Stevens Institute of Technology Annual Report 2004-2005
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Stevens Institute of Technology Annual Report 2004-2005 Stevens Institute of Technology Annual Report 2004-2005 Presentation Transcript

  • A N N U A L R E P O R T 2004-2005Stevens Institute of Technology 201•216•5000 • Castle Point on Hudson Hoboken, NJ 07030 USA
  • “Stevens Institute of“Clearly, the Stevens Technology is on an mission for education upward trajectory, and research is going and its destination is forward with tremendous among the very best energy and a vision that research institutions looks beyond the in the United States near horizon.” and the world.” Chairman Lawrence T. Babbio, Jr. President Harold J. Raveché
  • AI N S IW EP O I N T O N H U D S O N NE D cover: New Babbio Center looks out onto an interconnected world. ANNUAL REPORT 2004-2005 2 Message from the President 3 Message from the Chairman 4 A NEW POINT ON HUDSON • Stevens Launches Balloons for Homeland Security • Old Schooner With High-Tech Sensors Protects NY Harbor • SINTEL Draws on Interdisciplinary Research to Guard Against Threats • Attila Technologies is Latest WinSec Success Story • Center for Environmental Systems’ Surface, Water Decontamination • Howe School Efforts are Bearing Fruit • Biz Tech Graduates Attract Attention 26 IT TAKES AN INTERDISCIPLINARY TEAM TO SOLVE TODAY’S PROBLEMS • Center Delves Into Decision Making Process • Uniting to Battle for Cybersecurity • Systems Engineering Program is Largest • Undergraduate Engineering Aims to be More Flexible • Big Steps in Nanotechnology 38 MAKING OUR PRESENCE KNOWN, ON THE GROUND AND THE WEB • Stevens Makes Its Mark in China 40 STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS • Institute Marks Graduation Milestone • Athletics Program has Standout Year • Year of External Recognition • Feeling the Pain with Team MeCCo • Research, Awards and AchievementsSTEVENS INSTITUTE OF TECHNOLOGY STEVENS INSTITUTE OF TECHNOLOGY • New Faculty • An Incubator Company Grows Up • New Leadership • Development and Facilities ANNUAL REPORT 2005 ANNUAL REPORT 2005 • Faculty Profiles 52 2005 CONSOLIDATED FINANCIAL STATEMENTS 14 24 29 33 43 49 • Report of the Treasurer and Chief Financial Officer
  • PRESIDENT HAROLD J. RAVECHÉ CHAIRMAN LAWRENCE T. BABBIO, JR. Message from the President Message from the Chairman The important work of our faculty, the impressive Our collective goal is to continue to nurture the The Stevens Board of Trustees’ responsibilities include for achieving prominence and garnering a deserved rep- achievements of our students, the professional dedi- Institute’s distinct educational and research envi- evaluating opportunities for growth and, together with utation as a national – and global – asset. During this cation of our staff, and the exemplary commitment of ronment. campus leadership, charting a path that keeps Stevens time, many alumni and friends made gifts of significance our alumni have all contributed to a most successful Technogenesis® cultivates that high degree of competitive and ensures our ability to continue to edu- to help us move forward. 2004-05 academic year. I am honored to serve as pres- inventiveness which enables faculty and students to cate top students for promising careers. Two back-to-back, five-year capital campaigns set ident at this exciting time in the ascent of Stevens connect the pioneering progress they achieve in their A decade ago, we recognized that unless we could high goals for modernization of facilities and growth. among the nation’s top research universities. I am fields with products and services that are valued by strategically grow Stevens, our ability to continue as a Stevens now boasts academic and research faculty that especially proud of those extraordinary individu- business, industry and society as a whole. In the year source of excellence in research and education would be are competitive with the nation’s finest. Private philan- als that contribute to our campus as a just passed, Technogenesis has shown its value- severely hampered. To a large degree, that meant thropy at Stevens continues to grow in support of these dynamically vibrant center for learning and added impact for our students, faculty, industry part- investing in our physical facilities and infrastructure. new programs and facilities. creative activities. ners, the Institute itself, and the world at large. It is no The new and renovated facilities include a dozen The initiative to grow the student body has paid off Sponsored research of the faculty con- accident that Stevens was ranked in late 2004 by The undergraduate engineering labs; the Center for Maritime handsomely, too, with aggressive recruiting of new and tinued to grow in the 2004-05 academic Princeton Review as standing among the nation’s Systems and the rebuilt Davidson Lab; major new athlet- better-prepared constituencies at both the undergrad- year, reflecting the recognition of the schol- “most entrepreneurial campuses.” ics facilities, coaches and training personnel, resulting in uate and graduate levels. arly work of the Institute’s faculty among gov- Students and young alumni continued to apply for a meteoric rise for Stevens teams in the NCAA Division III Achieving these goals required major investments ernment agencies, private foundations and patents in technology applications that they helped ranks; new research centers focused on technology and unprecedented fund-raising efforts. As a result, the industry. It is a privilege to be to create through the Senior Design and problems in national security; new student dorms to quality of an education at Stevens has not gone unno- associated with these out- Technogenesis Scholars programs. Impressively, one accommodate the growing population; and The Babbio ticed: The number of undergraduate applications has standing faculty who are pio- biomedical device for detecting sources of pain in the Center for Technology Management, which will house the increased more than 26 percent in 10 years. And we have neers in their fields of body is expected shortly to undergo clinical trials at a administrative center of The Wesley J. Howe School and become increasingly selective: Improving from 71 percent research and who are con- New York City medical center. launch the next phase of growth for our management to 49 percent over this same 10 year period. In addition, tributing, through their The culture of the Scholar-Athlete at Stevens con- programs. Faculty in the three schools increased by one- even more students are applying for early-decision. research, to the rapid ascent tinued to expand and acquire new dimensionalities, third during this time to build upon specific, strategic Between 1995 and 2005, Stevens’ overall undergraduate of the Institute among the as our academically outstanding Division III athletes areas of our strength. enrollment has climbed nearly 37.5 percent. nation’s top universities. experienced their most successful season ever, with a The Institute has a long tradition of innovation and Our graduate programs are not only prominent region- In the recent US first-year student bringing home Stevens’ first excellence. It stands at the forefront of engineering, ally, but also globally. The Information Systems and Systems News & World Report National Championship in Equestrian Competition. technology advancement and scientific accomplish- Engineering programs are among the largest and finest in rankings for national As a testimony to our alumni, annual giving to ments; but we must continue to grow in order to compete the world. WebCampus.Stevens now reaches 43 states and universities, Stevens Stevens reached new highs, with the Edwin A. Stevens and keep pace with changes around us. 40 countries and was named among the best online gradu- climbed ten positions to Society breaking the 500-member barrier for the first It is impossible to get ahead – and stay ahead – by ate programs in 2005 by the US Distance Learning #71 - rising farther, faster, than time in its history. standing still. Further progress will ensure that current Association, having been similarly recognized in 2003 by the any other university in the Stevens Institute of Technology is on an upward students – as well as future incoming classes – receive Alfred P. Sloan Foundation. In 2005, Stevens awarded 848 National Top 100. In 2005, trajectory, and its destination is among the very best the highest quality education, and are fully prepared as master’s degrees, one of the largest classes ever. retention and graduation research institutions in the United States and the they begin their careers. Institutional success will enable Clearly, the Stevens mission for education and improved significantly, con- world. future alumni to continue the Stevens tradition of lead- research is going forward with tremendous energy and a tributing to the higher standing. ership in the competitive global workforce. vision that looks beyond the near horizon. When readingSTEVENS INSTITUTE OF TECHNOLOGY Stevens is now, in the category of Actual During years that witnessed the dot-com implosion, these pages, I am certain that you will be infused with ANNUAL REPORT • 2004-2005 Graduation, ranked 58, up from 83 in 2004. Ranked the 9/11 attacks, and a jolted and slowly recovering US this sense of the Institute’s mission and the spirit that 39th in SATs, Stevens continues to attract the most economy, Stevens has sought to fulfill its stated goals drives it. talented students in the nation. 2 3
