2023 was a year of many significant developments for CSHL that are worth reflecting on as we continue to advance the frontiers of biology through research and education and embrace the promise and opportunity ahead.
Financial Resources
CSHL’s philosophy is to budget conservatively, especially with revenue sources that are difficult to project with certainty, like third-party awards and philanthropic support. Despite unanticipated challenges, we were pleased to finish the year with a modest surplus. In 2023, CSHL revenues achieved their second highest level ever at $183 million.
Every major source of income exceeded original budget projections, including third-party awards (+10%), endowment funds, royalties, and interest (+10%), and our education divisions (+2%). For the second year in a row, unrestricted support from our generous donors set a record, capping the year with a very successful Double Helix Medals dinner. However, expenses also exceeded original budget projections as inflation continued to impact salaries, benefits, staff turnover, supplies, and utilities. Thankfully, income growth bested expense changes and our operating results improved, with the modest surplus creating a reserve that will help support 2024 operations.
Our endowment serves as a critical buffer against the uncertainties of federal and private funding. Led by a robust fourth quarter in the financial markets, the endowment returned 14.5% in 2023, its fifth best performance in 30 years. All but one asset class exceeded its benchmark, and the return was 6.5% higher than inflation (as measured by CPI) after a 4.5% draw from the endowment. That means the purchasing power of this critical income source was enhanced. Our 2023 endowment performance put it in the top quartile of a pool of more than 600 endowments and foundations. The endowment started 2023 with a balance of $698 million and—after returns, new gifts, and a $32.5 million operations draw—ended the year at $780 million.
Operating and Capital Matters
Managing operations across four campuses on 220 acres with 86 buildings requires significant capital and human resources. Our Facilities Department has more than 100 employees working across a wide range of functions. In 2023, $9.1 million was invested in our campus facilities for repairs, upgrades, equipment, and normal life cycle activities. However, this investment must increase, and we are working with the Board’s Facilities Committee to create a long-term capital plan to meet that goal. CSHL is fortunate that historically it has been able to supplement its capital budgets with restricted gifts and grants, and 2023 was no exception.
The capital project supported by our Foundations for the Future campaign is now officially underway. At the June 2023 Board meeting, our Trustees approved moving forward with the $240 million Phase I expansion of our Hillside campus. Over the next three years, research buildings focused on Neuroscience, Artificial Intelligence/ Quantitative Biology, and Brain-Body Physiology will rise up from an underground super-structure that will include the foundations, parking, and eventually, a vivarium.
Another multi-year effort dubbed “Project Helix” will bring significant long-term benefits to CSHL via the implementation of a new enterprise resource planning (ERP) platform. In 2023, CSHL selected Workday to provide an integrated system for its financial, human resources, procurement, and third-party awards activities. Hundreds of business processes will be streamlined, digitized, and automated, improving the efficiency, accuracy, and timeliness of our data access and analysis.
CSHL’s branding project also commenced in 2023 with the ultimate goal of broadening our audiences while maintaining the strong following we enjoy globally within scientific communities. Results of the first phase of this project will be presented at the June 2024 Board meeting, including recommendations to embrace a bolder, new approach on market positioning, messaging, and visuals. Look for more on this in next year’s Annual Report.
Our Global Community
CSHL is an amazing community of 1,000 people working across research labs, education divisions, and various support functions. We hail from 77 nations, creating a rich fabric of cultures and traditions all working toward a single mission. Each year we acknowledge the extraordinary work of employees who go “above and beyond” through our Community Recognition Program. Several years ago, we started the frameSHIFT Program, which brings speakers to campus to examine the social, cultural, and historical sides of working at an academic research institution. Last year we welcomed two new members to CSHL’s Administrative leadership. MaryJo Zaborowski, our Chief Information Officer, brings decades of experience in the private biotech sector. CSHL CFO Nick Milowski, CPA, joined us late in the year from Fordham University, where he was VP, Finance and Assistant Treasurer. Both bring experience with digital transformation and are valuable members of the Project Helix Steering Committee.
Thank you to the entire CSHL community for contributing to our success in 2023.
—John P. Tuke, Chief Operating Officer