New CFO Arrives At Choate Burditt Now Chief Investment Officer
By Mac Teng ‘07
News Staff Reporter
This summer, the Choate Financial Office underwent major structural changes, partly in preparation for the upcoming capital campaign. Early this month, Choate welcomed Mr. Richard Saltz as the new Chief Financial Officer. Mr. John Burditt, who previously held the position, is now the Chief Investment Officer, and will take charge of managing Choate’s $235 million dollar endowment.
Mr. Saltz joins Choate from his previous position as Vice President of Finance and Chief Financial Officer of the Central Connecticut Coast YMCA in New Haven, a $20 million not-for-profit organization. He has spent around thirty years in corporate finance, working for Fortune 500 corporations, smaller companies, not-for-profit organizations, and as an independent consultant. He graduated from Cornell University in 1973 and earned an MBA in Finance from Cornell’s Johnson Graduate School of Management, where he later served as a guest lecturer. He has taught corporate financial analysis at the University of Bridgeport’s Graduate School of Business and undergraduate accounting at Pace University. Mr. Saltz is a Certified School Business Administrator by the State of Connecticut Department of Education.
“I came to Choate for several reasons,” said Mr. Saltz. “For a long time I’ve been trying to get into the financial side of education, because I have felt that we have to run not-for-profits like businesses. There’s a lot of money [going through schools], and the size of school budgets puts them into increasing public scrutiny. With this responsibility, we’ve got to carry good business ethics and good business practices.”
“After my discussions with the Headmaster and John Burditt, [this job seemed] like something I could really be involved in, something that I could enjoy. You spend so much time at work, you have to enjoy it…Being part of an educational institution is going to make this a great job for me.”
Mr. Saltz’s transition into his new job is aided by Mr. Burditt. Once this transition has been completed, Mr. Burditt will take on his new role as Chief Investment Officer, which will allow Choate to focus more attention on its endowment.
The Chief Financial Officer at Choate “is responsible to the headmaster for most of the business and financial operations of the school,” according to Mr. Burditt. Many different offices report to the CFO, including the Controller, Ed Griffin, who manages tuitions and various aspects of the school budget, and the Personnel or Human Resource Department, which manages the supervision and payroll of non-faculty employees of the school. The CFO also manages Facilities, which is in charge of grounds, repairs, and cleaning, ITS, and the Assistant Business Manager who is in charge of insurance, contracts, real estate, legal issues, and Aramark. The CFO advises the Board of Trustees with regard to maintaining the school’s in financial health and with regard to strategy in the areas of finance, audits, building and grounds, and investment. The area of endowment, which used to be under the CFO’s supervision, is now mostly appropriated to the CIO.
In Mr. Saltz’s words, the CFO “makes sure that Choate can provide its primary service of education without having the faculty worry about how it can be afforded.”
Though the job and Investment Officer has been created to devote more resource towards gaining more return from Choate’s endowment, Mr. Burditt says that it might take two to three years for it to fully develop. Large institutions, such as Yale, have large staffs dedicated specifically to investments, and Mr. Burditt hopes that through networking with peer institutions and others, Choate can learn ways to further diversify its investment portfolio and identify the best possible managers. Of all of Choate’s peers, only Andover has already created the position of CIO.
Endowment draw provided more than a quarter of Choate’s operation costs, for the fiscal year ending this past June. Choate generated a 14.5% return on its endowment, which amounts to around 30 million dollars of which 11 million was used to support the school’s annual budget. Even a half percent increase in return would generate over $1 million dollars; as such, making sure the endowment is well taken care of is extremely important , especially as Choate begins its plans towards constructing two new dorms.
Although other changes this year have drawn a mixture of responses from students and faculty alike, the additional expertise of Mr. Saltz, and a new focus on endowment return led by Mr. Burditt this year will definitely prove to be a change for the better for Choate.
Rick Salt, Choate's new CFO, will, "make sure Choate provides its primary service of education without having the faculty worry about how it can be affected."
