, announced the hiring of three new assistant professors and a research scientist with experience in both biological science and the use of cutting-edge technology. The four were selected from more than 500 applicants eager to join Emr's team in Weill Hall, the university's new life sciences technology building.
Among faculty news was the announcement that four Cornell faculty members were included in the ranks of new American Academy of Arts and Sci-ences fellows. They are Barbara A. Baird, the Horace White Professor of Chemistry and Chemical Biol-ogy; John Guckenheimer, professor of mathemat-ics; Carol L. Krumhansl, professor of psychology; and G. Peter Lepage, professor of physics and the Harold Tanner Dean of the College of Arts and Sci-ences. Founded in 1780, the American Academy of Arts and Sciences is one of the nation's oldest and most prestigious honorary societies and indepen-dent policy research centers.
Several vacant dean positions were filled during the year. The Johnson Graduate School of Manage-ment and College of Human Ecology both turned to longtime faculty members. Joe Thomas, who had been serving as interim dean of the Johnson School, was selected to replace Robert Swieringa, who stepped down after 10 years of leadership. Alan Mathios, a 16-year member of the Human Ecology faculty who also was serving as interim dean, replaced Lisa Staiano-Coico, who left Cornell to become provost at Temple University.
nq as American Sign Language interpreters during the program.
In the College of Architecture, Art, and Planning, an extensive dean's search resulted in the appoint-ment of Kent Kleinman, chair of the Department of Architecture, Interior Design and Lighting at Par-sons The New School for Design in New York City.
Kleinman replaces Mohsen Mostafavi, who left AAP in January to become dean of Harvard's Grad-uate School of Design.
Also leaving their positions were Vice Provost for International Relations David Wippman, who was named dean of the University Minnesota Law School, and Robert Harris, who stepped down as vice provost for diversity and faculty development to return to the faculty. Wippman was succeeded by Alice Pell, CALS professor and director of the Cor-nell International Institute for Food, Agriculture, and Development. Harris was replaced by Elizabeth "Beta" Mannix, Johnson School professor and director of Cornell's Institute for the Social Sci-ences. Her one-year appointment as vice provost for equity and inclusion will serve as a transition to the position of vice provost for diversity and chief diverr sity officer, a new position for which a search is under way.
Other changes within the provost's office included the appointment of Deputy Provost David Harris to serve as interim provost while a search is conducted to replace Provost Martin, and the appointment of Robert Buhrman, director of Cornell's Center for Nanoscale Systems, as vice provost for research.
Buhrman replaces Nobel laureate Robert Richard-son, who now serves as senior science adviser to the president'and provost.
.Cornell University 2007-2008 Financial Report Message from the Vice President for Finance and Chief Financial Officer Financial Review Management Responsibility for Consolidated Financial Statements Independent Auditors' Report Notes to the Consolidated Financial Statements University Administration Board of Trustees and Trustees At Large 30 34 39 40 45 61 62
MESSAGE FROM THE VICE PRESIDENT FOR FINANCE AND CHIEF FINANCIAL OFFICER Economic conditions in the past year, and especially in the past few weeks, have drawn attention to financial portfolios throughout our nation. With its substantial endowment and significant fiduciary responsibilities, Cornell University is no exception. As always, we are committed to providing the lowest overall cost of capital balanced with managed risk exposure, and the university uses debt as a strategic tool to manage its finances. Given the current state of the capital markets and concerns about liquidity, I thought this would be a good time for an examination of Cornell's debt strategy.
Higher Education Debt Market Nationally, higher education is facing aging facilities with costly infrastructure needs, charitable contribution levels that do not keep pace with program requirements, and greater global competition. Debt financing allows institutions of higher education to pay for their assets over time, based upon useful life, matching a payment stream with the economic life of a particular asset. Through debt financing, universities are able to construct state of the art research facilities, residence halls, classrooms, and critical care facilities, which are necessary to maintain a competitive advantage and provide the ability to attract top faculty and students while performing the key missions of teaching, research, and service.
Higher education debt, which was almost non-existent until the early 1980s, has swelled to its current level over the last twenty five to thirty years, because investors have recognized that universities with strong credit ratings are an attractive pool of assets-a revenue stream against which money can be borrowed. In the early 1980s, higher education debt began to increase at a modest pace to meet the growing need for capital. In the 1980s and 1990s, use of debt as a manage-ment tool continued to increase more quickly, and by the year 2000, debt was growing at a fast pace.. Since 2000, in eight short years, the increase in debt at higher education institutions has more than tripled. Today, higher education is a leader in effectively using tax-exempt debt to advance institutional missions.
Debt affordability can be described as the key determinant in an institution's ability to issue and repay debt. Since debt is a long-term obligation and debt service is a current expenditure, typically the institution's outstanding debt is measured against its unrestricted assets and debt service expense is measured against available liquid resources. To manage institutional risk,, universities look to their cash projections as an indicator of their ability to pay for the debt. Often, the University's "debt affordability limit," the maximum debt the University can bear, is less than its "debt capacity limit," which is the level of debt that the University can prudently show on its balance sheet-a function of factors such as strength of student demand, unrestricted assets, risk profiles of potential investors, financial rating agencies, and fundraising capabilities.
While utilizing debt to maximize financial position may be strategically sensible, doing so carries with it certain risks.
For example, there may be interest rate risk if variable rate debt is issued without being hedged; there may be tax risk if variable rate or hedged tax-exempt debt is issued; there may be counter-party risk if a third party fails to make required payments; and there is always risk that a change in tax law or taxable use of a facility will eliminate the advantage of using tax-exempt over taxable bonds. Additionally, liquidity risk may be incurred, such as when an issuer cannot find a market for its bond, resulting in no liquidity facility, or when an issuer is unable to renew a liquidity facility needed to support variable rate demand bonds during a regular remarketing schedule. In these cases, the University would be required to purchase the bonds.
Cornell Debt History and Strategy In the late 1940s and early 1950s, Cornell's Board of Trustees debated the merits of debt financing. In the late 1960s, the trustees again were concerned about the lev-el of debt at Cornell and thus limited the amortization period to five years or less. By 1973, the University had approximately $60 million in debt and the question -of "How much debt is excessive?" was a discussion topic at more than one Board meeting. At that time, Cornell "Cornell has acted strategically when issuing debt, deciding carefully when debt is appropriate,and which type of debt should be issued."
compared its outstanding debt to the value of physical plant
($367 million). In 1973,16.3 percent of the value of physical capital was debt financed, compared to the national average of 18.4 percent for private universities.
In 1984, Cornell's credit rating was upgraded to AA and a ten-year financing plan was developed. Use of debt was still considered a privilege and used only after careful and judicious consideration. Because of Cornell's limited focus on its use of debt as a strategic tool, its ratios for debt capacity were significantly more favorable than its peers, although its total cost of debt was higher.
By the mid 1990s, Cornell not only used debt for capital projects, but also participated in three different bond programs with other New York State colleges and universi-ties to borrow funds for student loan programs. Cornell borrowed approximately $30 million, after establishing the standard that these bond proceeds would be used to make student loans.
30
The chart below shows the amount of outstanding debt by year since 1996.
Cornell Outstanding Debt 0
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0 Cornell has acted strategically when issuing debt, decid-ing carefully when debt is appropriate, and which type of debt should be issued. For example, in 1996, the University refunded $130 million of its 1986 bonds due to mature in 2015 by using commercial paper and other variable debt.
The present-value savings from using this structure was almost $2 million.
The University then began using debt more aggressively as a strategy to fund working capital and to provide interim bridge funds for capital projects at favorable interest rates. In 1999, it established a tax-exempt commercial paper program at an authorized level of $100 million. The average interest rate for the first four years of the program was 37 basis points lower than the national Bond Market Association (BMA) weekly variable rate bond index. This was due to Cornell's good credit rating and the high New York State income tax rates. The University added a taxable commercial paper line in 2002, and both lines have subsequently been increased to
$200 million each, for a total of $400 million. Commercial paper is used for short term bridge financing.
The University's financial leadership team believes its responsibility is to maintain the lowest cost of capital with-out exposing the University to the earlier-described risks.
This has been accomplished by fixing attractive interest rates through significant use of interest hedges. Currently, the University's adjusted portfolio interest rate is 3.7 percent.
The University also locked in interest cost on future debt needs through the execution of approximately $1 billion in future interest rate hedges. In addition, four hedges were ob-tained through multiple Aaa/AAA rated swap counterparties, limited to $400 million each to minimize credit exposure.
The University also established a $50 million Treasury Bond Fund to provide a two month liquidity reserve. Outside consultants have indicated that the University's risk exposure is well diversified and actively managed.
On June 30, 2008, the total Cornell outstanding debt is approximately $1 billion. The University continues to maintain its AA credit rating and regularly compares its debt capacity and ratings with its peers. The University and its trustees also periodically evaluate whether it should attempt to become an AAA rated institution. In each discussion the conclusion has been that there is little difference in interest rates of AA and AAA bonds. Institutional debt strategies are focused on maintenance of its AA credit rating; the value of an AAA is not worth the premium of building up assets on the balance sheet.
As the University establishes and revises institutional priorities through its strategic planning processes-capital planning, campus master plan and the 10-year financial plan-it considers utilizing a mix of financing and funding sources including gifts, internal reserves, and external debt based on its affordability level. Appropriate use of leverage enables the University to advance its mission, achieve its strategic goals, and ensure financial health over the long term. Cornell's 10-year financial plan is aligned with its capital construction plan, and debt affordability levels intend to inform debt funding levels without the loss of financial flexibility, balance sheet strength, or competitive advantage.
One key financial ratio is expendable resources to debt. As you can see from the chart below, the University has maintained a strong ratio.
EXPENDABLE RESOURCES TO DEBT Nlot Asntn + Tomnrorailv Restrinted Net As*sets -FEuity rn Plant
[ JnrR*lrlCiR*
16 14 12 10 0
Total Debt University Ratio I-Moody's Aaa Median
-Moodys Aa Median 60 r 0 4.7 4,5 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 8
6 4
2 (all figures in $ millions)
EXPENDABLE RESOURCES DEBT Expendable Resources to Debt (x Coverage) 1,630 1,926 2,310 2,549 3,069 2,815 2,505 2,453 2,756 2,959 3,376 4,225 455 414 449 422 509 481 450 426 542 491 756 800 3.6x 4.7x 5.1x 6.0x 6.Ox 5.9x 5.6x 5.8x 5.1x 6.Ox 4.5x 5,3x The University has typically borrowed at variable rates and then hedged its interest rate risk through fixed rate swaps.
Cornell's method to reduce risk is to structure swap agreements only with counterparties that are rated at or above the University's credit rating, and to require collateralization of the swap in the event of a downgrade. Cornell has been a leader among its peers in utilizing low variable rates while protecting risk through the use of swaps. The University is currently evaluating the appropriate mix of swaps and debt structures based on its current 10-year plan and in light of the current economic conditions and risk environment. Cornell currently has 25 percent of its debt portfolio in fixed rate debt, with another 53 percent in synthetic fixed rates.
