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Trudeau needs the community’s help to rebuild endowment

May 17, 2012
By Steve Smiley

I have been a scientist at the Trudeau Institute for 12 years. I love the institute, and I love the community it resides within. The following words reflect my personal opinion, not the official positions of Trudeau management.

To my knowledge, Trudeau has never sustained itself on National Institutes of Health grants alone. One can argue about whether it might be more successful obtaining grants if it was located elsewhere, but that does not change the fact that grants alone are unlikely to suffice. Institutes like Trudeau do not exist on NIH funds alone.

Our other funds historically came from the Institute's endowment. When Robert North was director, he built the endowment to nearly $40 million. At that level, one can expect about $2 million per year in extra income (presuming a 5 percent return). Those extra funds are essential for covering the operating expenses that NIH grants do not cover. With the board's approval, the institute's subsequent directors used more than $2 million per year of endowment funds year after year. They built programs and built buildings that improved the science and helped to make Trudeau the world-renowned institution it is today. In the process, they also eroded the endowment and created substantial new expenses, such as loan/bond repayments.

The original plan was to rebuild the endowment and pay off the loans/bonds with philanthropy, but that never occurred. Then, in recent years, the institute experienced increased competition for NIH funding, an ailing economy, the loss of its director and several (funded) investigators partly as a result of the relocation debate, and a continued failure to raise the necessary amounts of philanthropic funding. These circumstances all contributed to the current fiscal crisis.

What is needed is a plan to pay off our debt and rebuild the endowment - quickly. Then, the scientists can return to their work, return to bringing in grant funds to cover most expenses, and know that revenue from the endowment is there to cover the shortfall. I believe the so-called "translational problem" can be addressed by partnering with nearby institutes with clinical facilities (e.g. University of Vermont, SUNY Upstate) that value our stellar reputation and scientific strength in basic infectious disease research.

In fact, Trudeau will soon announce new grant awards that demonstrate our ability to perform translational-clinical research by partnering with others. However, I think it highly unlikely that partnering will suffice to overcome our revenue shortfall. Most businesses are struggling in the current economy, and I don't think any partner will commit to providing Trudeau with the extra operating funds that we need.

So I urge the community to help us rebuild the endowment. If you care and truly have the capacity to help, then I urge you to get involved.

How? I'm not sure. We may need a grassroots effort to figure out how. Maybe there are a few key "champions" in our community who can come to the rescue philanthropically, or take the lead on a vigorous fundraising campaign. Maybe someone from this community will help to deliver an impassioned message to a key philanthropist.

Why should you care? First of all, the Trudeau Institute has brought $138 million in revenue to Saranac Lake over the past 10 years. Those funds come mostly from NIH grants. A very large percentage of the dollars we obtain from NIH are spent paying the wages and benefits of the 100-plus people employed by Trudeau who live and work in this community. On average, we infuse the local economy with more than $6 million per year. Our employees spend much of that money locally: They eat in the local restaurants, shop at the local stores, pay local taxes, contribute philanthropically to local efforts, etc.

Second, the community should be proud of this jewel of an institute and use it as a means to sustain and build our regional economy. As our mayor is trying to do, we should use it as an example of the kind of future this region can look forward to. This is a wonderful place to live, work and raise a family. In a modern economy, rural locations like Saranac Lake should have less trouble competing, not more. We have a good infrastructure, we can exchange data instantly via the Internet, and we can get supplies delivered overnight. It is far easier to work here now than in the days when Frank Trudeau originally set the institute here. I applaud Mayor Rabideau's efforts, and I believe wholeheartedly that Trudeau Institute can help to anchor the growth of a high-tech economy in this region.

Third, I believe that the type of research we do will bring great value to society, benefiting your children and your children's children. It may take years for our basic research findings to translate into clinical utility at your doctor's office, but nevertheless basic research remains a critical step in the vaccine and drug development pipelines. Already there are many university campuses and medical centers around the world where clinical research can be done. What makes Trudeau special is our capacity for excellent basic research, our relatively small size, and our location.

After the sanatorium closed in 1954, Frank Trudeau had the opportunity to move this institute to the New York City area. He chose instead to keep it in Saranac Lake. Others may disagree, but I think some of the key characteristics that make the institute what it is, such as the collegiality that results from having to rely on a relatively small group of co-workers, will be difficult to replicate in the competitive environments of a big university campus or medical center. In my opinion, Trudeau would not really be "Trudeau" anymore if it moved. It would be a new institute with the Trudeau name. It may or may not be more successful that way, but it would have lost its connection to its roots - a collegial group of scientists working together in relative isolation at an institute populated by the people of Saranac Lake. For many of those locals, working at Trudeau is not just a job. It is a career at a place they care for deeply, a place with a rich history and important mission. That attitude permeates the institute and contributes to the success of its science.

I hope this commentary will help to turn the conversation away from a rehash of who is to blame for the current fiscal crisis. Certainly with hindsight we can identify past mistakes by well-intentioned individuals, including myself. But what we need now is a discussion of how a community that cares about Trudeau Institute can help to ensure its survival for another 127 years.

What I think would be most helpful is for people who care about Trudeau to think hard about whom they know. Do you know someone who has the capacity to contribute substantially? Do you have the ability to get the ear of that person and talk to them about Trudeau - its importance to the community, to the region and to science?

We hope to have a new CEO/director in place very soon, and that should certainly help us raise funds. In the meantime, my colleagues and I are happy to meet with prospective fundraisers and philanthropists. You can help by introducing us to people you know and helping them understand why Trudeau is a worthy cause.


Steve Smiley, Ph.D., lives in Saranac Lake and is a faculty member at Trudeau Institute.



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