President John Hennessy delivered his annual address to the Academic Council on Thursday afternoon in Cemex Auditorium, in a meeting that also offered another special report from Faculty Senate Chair Raymond Levitt M.S. ‘73 Ph.D. ‘75.

The meeting began with Levitt’s report, which acknowledged the lack of an Academic Council Meeting last year by recapping the Faculty Senate’s work over the past two years.

Levitt said that last year’s Senate “fundamentally re-imagined the Stanford undergraduate educational experience” through the implementation of a report produced by the Study of Undergraduate Education at Stanford (SUES) Committee.

Notable changes referenced by Levitt included the transition from the three-quarter Introduction to the Humanities (IHUM) program to a one-quarter Thinking Matters course and the replacement of general education requirements (GERs) with new Ways of Thinking/Ways of Doing requirements.

Levitt said that this year’s Senate has continued to act upon the recommendations made by the SUES committee while also discussing class scheduling issues and the future of online education, among other issues.

According to Levitt, the Senate will hear a panel discussion on the future of the doctoral degree, reports from student representatives and a presentation of the Provost’s annual budget report in the body’s last four meetings of this year.

The Senate will also debate the Alternative Review Process (ARP), a proposed revision of the University’s approach to sexual assault cases.

Hennessy spoke next, presenting a history of the past 30 years at Stanford. He focused his comments on faculty, students and financial aid, finances, facilities and the Medical Center; he framed his appreciation of the latter’s growth as necessary to charting a successful path for the University’s future.

“Where are we as an institution trying to go?” Hennessy asked. “Any good decision on that comes from looking back and seeing where we’ve come from.”

Faculty

Hennessy first discussed growth in the faculty population, growth in the tenure line, major awards won by faculty members, national program rankings and the faculty age distribution.

“Even though we had many strong programs, we now have programs that are ranked even higher,” Hennessy said, noting dramatic improvements in the humanities programs over the past three decades.

Though Hennessy discussed several significant advancements, including an increase in faculty quality, he acknowledged that faculty diversity has continued to be an area of weakness.

“This has been a long, slow haul for the University,” Hennessy said. “This is going to something that we continue to focus on, and we spend time every year in the Senate looking at it, but it continues to be a long slug.”

Hennessy said that the current trend in the age distribution of faculty is also troubling, as the median age of faculty members has increased by seven years from 1981 to 2012, with a particularly notable growth in the proportion of faculty members in the 60-69-year-old age range.

“That’s probably okay, but if this trend were to continue, what we would really worry about is our ability to bring in younger faculty, as we couldn’t replace older faculty,” he said.

Students

Hennessy then examined issues relating to students, including enrollment, admissions, diversity, financial aid and net tuition for both undergraduate and graduate students over the past 30 years.

According to Hennessy, net tuition (as calculated by subtracting financial aid from total costs of attending Stanford) was $16,586 in 2010-2011, compared to $16,090 in 1991-1992 on an inflation-adjusted basis.

“We’ve actually made the institution more affordable over time, and that no doubt bears directly on what’s happened with our student body in terms of more socio-economic diversity in it, and of course lots of applications,” Hennessy said.

Hennessy noted that while the undergraduate population is extremely diverse, graduate programs still aim to attract more African-American and Hispanic students.

“This bears directly on the issue of faculty diversity, which is why we are putting so much emphasis on the pipeline and getting diversity in graduate programs,” Hennessy said. “This is a long-term problem.”

According to Hennessy, future initiatives include a potential rebalancing of resources among majors, building a significant endowment for undergraduate financial aid and potentially limiting the size of graduate programs if federal resources are reduced for graduate financial aid.

Hennessy also mentioned the possible need to increase the number of undergraduates in the future to match the “considerably larger” graduate population.

 Finances

Hennessy then addressed the University’s financial standing from the 1980s to the present, focusing on the endowment value, University revenues and revenue composition and development results.

“We’ve been in a very blessed period,” Hennessy said. “The endowment has grown at 6.7 percent above inflation, so that’s a stunning growth number.”

While revenues from the endowment and medical service have grown, the federal research budget has fallen, which Hennessy predicted will prove a challenge in the future.

Though Hennessy acknowledged that continued strong endowment growth isn’t a certainty, he expressed confidence that the University is in “a good reserve position,” a particularly notable asset given the potential for further cuts in federal funding.

“We are well-protected for a federal downturn, particularly if that federal downturn is not sustained over a long period of time,” he said.

Facilities

According to Hennessy, Stanford’s facilities have grown extensively during the past 30 years, with a recent wave of renovations to replace older buildings.

“We have largely finished a renewal of the buildings on campus that were in the most desperate shape, those built in the ‘50s and ‘60s in the post-World War II boom in the University,” Hennessy said.

Hennessy also mentioned that several new building projects are in the planning stages or are currently being constructed, including the Anderson Building, the McMurtry Art and Art History Building and the Bass Biology Building.

According to Hennessy, the University recently found a donor to fund a renovation of the Old Chemistry Building, which will become an undergraduate science center with both classrooms and laboratory space. That renovation would fulfill a “long-standing goal” for both Hennessy and Provost John Etchemendy Ph.D. ‘82.

“That building is an architectural treasure, and we are delighted we can restore it,” Hennessy said.

Longer-term construction projects include the replacement of Meyer Library and the possible construction of new buildings for the Graduate School of Education, the School of Earth Sciences and the departments of neuroscience and chemical biology, according to Hennessy.

Medical Center 

Following a summary of the University’s finances, Hennessy discussed hospital finances and Medical Center revenues, focusing on potential challenges to the center’s continued growth.

The Medical Center currently generates 62 percent of University’s combined revenue.  Medical Center revenues have grown at 6 percent annually over the past 30 years, a substantially higher rate than the two percent growth rate of revenues on campus.

“We’ve got great growth in revenues as well as total net assets,” Hennessy said. “The issue that we face in the hospital and the Medical Center will be healthcare reform and what that will do to long-term revenues for hospitals.”

Hennessy also noted that the current expansion of the Medical Center will exhaust most of the growth capacity on the west side of campus, making it difficult to locate future construction initiatives in the same area.

“It will be hard to build much more on that side of campus,” he said. “We have to think about how we balance that. Longer term, we’re going to have to think about further expansions of the Medical Center, particularly clinical services, being off campus somewhere.”

Conclusion

Hennessy concluded with several remarks on Stanford’s expansion and development over the past three decades and his vision for the University in the future.

“Stanford’s growth and its preeminence have really been driven by an entrepreneurial culture,” Hennessy said. “By an entrepreneurial culture, I don’t mean startups and Silicon Valley, I mean faculty who are willing to head new directions, establish new fields and lead in development of their fields.”

Looking back at the past 30 years, Hennessy noted that Stanford’s capacity for growth has been crucial in allowing faculty to continue pursuing their research interests and beginning new initiatives.

“We haven’t very often had to make the decision of saying, ‘In order to do something new, we have to close something down,’” Hennessy said, adding that the University has been able to continuing expanding both because of its large campus and its ability to generate revenue through research funding and development.

Hennessy predicted several changes moving forward, including a more limited capacity for growth on campus and continued uncertainties surrounding federal expenditures leading to slower growths in research funding.

However, Hennessy expressed optimism that Stanford will acquire the resources needed to continue to thrive.

“The key for Stanford going forward will be to develop a vision and set of priorities for the institution that we can talk about to our friends, our donors and our alumni that will compel them to help support that mission through their philanthropic dollars,” Hennessy said. “If we do that well, I’m confident that we will continue to flourish as one of the great universities in the world.”