CURRENT PORTFOLIO ALLOCATIONS Risk-Free Fixed (Rates are fixed for the life of the Issues)
$254,134 At-Risk Fixed (Rates may be variable depending on market condltons)
$526,915 Floating Rate (Rates are variable and subject to risk)
$218,121 4
4 1
All figures in $000s. As of 6/30/08, unless otherwise noted.
[1] - Assumes Other at 4% interest rate and assumption is carried forward through rest of the presentation and analysis, unless otherwise noted.
[21 - Includes 2008 Swap, 2002BSwap, 2002ASwap, 2007MS, wo/ich has an extension option, 2004 Swap. and 2000B swap. Does not include forward starting swaps.
32
In the recent environment of 50-year low interest rates, the University has been able to take advantage of a weighted average interest rate of approximately 3.7 percent for its current outstanding debt. The average spread between short-term and long-term debt over the past 20 years has been about 2.75 percent, making a managed level of variable debt a cost effective debt strategy.
Management has further diversified the debt portfolio by expanding the number of high quality investment and commercial banks used as partners for underwriting bonds and providing liquidity facilities. Management regularly reviews its credit ratings, financial ratios, debt outstanding, annual debt service, available capacity, and affordability with the Finance Committee of the Board of Trustees.
Summary Through the appropriate use of financial leverage and management of associated risks, debt is used as a financial tool to fulfill Cornell's strategic plan. Debt provides the financial resources for investment to build the new facilities needed to maintain and grow academic operations, expand research activities, preserve cash, and meet the needs of the next generation and beyond.
The current economic conditions require the University to pause and reevaluate the appropriate mix of debt structures for the debt portfolio in light of risk tolerance, while meet-ing the needs of the University in these trying times. The goal over the coming year is to provide better transparency and clearer guidelines, to continue to strengthen Cornell's academic partnership, and to maintain a strong balance sheet to meet the future needs of the University.
Joanne M. DeStefano Vice President for Finance and Chief Financial Officer 33
FINANCIAL REVIEW BY THE UNIVERSITY CONTROLLER In November, 2007, the Federal Reserve Bank of San Francisco held a conference on "Recent Trends in Economic Volatility." The participants concluded that. over the last 25 years the U.S. economy has become much less volatile, with swings from boom to bust greatly reduced. This trend might well continue in the long run, but economic activities during the last half of this fiscal year began to suggest instability and uncertainty.
Although there was weakness in the national economy during fiscal year ended June 30, 2008, the University's audited financial statements reflect the overall financial soundness of the University.
NEW STANDARDS, EMERGING ISSUES AND INITIATIVES Financial Standards Accounting Board (FASB)
In the current fiscal year, Cornell adopted Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48), which requires organizations to recognize a liability or reduction of an asset in the financial statements for any tax position that fails to meet the "more likely than not" threshold. FIN 48 had no impact on the University's results as disclosed in the notes to the consolidated financial statements (Note 0).
The University elected early adoption of one the disclo-sure requirements in the FASB's staff position FSP FAS 117-1, Endowments of Not-for-Profit Organizations: NetAsset Classification of Funds Subject to an Enacted Version of the Uniform Prudent Management of Institutional Funds Act, and Enhanced Disclosures forAll Endowment Funds. We have included in the notes to the consolidated financial statement (Note 10) information on the endowment that includes the opening balances of true endowments and funds function-ing as endowment (FFE), current year activities and the endowment balances at June 30, 2008.
Contributions for capital projects and the endowment "...increased 13.5 percent for the fiscal year ended June 30, 2008."
In the prior fiscal year, the University adopted FAS 158 and recognized a reduction in unrestricted net assets of $77.1 million for the unfunded status of its pension and post-re-tirement medical benefits in unrestricted net assets. The FAS 158 adjustment for fiscal year ended June 30, 2008 reflects an expense of $16.5 million in nonoperating activities.
Regulatory Environment Congress and the IRS continue to scrutinize not-for-profit organizations in general and higher education in particular..During this fiscal year, the University responded to the Senate Finance Committee's lengthy questionnaire about endowments, payout policies, student enrollments, tuition rates and financial aid. On September 8, 2008 Senator Grassley and Congressman Welch held a roundtable discussion as another step "... to ensure accountability by the not-for-profit sector." Although there is currently no proposed legislation to mandate payout rates from endowments, the issues of endowment growth, payout rates and cost of education continue to be a focus of Congress.
The IRS is exceedingly active in monitoring the not-for-profit sector with the stated objectives of increased transparency, accountability, and compliance. The IRS issued the final, radically redesigned information return (IRS Form 990) effective for fiscal year 2009 (tax year 2008), and is also considering a new university-specific schedule for the 990 to capture more information about student population and cost of education. This schedule would be in addition to the sixteen schedules now included in the new 990.
In addition, the IRS has developed a compliance question-naire for higher education similar to their compliance questionnaire for hospitals and tax exempt bond financing, and plans to send this questionnaire to approximately four hundred colleges and universities in early fall 2008.
LONG-TERM INVESTMENT POOL Source and applications (in millions)
Beginning market value Gifts and other additions Withdrawals Realized and unrealized gain/(loss)
Ending market value Unit value at year end (in dollars) *
- Unit values adjusted for 2 for 1 unit split on July 1, 1998 34
Current Initiatives The University continues to refine the Ten-Year Financial Plan that it implemented during fiscal year 2007. The ongoing development and revision to this planning tool is important in identifying resources essential for funding strategic initiatives that include, but are not limited to, new buildings, systems, and the recruitment and retention of faculty and staff.
FINANCIAL YEAR IN REVIEW The notes to the consolidated financial statements (Note 10) provide detailed information on the University's net assets by restriction classification and purpose. In the fiscal year ended June 30, 2008, operating activities generated a loss with a corresponding decline in unrestricted net assets.
Cornell's current-year activities, based on the combined results from both operating and nonoprating activities, generated an increase to total net assets, as noted above, of
$200.2 million. Although this increase represents a decline from the prior year, the current year results continue to show solid performance.
Operating Income and Expenses For the fiscal year ended June 30, 2008, the change in net assets from operations reflects a loss of $69.8 million. The University's operating revenues grew by $136.2 million, or 5.4 percent, while growth in operating expenses grew at a rate faster than revenues, as they did during the prior year.
Operating Income The University's wealth, measured by the current-year change in net assets, continues to grow. Net assets increased by $200.2 million for fiscal year ended June 30, 2008. This year's increase, albeit modest, occurred during a year marked by overall weakness and volatility in the economy.
"Total net assets exceed
$8 billion, and unrestricted net assets account for over $5 billion of the University's accumulated wealth."
The University's investment portfolio generated returns of 2.7 percent for the current year, compared to 25.9 percent in the prior fiscal year. This significant decline in investment returns is the major factor in the University's smaller increase to total net assets. The University's investment returns, did, however, outperform a passive benchmark (i.e., 75 percent S&P and 25 percent Lehman Aggregate indexes) by more than 10 percent.
OTHER 19%
MEDICAL PHYSICIAN'S ORGANIZATION 17%
INVESTMENT RETURN 11%
TUITION, NET 18%
APPROPRIATIONS 7%
GRANTS AND CONTRACTS 20%
I CONTRIBUTIONS 8%
1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08
$2,427.6
$2,760.3
$3,288.0
$ 3,043.9
$ 2,750.4
$2,720.8
$ 3,070.2
$3,623.2
$4,180.4
$5,197.5 147.8 146.4 135.4 132.5 124.3 88.9 234.8 202.0 128.7 236.8 (40.5)
(55.5)
(84.6)
(110.5)
(128.1)
(116.4)
(37.1)
(33.7)
(125.1)
(130.1) 225.4 436.8 (294.9)
(315.5)
(25.8) 376.9 355.3 388.9 1013.5 73.9
$2,760.3
$3,288.0
$3,043.9
$2,750.4
$2,720.8
$3,070.2
$3,623.2
$4,180.4
$5,197.5
$5,378.1 51.16 58.16 51.85
$ 44.95
$ 42.65
$ 46.51 50.11 55.42
$ 66.62
$ 65.37 35
Tuition revenues, net of the scholarship allowance, increased by $31.4 million, a 7.1 percent increase from the prior year, due to increases in both overall enrollment in the graduate and professional schools and authorized tuition rates.
Appropriations, both federal and state, increased by $17.5 million. There was a one-time increase of $3.7 million in federal appropriations and an increase of $13.8 million in New York State appropriations. With the current state of New York's economy, it is likely that state appropriations will decline in future years.
Income from sponsored awards increased overall by
$8.7 million, consisting of a $4.3 million increase for the endowed colleges, a $9.4 million increase for the Medical College, particularly in federally funded awards, and a $5.0 million reduction in the contract colleges. Indirect cost re-coveries decreased by $2.2 million, based primarily on the phase-in of lower negotiated rates for the contract colleges, which affect a larger proportion of the total active awards.
When current awards are extended or new awards granted, they are subject to the lower negotiated rate.
Cornell's donors contribute in major ways to the University's growth, focusing in the current year on support for capital projects and the endowment, consistent with the goals of the capital campaign. Contributions for these purposes, re-ported as nonoperating revenues, increased 13.5 percent for fiscal year ended June 30,2008. Contributions for operations have declined by less than 1 percent from the prior year.
Cornell's distribution of investment returns for operations decreased by $9.7 million, or 3.4 percent. The distribution has two major components: payout from the Long Term Investment Pool (LTIP), based on the per-share rate, and payout from the Pooled Balance Income Fund (PBIF). The payout rate from the LTIP increased by 9.0 percent to $2.66 per share, from $2.42 in the prior fiscal year. In fiscal year ended June 30, 2008, market conditions did not support an additional discretionary payout from the PBIF to help fund initiatives. In the prior year, $38.0 million of additional funding was provided from PBIF investment gains to sup-port major initiatives.
The University's total operating expenses increased by 9.6 percent during fiscal year ended June 30, 2008.
Compensation and benefits represent 64.5 percent of total operating expenses, a pattern that is generally consistent with other research universities. The combined costs for compensation and benefits increased by $126.5 million, or 7.8 percent.
Operating Expenses INTEREST DEPRECIATION UTILITIES RENTS 1%
6%
SUPPLIES 18%
SERVICES -
5%
.COMPENSATION/
BENEFITS 65%
The salary and wage component increased by $90.0 mil-lion, to a total of $1.4 billion for fiscal year ended June 30, 2008. Salary and wage costs at the Medical College account for approximately $46.0 million of the increase. Employ-ment at the Medical College increased by 9.1 percent to support key strategic initiatives: faculty hiring in key de-partments; expanded research initiatives, administrative support for research compliance, and other activities in Qa-tar; systems implementations; and the Medical Physicians' Organization. The workforce in Ithaca grew by approximately 1.1 percent. The University's annual salary improvement program also impacts the $90.0 million increase, but within the range established by management (i.e., overall salary improvement increases of 3-4 percent).
Benefit costs for fiscal year ended June 30,2008 were $348.1 million, compared to $311.7 million in the prior year. This 11.7 percent increase includes pension costs, post-retirement benefit costs, vacation accruals, and costs for medical and workers' compensation claims incurred but not yet paid.