  • INTRODUCTION A New Point on Hudson From the countless windows of occasion was capped with the “Stevens knows the skyscrapers of Manhattan, convening of two expert panels business and the view of Stevens has changed. that considered Technology technology. The red brick of our heritage is Convergence in Security and That is our still visible, as is the square Telecommunications, the first ‘secret solidity of The Howe Center. The of what Stevens expects will be weapon.’ We’re bluff of gray stone on which many such high-level events at striving to be Stevens is situated remains unal- The Babbio Center. The keynote seen as the tered. Anchored in that bedrock, speaker was Pat Russo, CEO of technical however, is a new structure which Lucent Technologies. commands the attention of the It’s especially fitting that university of city, the harbor and the world in a the new building houses The choice for way no previous building has: The Howe School, notes President business and Lawrence T. Babbio, Jr. Center for Raveché, because “Stevens industry.” Technology Management. knows business and technology. –President Harold The six-story, 95,000 square That is our ‘secret weapon.’ We’re J. Raveché foot Babbio Center is a beacon, striving to be seen as the techni- signaling the resolve of Stevens’ cal university of choice for busi- students, faculty and adminis- ness and industry.” trators to meet the needs of the wider world with At The Howe School in The Babbio Center, research and leadership. As the new headquarters Stevens’ dedication to meeting the needs of an of The Wesley J. Howe School of Technology ever-more-complex world will be realized with the Management, it is a glass-and-steel symbol of the cultivation of leaders able to mesh diverse disci- Institute’s commitment to “excellence for a pur- plines successfully to achieve solutions to prob- pose,” in the words of President Harold J. Raveché, lems in homeland security, health care, the envi- “a place where we can tailor and customize pro- ronment and other critical areas. grams, where faculty members can work together This is the dynamic environment described as in an interdisciplinary fashion. In today’s integrat- Technogenesis®, the educational frontier where fac- The six-story, 95,000 square foot Babbio Center is a beacon, ed and highly competitive world, they can’t just ulty and students work with colleagues in industry signaling Stevens’ resolve to meet the needs of the wider world stay in one field.” and government to nurture the conception, design with education and research leadership. As the new headquarters Stevens marked the official dedication of the and marketplace realization of new technologies. of The Wesley J. Howe School of Technology Management, it is a center on historic Castle Point on October 7 & 8 The melding of Technogenesis with the mis- glass-and-steel symbol of the Institute’s commitment to with an invitation-only gala and alumni reception sion of The Babbio Center enables Stevens “excellence for a purpose,” in the words of President Harold J. Raveché, “a place where we can tailor and customize programs, honoring the building’s benefactor and champion, Institute to chart a new direction in the twenty- ANNUAL REPORT • 2004-2005 where faculty members can work together in an interdisciplinary Lawrence T. Babbio, Jr., Class of 1966 and first century and to add another dimension to the fashion. In today’s integrated and highly competitive world, they Chairman of Stevens’ Board of Trustees. The structure of higher education. can’t just stay in one field.”4 5
  • A NEW POINT ON HUDSON Stevens Launches Balloons for Homeland Security Balloons wafting on an August breeze against the Coulter from Argonne National Laboratory also one of many “targeted research programs focused its extraordi- backdrop of Midtown Manhattan may not bring to deployed a radar wind profiler from the Stevens on key elements of homeland protection and secu- nary research, “The goal is to mind serious research to protect US homeland campus and used Stevens as a launch site for free- rity,” notes Dr. George P. Korfiatis, dean of The technology make a model security. But the “Urban Dispersion Program” is just flying balloon-borne instrument packages called Charles V. Schaefer, Jr. School of Engineering. and entrepre- of where the one of the latest – and most visible – of many proj- radiosondes. The Stevens site was selected not only These high-tech applications for homeland neurial vision. gas is going ects Stevens has designed for that purpose. because of its location west of Manhattan but also security and defense have been of particular inter- She reports that to go.” And, in spite of its serious intent, “We’re having because of the Institute’s role in meteorological est to government science and technology agen- FY 2005 research a lot of fun with this project,” says Dr. Alan F. modeling. cies, adds Dr. Helena Wisniewski, vice president for expenditures were – Dr. Alan F. Blumberg Blumberg, director of the Department of Civil, “We released weather balloons on the Stevens university research and enterprise development. nearly triple those of FY Environmental and Ocean Engineering. campus to measure wind speed and direction from “Our highly developed expertise in computer sci- 2000 – boding well for With funding from the US Department of the surface up to about seven miles. We measured ence and engineering, maritime systems, systems loftier future targets. Dr. Alan F. Blumberg (above) Homeland Security and the US Defense Threat the temperature of the air, humidity, pressure, and engineering and nanoscale technologies has and colleagues launch Reduction Agency, and support from the New York dew point. So when we study the gas data, we’ll resulted in major growth of instrument packets attached to weather City Office of Emergency Management, non-toxic have an idea of the forces that pushed the gas. The funded research.” balloons as part of the perfluorocarbon tracer gases were released in a goal is to make a model of where the gas is going to Wisniewski is well “Urban Dispersion series of tests in Manhattan. “Then, about 150 peo- go. The data comes in in real on the way to her Program,” August 2005. ple with backpacks with sensors measured where time,” Blumberg says. All this goal of ensuring the gas went.” Blumberg says. In addition, sensors allows researchers to project what that Stevens is were posted on city streets. might occur if terrorists released recognized as a Blumberg and colleagues Larry Berg from toxins into the air. national resource, Pacific Northwest National Laboratory and Richard The Urban Dispersion Program is just sought after by gov- ernment and industry forSTEVENS INSTITUTE OF TECHNOLOGY ANNUAL REPORT • 2004-2005 ANNUAL REPORT • 2004-2005 6 7
  • A NEW POINT ON HUDSON Old Schooner with High-Tech Sensors Protects New York Harbor A 120-year-old schooner has been pressed into service and the environmental monitoring being done by wirelessly via cellular connections to the Stevens Davidson Lab Still Making to study and protect New York area waterways. The the scientific community. Students can go home oceanographic and meteorological data repository; Waves in Ship Design “Stevens has ship, the Pioneer, now carries the latest technology in and see the state of the water, plot trends and stay they are then assimilated into the operational fore- become a the form of a computerized water monitoring system as in touch with the water even when they’re not phys- casting data stream,” according to Blumberg. The “Designing small, high-speed national leader part of the Urban Ocean Observatory/NYHOPS. ically, literally at the water’s edge.” modeling system consists of a three-dimensional ships is what Davidson Lab is in the In partnership with the New York Department of A June voyage that set sail from South Street circulation model, an atmospheric model and a famous for,” Professor Blumberg development Environmental Protection, the system measures water Seaport on the Pioneer celebrated this new tech- wave model. It is designed to provide reliable and notes. of sensor temperature, salinity and dissolved oxygen in New York nology/education partnership. timely meteorological and oceanographic “now- Stevens’ ship design facilities technologies Harbor from the Pioneer as it conducts its public sails. The Urban Ocean Observatory/NYHOPS is built casts” and forecasts for the New York Harbor region. have come a long way since 1931, and data analysis The data is fed via a wireless network to CMS computers. around three main components: observations, Stevens also has become a key player in devel- when small models were tested in and integration.” The CMS is playing a leading role in this area, accord- numerical modeling, and information distribution. oping the Integrated Ocean Observing System, which a 60-foot swimming pool on campus. The Institute is ing to Dr. Michael S. Bruno. “Stevens has become a The observation system consists of in situ measure- is directed through the National Oceanic and nearing completion of a major renovation of Davidson – Dr. Michael S. Bruno national leader in the development of sensor technolo- ments that are acquired in real-time to provide Atmospheric Administration. Lab’s high speed towing tank. The original tank was built knowledge of present conditions and to “We have a system of weather sensors across during World War II, “and had not been touched since,” directly support the modeling effort. Stevens the United States and we hope to have similar according to Bruno. This undertaking increases the size has formed a partnership with the US Navy, ability in coastal ocean and estuaries,” Bruno of the tank, nearly doubling its cross-sectional area, the National Oceanic and Atmospheric says. Such a system could warn of tsunamis, pro- and enhances its electronics and instrumentation. Administration and state agencies to create vide maritime security and pollution data. Originally 313 feet long, 12 feet wide and 6 feet deep, it a modeling/observation system that func- Several observatories are already in place, he adds, will be 320 feet long, 16 feet wide and 8 feet deep. tions as both an operational