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Layoffs, retirement of staff, faculty reduce Luther Sem’s debt

UPDATED-- March 21

In response to ongoing financial difficulties, Luther Seminary Interim President Rick Foss on March 19 announced “changes to 30 positions out of 125 staff positions” at the institution. Some individuals whose positions were eliminated will end their employment with Luther Seminary on April 5; others will continue until June 30.
In addition, eight of the seminary’s 44 faculty members will seek retirements or pursue new calls at the end of the school year – some retirements were previously planned and some are early. Other retirements or changes in vocation are planned for the 2013-2014 school year. Early recommendations from the administration to the Luther Seminary Board of Directors had indicated that 16 faculty positions would need to be eliminated or go unfilled over the next three years.
In his letter to students and alumni, Foss explained, “In mid-October, it became clear that Luther Seminary was spending well beyond our means. When we investigated the situation, we found we were over-spending on an annual basis by several million dollars. Unfortunately, we were relying on loans from financial institutions, as well as from our endowment, to cover our expenses. While the money was being spent on excellent initiatives, including personnel, programs, and innovative missional work, it was clear we could not sustain this rate of spending.”

Luther Seminary's Interim President Rick Foss

Eight of the seminary’s 44 faculty members will seek retirements or pursue new calls at the end of the school year.

Recently, the board realized that the annual operating expenses for the seminary would need to be reduced by at least $4 million. The board considered a number of options to raise money and cut costs, including staff and faculty reduction, salary and benefits reduction, creative job sharing, property sale, elimination of the Ph.D. program, and stricter management of non-employee-related expenses.
In a February 21 letter, Foss and Academic Dean Roland Martinson had recommended the elimination of the Ph.D. program, a potential savings of $460,000 to $600,000 annually. After further conversations with faculty and the board, Foss on March 13 notified the board that “In light of the faculty’s expressed desire and commitment to seek a more viable Ph.D. model for the future, we are now recommending to the board that we place a three-year hiatus on the admission of new students.” The Luther administration and faculty will use that time to determine the long-term viability of this program, which is especially popular with international students from Asia and Africa.
In addition, the Master of Sacred Music program will remain on hold. It will also go through a three-year assessment process, though the two remaining students will be “accompanied.” And the Wee Care early childhood education program, which “was originally opened to provide care for the children of our students, faculty and staff,” according to Foss, will close on June 30.
Because the Evangelical Lutheran Church in America is not covered by unemployment compensation insurance, the laid-off staff do not qualify for unemployment insurance payments. The seminary severance package does give one week’s severance for each year worked at the seminary, with a minimum of four weeks and a maximum of 26 weeks. The seminary has also hired outplacement experts to work with job searches.
Professors will also see their average course load increase gradually over two years from 4.5 to five courses. With a reduced number of faculty, the remaining professors will need to support more coursework and students. (These recommendations come from a study called “Faculty Reduction and Reconstruction: A Right-Fit, Right-Sized Faculty at Luther Seminary.”)
In response to the stress created by the massive changes to the staff and faculty, the Rev. Laura Thelander, the seminary’s newly appointed campus pastor, planned a service of healing for March 19, the day many staff members found out about their termination.

The campus’ other stakeholders

Luther Seminary students, especially doctoral students, had strong reactions to the announced layoffs and program changes.
On March 15, the day the board met to finalize decisions, students, faculty, alumni, and community members were invited to participate in a gathering under the rubric of the Respectful Conversations Project, a process developed originally with funding from the Bush Foundation for the Minnesota Council of Churches’ congregational discussions during the marriage amendment debate in 2012. The event was sponsored by the Luther Seminary Student Council, led by Michael Rusert (a student), and additional sponsorship came from Luther’s Student Services department, according to Mary Hess, associate professor of educational leadership at Luther.
“We made very clear from the outset that this was not a conversation aimed at ‘fixing’ anything,” Hess explained. “[T]here would be no reporting out of any data to anyone in particular.”
Still, she said, “I heard from many that it was the first time they felt they had had the opportunity to listen deeply to people in other sectors of the Luther community.” She added, “I, personally, was deeply moved by the sharing that took place, and the clear and obvious respect that people held for each other, and for the different positions they brought to the conversation.”
Other students produced a document titled the “9.5 Theses.” Among the expectations they listed:
1. We want open disclosures and open imagination about the path forward.
2. We want injustice named and truth told so that confession and accountability ground this community.
3. We want stated and communally agreed upon theological values to guide the process.
4. We want to help inform the decisions, not be informed of them.
5. We want to be recognized as the church leaders we already are. We want to contribute to the process and learn form it as active participants.
6. We want to acknowledge that God is the owner, we are the stewards, and we are God’s hands and feet to the world. As partner[s] with God, we need to be in constant communication (prayer).
7. We know each decision made about faculty and programming will have far-reaching effects. We want to know how these effects are being taken into consideration.
8. We want to trust those making decisions at Luther. Being a part of the decision-making process would allow us to rebuild trust in leaders and process[es].
9. We want to be a learning community that is centered around God and open to God’s agency in the world. To begin to think about what a seminary is or could be is also a way into listening to faculty, student, and staff voices.
9.5 We think Luther Seminary is similar to a church that needs redevelopment. If we were a church, how would we approach redevelopment? How might that change the way in which we are approaching these matters?
One doctoral student, speaking on the condition of anonymity, told Metro Lutheran, “The soul of Luther Seminary is at stake [in these decisions].” Students believe that this is an opportunity for publicly stating an “alternative theological vision” that is committed to collaboration from all the stakeholders. “Transparency allows for confession and a ritual of mourning,” she said, adding that such a response by the seminary administration would point to a new model of being church.
“Bonhoeffer calls us to serve together,” another student explained. “He offers a worldview into what being church can be.” Both students agreed that carefully-worded memos from the administration can be alienating and unempowering for future church leaders.

The effects on faculty positions

One knowledgeable faculty source, speaking on the condition of anonymity, told Metro Lutheran, that the six retiring professors are Terry Fretheim, Elva B. Lovell professor of Old Testament; Fred Gaiser, professor of Old Testament and editor, Word and World; Gracia Grindal, professor of rhetoric; and Paul Westermeyer, seminary cantor and professor of church music. Mary Hinkle Shore, professor of New Testament, and Carla Dahl, professor of congregational and community care leadership, have announced their intentions to seek parish ministry calls. In addition, both Foss, in his role as director of contextual learning, and Martinson, in his role as academic dean, have announced their intention to retire.
Three additional faculty members have announced plans to retire or pursue other employment after the 2013-2014 school year. They are Richard Nysse, professor of Old Testament; Craig Van Gelder, professor of congregational mission, and Paul Chung, associate professor of mission and world Christianity.
In addition, Chris Scharen, assistant professor of worship, was recently named the new director of contextual learning.
One faculty member, pointing to the number of announced retirements, expressed the hope that attrition will solve the teaching faculty dilemma, meaning no one need be cut. Non-tenured faculty, however, may still be in a tenuous situation.
The identity of the laid-off staff members are not yet being made public.
“As we make these announcements, I am deeply aware of the sadness in our community,” Foss told students, faculty, and alumni. “I wish things were different. I will never think of this day as a good day; it simply isn’t. There will be good days ahead, but this isn’t one of them.”
CORRECTION: An earlier version of this story incorrectly stated that Mary Shore and Carla Dahl were  retiring; in fact, they have announced plans to seek opportunities in parish ministry.

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