The costs of purchased services increased by $18.1 million, or 14.3 percent, due to increases in patent-related expenses, investment management fees, and costs for systems implementations at both the Ithaca and the Medical College campuses. The costs for supplies and general expense increased by $52.1 million, or 12.2 percent. Increased activities at the Medical College accounted for $18.4 mil-lion of the increase. This includes a broad range of expenses such as lab costs, office supplies, maintenance expenses, and additional expenses for activities in Qatar.
Depreciation expense continues to increase as the new buildings open and new research labs become operative, consistent with Cornell's strategic plan. Two major facilities opened in fiscal year ended June 30, 2008: the Life Science Technology Building and the East Campus Research Building. In addition, the University uses shorter lives for components of buildings where appropriate, and this, too, serves to increase depreciation expense.
Nonoperating Income and Expenses Nonoperating income for fiscal year ended June 30, 2008 was $269.9 million, compared to $1.3 billion in the prior year. The decline, as mentioned above, is attributable in large part to the investment return. A review of Cornell's recent history reflects the consistent impact of investment return on each year's performance. Overall investment re-turn declined by $1 billion, or 85.8 percent, for fiscal year ended June 30, 2008.
In fiscal year ended June 30, 2008, there was a loss of $33.4 million recorded as "other" in nonoperating activities. This loss consists primarily of the year-end market adjustment for the debt swaps based on interest rates in effect at June 30, 2008.
Statement of Financial Position (Balance Sheet)
The University's total assets grew by 5.2 percent, to $10.6 billion at June 30,2008. Contributions receivable increased by $170.9 million, or 34.4 percent, based on gross pledges less the discount and allowance for uncollectible pledges.
Total new pledges for fiscal year ended June 30, 2008 were
$265.8 million. The increase of $170.9 million includes*$17.5 million in accretion of the discount associated with the net present value calculation at the time of the gift.
The University's land, buildings and equipment, net of deprecation, increased by 11.4 percent to $2.6 billion at June 30, 2008. Cornell capitalized numerous proj-ects in this fiscal year. As mentioned previously, the two major building projects are the Life Science Technology Building, with capitalized costs of $133.8 million, and the East Campus Research Facility, with capitalized costs of
$51.5 million.
Extraordinary returns on investments over the past several years were the primary reason for the University's substantial increase in assets over that time period. In fiscal year 2008, the investment portfolio's overall return was 2.7 percent, and the value of total investments increased to $6.5 billion, from $6.4 billion in the prior year.
Inventories and prepaid expenses declined due to the market adjustment for debt swaps. The year-end adjustment for debt swaps is affected by interest rates at one point in time. In the current year, the adjustment was recognized as an expense based on interest rates at June 30. This market adjustment caused the decrease in prepaid expense and the correspond-ing increase in accounts payable and accrued expenses. The increase in deferred revenue and other liabilities of $161 million is based primarily on the University's increase in its line of credit of $134 million.
At June 30, 2008, the University's liability for deferred ben-efits was $425.0 million, compared to $374.6 million-in the prior year. The $50.4 million increase reflects, as highlighted in the section on operating expenses, increased costs for va-cation accruals, the impact of recording the unfunded status for pensions and post retirement medical benefits (i.e., the FAS 158 adjustment), and expenses for medical and workers' compensation claims incurred but not yet paid.
Bonds and notes payable increased by approximately 24.9 percent, due primarily to the new financing in 2008. The increase in debt reflects the University's commitment to fund infrastructure, buildings, and equipment through strategic use of debt as well as contributions from donors, and the use of unrestricted net assets.
Summary Cornell's balance sheet reflects its financial strength. The University's net assets grew by $200.2 million, even in a year marked by overall economic weakness. Total net assets exceed $8 billion, and unrestricted net assets account for over
$5 billion of the University's accumulated wealth.
The new format for the consolidated statement of activities displays the results from operating activity separately from the results of nonoperating activity. We hope this format enhances the reader's understanding of the -University's financial activities, including the extraordinary generosity of the University's donors who provide major support for operating initiatives and critical funding for plant and endowments which are cornerstones for ensuring the Uni-versity's continued excellence.
Anne Shapiro University Controller 37
MANAGEMENT RESPONSIBILITY FOR CONSOLIDATED FINANCIAL STATEMENTS The management of Cornell University is responsible for the preparation, integrity and fair presentation of the consolidated financial statements that have been prepared in conformity with generally accepted accounting principles and, as such, include amounts based on judgments and estimates by management. The University also prepared the other information in this annual report and is responsible for its accuracy and consistency with these consolidated financial statements.
The consolidated financial statements have been audited by the independent accounting firm KPMG LLP, which was given unrestricted access to all financial records and related data, including minutes of all meetings of trustees.
The University believes that all representations made to KPMG LLP during its audit were valid and appropri-ate. The independent auditors' report expresses an independent opinion on the fairness of presentation of these consolidated financial statements.
The University maintains a system of internal controls over financial reporting that is designed to provide reasonable assurance to the University's management and Board of Trustees regarding the preparation of reliable published financial statements. Such controls are maintained by the establishment and communication of accounting and financial policies and procedures, by the selection and training of qualified personnel, and by an internal audit program designed to identify internal control weaknesses in order to permit management to take appropriate, corrective action on a timely basis.
There are inherent limitations in the effectiveness of any system of internal control, including the possibility of human error and the circumvention of controls. Accordingly, even an effective internal control system can provide only reasonable assurance with respect to financial statement preparation. Furthermore, the effectiveness of the internal control system can change with circumstances.
The Trustees of Cornell University through its Audit Committee, comprised of trustees not employed by the University, are responsible for, engaging independent accountants and meeting with management, internal auditors, and the independent accountants to ensure that all are carrying out their responsibilities. Both internal auditors and the independent accountants have full and free access to the Audit Committee.
David J. Skorton Stephen T. Golding Joanne M. DeStefano Anne Shapiro President Executive Vice President for Vice President for Finance University Controller Cornell University Finance and Administration and Chief Financial Officer 39
CONSOLIDATED FINANCIAL STATEMENTS OndiependIenfr Auditors' Report The Board of Trustees of Cornell University:
We have audited the accompanying consolidated statement of financial position of Cornell University as of June 30, 2008, and the related consolidated statements of activities and cash flows for the year then ended. These consolidated financial statements are the responsibility of the University's manage-ment. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. The prior year summarized comparative information has been derived from the University's 2007.consolidated financial statements and, in our report dated September 20, 2007, we expressed an unqualified opinion on those consolidated financial statements. Our opinion on the University's 2007 consolidated financial statements included an explanatory paragraph regarding the University's adoption of the provisions of Financial Accounting Standards Board Statement No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Benefit Plans.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
An audit includes consideration of internal control over financial reporting as a basis for designing audit procedu'res that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the University's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting prin-ciples used and significant estimates made by management, as well as evaluating the overall -financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Cornell University as of June 30, 2008, and the changes in its net assets and its cash flows for-the year then ended, in conformity with U.S. generally accepted accounting principles.
LUP Albany, New York September 26, 2008 40
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS OF JUNE 30, 2008 (in thousands (WITH COMPARATIVE INFORMATION AS OF JUNE 30, 2007) 2008 2007 Assets I
Cash and cash equivalents 2
Collateral for securities loaned 3
Accounts receivable, net (note 2-A) 4 Contributions receivable, net (note 2-B) 5 Inventories and prepaid expenses 6
Student loans receivable, net (note 2-C) 7 Investments (note 3) 8 Land, buildings, and equipment, net (note 4) 9 Funds held in trust by others i0 Total assets Liabilities 11 Accounts payable and accrued expenses 12 Payable under securities loan agreements 13 Deferred revenue and other liabilities (note 7) 14 Obligations under split interest agreements 15 Deferred benefits (note 5) 16 Funds held in trust for others (note 6) 17 Bonds and notes payable (note 7) 18 Government advances for student loans
.19 Total liabilities 41,279 215,854 276,891 666,817 62,829 72,284 6,549,288 2,616,230 105,904 10,607,376 306,654 215,854 299,283 128,540 425,038 147,036 999,170 47,146 2,568,721 5,129,765 919,960 1,988,930 8,038,655 T
10,607,376 27,569 346j804 247,965 495,910 75,176 64,931 6,369,225 2,348,223 103,550 10,079,353 227,321 346,804 138,263 125,131 374,557 184,830 800,107 43,875 2,240,888 5,303,889 777,922 1,756,654 7,838,465 10,079,353 Net assets (note 10) 20 Unrestricted 21 Temporarily restricted 22 Permanently restricted 23 Total net assets 24 Total liabilities and net assets The accompanying notes are an integral part of the consolidated financial statements.
41
CONSOLIDATED STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2008 (in thousands)
(WITH SUMMARIZED INFORMATION FOR THE YEAR ENDED JUNE 30, 2007)
Temporarily Restricted Unrestricted Operating revenues I
Tuition and fees 2
Scholarship allowance 3
Net tuition and fees 4
State and federal appropriations 5
Grants, contracts and similar agreements 6
Direct 7
Indirect cost recoveries 8
Contributions 9
Investment return, distributed (note 3-A) 10 Medical Physicians' Organization 11 Auxiliary enterprises 12 Educational activities and other sales and services 13 Net assets released from restrictions 14 Total operating revenues 669,681 (194,071) 475,610 190,885 390,837 114,121 87,257 197,027 451,497 140,993 373,970 146,716 2,568,913 1,746,496 144,594 478,041 138,223 27,784 173,775 2,708,913 (140,000) 130,262 83,958 2,740 (146,716) 70,244 Operating expenses (note 9) 15 Compensation and benefits 16 Purchased services 17 Supplies and general 18 Utilities, rents and taxes 19 Interest expense (note 7) 20 Depreciation 21 Total operating expenses 22 Change in net assets from operating activities 70,244 Nonoperating revenues and (expenses) 23 State and federal appropriations for capital acquisitions 24 Grants, contracts and similar agreements for capital acquisitions 25 Contributions for capital acquisitions, trusts and endowments 26 Investment return, net of amount distributed (note 3-A) 27 Change in value of split interest agreements 28 Pension and postretirement changes other than net periodic costs (note 5-C) 29 Other 30 Net asset released for capital acquisitions and reclassifications 55,580 2,451 57,616 (128,834) 8,627 (16,481)
(62,791) 49,708 110,323 6,747 (5,609) 29,359 (69,026) 31 Change in net assets from nonoperating activities (34,124) 71,794 32 Change in net assets before effect of change in accounting principle 33 Effect of adoption of FASB Statement No. 158 (notes 1 -0, 5-C) 34 Change in net assets 35 Net assets, beginning of the year 36 Net assets, end of the year (174,124) 142,038 (174,124) 5,303,889 5,129,765 142,038 777,922 919,960 The accompanying notes are an integral part of the consolidated financial statements.