product and a along the New Jersey coast and in New York Harbor. An important aim of the renovation is to allow more research tool. The Department of Homeland “Plus,” says Bruno, “we have an exciting interna- access for classroom instruction and outreach, Bruno Clockwise from above: Security is also working with the experts in tional project, ACCESS – the Atlantic Center for the says, because “if we are really serious about producing The Davidson Lab towing the NYHOPS program to study the tracking of Innovation, Design and Control of Small Ships – which is the next generation of ship designers it has to start tank in the 1970’s; potential hazardous agents released in the being funded by the Navy” says Bruno. This joint project from an early age.” To encourage the next generation Pioneer crewmembers; New York and New Jersey urban environment. with the Office of Naval Research is developing tech- CMS now works with the Center for Improved Science (left to right) Dr. Michael This comparatively new research field nology to identify and track small vessels and predict and Engineering Education. “We have found the ocean S. Bruno, Dov Kruger, Dr. George P. Korfiatis, known as operational oceanography brings whether such vessels pose a threat. is a very powerful vehicle for inspiring youngsters in Howie Goheen, Brian together expertise in ocean physics, coastal All these efforts involve experts from a variety of math and science,” Bruno says. Fullerton and Douglas engineering and computer science, Professor disciplines. “These projects are trans-disciplinary Stevens is also building the curricula and partner- Meding. Alan Blumberg explains. “Real-time oceano- because some of what we are trying to develop does not ships to create the next generation of Navy ship design- gies and data analysis and integration – data fusion with graphic information within New York Harbor is obtained exist in any one discipline. We are almost creating new ers, he says. “We’re developing the knowledge and tools the purpose of enhancing maritime security.” using various sensors placed at strategic locations to disciplines that draw on the expertise” of professors that will lead to real, radical innovation in ship design.” The new partnership between Stevens and South monitor the current state of the estuarine environment.” and students throughout Stevens, Bruno says. “There Stevens also has created a new program – theSTEVENS INSTITUTE OF TECHNOLOGY Street Seaport Museum, which owns the ship, is In addition to the Pioneer, these locations does not exist a realistic laboratory in which one can Naval Engineering Program – and has just accepted the ANNUAL REPORT • 2004-2005 ideal, Bruno says, “because the museum is focused include shore, offshore mooring and commuter- develop and test maritime security technology; but we first class. “We have an exchange agreement with The on education, and the Stevens instrumentation ferry-based conductivity and temperature sensors. have at our doorstep the laboratory right here – one of University College London and welcomed the first two provides a direct connection between the vessels “All of the sensors transmit their data in real-time, the busiest harbors in world.” students in August,” Bruno says. 8 9
  • A NEW POINT ON HUDSON SINTEL Draws on Interdisciplinary Research to Guard Against Threats Argus, a monster in Greek mythology, had many eyes, “Defending against the asymmetric threats to our Navy making it the almost-perfect guard creature. Stevens forces at home and abroad constitutes the primary has brought together its wealth of research resources to research, modeling and development business of SIN- form the Secure Infrastructure Technology Laboratory TEL.” The benefits of SINTEL include automated deci- (SINTEL), a many-faceted guard to protect against ter- sion aids providing rapid responses to threats and the rorist threats at home and abroad. capability to act prior to attack; sensor placement The unique research facility debuted in July with the optimization; and the ability to monitor and ods currently available. Stevens is located on the announcement of an initial grant of $6.8 million from determine threats in a foreign or home port. “To achieve our goal we will take advantage of our edge of the world’s greatest port security lab the US Office of Naval Research (ONR). An additional $6 An imagery sensor modeling system will be able to realistic maritime environment, and develop systems – New York Harbor. million is earmarked for FY 2006. resolve small-scale surface ocean motions and to which integrate real-time mobile and remote ocean Bottom: The renovation of President Raveché sees SINTEL as “a synthesis and provide bottom topography – providing force pro- sensor capability, ocean forecast models, wireless net- the Davidson Towing Tank expansion of Stevens’ already vast expertise in the area tection and situation awareness. working, and automated decision aids; and advanced in progress. of homeland security technologies. It will serve the SINTEL’s applications include effective solutions to human/computer interfaces will provide a secure needs of the US Navy and others by leveraging several environment surveillance, data management, decision infrastructure technology research and development existing research centers, which are already engaged in support and latency problems. It will provide knowl- enterprise unequaled in the United States,” says Dr. Naval Anti-Terrorism and Force Protection work, as well edge of bottom topography from underwater Michael S. Bruno, who co-founded SINTEL and will serve as infrastructure security research.” autonomous vehicles, small planes or other platforms as SINTEL’s interim director. Bruno is also a professor Those existing research centers at Stevens include: for force protection and situation awareness that and director of the Center for Maritime Systems, which would be difficult or impossible to acquire with meth- houses the historic Davidson Laboratory. • The Center for Maritime Systems • The Urban Ocean Observatory/New York Harbor Observing and Prediction Center (NYHOPS) • The Design and Manufacturing Institute (DMI) • The Wireless Network Security Center (WiNSeC) “SINTEL is an interdisciplinary laboratory for real-time systems development for the protection of maritime infrastructure. It tests and analyzes threat scenarios in the realistic environment of the New York Harbor,” says Wisniewski, to whom the director of SINTEL reports. “The goal is to provide each member of the ship’s crew with automated, real-time situational information for the entire ship, in a hand held device. This information includes threat assessment and automated decision aides.”STEVENS INSTITUTE OF TECHNOLOGY Protection of Naval infrastructure against terrorist attack is extremely critical, she continues. ANNUAL REPORT • 2004-200510 11
  • A NEW POINT ON HUDSON Attila Technologies is Latest WiNSeC Success Story Attila Technologies LLC, a Stevens Technogenesis Company, was launched in July by Vice President Helena S. Wisniewski to meet the vital needs of first responders in emergency situations. Attila Technologies is a wireless commu- nications company that provides continuous broadband, on-demand commu- nication devices and services that function despite saturated airways. Attila’s technology is critical to developing a communication system that cannot be interrupted, or jammed, resulting in ultra-reliable, high- speed communications. Attila’s products are based on patent-pending, breakthrough technology that was developed at WiNSeC by Dr. Patrick E. White, director of WiNSeC, and researcher Nicholas Girard, with funding from the National Science Foundation. White and Girard“The two most are co-founders of Attila. important John E. Bischoff, the former vice president of operations and finance of AOL, was named first problems faced by CEO of Attila Technologies. Before joining AOL in the early days of the company, Bischoff had long first responders experience at IBM. He also served a stint with a successful start-up company, Aurora Biometrics, are continuous where he acted as COO during the start-up phase and served on the board for more than two years. communications Wisniewski serves as Attila’s chairman of the board. and The new company’s initial market will be first responders, because Attila solves “the two interoperability.” most important problems faced by first responders – Vice President in a disaster, as stated by gencies. Until now, in situations such as the the military market.” For the military appli- Above, left to right: Helena S. Wisniewski President Raveché, the Department of Homeland 9/11 terrorist attacks and the hurricane in cation, the Attila radio will enable front-line Dr. White, Vice President Security – continuous com- New Orleans, this has proved a critical short- troops reliably to receive and deliver high- Wisniewski and Stevens munications and interoper- coming. resolution situational awareness data. graduate students discuss ability,” Wisniewski says. “Additional applications of Attila include “Looking to the future,” Wisniewski says, the Attila radio prototype. Interoperability is a critical delivery of high resolution mug shots to “Attila has the capability to provide high- Far left: need in a disaster situation patrol cars operating in the field, or trans- speed Internet access to users, thus turning Close-up of an Attila radio because it provides the abil- mission of crime-scene videos to headquar- wherever they are into a virtual hot spot.” prototype. ity to interconnect diverse ters command centers,” White says. “Both can Stevens has become established as a first-responder groups such be done efficiently and at low cost without major center for research on cognitive radio, as federal, state and local having to build an entirely new infrastruc- White adds, noting, “We have gotten more agencies, police depart- ture.” grants in this area from the National Science ments and fire depart- Raveché praises “Attila’s dynamic trans- Foundation than any other school.” This past ments that are taking mission security, which also prevents jam- year WiNSeC received its fourth straight grant STEVENS INSTITUTE OF TECHNOLOGY action during major emer- ming and eavesdropping, making it ideal for from NSF. ANNUAL REPORT • 2004-200512 13
