UNIVERSITY RUNS INTO RED $58,605.15 REPORT DISCLOSES

In the red for the first time in recent years, the University ran a deficit of $58,605.15 during the past year ending June 30, 1940, according to the annual report of the Treasurer, William H. Clafflin, Jr., to the Board of Overseers which was released yesterday.

The deficit arose despite a decrease of $68,706.15 in the running expenses of the University. Income for the year fell off $128,154.53, Clafflin's report revealed. A sharp decline in the amount of gifts received for immediate use, and a decrease in the interest from University investments were largely responsible for the deficit, officials stated.

Drop in Tuition

University books also show a drop of close to $75,000 in tuition and other fees received from students.

For the previous year ending in June 1939, Harvard eked out a bare surplus of $843.23, and at that time plans for retrenchment were introduced. Largely because of the financial situation, President Conant instituted a new system of Faculty tenure and gave terminating appointments to 10 assistant professors, several of whom were subsequently rehired.

In the departments of instruction, research, and administration, income declined by $174,881.35, while expenses were only reduced by $52,107.97, leaving a deficit of $83,926.36 in sharp contrast to the previous year's surplus of $38,847.02.

Partly offsetting the deficit in the departments of instruction, research, and administration, is a surplus of $25,321.21 in the service and maintenance departments. Drastic economics erased the previous year's deficit of $38,003.79 in the service departments.

During the twelve months ended June 30, 1940, the endowment funds, including funds subject to annuity payments, increased by $3,807,121.26, making a total of $143,922,931.20.