Some departments, like English, were able to turn to reserve funds.

“I had thought that the cuts were going to be more dramatic than they ended up being,” Simpson said.

After announcing an 11 percent increase in the endowment value—following a restructuring of its investments to maintain diversified asset classes but drift from illiquid holdings—the Harvard Corporation approved a payout rate for the 2012 fiscal year that would lead to a rise of 4 percent in the nominal value of the distribution FAS would receive from the endowment.

That increase has freed administrators from the penny pinching that marked the previous two years and allowed them to turn back toward a focus on academic programming.

“We’re finally at the point that we can worry about things other than not buying paper clips,” History of Art and Architecture Department Administrator Deanna Dalrymple said in an interview early this month. “We can now worry about putting more focus on the academic ambition within the department—bring back symposia, host panels, think again about the academics.”

And FAS department staff members are hopeful about that transition.

“I’m in an optimistic mood,” History Department Administrator Janet H. Hatch said. “Yes, we still have some ways to go with the remaining deficit, but we’ve also learned how to operate at the same level more cheaply—and it’s easier to maintain it.”

YALE YEARNINGS

But as FAS approaches a balanced budget, Yale President Richard C. Levin and Provost Peter Salovey announced in January that Yale would pursue another round of budget cuts, to be approved this May.

In an email to faculty and staff, they said that for fiscal year 2012 they expected a 5 percent decrease in non-academic budgets, while academic programs would maintain their slimmed down budgets.

Although Yale’s endowment increased at 8.9 percent last fiscal year—less than the investment return seen at Harvard—the university still faces a more daunting deficit of $68 million.

Rather than immediately making cuts in the wake of the financial crisis, Yale has relied on its reserves in order to bridge shortfalls in the budget. As a result, it has been slower to make necessary long-term cuts, according to The Yale Daily News.

Staff consolidation still lags behind projected timetables and will continue next year, the YDN reported.

At Harvard, FAS refrained from spending the majority of its large reserves—which stood at $138 million in 2008—in the first two years after the crisis. In May 2010, Smith said the school would draw on the reserves more heavily as it tackles the remaining $35 million deficit by the self-imposed 2012 deadline.

PRIVATE EQUITY PRINCETON