  • A NEW POINT ON HUDSON Center for Environmental Systems’ Surface and Water Decontamination The Center for Environmental Systems (CES) is charge short pulses that generate chemical of using chlorine. But “the prob- exploring new surface and water decontami- radicals and ultraviolet radiation for sterili- lem with ozone is that it has to be nation projects. The CES’s multifaceted zation and surface decontamination, says generated one place, then trans- research covers topics ranging from waste Dr. Kurt Becker, director, Physics and ported and stored. We’re trying to treatment processes, ground-water modeling Engineering Physics, and associate director generate ozone on demand, in and remediation, and monitoring of contami- for CES. Becker is working on the project with situ, right in the water where it is nants in inland and coastal waters, to resi- research professor Dr. Abe Belkind. needed,” Becker says. dential water conservation, flushability and The two also have been working with This process can be used for drinking water safety. Picatinny Arsenal on water disinfection using chemical and biological decont- The center is working with the US Air Force pulse electrical discharge. Water can be dis- amination of water. In principle to find ways to use di-electric barrier dis- infected by bubbling ozone through it instead it might be used to clean the family swimming pool, “but I’d advise against it,” Becker says. “We’re not trying to replace large because the initial scientific concept is Above: Experiments in treatment plants; these could become being nurtured by faculty, students and progress. Left: The portable units,” he says. The goal is industry and the technology is being trans- James C. Nicoll “to size it down, not scale it up.” formed into a product that can be patented Environmental Lab. This project fits nicely into the and eventually sold. Technogenesis model, he adds,STEVENS INSTITUTE OF TECHNOLOGY ANNUAL REPORT • 2004-200514 15
  • A NEW POINT ON HUDSON Howe School Efforts are Bearing Fruit The Wesley J. Howe School of Technology McCusker, acting dean of The Howe School, sees a Deluxe, highly-networked Management’s efforts to educate technology man- maturing of the program and recognition by busi- lecture halls, equipped for The Howe multimedia instruction, agers to lead and innovate in business in the United nesses that The Howe School’s innovative approach distinguish The Babbio School was States and around the globe are bearing fruit for is well suited to their needs. Center for Technology cited among the school itself, for its students and for the busi- “The school now has a national reputation. Management. the world’s ness community at large. Business knows that Stevens is the place to turn. elite research Seven years after the school was started, Lex We’re quick, responsive. Whatever is hot in industry, institutions in we have an offering,” he management says. “Technology is of technology. changing everything. Exploit technology,” is McCusker’s motto. It has been a year of external recognition for The Howe School, one in which the school has received numerous high-level awards (see page 34). Among those, The Howe School was cited among the “World’s Elite Research Institutions in Management of Technology.” responsibilities and project oversight, mainly in the research centers through The This, McCusker says, is field of telecommunications. Prior to joining Howe School: the capstone in Stevens’ Stevens last year McCusker served as professional • The Center for Decision continuing mission, “to services vice president/ general manager at AT&T Technologies (see page 20), carry the school’s visions Laboratories. He oversaw the day-to-day opera- which explores new ways to aid and offerings to an tions of the internal consulting practice of 450 human decision making. expanding global audience, technical professionals, providing a wide range of • The SAP/IDS Scheer Center to nations that actively consulting services to the organization. of Excellence in Business Process Innovation focus- seek new ways to manage Among the school’s other accomplishments, es on how technology can help redesign business the ever-changing technol- “we created a different kind of MBA,” he says. The processes and how business processes can be man- ogy landscape to the bene- executive master of technology management aged using technology. fit of all members of socie- degree went from “being a glimmer in someone’s • The Center for Technology Management forSTEVENS INSTITUTE OF TECHNOLOGY ty.” eye to graduates in two and a half years,” showing Global Development analyzes the intersection of Stevens’ agility and ability to respond to market global development and technology management. ANNUAL REPORT • 2004-2005 McCusker himself has a long history of high-level needs. technology management Stevens also has established three new16 17
  • A NEW POINT ON HUDSON Biz Tech Graduates Attract Attention The Howe School’s between theory and reality. This brings them to the Business and Technology reality. They really see how the pieces come A Pharmaceutical Management Cure “We held one big meeting and went through the “Students learn undergraduate program together.” whole thing. We had follow up emails and conference all the pieces continues to bear fruit Business and Technology students work with The problem? In the words of one pharmaceutical calls,” he says. After that came the internal process of a company as well, graduating its engineering students on projects, “almost as con- company executive, too many managers in the at Stevens; the program was approved in late spring. and actually second class and estab- sultants, ” he says. “The engineering students have industry who are “an inch wide and a mile deep.” Dobbs himself had spent about 25 years in the write a lishing its graduates as a problem to solve. They have to make the widget. Stevens’ prescription? The new graduate pro- pharmaceutical industry before coming to Stevens. business plan. sought after in the Our students look at costs, look at what the com- gram in Pharmaceutical Technology Management He was vice president of research information serv- They really see marketplace. petition is doing. They look at what it costs the offered by The Howe School. ices and global IT strategy and compliance for “Nationally, the competition to make a widget.” Dr. Joel Dobbs, who joined Stevens full time at the Schering–Plough Corporation. In this capacity, he how the pieces starting salaries of busi- The first honors program began this past spring. beginning of the year, began working on the new pro- was responsible for all come ness majors tend to be considerably less than those In keeping with the program’s real-world focus, gram last fall. The first step was a survey of more information technology together.” of engineering and science graduates. However, at students chose the Ford Motor Co. for a case study. than a dozen senior-level pharmaceutical company for the Schering-Plough “[Companies] – Associate Dean Stevens they are very much on par with engineering executives, a half dozen leading industry consultants Research Institute as need people who Louis F. Laucirica and computer science majors, given an average and a handful of Stevens faculty members. well as for strategy and communicate (right) The experts looked at the challenges the indus- starting salary of $54,000,” says Louis F. Laucirica, IT regulatory compliance well and associate dean and director of undergraduate try faces today – the explosion of new technology, globally. Prior to joining understand studies in The Howe School. In fact, Laucirica the rising cost and complexity of R&D, patent expi- Schering-Plough he when a new notes, a Business and Technology graduate in the rations and regulatory pressures. They also consid- spent 12 years with Glaxo technology Class of 2005 (who earned a concurrent master’s ered the managerial challenges – pharmaceutical Inc. in various manage- should be degree) received an offer package that included a companies engage in strategic alliances and part- ment and executive positions in regulatory affairs, embraced and signing bonus and totaled $80,000. nerships, which almost always involve the sharing medical services and information services. He also and management of advanced technologies as well when it “These new graduates are valuable because spent one year with Glaxo Wellcome as worldwide as complex intellectual property issues. director, information management and analysis. He shouldn’t.” they combine technical knowledge with a broad- minded approach to business management; they’re “The answers were fairly consistent,” Dobbs has served on the Compaq Computer Corporation – Dr. Joel Dobbs able to bridge the critical gap between business says. “They say they really need people who have a Pharmaceutical Advisory Board, the Digital (left) and technology in today’s highly competitive broad understanding of pharmaceutical business. Equipment Corporation Pharmaceutical Advisory world,” he says. Folks tended to understand their area very well, but Board, the PhRMA/FDA Information Management The program is made of up 20 percent “techies” not understand the broader industry.” Working Group, the PhRMA CIO Forum, the PMA and 80 percent students who want to know how to “They also need people who communicate well Information Management Steering Committee, the use the technology. They all receive a well-round- and understand when a new technology should be Documentum Advisory Council, and the PMA Safety ed education that includes the humanities and sci- embraced and when it shouldn’t, people who know Surveillance Committee. ences. They learn accounting and marketing. But how to develop and execute strategy,” Dobbs says. In all, he’s proud of how the new graduate pro-STEVENS INSTITUTE OF TECHNOLOGY the real “spine” of the Business and Technology Stevens put together an industry advisory board gram was designed: “It was done in a logical fash- of about 15 members to help develop the curriculum ion, with a great deal of input from people in the ANNUAL REPORT • 2004-2005 program, Laucirica explains, is the business plan. Students learn “all the pieces of a company and and provide feedback. industry.” actually write a business plan. There’s a tension18 19
