Some damn good questions about the new university budget.

✔ Fact Checker here. Good day, fellow Dukies.

With the start of the new academic and fiscal year on July 1, we are told the two-year wage freeze for faculty and staff that was imposed during the financial meltdown is over. Hooray!

We're told that merit increases have been awarded. But Deputy Fact Checkers have been unable to confirm the merit system now in effect is the same as it was three years ago -- or if there is a new way to measure performance that employees themselves do not know about.

We cannot find out what percentage of our faculty and employees actually got raises. And how large (or small) they were.

And vitally important, we cannot find out if lower paid workers were given a little extra. Their personal budgets had the least flexibility during the freeze, so they were hit the hardest.

Welcome to the Brodhead years, when stakeholders cannot find out basic information about Duke, so they can fulfill their responsibility to look after the institution. Welcome to the Brodhead years, where we must wonder how the administration makes decisions on what little information to trickle out: whether what officials do reveal is for the good of Duke, or the good of their own hides.

✔ Back to the wage freeze: Duke tried to soften the impact on its lowest paid employeese by giving them $1,000 checks each year. This was an extra payment; base salaries did not budge.

Now consider someone earning $30,000 a year or less. Their minimal raises will bring them less than the $1,000 -- so they will earn less in the new year than they did in the crisis years.

That's crazy. That's acceptable only to Brodhead and his minions.

Moreover, FC finds that many people do not realize the continuing impact the freeze will have for the rest of their careers at Duke.

For this example, we make some assumptions.

A) Duke will never be able to hike salaries to make up for the raises missed during the freeze. For example, a faculty member who before the freeze was making $100,000, missed out on two raises of 2.5 percent each that should have moved his or her salary to $105,083 compounded.

So $5,000 is missing this year. And will be missing for the rest of this person's career at Duke, which for this example, we assume is 20 more years.

Let's make a couple more assumptions. The faculty member was lucky enough to be able to salt the entire $5,000 a year into an IRA, every year. And the IRA earned 8.5 percent, which is what the University calculates as the average return for its endowment (even though in the past decade the return was only 6.5 percent.)

Do the math. Because of the wage freeze, after 20 years, the professor will be missing $290,306 from his or her IRA. Ouch.

There are other ramifications too. For example, life insurance based upon annual earnings will be less. For employees covered by pension plans, benefits will be less.

✔✔ Turning to the University budget, there are some crucial questions -- and make no mistake -- every stakeholder is entitled to answers. We should not have to ask and ask, beg, and extrapolate to find answers (although the contrary view of the Brodhead Administration gives rise to the need for Fact Checker!)

We want to know:

A) How the Arts and Sciences fared in the new budget. Are all faculty positions intact? How many searches will there be for new professors? And will hiring be limited to cheaper assistant and associate professors, or will we also seek out established talent?

B) What is the athletic subsidy?

C) Are the projections for losses due to the folly of Kunshan still the same? Or did they increase, as surely they will in time. Loyal Readers know the faculty in Fuqua disputed the fundamentals upon which their dean, Blair Sheppard, and President Brodhead had built a house of cards. And FC notes too, that Executive Vice President Trask, our chief financial officer, has steered clear of accepting the house of cards, stating only that we do not know the amount of tuition we can charge, nor the number of students we will attract, so we do not know how much Duke will have to subsidize Kunshan.

D) What are the projections on fringe benefits? Can the medical plan be sustained? Will monthly contributions from all employees and co-payments remain the same?

✔E) In the new budget, what is the estimated rate of return on endowment -- and what is our distribution (annual spending from the endowment). Duke has assumed that it would earn a sustained 8.5 percent compounded on its endowment, but in the past decade, as the Administration finally admitted after a FC essay, the return has only been 6.5 percent.

✔F) And on the spending side, will we continue to take out more than the responsible formula allows to sustain financial aid? In the year just ended, we took out 28 percent more than the formula allowed; this means we spent money at the expense of future generations. And this extra spending allowed Brodhead to make it seem as though his Financial Aid Initiative worked, when in fact it did not, when in fact it was woefully insufficient. A Deputy Fact Checker recalls that the amount raised for undergraduate scholarships was precisely half what Trask projected was needed -- before his buddies on the second floor of Allen Building told him to shut up.

G) Overall, is the budget for the 2011-12 academic and fiscal year truly balanced, or are we going to have to take another secret puff of endowment money to make it look like it is. The projection was, in the year just ended, we'd inhale $72 million above and beyond normal distributions; we won't know until October the actual results.

Or put another way, Brodhead said it would take three budgets to untangle the mess of the financial meltdown and create a sustainable budget. Did he reach his goal? We do recall the President's saying when the mess started that in the year 2011-12, Duke's spending had to be $125 million less than it was in 2008-9, which is to say around $1.75 billion. This was called "the new normal." Yet the budget the trustees adopted for 2011-12 calls for expenditures of $2.1 billion. We need a reconcilation.

Fellow Dukies, we think you should be connected to all this information. We should not have to discuss it with a series of question marks. The Administration, while temporarily holding the keys, does not own this place. Rather than locking up information, Brodhead should lead the way in opening doors for every stakeholder. Unless he fears transparency and accountability.

Thank you for reading FC. Probative. Provocative.

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