42
Permanently Restricted 2008 Total 2007 Total 669,681 (194,071) 475,610 190,885 390,837 114,121 217,519 280,985 451,497 140,993 376,710 633,387 (189,225) 444,162 173,360 382,181 116,274 219,136 290,655 438,355 134,731 304,101 2,502,955 1,620,037 126,488 425,987 120,853 30,509 147,639 2,471,513 31,442 2,639,157 1,746,496 144,594 478,041 138,223 27,784 173,775 2,708,913 (69,756) 2 3
4 5
6 7
8 9
10 11 12 13 14 15 16 17 18 19 20 21 22 196,751 12,333 3,874 19,318 55,580 2,451 364,690 (109,754) 6,892 (16,481)
(33,432) 25,220 23 6,805 24 321,414 25 911,461 26 12,147 27 28 21,754 29 30 232,276 232,276 232,276 1,756,654 1,988,930 269,946 200,190 200,190 7,838,465 8,038,655 1,298;801 1,330,243 (77,133) 1,253,110 6,585,355 7,838,465 31 32 33 34 35 36 43
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED JUNE 30, 2008 (in thousands)
(WITH COMPARATIVE INFORMATION FOR THE YEAR ENDED JUNE 30, 2007) 2008 2007 Cash flows from operating activities I
Change in net assets Adjustments to reconcile change in net assets to net cash provided/(used) by operating activities 2
Contributions for capital acquisitions, trusts and endowments 3
Income for-endowments and other donor restricted funds 4
Depreciation 5
Net realized and unrealized (gain)/loss on investments 6
Pension and postretirement changes other than net periodic costs 7
Effect of adoption of FASB Statement No. 158 8
Other adjustments Change in assets and liabilities 9
Accounts receivable, net 10 Contributions receivable, net 11 Inventories and prepaid expenses 12 Accounts payable and accrued expenses 13 Deferred revenue and other liabilities 14
.Deferred benefits 15 Government advances for student loans 16 Net cash provided/(used) by operating activities Cash flows from investing activities 17 Proceeds from the sale and maturities of investments 18 Purchase of investments 19 Acquisition of land, buildings, and equipment (net) 20 Student loans granted 21 Student loans repaid 22 Change in funds held in trust for others 23 Net cash used by investing activities Cash flows from financing activities Contributions restricted to 24 Investment in endowments 25 Investment in physical plant 26 Investment subject to living trust agreements 27 Income for endowments and other donor restricted funds 28 Principal payments of bonds and notes payable 29 Proceeds from issuance of bonds and notes payable 30 Bond issuance costs incurred 31 Change in obligations under living trust agreements 32 Net cash provided by financing activities 33 Net change in cash and cash equivalents 34 Cash and cashequivalents, beginning of year 35 Cash and cash equivalents, end of year Supplemental disclosure of cash flow information 36 Cash paid for interest 200,190 (357,356)
(7,907) 173,775 (58,543) 16,481 66,800 (28,926)
(170,907) 15,116 79,333 161,020 34,000 3,271 126,347 10,123,144 (10,299,8581 (456,933)
(13,692) 9,835 (37,794)
(675,298) 234,032 110,120 13,204 7,907 (87,316) 286,428 (2,769) 1,055 562,661 13,710 27,569 41,279 38,142 1,253,110 (240,231)
(7,588) 147,639 (1,096,470) 77,133 (26,022)
(38,840)
(160,285)
(13,012) 37,308 (34,207) 36,622 18 (64,825) 8,049,830 (8,036,595)
(406,155)
(15,725) 14,466 91,426 A302,753) 101,531 116,213 22,487 7,588 (117,936) 215,751 (3,324) 29,748 372,058 4,480 23,089 27,569 33,682 The accompanying notes are an integral part of the consolidated financial statements.
44
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
- 1. SIGNIFICANT ACCOUNTING POLICIES A. Description of the Organization Cornell University ("the University") consists of three major organizational units: Endowed Ithaca, which includes the endowed colleges, the central University administration, and the enterprise and service operations for the Ithaca campus; Contract Colleges at Ithaca (colleges operated by the University on behalf of New York State); and the Joan and Sanford I. Weill Medical College and Graduate School of Medical Sciences ("the Medical College") in New York City. These three units are subject to the common administrative authority and control of the Cornell University Board of Trustees, but generally operate as financially discrete entities. The laws establishing the Contract Colleges at Ithaca prohibit other units of the University from using funds attributable to those colleges. Except as specifically required by law, the contract and endowed colleges at Ithaca are, to the extent practicable, governed by common management principles and policies determined at the private discretion of the University. In addition to the three major organizational units, the University's subsidiaries and certain affiliated organizations are included in the consolidated financial statements. All significant intercompany transactions and balances are eliminated in the accompanying consolidated financial statements.
B. Basis of Presentation The accompanying consolidated financial statements have been prepared on an accrual basis in accordance with U.S. generally accepted accounting principles (GAAP), and are presented in accor-dance with the American Institute of Certified Public Accountants (AICPA) Audit and Accounting Guide for Not-for-Profit Organizations. The standards for financial statements of not-for-profit or-ganizations require a statement of financial position, a statement of activities, and a statement of cash flows, and that they be displayed based on the concept of net assets. GAAP requires presentation of revenues, expenses, gains, losses, and net assets in three categories based on the presence or absence of donor-imposed restrictions: permanently restricted, temporarily restricted, and unrestricted.
Permanefitly restricted net assets include the historical dollar amount of gifts, pledges, trusts, and gains explicitly required by donors to be permanently retained. Pledges and trusts are reported at their estimated fair values.
Temporarily restricted net assets include gifts, pledges, trusts, income, and gains that can be expended, but for which the donor restrictions have not yet been met. Such restrictions include purpose restrictions where donors have specified the purpose for which the net assets are to be spent, or time restrictions imposed by donors or implied by the nature of the gift (e.g., future capital projects, pledges to be paid in the future, life income funds). Expiration of donor restrictions is reported in the consolidated statement of activities as a reclassification from temporarily restricted net assets to unrestricted net assets on the net assets released from restrictions line.
Unrestricted net assets are the remaining net assets of the University, including appreciation on true endowments where the donor restrictions are deemed to have been met.
The consolidated statement of activities presents the changes in net assets of the University from both operating and nonoperating activities. Revenues and expenses that relate to carrying out the University's educational, research, and public service missions are reported as operating activities. Operating revenues include investment income and appreciation utilized to fund current operations, the largest portion of which is the distribution of endowment return as determined by the University's spending policy. The University reports as nonoperating activities the excess of investment earnings over amounts utilized 45
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands) in operating activities, contributions and net assets released from restrictions for endowment and facilities, and other activities not in direct support of the University's annual operations.
All amounts in the consolidated financial statements and accompanying notes are presented, unless otherwise indicated, in thousands.
C. Cash and Cash Equivalents The University classifies any instrument that has an original maturity term of ninety days or less as a cash equivalent. The carrying amount of cash equivalents approximates fair value because of their short terms of maturity.
D. Collateral for Securities Loaned The University has an agreement with its investment custodian to lend University securities to approved brokers for a fee.
The agreement specifies that, to limit the University's risk, the securities on loan must be collateralized by cash deposits.
Cash collateral is reported as both an asset and liability of the University. The collateral is invested in short-term securities, and the earnings are recorded as additional income to the investment p6ols.
E. Contributions Contributions, including unconditional promises to give (pledges), are recognized as revenues in the appropriate categories of net assets in the period received. A pledge is recorded at present value of estimated future cash flows, based on an appropriate discount rate at the time of the contribution. Amortization of this discount in subsequent years is included in contribution revenue. A contribution of assets other than cash is recorded at its estimated fair value on the date of the contribution. Contributions for capital projects, endowments, and similar funds are reported as nonoperating revenues.
Conditional promises to donate to the University are not recognized until the conditions are substantially met.
Temporarily restricted net assets include contributions to a consolidated organization that maintains a donor-advised fund for which the donors will make recommendations to the fund's trustees regarding distributions to the University or other charitable organizations.
F. Investments The University's investments are recorded in the consolidated financial statements at fair value. The values of publicly traded securities are based on quoted market prices and exchange rates, if applicable. The fair value of nonmarketable securities is based on valuations provided by external investment managers. These investments are generally less liquid than other investments, and the values reported by the general partner or investment manager may differ from the values that would have been reported had a ready market for these securities existed. The University exercises due diligence in assessing the policies, procedures, and controls implemented by its external investment managers, and believes the carrying amount of these assets is a reasonable estimate of fair value.
Investment income is recorded on an accrual basis, and purchases and sales of investment securities are reflected on a trade-date basis. Realized gains and losses are calculated using average cost for securities sold.
G. Derivative Instruments and Hedging Activities The University holds derivative instruments for investment, and records their fair value within the applicable portfolio.
The change in the fair value of a derivative instrument held for investment is included in nonoperating investment return in the consolidated statement of activities.
In addition, the University holds other derivatives to manage its current and/or future long-term debt. These instruments are recorded at fair value as either prepaid expenses or other liabilities in the consolidated statement of financial position, and the change in fair value is recorded as other nonoperating revenues and expenses in the consolidated statement of activities.
H. Land, Buildings, and Equipment Land, buildings, and equipment are stated in the consolidated statement of financial position at cost on the date of acquisition or at fair value on the date of donation, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful life of the asset, and is reflected as an operating expense. Expenditures associated with the construction of new facilities are recorded as construction in progress until the projects are completed.
46
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
The University's collections, whether paintings, rare books, or other tangible property, have been acquired through purchases and contributions since the University's inception. They are recognized as capital assets and are reflected, net of accumulated depreciation, in the consolidated statement of financial position. A collection received as a gift is recorded at fair value as an increase in net assets in the year in which it is received.
I. Funds Held in Trust by Others Funds held in trust by others represent resources that are not in the possession or under the control of the University.
These funds are administered by outside trustees, with the University receiving income or residual interest. Funds held in trust by others are recognized at the estimated fair value of the assets, or the present value of the future cash flows due to the University when the irrevocable trust is established or the University is notified of its existence.
J. Living Trust Agreements The University's living trust agreements with donors consist primarily of charitable gift annuities, charitable remainder trusts, and pooled income funds for which the University serves as trustee. Assets held in trust are either separately invested or included in the University's investment pools in accordance with the agreements. Contribution revenue and the assets related to living trust agreements, net of related liabilities, are classified as increases in temporarily restricted net assets or permanently restricted net assets. Liabilities associated with charitable gift annuities and charitable remainder trusts represent the present value of the expected payments to the beneficiaries over the terms of the agreements. Pooled income funds are recognized at the net present value of the net assets expected at a future date. Gains or losses resulting from changes in actuarial assumptions and amortization of the discount are recorded as changes in value of split interest agreements in the appropriate restriction category in the nonoperating section of the consolidated statement of activities.
K. Sponsored Agreements Revenues under grants, contracts, and similar agreements are recognized at the time expenditures are incurred. These revenues include the recovery of facilities and administrative costs, which are recognized according to negotiated prede-termined rates. Amounts received in advance, in excess of incurred expenditures, are recorded as deferred revenues.
L. Medical Physicians' Organization The Medical Physicians' Organization provides the management structure for the practice of medicine in an academic medical center. In addition to conducting instructional and research activities, physician members generate clinical practice income from their professional services to patients. Also reflected as University revenues are Medical Physicians' Organization fees. Expenses of the clinical practice, including physician compensation, administrative operations, and provision for uncollectible accounts, are reflected as University expenses. Net assets resulting from the activities of the Medical Physicians' Organization are designated for the respective clinical departments of theMedical College.
M. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses during the reporting period. The University uses a discount rate based on Moody's AA rating for calculating present value. Actual results may differ from those estimates.
N. Comparative Financial Information The consolidated statement of activities includes prior-year information in summary form, rather than by restriction class.
Such information does not include sufficient detail to constitute a presentation of prior-year data in conformity with U.S.
generally accepted accounting principles. Accordingly, such information should be read in conjunction with the University's consolidated financial statements for the prior fiscal year, from which the summarized information was derived.
- 0. Accounting Pronouncements Effective for the fiscal year ended June 30, 2008, the University adopted the provisions of Financial Accounting Standards Board (FASB) Interpretation No. 48: Accounting for Uncertainty in Income Taxes (FIN 48). FIN 48 addresses the accounting for uncertainty in income taxes recognized in an enterprise's financial statements. It prescribes a threshold of "more likely than not" for recognition of tax positions taken in a tax return, and provides related guidance on measurement, classification, interest and penalties, and disclosure. FIN 48 had no material impact on the University's results of operations and financial position.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
In the fiscal year ended June 30, 2007, the University adopted Statement of Financial Accounting Standards No. 158:
Employers' Accounting for Defined Benefit Pension and Other Postretirement Benefit Plans (FAS 158), which required recognition of the funded status of these employee benefit plans in the consolidated statement of financial position as either a prepaid expense or an accrued liability. The adjustment necessary to comply with FAS 158 was presented as a separate line in unrestricted net assets and not as income or expense in the consolidated statement of activities. The University recorded an additional liability of $77,133 to reflect the unfunded status of its plans at June 30, 2007. In subsequent years, the University will continue to record changes in the funded status as pension and postretirement changes other than net periodic costs in the consolidated statement of activities.
P. Reclassifications Certain prior-year amounts have been reclassified to conform to the current-year presentation.
- 0. Income Taxes The University is a not-for-profit organization as described in Section 501(c) (3) of the Internal Revenue Code and is gener-ally exempt from income taxes ofn related income pursuant to the appropriate sections of the Internal Revenue Code.
- 2. RECEIVABLES A. Accounts Receivable Accounts receivable from the following sources were outstanding as of June 30:
SUMMARY
OF ACCOUNTS RECEIVABLE Grants and contracts Patients (net of contractual allowances)
Student accounts Other Subtotal Less: allowance for doubtful accounts Net accounts receivable 2008 55,828 71,619 5,764 158,843 292,054 (15,163) 276,891 2007 49,996 75,512 5,766 133,146 264,420 (16,455) 247,965 The patient accounts receivable for medical services was comprised of the following at June 30,2008 and 2007, respectively:
commercial third parties 53 percent and 54 percent; federal/state government 12 percent and 14 percent; and patients 35 percent and 32 percent. Other accounts receivable include receivables from the Dormitory Authority of the State of New York (DASNY) for reimbursement of construction, the New York-Presbyterian Hospital for services provided by the Medical College, sponsoring agencies for grants and contracts, and matured bequests.
B. Contributions Receivable Unconditional promises to give, or pledges, are recorded in the consolidated financial statements at present value using discount rates ranging from 5 percent to 7 percent. Contributions are expected to be realized as follows:
SUMMARY
OF CONTRIBUTIONS RECEIVABLE Less than one year Between one and five years More than five years Gross contributions receivable Less: unamortized discount Less: allowance for uncollectible amounts Net contributions receivable 2008 212,667 315,095 474,898 1,002,660 (300,748)
(35,095) 666,817 2007 147,653 243,849 448,769 840,271 (318,260)
(26,101) 495,910 48
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
Contributions receivable as of June 30 are intended for the following purposes:
EXPECTED PURPOSE OF CONTRIBUTIONS RECEIVABLE Support of University operations Capital purposes Endowments and similar funds Net contributions receivable 2008 297,287 153,352 216,178 666,817 2007 239,604 117,383 138,923 495,910 At June 30, 2008 and 2007, conditional promises not reflected in the consolidated financial statements, which consist primarily of bequest intentions, were approximately $165,458 and $160,273, respectively.
C. Student Loans Receivable The University participates in various federal revolving loan programs, in addition to administering institutional loan programs. Loans receivable from students as of June 30 are as follows:
SUMMARY
OF STUDENT LOANS RECEIVABLE Federal revolving loans Institutional loans Gross student loans receivable Less: allowance for doubtful accounts Net student loans receivable 2008 48,962 29,618 78,580 (6,296) 72,284 2007 48,225 26,498 74,723 (9,792) 64,931 The allowance for doubtful accounts is for loans in both repayment status and those not yet in repayment status because the borrowers are still in school or in the grace period following graduation.
Student loans are often subject to unique restrictions and conditions and, therefore, it is not feasible to determine their fair values.
- 3. INVESTMENTS A. General Information The University's investment holdings as of June 30 are summarized in the following table:
INVESTMENTS AT FAIR VALUE Cash and cash equivalents Domestic equities Foreign equities Absolute return Hedged equities Fixed income Private equities Real assets Other Total 2008 267,836 699,794 911,636 625,452 1,252,730 898,489 902,677 956,468 34,206 6,549,288 2007 129,614 834,060 1,107,758 572,721
.1,306,924 749,574 751,801 885,194 31,579 6,369,225 The University's investments are overseen by the Investment Committee of the Board of Trustees. The University's investment strategy incorporates a diversified asset allocation approach and maintains, within defined limits, exposure to the movements of the world equity, fixed income, commodities, real estate, and private equity markets. Based on guidelines established by the Investment Committee, the University's Investment Office directs the investment of endowment and trust assets, certain working capital, and temporarily invested expendable funds.
49
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
Under the terms of certain limited partnership agreements, the University is obligated to make additional capital contribu-tions up to contractual levels. At June 30, 2008 and 2007, the University had commitments of $1,362,308 and $1,066,802, respectively, for which capital calls had not been exercised. Such commitments generally have fixed expiration dates or other termination clauses. The University maintains sufficient liquidity in its investment portfolio to cover such calls.
The University maintains a number of investment pools or categories for specified purposes, the most significant of which are the Long-Term Investment Pool (LTIP), described below, and the Pooled Balances Investment Fund (PBIF), established to maximize total return derived from the investment of intermediate-term cash balances. The fair values as of June 30 were as follows:
INVESTMENTS POOLS/CATEGORIES AT FAIR VALUE Working capital Intermediate-term (PBIF)
Long-term investment pool (LTIP)
Separately invested portfolio Pooled life income funds Other Total 2008 32,704 571,174 5,378,096 411,614 13,909 141,791
$ 6,549,288 2007 3,807 609,353 5,197,503 478,902 16,935 62,725 6,369,225.
Additional information about the University's investment return for the fiscal years ended June 30 is presented in the following table:
SUMMARY
OF INVESTMENT RETURN 2008 Interest and dividends, net of investment fees 11 2,688 Net realized gain/(loss) 415,142 Net unrealized gain/(loss)
(356,599)
Total investment return 171,231.
2007 105,646 394,161 702,309 1,202,116 290,655 911,461 1,202,116 Investment return, distributed Investment return, undistributed Total investment return 280,985 (109,754) 171,231 B. Long-Term Investment Pool The LTIP is a mutual fund-like vehicle used for investing the University's true endowment funds, funds functioning as endowment, and other funds that are not expected to be expended for at least three years. The objective of this vehicle is to achieve a total return, net of expenses, of at least 5 percent in excess of inflation, as measured by a rolling 5-year average of the Consumer Price Index.
The University employs a unit method of accounting for the LTIP. Each participating fund enters into and withdraws from the pooled investment account based on monthly unit market values. At June 30, 2008 and 2007, the fair values per unit were $65.37 and $66.62, respectively. The total return on the University's long-term investments, of which the LTIP is the major component, was 2.7 percent for the fiscal year ended June 30, 2008. The changes in the fair value and cost of the LTIP and information about its participating units as of June 30, 2008 and 2007 are as follows:
SUMMARY
INFORMATION - LONG-TERM INVESTMENT POOL End of year Beginning of year Unrealized net gain/(loss) for year Realized net gain/(loss) for year Net gain/(Iloss) for year Fair value 5,378,096 5,197,503 Cost 4,267,499 3,800,321 Appreciation 1,110,597 1,397,182 (286,585) 360,501 73,916 Fair value per unit 65.37 66.62 Number of units 82,269,929 78,016,232 50
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
The University has a total distribution policy. Under this policy, a distribution is provided from the pool, independent of the cash yield and investment returns in a given year. This insulates investment policy from budgetary pressures and insulates the distribution from fluctuations in financial markets. Distributions from the pool are approved by the Board of Trustees as part of the financial planning process. The annual distribution is set so that, over time, a sufficient portion of the return is reinvested to maintain the purchasing power of the endowment and provide reasonable growth in support of program budgets.
For the fiscal year ended June 30, 2008, distributions of investment payout to participating funds totaled $213,048 ($2.66 per unit) of which $191,724 was paid out for the University's operations, with the balance in the amount of $21,324 either returned to principal or distributed to funds held for others. The distribution for the fiscal year ended June 30, 2008 was comprised of $46,997 in net investment income and $166,051 paid from accumulated gains. For the fiscal year ended June 30, 2007, the investment payout was $185,508 ($2.42 per unit), and was comprised of $44,726 in net investment income and $140,782 paid from accumulated gains.
C. Separately Invested Portfolio, Pooled Life Income Funds, and Other The University maintains a category of assets referred to as the separately invested portfolio. This category consists of assets that, for legal or other reasons, or by request of the donor, could not participate in any of the investment pools.
Life income fund pools consist of donated funds, the income from which is payable to one or more beneficiaries during their lifetimes. On the termination of life interests, the principals become available for University purposes, which may or may not have been restricted by the donors.
Other investments consist primarily of University funds on deposit at DASNY as reserves for retirement of debt and bond proceeds not yet expended. The total funds on deposit are $122,599 and $37,480 as of June 30,2008 and 2007, respectively.
The amount of bond proceeds not yet expended included in the total reserves at DASNY are $107,653 and $21,550 as of June 30, 2008 and 2007, respectively.
D. Derivative Financial Instruments The University has approved the use of derivatives by outside investment managers, based on investment guidelines negotiated at the time of a manager's appointment. The derivatives are used to adjust fixed income durations and rates, to create "synthetic exposures" to certain types of investments, and to hedge foreign currency fluctuations.
Certain investment transactions, including derivative financial instruments, involve counterparty credit exposure. The University's investment guidelines require that investment managers use only those counterparties with strong credit ratings for these derivatives. For the fiscal years ended June 30, 2008 and 2007, the University recorded unrealized gains of
$7,676 and $2,385, respectively, on derivative holdings.