  • PART TWO It Takes an Interdisciplinary Team to Solve Today’s Problems “We plan to establish a fully It takes an interdisciplinary team that can successfully mesh diverse disciplines to meet the demands Uniting to Battle for security research and educational efforts, says Dr. autonomous of today’s ever-more-complex global environment. Stevens goes to great lengths to promote this type Susanne Wetzel, a security expert who is an assis- shielded lab in of interdisciplinary work because “that’s the real world,” says President Raveché, the real world where Cybersecurity tant professor in the Department of Computer which students people urgently need assistance designing and building complex systems, fighting computer hackers, The news is filled with stories about computer Science. The equipment covered by this grant will and faculty have and even assistance with the decision-making process itself. viruses, worms and trojans, with individuals suf- not only improve the Institute’s infrastructure full access to fering privacy violations and identity theft and greatly, but most importantly will enable innova- businesses fighting off attempts to break into tive teaching and strengthen security research in the network Center Delves Into Decision Making Process their computer databases. Worldwide losses from all three schools. infrastructure.” The Howe School’s Center for Decision Technologies – drawing on a mix of experts in management, engineering and arts and sciences – exemplifies Stevens’ approach to interdisciplinary cooperation. The center seeks new cyber attacks were estimated at $16.7 billion in Wetzel notes with pride that these Cisco – Dr. Suzanne Wetzel ways to aid human decision-making so that people can evaluate courses of action available to them and the risks 2004, according to Computer Economics. More equipment grants are much sought after and (below right, with frightening still, governments factor in the threat given only biannually to four recipients through- Associate Professor involved in each, says Jeffrey Nickerson, associate professor and director of E-Commerce-Management. Rebecca Wright) Business schools have long taught the psychological aspects of decision-making, using various research of cyber terrorism in addition to other types of out the country. In 2003 Stevens was named a methods, Nickerson says. Management students learn to look at proposed solutions from different perspectives, terrorist attacks. National Security Agency (NSA) Center of to weigh pros and cons and to conduct cost/benefit analysis. At the Center for Decision “Attacking computer systems has become a Academic Excellence in Information Assurance Technologies those management skills are directed at solving technological problems. lot easier” in recent years, says Manu Malek, Education for the academic years 2003 through In a project with WiNSeC, Nickerson and other researchers looked at a campus map of wire- director of the cybersecurity certificate program 2006. This recognition for education and research less connectivity hotspots to determine how an emergency responder could stay continuously in Stevens’ Computer Science Department. expertise in the areas of information security and connected to an ad hoc network and make the best decisions while en route to an emergency. “Hackers are getting more and more sophisticat- information assurance was a prerequisite for The project is just one of several Stevens “testbed” research efforts that are an outgrowth of ed and attacks are more frequent.” applying for the Cisco grant. the communications failures experienced during the September 11, 2001 terrorist attacks. At Stevens, experts in the Computer Science Researchers are discovering that ad hoc networks (formed by wireless devices within and Telecommunications Management depart- range) have important advantages, such as being able to remain secure when normal ments and their colleagues in other fields are wireless service is disrupted in an emergency. But they also pose problems in decision- finding new ways to fight back to protect the making and information access relating to national security, emergency response, information infrastructure. search and rescue, and the remote control of robots that the center is now studying. This year Stevens won a highly competitive grant The center has received a grant from the Office of Naval Research, part of the Navy’s Critical of nearly $100,000 worth of computer routing, Infrastructure Protection program, to study the interaction of people on mobile networks and semiau- switching and networking equipment from the Cisco tonomous robots and sensor networks. Systems Equipment Donation Program. The grant “The convergence of robotics and mobile networks has created a new class of problem: how best to move in goes toward strengthening institute-wide educa- order to increase our understanding of situations,” Nickerson says. “What we envision is a new kind of command- tion and research programs in the fields of informa- and-control focusing on the relationship between movement and communications.” tion security and assurance, network security, mul- When talking with colleagues at other universities, the advantage of Stevens’ size and its ability to bring timedia security, secure data mining, and technol- together engineering, technology, math, computer and management studies becomes clear, Nickerson says. ogy management of emergency communications.STEVENS INSTITUTE OF TECHNOLOGY “Large funding organizations expect to see cross-disciplinary projects. In most big universities that’s impossible. The grant is an important building block in Stevens’ plan for growing and strengthening its ANNUAL REPORT • 2004-2005 Stevens has a real advantage; it’s easy to do here.”20 21
  • IT TAKES AN INTERDISCIPLINARY TEAM TO SOLVE TODAY’S PROBLEMS Martin Corp. and Northrop Grumman Corp. has fueled the “The proposal had to have an overarching to Networked Information Systems, will benefit Systems Engineering story,” says Wetzel. “It had to be integrated. We needed to be able to make the whole thing work.” greatly from the new lab facilities, as well as interdisciplinary faculty research efforts. Program is Largest growth of regional programs and online courses. “We want to improve the stu- The equipment grant builds on an educational Wetzel says also that the new Cisco equip- The need for people with multi-disciplinary skills who can Undergraduate dents’ experi- grant which was recently awarded to Wetzel and ment will allow advanced research to be imple- develop large, expensive critical systems has helped make the Systems Engineering and Engineering Management Engineering Aims to be ence in their first Computer Science Associate Professor Rebecca mented and validated in a real networking Wright by the National Science Foundation, environment, which in turn may allow for a bet- program at Stevens become the largest in the country. More Flexible year and make titled “Capacity Building ter algorithmic design, Systems engineering has been around for Stevens also fosters meaningful partnerships between the transition to through Interdisciplinary in particular for parallel decades, but the field has grown dramatically students at the graduate and undergraduate levels. A the rigorous cur- Degrees in Cybersecurity.” and distributed sys- because of “the realization that systems are getting group of undergraduates working on their civil engineer- riculum a little The project is intend- tems. more complex. Development is not as linear as it used ing senior design project joined with students working on easier.” ed to build Stevens’ Wetzel and Wright to be,” explains Dr. Rashmi Jain, associate professor, their masters in Product-Architecture Engineering to – Dr. Keith Sheppard capacity in information received a $125,000 NSF Systems Engineering and Engineering Management. design a pavilion to house the Concorde at the Intrepid assurance and computer grant to establish a She sees more formal recognition today of systems Sea, Air & Space Museum in New York City. The resulting security education by cybersecurity laborato- engineering as a separate discipline. design was light-weight, cost effective and functional, developing new interdis- ry at Stevens. The lab, Weapons, medical and communication systems, capturing the grace and visual excitement of the ciplinary cybersecurity which will focus on the for example, need to be built and designed to be Concorde. This design was presented to the CEO and degree programs on both network security issues robust enough to be predictable, she says. “These are chairman of the Intrepid board for consideration. the undergraduate and the graduate level. The area of cybersecurity, will be “a safe environ- the challenges that are making systems engineering “This pilot project is a model for having under- goals are not only to attract new students to ment in which we can run experiments that we so important.” graduates and graduates work