The Peabody Institute is considering possible reductions in staff and services, increased tuition revenue and stepped-up private fund-raising to deal with cuts in state aid to its operating budget totaling some $875,000.
But Robert O. Pierce, director of the Peabody, said he was "cautiously optimistic" that the cuts wouldn't derail a carefully crafted plan to assure the conservatory's long-term financial well-being approved just last year.
The Peabody was hit especially hard by the latest round of budget cuts announced Tuesday by Gov. William Donald Schaefer. In addition to a 25 percent reduction in state grants to private colleges that cost the Peabody $125,000, the state cut $750,000 from a special $3 million appropriation to the conservatory. Together, the cuts amount to about 6 1/2 percent of the Institute's $13 million annual operating budget.
Also trimmed was 25 percent of a $2.3 million annual contribution to the Peabody Institute Fund, part of $15 million in state funds earmarked for the conservatory's endowment that are to be swapped in January 1996 for the school's extensive art collection. The deal was part of the plan to rescue the Peabody from insolvency.
The $875,000 cuts in operating support come on top of the conservatory's own cost-cutting moves, including reductions in support staff, and revenue enhancements totaling more than $1.1 million over the last two years.
"That's a large enough sum that a solution isn't going to come from just one or two sources," Mr. Pierce said of the state cuts. He said the 500-student conservatory would "lean more heavily on our annual fund efforts and look at what additional cutbacks we can make," as well as look to increase tuition and enrollment to make up for the loss in state money.
However, he said no decisions would be made before the meeting in two weeks of the board of trustees of Johns Hopkins University, with which Peabody is affiliated.
Mr. Pierce said he considered the endowment cut to be a "deferment of payment" that would be made up once the state's revenues improved.
And although he said he "always looks at the downside of things," he said he was "cautiously optimistic" the Peabody would continue to move toward financial self-sufficiency.
"We're better off than we were three years [before the appointment of a gubernatorial task force to suggest ways to eliminate years of operating deficits] and we're better off than we were in 1977 [before the school affiliated with Hopkins]," Mr. Pierce said. "I figure we'll figure out a way to get through this."