- 4. LAND, BUILDINGS, AND EQUIPMENT Land, buildings, and equipment are detailed as follows:
LAND, BUILDINGS, AND EQUIPMENT Book value at Disposals and Book value at June 30, 2007 Additions closed projects June 30, 2008 Land, buildings, and equipment 2,616,202 320,779 (34,768) 2,902,213 Furniture, equipment, books, and collections 886,520 86,406 (39,414) 933,512 Construction in progress 351,592 453,257 (396,416) 408,433 Total before accumulated depreciation 3,854,314 860,442 (470,598) 4,244,158 Accumulated depreciation (1,506,091)
(1,627,928)
Net land, buildings, and equipment 2,348,223 2,616,230 Certain properties to which the University does not have title are included in physical assets at net book values as follows: (1) land, buildings, and equipment of the Contract Colleges aggregating $421,439 and $368,215 at June 30, 2008 and 2007, respectively, the acquisition cost of which was borne primarily by New York State and (2) land, buildings, and equipment for which titles rest with government and corporate agencies aggregating $17,296 and $17,293 at June 30, 2008 and 2007, respectively.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
- 5. DEFERRED BENEFITS A. General Information Accrued employee benefit obligations as of June 30 include:
SUMMARY
OF DEFERRED BENEFITS 2008 2007 Postemployment benefits 21,334 21,765 Pension and other postretirement benefits 239,950 212,066 Other deferred benefits 163,754 140,726 Total deferred benefits 425,038 374,557 Accrued postemployment benefits include workers' compensation and medical continuation benefits for those on long-term disability. The University also provides various benefits to former or inactive employees after employment, but before retirement, that are recognized when they are earned..
B. Pension and Postretirement Plans The University's employee pension plan coverage is provided by two basic types of plan: one based on a predetermined level of funding (defined contribution), and the other based on a level of benefit to be provided (defined benefit).
The primary defined contribution plans for Endowed Ithaca and for exempt. employees (those not subject to the overtime provisions of the Fair Labor Standards Act) at the Medical College are carried by the Teachers Insurance and Annuity Association, the College Retirement Equities Fund, the Vanguard Group (Medical College only), and Fidelity Investments (Endowed Ithaca only), all of which permit employee contributions. Total pension costs of the Endowed Ithaca and Medical College plans for the fiscal years ended June 30, 2008 and 2007 amounted to $76,873 and $72,771, respectively.
The Medical College maintains a defined benefit plan for non-exempt employees. The defined benefit plan for exempt employees was frozen in 1976, and the accrued benefits were merged with the active non-exempt retirement plan in 1989.
In addition, certain non-exempt employees of Endowed Ithaca were covered by the Cornell University Retirement Plan for Non-Exempt Employees of the Endowed Colleges at Ithaca (NERP), a defined behefit plan. The Board of Trustees voted to terminate this frozen plan effective December 31, 2006, with all surplus-assets inuring to the plan participants.
As of June 30, 2008, the majority of benefits have been paid out to retirees, former employees and active employees with a vested benefit in NERR In accordance with Employee Retirement Income Security Act (ERISA) requirements for the defined benefit plans, the University must fund annually with an independent trustee an actuarially determined amount that represents normal costs
.plus amortization of prior service costs over a forty-year period that began on July 1, 1976.
The University also provides health and life insurance benefits for eligible retired employees and their dependents. Although there is no legal obligation for future benefits, the cost of postretirement benefits must be accrued during the service lives of employees. The University elected the prospective transition approach and is amortizing the transition obligation over 20 years, through fiscal year 2012-13.
C. Obligations and Funded Status In the fiscal year ended June 30, 2007, the University adopted FAS 158, which required employers to recognize the over-funded or under-funded status of defined benefit pension and postretirement plans in their statements of financial position. This resulted in an increase in deferred benefits liability of $77,133. Adustments in subsequent years will be recorded as pension and postretirement changes other than net periodic costs in the consolidated statement of activities.
52
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
The following table sets forth the pension and postretirement plans' obligations and funded status as of June 30:
SUMMARY
OF OBLIGATIONS AND FUNDED STATUS Pension benefits 2008 2007
.Other postretirement 2008 2007 CHANGE IN PLAN ASSETS Fair value of plan assets at beginning of year Actual return on plan assets.
Employer contribution Benefits paid Settlements Fair value of plan assets at end of year CHANGE IN BENEFIT OBLIGATION Benefit obligation at beginning of year Service cost (benefits earned during the period)
Interest cost Plan amendments Actuarial (gain)/loss Settlements Benefits paid Projected benefit obligation at end of year 53,110 (3,930) 3,000 (1,725)
(9,736) 40,719 59,919 3,420 3,094 3,132
- (727)
(9,736)
(1,725) 57,377 64,846 7,801 3,800 (4,056)
(19,281) 53,110 127,921 (6,212) 5,336 101,552 21,276 5,093 127,045 127,921 67,721 3,212 4,028 326,096 13,528 18,841 1,942 314,733
.13,660 18,734 (11,435) 8,295 (19,281)
(4,056) 59,919 (10,272)
(9,596) 350,135 326,096 FUNDED STATUS (16,658)
(16,658)
(6,809)
(223,090)
(198,175)
(6,809)
(223,090)
(198,175)
AMOUNTS RECOGNIZED IN THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION AMOUNTS RECORDED IN UNRESTRICTED NET ASSETS NOT YET AMORTIZED AS COMPONENTS OF NET PERIODIC BENEFIT COST Net transition obligation 18,221 21,866 Prior service cost 510 639 Net actuarial (gain)/loss 8,681 5,992 66,202 48,636 Amount recognized as reduction in unrestricted net assets 8,681 5,992 84,933 71,141 The accumulated benefit obligation for the pension plans was $44,061 and $46,737 at June 30, 2008 and 2007, respectively.
The accumulated benefit obligation differs from the projected benefit obligation in the table above in that it includes no assumptions about future compensation levels. It represents the actuarial present value of future payments to plan participants using current and past compensation levels. For postretirement plans other than pensions, the accumulated benefit obligation is the same as the projected benefit obligations because the liabilities are not compensation-related.
D. Net Periodic Benefit Cost Net benefit expense related to the pension and postretirement plans for the fiscal years ended June 30 includes the following components:
NET PERIODIC BENEFIT COST Service cost (benefits earned during the period).
Interest cost Expected return on plan assets Amortization of initial transition obligation Amortization of prior service cost Amortization of Pet (gain)/loss Settlement (gain)/loss Net periodic benefit cost Pension benefits 2008 2007 3,420 3,212 3,094 4,028 (3,776)
(4,923) 3,133 3,593 612 696 10,685 10,160 13,614 Other postretirement 2008 2007 13,528 13,660 18,841 18,734 (9,906)
(8,309) 3,644 3,644 129 264 495 2,365 26,731 30,358
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
The amounts of transition obligation, prior service costs, and actuarial gains/losses that will be amortized into net periodic benefit cost for the year ending June 30, 2009 are estimated as follows:
ESTIMATED COMPONENTS OF NET PERIODIC BENEFIT COST Pension benefits Other postretirement Transition obligation 3,644 Prior service cost 129 Net actuarial (gain)/Ioss 282 2,620 Total 282 6,393 E. Actuarial Assumptions Assumptions used in determining the pension and postretirement plans benefit obligations and net periodic costs are:
SUMMARY
OF ACTUARIAL ASSUMPTIONS Pension benefits Other postretirement 2008 2007 2008 2007 USED TO CALCULATE BENEFIT OBLIGATIONS AT JUNE 30 Discount rate 6.00%
6.00%
6.00%
6.00%
Rate of compensation increase 6.10%
6.10%
USED TO CALCULATE NET PERIODIC COST AT JULY 1 Discount rate 6.00%
6.00%
6.00%
6.00%
Expected return on plan assets 8.00%
8.00%
8.00%
8.00%
Rate of compensation increase 6.10%
6.10%
ASSUMED HEALTH CARE COST TREND RATES Health care cost trend rate assumed for next year n/a n/a 8.00%
8.00%
Ultimate trend rate n/a n/a 5.00%
5.00%
Years to reach ultimate trend rate n/a n/a 6
3 The health care cost trend rate assumption has a significant effect on the amounts reported for other postretirement (health care) plans. Increasing the health care cost trend rate by 1 percent in each future year would increase the benefit obligation by $56,892 and the annual service and interest cost by $6,629. Decreasing the health care cost trend rate by 1 percent in each future year would decrease the benefit obligation by $46,023 and the annual service and interest cost by $5,213.
F. Plan Assets The plan assets for Endowed Ithaca and the Medical College are invested with an outside trustee for the sole benefit of the plan participants. Consistent with that objective, investments are managed to maximize total return while maintaining a prudent limitation on risk.
Riskmitigation is achieved by diversifying investments across multiple asset classes, by investing in high quality securities, and by permitting flexibility in the balance of investments in the permitted asset classes. The expected return on assets was derived based on long-term assumptions of inflation, real returns (primarily historically based), anticipated value added by the investment managers, and expected average asset class allocations. The expected returns on plan assets by category are 9.25 percent on equity securities, 5.75 percent on debt securities, and 8.25 percent on real estate.
54
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
Plan asset allocations by category at June 30 are as follows:
SUMMARY
OF PLAN ASSETS PERCENTAGE OF PLAN ASSETS Equity securities Debt securities Real estate Total Target allocation 39-85%
15-55%
0-5%
Pension benefits 2008 2007 59.7%
52.0%
36.7%
44.6%
3.6%
3.4%
100.0%
100.0%
Other postretirement 2008 2007 69.7%
30.3%
0.0%
100.0%
70.1%
29.9%
0.0%
100.0%
G. Expected Contributions and Benefit Payments The expected annual contributions and benefit payments that reflect anticipated service are as follows:
EXPECTED CONTRIBUTIONS AND BENEFIT PAYMENTS Other postretirement Employer paid Government subsidy Pension benefits UNIVERSITY CONTRIBUTIONS 2009 FUTURE BENEFIT PAYMENTS 2009 2010 2011 2012 2013 2014-2018 2,500 3,024 2,918 3,588.
3,599 3,540 23,326 5,589 n/a 11,181 12,218 13,450 14,539 15,683 98,741 1,502 1,665 1,820 1,988 2,178 14,244 The Medicare Prescription Drug, Improvement and Modernization Act of 2003 established a prescription drug benefit known as "Medicare Part D" that also established a federal subsidy to sponsors of retiree healthcare benefit plans. The estimated future government subsidy amounts are reflected in the table above.
H. Contract College Employees Employees of the Contract Colleges are covered under the New York State pension plans. Contributions to the state retirement system and other employee benefit costs are paid directly by the state. The amounts of the direct payments applicable to the University as revenue and expenditures are not currently determinable and are not included in the consolidated financial statements. The University reimburses the state for employee benefit costs on certain salaries, principally those associated with externally sponsored programs. The amounts reimbursed to the state during the fiscal years ended June 30, 2008 and 2007, were $18,459 and $17,488, respectively, and were included in operating expenses.
- 6. FUNDS -HELD IN TRUST FOR OTHERS The University, in limited instances, invests funds as a custodian for other closely related parties. Independent trustees are responsible for the funds and for the designation of income distribution. The New York Hospital-Cornell Medical Center Fund, Inc., which benefits the Weill Cornell Medical Center of the New York-Presbyterian Hospital, is the major external organization invested in the LTIP with assets having market values of $189,342 and $186,461 at June 30, 2008 and 2007, respectively. Of these investments, a portion of the future income stream has been directed in perpetuity to benefit the Medical College. The present values of this income stream, calculated to be $75,966 and $74,141 at June 30,2008 and 2007, respectively, are recorded as reductions in the funds held in trust for others liability.