together to develop an these programs, but to provide these students can’t do on a regular network,” says Wetzel. “It The increasingly compressed time to market and aesthetic design for clients. This is something we’re with an education that prepares them more is a separate lab that won’t interfere with the competition from outsourcers put pressure on all trying to build on,” says Dr. Keith Sheppard professor thoroughly for careers as information assur- regular operation of any networks here.” The types of companies to design, develop and sell new and associate dean of engineering, Chemical, ance and computer security professionals. lab will serve as a facility for faculty and stu- products much more quickly. “It’s now or never. They Biomedical & Materials Engineering Department. “Lab courses and hands-on projects are dent research projects. can’t afford trial and error or they will be left out of This past year Stevens revised its undergraduate integral components of these programs,” The hands-on, state-of-the art lab will the market. They can’t afford flab.” engineering curriculum to allow for more flexibility according to Wetzel. “For these purposes, we provide students with practical training in That’s where systems engineering comes in, effi- and choice in core science requirements. “We want to plan to establish a fully autonomous, shielded security and information assurance, preparing ciently and effectively reducing “flab” through a part- improve students’ experience in their first year and laboratory in which students and faculty have them to meet the challenges in protecting and nership with the end user of the system. “Systems engi- help make the transition into the rigorous curriculum full access to the network infrastructure with- securing our nation’s information infrastruc- neers have to look at who will be the potential user. They a little easier,” Sheppard says. One goal of this rigor- out imposing any danger of compromise or dis- ture. The lab will be used for the undergraduate need to know what the user wants. They need to trans- ous curriculum is to develop the ability to use both the ruption on the campus network. The Cisco security lab course involving experimentation late those needs and wants in a meaningful way. Then right brain and left brain, he adds, “because engineers equipment will be used to build the basic infra- with specific security solutions, vulnerabilities they build systems and test them. They have to verify of the future will need both.” structure of the laboratory.” and exploits, and will allow students to gain and validate to make sure it operates the way it is sup- The curriculum changes also will allow students In addition to the new programs and class- experience by applying their theoretical knowl- posed to operate,” Jain explains. more opportunity to take semesters abroad, so they can es, many existing classes throughout the edge in practice. The tremendous demand from government entities better compete in the global economic environment. Institute’s three schools, including Network such as NASA and the Department of Defense and from “We want to facilitate an international experience.STEVENS INSTITUTE OF TECHNOLOGY Management, Network Design and Introduction corporate giants such as The Boeing Company, Lockheed That’s very important for the future,” Sheppard says. ANNUAL REPORT • 2004-200522 23
  • IT TAKES AN INTERDISCIPLINARY TEAM TO SOLVE TODAY’S PROBLEMS Big Steps in Nanotechnology Sometimes it takes teamwork on a grand scale to disciplines. The project also involves postdoc- materials at high resolution. A main theme of increasingly for a variety accomplish grand things on the nanoscale. toral fellows, graduate students and several this research concentrates on the study of poly- of biomedical applica- Dr. Henry Du, director and pro- undergraduate/high-school summer research mers and polymeric biomaterials, such as hydro- tions, including tissue- fessor of materials engineering, scholars, giving them training and exposure in gels, using techniques such as electron hologra- engineering matrices, Chemical, Biomedical & Materials chemical and biological sensing and monitoring, phy and electron energy-loss spectroscopy. One implants with biocom- Engineering Department, has a priority area of federal research and develop- of the group’s recent innovations has been the patible surfaces, drug brought together a team of aca- ment. The business community is directly development of new methods to map the spatial delivery and biosensors,” Libera explains, “but Below, left to right: demic and industrial researchers to involved in this project; it is being conducted in distribution of water in synthetic materials for new tools and new ways of thinking based on Nanostructures and conduct pioneering work on the collaboration with OFS Laboratories (formerly health and personal care applications using nanotechnology are opening radically different microlithographic integration of photonic crystal the Optical Fiber Division, Bell Laboratories), a advanced methods of cryo-electron microscopy. pathways to achieve success.” imagery; Dr. Henry Du; fibers (PCFs) with nanotechnology for potential- world leader in fiber optic research, via NSF’s The group uses electron microscopes not only Significantly, Libera’s team is aggressively electron optics lab ly robust chemical and biological sensing. Using GOALI mechanism. as materials-characterization tools but also as investigating the properties of hydrogels, the team; Dr. Matthew molecular and nanoscale surface modification, materials-processing tools. High-energy elec- kinds of polymeric materials that form the basis Libera. state-of-the-art laser techniques and computer Engineering the trons can modify the structure and properties of for everyday soft contact lenses and other com- simulation, their research will enhance the polymers, and because a microscope can focus mon biomedical applications. prospects of PCF sensors, sensor arrays and sen- Nano-Bio Interface electrons into fine probes with nanoscale dimen- “We use focused electron-beam cross-link- sor networks for diverse applications such as Dr. Matthew R. Libera leads the Microstructure sions, electron microscopes can be used to pat- ing to create nanosized hydrogels,” says Libera, remote and dynamic environmental monitoring, Research Group and is director of the Electron- tern polymers into nanostructures. “and this provides us with a new method of manufacturing process safety, medical diagno- Optics Laboratory in The Schaefer School. Using The team has pushed this technology in an bringing the biocompatibility associated with sis, early warning of biological and chemical powerful transmission and scanning electron entirely new direction by applying it to specific macroscopic hydrogels into the nanoscale warfare and homeland defense. microscopes, Libera’s team graphically demon- polymers to influence the way they interact with regime.” Through basic and applied research, the strates the possibilities that flow from engineer- physiological systems involving proteins, cells Libera’s work on nanohydrogels holds impli- optically robust PCFs with surface functional- ing materials in the micro and nano worlds. and tissues. cations for the eventual production of the next ized, axially aligned air holes are expected to Their research centers on the development “The central idea is to create biospecific sur- generation of protein microarrays, which can be achieve a quantum leap in chemical and biological detec- tion capability over conven- tional fiber-optic sensor tech- nology. PCF sensors enabled by nanotechnology also have the potential to be a powerful research platform for in situ fundamental studies of surface chemistry and chemical/bio- logical interactions in microchemical and micro- and application of advanced electron-optical faces,” says Libera, “surfaces that interact with used to establish the function of various genesSTEVENS INSTITUTE OF TECHNOLOGY biological systems. techniques for the measurement and control of physiological systems in highly controlled ways. that become active during cancer, disease and Du’s team cuts across a broad spectrum of microstructure and morphology in engineering “Polymeric materials have been used the aging process. ANNUAL REPORT • 2004-200524 25
  • PART THREE Making Our Presence Known, On the Ground and the Web Stevens Institute is making its outstanding “insists on academic rigor” in its online and Stevens has extended its hybrid-learning University Enrollment and Academic Services, academic presence known throughout the hybrid programs, just as much as it does in the program far beyond the United States. “We Professor Kevin Ryan and officials of the world, both on the ground and on the Web. In traditional class- decided ‘let’s go overseas and find partners Chinese Ministry of Education made remarks at addition to classes on the Castle Point cam- room setting, says there.’ We want to combine the the ceremony. pus, the Institute provides a rich selection of Jerry Luftman, strength of Stevens and the Stevens’ program with BIT, one of China’s courses on the Internet. Stevens also is a Howe School strength of the local institu- highest-ranking engineering schools, was trendsetter in hybrid learning, an effi- distinguished tions. So far the reception has approved by the Chinese Ministry of Education cient and effective combination of service profes- been nothing short of phe- and other government bodies and is the first online and face-to-face education. sor and director of nomenal,” says Luftman, pre- such hybrid degree from a US university in China. WebCampus, Stevens’ online unit, the Master of Science dicting that “Stevens will make “Students in Beijing earned their master’s now has more than 5,000 graduate stu- in Information Systems Management its mark as a global university.” from Stevens – it’s no different from the dents from more than 40 states within the program. degrees the school confers in Hoboken,” says United States and 40 nations around the More than 80 percent of the working pro- Dr. Audrey K. Curtis, executive director of world. A winner of the Sloan Award as fessionals taking classes are sponsored by Stevens Makes Its Mark Stevens’ Telecommunications and Project the “best online university” in the their companies. “The proof of our success is Management programs at The Howe School. nation, WebCampus offers 31 gradu- not only in the numbers but in all the corpo- in China She sees the Institute’s program in China as ate certificates and 12 master’s rate sponsorships,” Luftman says. Stevens The Institute is already making its mark in “a giant step in extending Stevens’ graduate degrees. Navigating Web links allows provides more than 30 global companies and China, a nation of 1.3 billion people whose education to students outside the US.” potential students to obtain informa- US government agencies with graduate educa- leaders are intent on expanding technology- Instruction was delivered one-third online tion about courses in telecommunica- tion and training on its Hoboken campus, at intensive industries such as petrochemicals by Stevens’ faculty, one-third by Chinese tions management, technology manage- corporate sites and online. and digital electronics. instructors in Beijing, and one-third by ment, networked Among the latest US companies to take Stevens held a historic commencement cer- Stevens faculty in intensive courses in China. information sys- advantage of Stevens’ WebCampus experience emony in Beijing in January for the first 21 grad- Curtis herself spent ten weeks in Beijing, deliv- tems, computer are Fortune 500 giants The Boeing Company, uates from the Stevens Telecommunications ering live instruction. Other Stevens faculty science and wire- the world’s largest aerospace company and Management master’s degree program, in part- also spent time teaching in the course at the less communica- the second largest manufacturer of commer- nership with the Beijing Institute of Technology BIT campus. tions, among other cial aircraft; Intel Corporation, the world’s (BIT). Maureen Weatherall, vice president for It was a learning experience for instructors technical and busi- largest computer chip maker and a leading ness programs. manufacturer of computer, networking and These online communications products; and Verizon and hybrid courses are a practical approach Communications, Inc., the leading provider of especially well suited to the needs of profes- high-growth communications services and the sionals seeking to combine high-powered largest provider of wire line and wireless com-STEVENS INSTITUTE OF TECHNOLOGY careers with continuing education. Stevens munications. ANNUAL REPORT • 2004-200526 27
  • MAKING OUR PRESENCE KNOWN, ON THE GROUND AND THE WEB Clockwise from left: BIT officials during Stevens graduation ceremony; MSIS alumna Dening Wu-Lohez with as well as for students, according to Curtis. “In and Economics (CUFE), also in Beijing. all seven courses will be available in Paris. Dr. Luftman; VP Maureen China, professors give formal lectures in big Graduates of CUFE often fill high-level posi- Guayaquil, Ecuador, at Escuela Superiore Weatherall with BIT graduate; classes and students are rarely asked to make tions in China’s burgeoning telecommunica- Politecnica del Litoral (ESPOL): The Master of the French Consul in New York presentations in class. In the US, we expect tions industry. Stevens has signed a memoran- Technology Management and MBA programs with Wu-Lohez and MSIS more interaction. We had to work to draw the dum of understanding with Beijing University are being offered this fall. students from France. students out, to get them to participate.” of Posts and Telecommunications (BUPT) to She finds Chinese students very enthusias- launch several programs for Chinese graduate tic about being able to receive a US degree, students in technology and management. with courses conducted in English, while The Beijing partnership is just the begin- remaining in their home country. “They’re ning. Luftman reports that Stevens has a half a committed and hard working.” The first group dozen new programs in the works overseas, started classes in November 2003. Of this including: year’s graduating class, three have already Sofia, Bulgaria, at the University of Sofia: applied for Ph.D. programs – one of them Stevens’ Master of Science in Information applied to Stevens. Another graduate pro- Systems (MSIS) program, with a concentration gram, this one in photonics and optoelectron- in computer science, will be offered in Sofia. ics, is under way at BIT. In Paris, France, at the Ecole Pour Stevens is teaming up with other institu- l’Informatique et les Techniques Avencées tions of higher learning in China. Stevens’ (EPITA), the same MSIS program as in Bulgaria graduate program in Project Management is being offered. French students used to go to began this fall at Central University of Finance Stevens each January to take the course; nowSTEVENS INSTITUTE OF TECHNOLOGY ANNUAL REPORT • 2004-200528 29
  • PS TR TV E N S R T U D E N T S S T A N D O U T A S A C H I E V E R S A N D L E A D E R S A E FOU S Stevens Students Stand Out as Achievers and Leaders Stevens students are up-to-date and well pre- want the students to succeed,” agrees Louis Technogenesis is all about,” VP Wisniewski says, Clockwise from left: 2005 pared for the challenges of today’s complex, mul- Laucirica. “We want them to see the application “students collaborating with faculty and profes- Valedictorian“ Technology has ticultural workplace. The Institute itself is “a closely knit, but also very diverse community. The of science, to take ideas from the lab to cus- tomers.” sionals in industry to create new market-based initiatives that are self-sustaining, and that Andrew Corrigan; Castle Point records team; become the enrich the learning environment for current and jacket of first Castle Point thing that keeps us together is mutual respect,” The higher retention rate is also a result of Records production, ultimate Raveché says. “We learn from a richly diverse Stevens’ richer array of academic offerings. “In future students.” "Delusions of Grandeur." connector of group of students and faculty. Our graduates have the old days you went to Stevens and became a people to worked with different cultures every day.” mechanical engineer,” he says, and, if you Institute Marks Commitment and focus on the undergraduate changed your mind, you left Stevens. people, experience has resulted, for the first time, in a Now, with programs such as Business and Graduation Milestone society to more than 75 percent retention rate. As part of Technology, there are more options. Trumpeters heralded the procession on May 26 as society, Stevens’ planned expansion, the number of fresh- “This is a real choice. Students can transfer the Institute graduated its largest undergraduate men entering the institute reached a new high. into this program and companies love them” when class ever: 377 undergraduates. Also, 845 gradu- culture to “In academic terms, the retention rate is a big they graduate, he says. So much so that 90 percent ate students received degrees, including the first culture.” accomplishment,” says Maureen Weatherall, vice of the students have jobs lined up at graduation. graduating class of MBA recipients, and close to – Cong. Robert Menendez president for university enrollment and academic “That’s the proof of the pudding. They’re able 100 were awarded graduate certificates. services. She credits faculty members for their to go out there and do their stuff,” Laucirica says. a third. For the second straight year graduation took support in making for a stellar student experience Music technology is another example of the Under the guidance of Stevens’ Music and place outdoors. The combined number of gradu- at Stevens. range of options at Stevens. A group of six stu- Technology director, David Musial, the students ates and family members attending has grown so Faculty members are “give-back people who dents created an innovative, student-run record managed virtually everything, including procuring much in recent years that the event has expanded label. funding, artist scouting and recruitment, and the beyond the capacity of the university’s Schaefer Unlike most academic record labels, creation of the overall business plan document. Athletic Center, where previous graduations took Castle Point Records reaches out beyond Sponsored by a Technogenesis start-up grant from place. the limits of its school’s own musical the Office of University Research and Enterprise New Jersey Congressman Robert Menendez (D- groups. For its first project, the label is Development, Castle Point Records will function 13th District) and Dr. Kevin M. Cahill addressed recording and producing original music as a student organization at the Institute. The the students, their families and administration at HarariVille Studios. Carlos Alomar, label planned to release its first album in late and faculty members. Both Menendez and Cahill long-time David Bowie guitarist (who 2005. received honorary doctorates in engineering. also worked with Duran Duran, Iggy Pop, “The whole experience has been unbeliev- During his commencement address, Menendez Luther Vandros and John Lennon) who is able,” says label president Ian Wolf, “It’s a new told graduates that “technology can be a vehicle the president of the New York chapter of approach to the traditional college record label. for humanity’s progress and well-being.” the National Association of Recording We’ve all learned so much and produced an album “Democracy itself – the core principle of our Arts & Science (NARAS), has produced that rock fans will actually like.” nation – has spread through technology,” he said.STEVENS INSTITUTE OF TECHNOLOGY two songs for the release and assisted on “This is what Stevens’ learning environment of “The Internet, and all forms of modern communi- ANNUAL REPORT • 2004-200530 31
