As the new chief financial officer it is my pleasure to report to you on the financial condition of Brewster Academy. I was attracted to Brewster by the school’s well-deserved reputation for excellence in instruction, by the outstanding team of educators and administrators who make this a world-class learning environment, and of course by the school’s spectacular location on the shores of Lake Winnipesaukee.
Another factor that attracted me to Brewster is the school’s potential in the years to come. Brewster is well positioned to be successful in attracting and retaining students in an increasingly competitive environment. I am excited to be contributing my experience to the development of our strategic financial plan assuring the school’s continued success.
Among the financial highlights of this past year is Brewster’s enrollment, which has exceeded plan by five students. In 2009 tuition provided 64 percent of expenses. Summer activities on the campus, including the Heifetz International Music Institute, Royal Thai Scholars, rentals, and summer camps netted about $350,000 toward operations. Utility costs increased by 29 percent over 2008 but other expenses remained within budget. Significant investment losses as a result of overall market declines caused the book value of the endowment to decrease. As of this writing, some of those losses have been made up as the market has recovered.
It was a difficult year for the U.S. and world economies. However, these times also highlight why your support is so crucial to Brewster Academy. The endowment, while small, provided a critical resource during the past two years as a source of income and cash flow. The Curvey family’s gift of $6.3 million in land and buildings helped to offset significant book losses to investments, resulting in a net increase in Brewster’s booked assets of $2.4 million. Annual Fund gifts provided more than $780,000 in support of operations.
The financial turmoil of the past two years is an opportunity to recognize the strength of Brewster as an institution of learning, to refocus our efforts on the future, and most of all realize that now is the time to make the investments that will yield results for Brewster’s current students and all future students to come.
For 2009-2010 we have set the following priorities to help us better position for the future:
Efficient and Effective Use of Resources
We have begun a process that will ensure we are spending money wisely. We have already reduced on-going expenses by reviewing contracts with current vendors. In the next year we will bid out some large products and services and re-examine the details of what we do and why we do it. We expect this process to help us reduce non-instructional costs even further.
Financial Information Systems and New Online Account Access
We are installing new financial software and beefing up our in-house accounting capabilities. We need more and better information in real time. We also will reduce our use of outside accounting services. As part of this project we will roll out a web-based portal that will allow our parents online access to detailed tuition bills and student account information. I know from the many calls we receive that parents want this information and now they will have it in a very convenient format. This portal will be integrated with a new web-based application and enrollment process that our Admission Office will release later this year. Next summer we will complete this project with a new point-of-sale system for our campus store.
Going GreenWe continue to examine the ways we can reduce our fuel and other utility costs. This impacts our long-term financial picture and reduces Brewster’s environmental footprint, consistent with our vision to “Live, Learn, Lead.”
Building a Strong Endowment We are continuing the emphasis we began last year on building a significant endowment as part of Brewster’s long-term plan for sustainability. Brewster’s endowment is among the smallest within its competitive school group. Endowment provides an important source of income for financial aid, capital for facilities, and a source of income during times of financial stress. Endowment also helps the school maintain a strong credit profile.
Modernizing and Maintaining our FacilitiesOver the past 20 years Brewster’s physical plant has grown through construction and building acquisition. The focus now turns to deferred maintenance and modernization. A comprehensive study of our buildings was performed in 2008. We are using this study to prioritize resources where they are needed most. It also was clear to me in touring our facilities that our dormitory rooms were overdue for a fresh look. We have developed a plan for our dormitory rooms that includes efficient lofted furniture systems and a bright fresh look. We plan to renovate dormitories as funds become available from donations and grants. We have also had the design work done for the landscaping in front of the Estabrook, replacing the narrow steps and concrete walkway with a large patio area with stone walls and natural granite seating. This work, when completed, will create a new social space and the beginning of a revival of Lamb Green as Brewster’s “Central Park”.
Planning for Long-Term Sustainability Private school education is labor intensive. As a result the cost rises faster than the U.S. Consumer Price Index. To remain affordable we must look at revenue enhancement opportunities, controlling costs, managing the costs and risks of our outstanding debt, and especially increasing our endowment and annual financial support from donors. In the next year we will develop a long-term financial model to help us track and meet our goal of sustainability.
I welcome your input and your support. Brewster Academy is a joint effort of board members; faculty, staff, and administration; parents; alumni; and friends.Together we can continue the school’s storied history as an institution that changes lives and produces tomorrow’s leaders.
Lisa Braiterman (Shira ’13)
Chief Financial Officer