55
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
- 7. BONDS AND NOTES PAYABLE Bonds and notes payable as of June 30 are summarized as follows:
SUMMARY
OF BONDS AND NOTES PAYABLE 2008 2007 Interest rates Final maturity Dormitory Authority of the State of New York (DASNY)
Revenue Bond Series 1990B-Variable rate/daily 56,700 57,300 0.55 to 3.96 2025 2000A-Variable rate/weekly 56,620 58,320 2.99*
2029 2000B-Variable rate/weekly 74,835 76,765 4.63*
2030 2004-Variable rate/weekly 88,175 90,150 3.51
- 2033 2006-Fixed rate 231,160 239,750 4.00 to 5.00 2035 2008B&C-Variable rate/daily 130,000 0.35 to 2.50 2037 1995 Student loan bond capital appreciation 6,339 5.90 to 6.15 2008 Tax-exempt commercial paper 149,875 89,005 1.00 to 3.72*
2037 Bond Series 1987B-Fixed rate 8,825 10,370 11.11 2012 Taxable commercial paper 60,911 86,979 2.25 to 5.33 Industrial Development Agency 2000-Fixed rate 3,330 4,335 5.10 to 5.25 2011 2002A-Variable rate/weekly 42,530 42,710 4.52*
2030 2002B-Variable rate/weekly 15,390 15,390 4.33*
2015 2008A-Variable rate/daily 70,000 0.55 to 3.40 2037 Student Loan Marketing Association-Fixed rate 5,030 5,340 5.75 to 6.50 2019 Urban Development Corporation 2,625 2,750 2029 Capitalized leases 312 College Ave 11,296 various 2008 Other 3,164 3,308 various 2009-2029 Total bonds and notes payable
$ 999,170
$ 800,107
- Rates presented are the swap interest rates as noted in the following Summary of Interest Rate Swaps table.
The University's bonds and notes payable had carrying amounts of $999,170 and $800,107 at June 30, 2008 and 2007, respectively, compared to estimated fair values of approximately $1,001,739 and $808,513 at June 30, 2008 and 2007, respectively. Estimated fair value of bonds is based on quoted marketprices for the same or similar issue's. The market prices utilized reflect the amounts a third party would pay to purchase the bonds, and not an additional liability to the University.
Interest expense during the fiscal year ended June 30,2008 was $27,784, of which $25,926 was related to the bonds and notes payable displayed-in the table above. During the fiscal year ended June 30, 2007, interest expense was $30,509, of which
$28,890 was related to the bonds and notes payable. The University capitalized interest on self-constructed assets, such as buildings, in the amount of $9,698 and $4,218 for the fiscal years ended June 30, 2008 and 2007, respectively.
Debt and debt service related to borrowings by New York State for the construction and renovation of facilities of the Contract Colleges are not included in the consolidated financial statements because they are not liabilities of the University.
Under agreement with DASNY, certain revenues, principally rental income from facilities financed by bond proceeds plus a portion of tuition, are pledged by the University to meet debt service requirements. Also, certain revenue bonds require compliance with an asset-to-liability ratio and an unencumbered securities-to-operating-expense ratio.
The University has eleven interest rate swap agreements to exchange variable rate debt for fixed rate obligations without the exchange of the underlying principal amount. Net payments or receipts under the swap agreements are recorded as adjustments to interest expense. Three of the six forward-starting swaps were negotiated in the fiscal year ended June 30, 2008. Under four agreements in effect at June 30, 2008, the counterparty pays the University a variable interest rate equal to the Securities Industry and Financial Markets Association (SIFMA) index, and under seven other agreements, the counterparty pays a variable interest rate equal to a percentage of the one month London Interbank Offered Rates (LIBOR).
56
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
At June 30, 2008 and 2007, the total fair value was ($34,504) for eleven swap agreements and $20,691 for eight swap agree7 ments, respectively. Detailed information about the interest rate swaps is shown in the following table:
SUMMARY
OF INTEREST RATE SWAPS Notional amount 15,390 106,620 42,530 74,835 88,175 200,000 100,000 200,000 275,000 200,000 200,000 Interest rate 4.33%
2.99%
4.52%
4.63%
3.51%
.3.84%
3.55%
3.45%
3.65%
3.48%
3.77%
Commencement July 1, 2008 July 1, 2009 July 1,2010 July 1,2010 July 1, 2012 July 1,2014 Expiration date July 1,2010 October 1, 2012 July 1, 2030 July 1, 2030 July 1,2033 July 1,2037 July 1, 2036 July 1, 2039 July 1,2040 July 1,2041 July 1,2044 Basis
_SIFMA SIFMA SIEMA LIBOR LIBOR SIFMA LIBOR LIBOR LIBOR LIBOR LIBOR During the fiscal year ended June 30, 2008, the University issued $70,000 of variable rate bonds to finance the central heating plant project, and $130,000 of variable rate bonds to refund tax-exempt commercial paper. In addition, the University reoffered the Series 2004 bonds: There was no change in the underlying bonds other than from an auction rate to a variable rate mode.
The University continues to issue both tax-exempt and taxable commercial paper. Tax-exempt commercial paper is used to finance capital projects and equipment purchases for the Ithaca and Medical College campuses. Taxable commercial paper is also used for these purposes, as well as to finance short-term working capital needs. The maximum amount outstanding at any one time under each program is $200,000.
The University paid $3,252 in the fiscal year ended June 30, 2008 to defease the 1995 student loan capital appreciation bonds. In addition, the university terminated its capitalized lease.
Scheduled principal and interest payments on notes and bonds for the next five fiscal years and thereafter are shown below:
ANNUAL DEBT SERVICE REQUIREMENTS Year 2009 2010 2011 2012 2013 Thereafter Total Principal 22,035 22,556 26,761 27,543 26,538 873,737 999,170 Interest 38,112 37,091 36,033 34,651 32,996 432,604 611,487 Total 60,147 59,647 62,794 62,194 59,534 1,306,341 1,610,657 The University records its working capital: line of credit as other liabilities in the consolidated statement of financial position. During the fiscal year ended June 30, 2008, the University added an additional working capital line of credit with Bank of America for $100,000 to support short-term cash flow needs, bringing the maximum amount outstanding at any one time for both lines of credit to $200,000. At June 30, 2008, the interest rates were 2.58 percent and 3.00 percent for the University's two lines of credit. At June 30, 2007, the University had one line of credit with an interest rate of 6.25 percent. The two lines of credit have annual expiration dates of February 20 andDecember 31. As of June 30, 2008 and 2007, $164,500 and $30,500, respectively, were borrowed against the lines of credit.
57
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
- 8. OPERATING LEASES Although the University generally purchases, rather than leases, machinery and equipment, the University does enter operating lease agreements for the use of real property. Total lease expenses were $18,058 and $18,011 for the fiscal years ended June 30, 2008 and 2007, respectively. The future annual minimum lease payments in the following table are payments under operating leases expiring at various dates through November 1, 2054.
ANNUAL MINIMUM OPERATING LEASE PAYMENTS Year 2009 2010 2011 2012 2013 Thereafter Total minimum operating lease payments Payments 20,281 16,526 15,436 13,222 11,495 69,916
.146,876
- 9. FUNCTIONAL EXPENSES AND STUDENT AID Total expenses by functional categories for the fiscal years ended June 30 are as follows:
FUNCTIONAL EXPENSES Instruction Research Public service Academic support Student services Medical services Institutional support Enterprises and subsidiaries Total expenses 2008 597,606 511,158 114,143 267,222 119,858 474,471 414,747 209,708
$ 2,708,913 2007 555,434 502,661 108,847 236,784 111,279 412,270 360,426 183,812 2,471,513 The expenses for operations and maintenance of facilities, depreciation, and interest are allocated to functional categories based on square footage. The amounts allocated for operations and maintenance were approximately $154,430 and $143,344 for the fiscal years ended June 30, 2008 and 2007, respectively.
Student financial assistance, other than assistance in exchange for services, is shown as a component of instruction expense unless the assistance is for tuition and mandatory fees. If the assistance is for tuition and mandatory fees, the amounts are recorded as scholarship allowance which reduces tuition revenue. Total financial assistance amounts classified as instruction expense were $24,106 and $23,401 for the fiscal years ended June 30, 2008 and 2007, respectively.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands)
- 10. NET ASSETS The University's net assets as of June 30 are as follows:
SUMMARY
OF NET ASSETS Endowment True endowment Funds functioning as endowment (FFE)
Total true endowment and FFE Funds held by others, perpetual Total University endowment Other Net Assets Operations Student loans Facilities and equipment Living trust funds Funds held by others, other than perpetual Contributions receivable, net Total net assets Unrestricted
$ 1,979,508 1,538,967
$ 3,518,475
$ 3,518,475 (170,458) 8,725 1,773,023
$. 5,129,765 Temporarily restricted 173,825 173,825 173,825 134,756 48,136 68,207 44,397 450,639 919,960 Permanently restricted 2008 Total
$ 1,555,709
$ 3,535,217 1,712,792
$ 1,555,709
$ 5,248,009 137,473 137,473
$ 1,693,182
$ 5,385,482 2007 Total
$ 3,460,881 1,652,213
$ 5,113,094 134,003
$ 5,247,097 165,396 37,775 1,739,438 109,161 43,688 495,910
- $ 7,838,465 33,516 46,054 216,178
$ 1,988,930 (35,702) 42,241 1,821,159 114,261 44,397 666,817
$ 8,038,655 Unrestricted net asset balances for operations are primarily affected by operating activities and strategic decisions to invest expendable balances in funds functioning as endowment and capital projects.
Of the endowment assets held at the University, 98 percent and 97 percent were invested in the LTIP at June 30, 2008 and 2007, respectively. At June 30, 2008, 257 of 5,581 true endowment funds invested in the LTIP, with a book value of
$84,435, had fair values below book values by a total of $2,287. The University holds significant unrestricted appreciation on endowments to offset these temporary decreases in value. The University has maintained these true endowment funds at their historical book value.
Changes in the endowment net assets, exclusive of funds held by others, for the fiscal years ended June 30 are presented below:
SUMMARY
OF ENDOWMENT ACTIVITY True endowment and FFE beginning of year Investment return Net investment income Net realized and unrealized gains Total investment return New gifts Net transfers to/(from) FFE Distribution of endowment return to other funds Other changes Reclassifications Total true endowment and FFE end of year Temporarily Permanently 2008 2007 Unrestricted restricted restricted Total Total
$ 3,576,523
$ 120,053
$ 1,416,518
$ 5,113,094
$ 4,152,207 27,489 1,741 29,230 6,950 20,457 (115,072)
(5,091) 5,478
$3,518,475 17,338 66,743 84,081 42,558 (9,097)
(76,651)
(2,464) 15,345 173,825 2,376 4,534 6,910 109,243 (2,763) 6,475 19,326"
$1,555,709 47,203 73,018 120,221 158,751 11,360 (194,486)
(1,080) 40,149
$ 5,248,009 44,352 979,166
$1,023,518 87,142 11,122 (170,134) 5,210 4,029
$5,113,094 59
- 11. CONTINGENT LIABILITIES The University is a defendant in various legal actions, some of which are for substantial monetary amounts, that arise out of the normal course of its operations. Although the final outcome of the actions cannot be foreseen, the University's administration is of the opinion that eventual liability, if any, will not have a material effect on the University's financial position.
The University retains self insurance for property, general liability, and certain health benefits, and has an equity interest in a multi-provider captive insurance company.
60
ADMINISTRATION JULY 1, 2008 UNIVERSITY ADMINISiTRATON David J. Skorton, President C. Biddy Martin, Provost Antonio M. Gotto, Jr., Provost for Medical Affairs and Stephen and Suzanne Weiss Dean of the Joan and Sanford.I. Weill Medical College Carolyn N. Ainslie, Vice President for Planning and Budget Thomas W. Bruce, Vice President for University Communications Robert A Buhrman, Sr. Vice Provost for Research Doris Davis, Associate Provost for Admissions and Enrollment Joanne M. DeStefano, Vice President for Financial Affairs and Chief Financial Officer Michael B. Dickinson, University Auditor William E. Fry, Dean of the University Faculty Stephen T. Golding, Samuel W. Bodman Executive Vice President for Finance and Administration Stephen F. Hamilton, Associate Provost for Outreach David R. Harris, Vice Provost for Social Sciences Kent L. Hubbell, Robert W. and Elizabeth C.
Staley Dean of Students Stephen Philip Johnson, Vice President for Government and Community Relations Stephen Kresovich, Vice Provost for Life Sciences Polley Ann McClure, Vice President for Information Technologies Richard W. McDaniel, Vice President for Risk Management and Public Safety James J. Mingle, University Counsel and Secretary of the Corporation Michele M. Moody-Adams, Vice Provost for Undergraduate Education Susan H. Murphy, Vice President for Student and Academic Services Mary G. Opperman, Vice President for Human Resources Alan S. Paau, Vice Provost for Technology Transfer and Economic Development Alice N. Pell, Vice Provost for International Relations Charles D. Phlegar, Vice President for Alumni Affairs and Development Robert C. Richardson, Senior Science Advisor Steven P. Rosalie, Executive Vice Dean and Associate Provost for International Initiatives Ronald Seeber, Vice Provost for Land Grant Affairs.
John A. Siliciano, Vice Provost James H. Walsh, Chief Investment Officer Kyu-Jung Whang, Vice President for Facilities Services ACADEMIC UNITS College of Agriculture and Life Sciences Susan A. Henry, Ronald P. Lynch Dean College of Architecture, Art, and Planning Kent Kleinman, Gail and Ira Drukier Dean College of Arts and Sciences G. Peter Lepage, Harold Tanner Dean College of Engineering W. Kent Fuchs, Joseph Silbert Dean College of Human Ecology Alan D. Mathios, Rebecca Q. and James C.
Morgan Dean College of Veterinary Medicine Michael I. Kotlikoff, Austin 0. Hooey Dean of Veterinary Medicine Graduate School Alison G. Power, Dean Law School Stewart J. Schwab, Allan R. Tessler Dean School of Continuing Education and Summer Sessions Glenn C. Altschuler, Dean School of Hotel Administration Michael D. Johnson, Dean School of Industrial and Labor Relations Harry C. Katz, Kenneth F. Kahn Dean S. C. Johnson Graduate School of Management, L. Joseph Thomas, Anne and Elmer Lindseth Dean Weill Cornell Graduate School of Medical Sciences David P. Hajjar, Senior Executive Vice Dean, Executive Vice Provost, and Dean Weill Cornell Medical College Stephen M. Cohen; Executive Vice Dean for Administration and Finance and Associate Provost Weill Cornell Medical College Antonio M. Gotto, Jr., Stephen and Suzanne Weiss Dean and Provost for Medical Affairs Weill Cornell Medical College in Qatar Daniel R. Alonso, Dean Computing and Information Science Robert L. Constable, Dean Cornell University Library Anne R. Kenney, Carl A. Kroch University Librarian
BOARD OF TRUSTEES AND TRUSTEES AT LARGE 4-JULY 1,2008 LEADERSHIP COMMITTEES Peter C. Meinig, Chairman Samuel C. Fleming, Vice Chairman Robert S. Harrison, Vice Chairman.
David W. Zalaznick, Vice Chairman Jan Rock Zubrow, Vice Chairman Ex Officio Members David J. Skorton, President of Cornell University David Paterson, Governor of New York State Dean G. Skelos, Temporary President of the New York State Senate Sheldon Silver, Speaker of the New York State Assembly Other Members Elizabeth J. Altman Stephen B. Ashley Rosemary Jane Avery Jeffrey E Berg C. Morton Bishop III Franci J. Blassberg Richard L. Booth Kelly J. Brown Dwight L. Bush Sr.
Ronnie S. Chernoff Ezra Cornell David D. Croll Diana M. Daniels Ira Drukier Katherine H. Duch William V. Eaton Ronald G. Ehrenberg Stephen J. Ettinger Miguel A. Ferrer David R. Fischell Cheryl A. Francis Blanche S. Goldenberg Kenneth A. Goldman Paul A. Gould Denis M. Hughes Robert J. Katz Karen Rupert Keating Jill N. Lerner Marcus H. Loo Kevin M. McGovern Beth McKinney Howard P. Milstein Elizabeth D. Moore N.R. Narayana Murthy Carolyn Chauncey Neuman John A. Noble Peter J. Nolan Lubna Suliman Olayan Donald C. Opatrny Bruce S. Raynor Philip R. Reilly Irene B. Rosenfeld Jerold R. Ruderman Robert L. Ryan Sherri K. Stuewer Martin Y. Tang Ratan N. Tata Lisa Skeete Tatum Andrew H. Tisch Michael J. Walsh Barton J. Winokur Sheryl WuDunn Philip M. Young Craig Yunker Michael J. Zak Executive Committee Diana M. Daniels, Chairman Robert J. Katz, Vice Chairman Investment Committee Paul A. Gould, Chairman Donald C. Opatrny, Vice Chairman Audit Committee Cheryl A. Francis, Chairman Kenneth A. Goldman, Vice Chairman Finance Committee David W. Zalaznick, Chairman Franci J. Blassberg, Vice Chairman Buildings and Properties Committee Ira Drukier, CoChairman Sherri K. Stuewer, CoChairman Committee on Governmental Relations Andrew H. Tisch, Chairman.
Bruce S. Raynor, Co-Vice Chairman Elizabeth D. Moore, Co-Vice Chairman Committee on Board Membership Samuel C. Fleming, Chairman Board of Overseers - Weill Medical College and Graduate School of Medical Sciences Sanford I. Weill, Chairman Committee on Academic Affairs Robert J. Katz, CoChairman Sheryl WuDunn, CoChairman Craig Yunker, Vice Chairman Committee on Student Life Kelly J. Brown, Vice Chairman Robert S. Harrison, CoChairman Peter J. Nolan, CoChairman Committee on Alumni Affairs and Development Stephen B. Ashley, CoChairman Jan Rock Zubrow, CoChairman Karen R. Keating, Vice Chairman Trustee-Community Communications Committee Carolyn C. Newman, Chairman
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Emeritus Chairmen of the Board Austin H. Kiplinger Harold Tanner Other Emeritus Trustees Robert H. Abrams Ellen Gussman Adelson Lilyan. H. Affinito John E. Alexander Robert J. Appel Richard A. Aubrecht Robert W. Bitz Robert T. Blakely III Kenneth H. Blanchard Ann Schmeltz Bowers James L. Broadhead Richard C. Call Michael W.N. Chiu James M. Clark J. Thomas Clark Laura J. Clark Abby Joseph Cohen Paul F. Cole Robert A. Cowie Kenneth T. Derr John S. Dyson Robert R. Dyson Anne Evans Estabrook Fred J. Eydt Mary C. Falvey Stephen W. Fillo Earl R. Flansburgh Barbara B. Friedman H. Laurance Fuller James Lowell Gibbs Jr.
Myra Maloney Hart Joseph H. Holland H. Fisk Johnson Thomas W. Jones Albert J. Kaneb Robert D. Kennedy Harvey Kinzelberg Benson P. Lee Charles R. Lee Jon A. Lindseth Carol Britton MacCorkle Eli Manchester Jr.
Thomas A. Mann Dale Rogers Marshall Ronay A. Menschel Robert W. Miller Rebecca Q. Morgan Edwin H. Morgens John P. Neafsey Margaret Osmer-McQuade Roy H. Park, Jr.
Jeffrey P. Parker Andrew A. Paul Robert A. Paul William E. Phillips Curtis S. Reis William R. Robertson Nelson Schaenen Jr.
Richard J. Schwartz Daniel G. Sisler Robert W. Staley Patricia Carry Stewart Peter G. Ten Eyck II Allan R. Tessler Samuel 0. Thier Paul R. Tregurtha Richard F. Tucker Sanford I. Weill Roger J. Weiss Bruce Widger 63
BOARD OF TRUSTEES AND TRUSTEES AT LARGE JULY 1,2008 WEILL CORNELL MEDICAL COLLEGE AND WEILL CORNELL GRADUATE SCHOOL OF MEDICAL SCIENCES BOARD OF OVERSEERS Sanford I. Weill, Chairman Hushang Ansary, Vice Chair Barbara B. Friedman, Vice Chair Arthur J. Mahon, Vice Chair Her Highness Sheikha Mozah Bint Nasser Al-Missned Madelyn Antoncic, Ph.D.
Robert Appel Robert A. Belfer Jessica Bibliowicz Lloyd C. Blankfein Abby Joseph Cohen Timothy Collins Alberto Cribiore Daniel P. Davisont Sanford B. Ehrenkranz Israel A. Englander Anne E. Estabrook Jeffrey J. Feil Samuel Fleming Charlotte M. Ford Gerald J. Ford Jean-Pierre Garnier, Ph.D.
Antonio M. Gotto Jr., M.D., D. Phil*
Paul Gould Jeffrey W. Greenberg Maurice R. Greenberg Rajat K. Gupta David P. Hajjar, Ph.D.*
Leonard M. Harlan Raymond R. Herrmann Jr.t Michael Jaharis John Kanas Harvey Kaylie James M. Kilts Harvey Klein, M.D.
Charles R. Lee Michael T. Masin Peter C. Meinig*
Ronay A. Menschel Fabrizio Michelassi, M.D.
Howard P. Milstein Edwin H. Morgens Rupert Murdoch Margaret Osmer-McQuadet Nancy Paduano Ankit Patel Nelson Peltz Ronald 0. Perelman Bruce Ratner Burton P. Resnick Gene Resnick, M.D.*
Frank H. T. Rhodest Isadore Rosenfeld, M.D.
Zev Rosenwaks, M.D.
Peter M. Sacerdote David A. Shapiro, M.D.
Herbert J. Siegel David J. Skorton, M.D.*
A.J.C. (Ian) Smith Daisy Margaret Soros Saul P. Steinbergt Patricia Carry Stewartt Louis Wade Sullivan, M.D.
Harold Tannert Samuel 0. Thier, M.D.
Richard E Tuckert Roger Weisst Carolyn Wiener
ý Ex officio t Life Overseer 64
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