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS cation, has made it much tougher for appreciation of your own individual wonder, and on business strategy today.” qualified for NCAA tournaments were Men’s Soccer; Stevens students oppressive regimes to hide the hope and given you the confidence to share, even if there are A perfect 4.0 made Andrew Corrigan “first in Women’s Soccer; Women’s Volleyball (first time in continued to excel “ Our students promises of freedom from their citizens. “Technology has become the ulti- dangers in exposing your vulnerabilities,” Cahill said in his address. “Without that courage nothing class.” Corrigan, of Merrick, L.I., received the degree of Bachelor of Science in Computational Science, school history); Men’s Lacrosse; and (for the first time in the school’s history) Women’s Lacrosse. in Equestrian competition, Men’s not only had a and Women’s mate connector of people to people, good happens – people wouldn’t fall in love, they with a concentration in Computer Graphics. Stevens junior Men’s Soccer player Brian Marks Soccer, Lacrosse great athletic society to society, culture to culture, wouldn’t sacrifice to make other lives better, and of Yardley, Pa., was named a first-team All- and Volleyball. year, but a great and with that, liberty and democracy they wouldn’t grow, gently and generously, accept- Athletics Program Has American by the National Soccer Coaches academic one.” are communicated across traditional ing others’ faults as well as their virtues.” Association of America (NSCAA). Marks is the first borders. Having family myself who fled Cahill is director of The Institute of Standout Year Stevens student-athlete in any sport to earn first- – Athletic Director an oppressive regime to come to this International Humanitarian Affairs at Fordham Stevens athletics had a standout year, “it’s best team All-America honors. He was a third-team Russ Rogers country seeking freedom, anything that University and president of the Center for year ever,” says Athletic Director Russ Rogers. selection last season. Giuseppe Incitti (Men’s makes freedom more accessible is dear International Health and Cooperation in New York. The Institute finished among the top 50 schools Soccer, 2002) and Matt Grande (Men’s Lacrosse, to my heart and soul. I hope you keep it dear to He is an expert on tropical medicine and a leader in in the US Sports Academy (USSA) Division III 2004) were second-team selections. yours as you move out into the world.” humanitarian campaigns. Directors’ Cup. The USSA Directors’ Cup was devel- The two-time Skyline Conference Player of the Menendez is the third-ranking Democrat in the C.K Prahalad, the Harvey C. Fruehauf Professor oped as a joint effort with the National Association Year, Marks helped Stevens to a 21-2-1 overall US House, the highest-ranking Hispanic in of Business Administration at The Ross School of of Collegiate Directors of Athletics (NACDA) and record, a second straight Skyline championship and Congressional history, and the only Hispanic ever Business at the University of Michigan, Ann Arbor, honors institutions maintaining a broad-based second consecutive NCAA Division III Tournament elected to a leadership position, in either chamber, was the honorary degree recipient for the graduate program and achieving success in many sports. berth. Stevens advanced to the Sweet Sixteen of the by either party. ceremony. Prahalad specializes in corporate strat- With five teams qualifying for NCAA NCAA Tournament for the second year in a row “I hope you invent. I hope you create. I hope you egy and the role of top management in diversified, Tournaments this past year and four advancing before falling to Richard Stockton 2-1 in overtime. find solutions, build businesses, bridge the gaps, global corporations. past the first round, Stevens earned its highest- The Ducks were ranked seventh in the nation in the expand the world, know where you come from, know Prahalad has been ranked among the Top Ten ever finish at 46th, marking one of the most suc- final NSCAA Division III poll. what you stand for. And live it in the work you do,” management thinkers in every major survey for cessful years in the history of athletics at the insti- Two wrestlers, Michael Detsis and Brandon Menendez told the graduates. more than 10 years. BusinessWeek has said that tution. In addition, Stevens finished second among MacWhinnie, earned trips to the NCAA Wrestling “Education should have brought you to an Prahalad may well be “the most influential thinker technology-based universities. The five teams championships. Both athletes were freshmen on aSTEVENS INSTITUTE OF TECHNOLOGY ANNUAL REPORT • 2004-200532 33
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS first-year team. Year of External received an especially impressive list of honors: Technology (IAMOT) held in Vienna, Austria. “Seven teams – Men’s Soccer, The school was cited as co-existing among the Howe was named one of the top-five graduate It was a Women’s Soccer, Women’s Volleyball, Recognition “World’s Elite Research Institutions in Management business and technology programs by Optimize year of Baseball, Men’s Lacrosse, Women’s It was a year of external recognition for the insti- of Technology.” The award was accepted by Acting Magazine. Lacrosse, Men’s Tennis – either set or tution, one filled with awards and accolades. Dean Lex McCusker at a conference of the It was named in the Top-10 external tied school records for wins in a sea- In the US News & World Report rankings for International Association for Management of in research in technology man- recognition, son,” says Rogers. “Eight, if you count national universities, Stevens climbed to #71 – ris- filled with Field Hockey.” ing farther, faster, than any other university in the awards and “Our students not only had a great National Top 100. Stevens continued its swift Feeling the Pain with Team MECCo athletic year, but also a great academ- upward movement in qualitative and quantitative accolades. ic one,” he notes. “Their overall team criteria among all national universities granting Dr. Norman Marcus, a noted pain management specialist, slides the medical device GPAs were 3.1 for the academic year.” doctoral degrees. The ranking represents an over the “patient’s” body. It’s not a real patient, but a Stevens undergraduate who And the Stevens Equestrian Team had a nation- improvement of ten places, which is the largest is studying biomedical engineering. al champion – its first ever individual national advance within the top 100 universities. Since 2000, “So far the device can’t be used on actual patients, so we volunteered one of our champion in school history. Freshman Kerri Rettig Stevens has moved up 20 positions. young healthy bodies to test it,” says Ryan Stellar, a member of a Senior finished first in the Intermediate on the Flat at the “Simply put, the great work of our faculty, stu- Design Project team in Professor Vikki Hazelwood’s BME 424 class known as 2005 Intercollegiate Horse Show Association (IHSA) dents, staff, and administration has got us to “Team MECCo.” National Championship Show. It was the first time where we are today in terms of national ranking,” Team MECCo – Stellar, Jeckin Shah, and Daniel Silva – volunteered their a member of Stevens’ Equestrian Team, inaugurat- Raveché says. “Our movement upward towards the minds to work in collaboration with Dr. Marcus to design and build this spe- ed just three years ago, took home a national com- Top 50 indicates that our momentum in education cial electrical stimulator device, which facilitates diagnosing and treating petitive award. and research has never been greater than at this pain. The device is patent pending. The key to winning is “being able to communi- moment in our 135-year history.” Dr. Marcus teaches at NYU Medical School, as well as conducting a med- cate with the horse,” says Rettig, who has been rid- Retention and graduation improved signifi- ical practice, and plans to coordinate clinical trials at NYU. Stevens and ing for almost 10 years. At the Nationals, “you don’t cantly, contributing to the higher standing, the Clockwise from left: Dr. Team MECCo will continue to collaborate with him, and are discussing the Norman Marcus; the MECCo ride your own horse. You draw a number. You don’t president notes. Stevens is now, in the category of prospect of starting a new biomedical company together. stimulator device; Team get to practice on that horse.” Actual Graduation, ranked 58, up from 83 in 2004. The project came about because the doctor “has a friend who is friends with President Raveché, MECCo, with VP Helena S. Rettig came to Stevens to study engineering but Ranked 39th in SATs, Stevens continues to attract so it trickled down that Dr. Marcus had this methodology and was looking for help to develop it,” says Wisniewski: Ryan Stellar, recently switched to the rigorous undergraduate the most talented students in the nation. “Alumni Stellar. “He had a patent on the methodology but he needed engineering and tech people.” Daniel Silva, Wisniewski, Business and Technology program. giving remains strong, an area where Stevens Team MECCo had complementary experience from a recent co-op project, so “we dissected his and Jeckin Shah. “She had offers from a number of institutions, placed 24th in the nation,” said Raveché. patent,” says Stellar, and “at our first meeting but it was Stevens’ well-rounded course of fresh- Stevens ranked among the Top 25 American col- he could see we had our homework done. I think man academics, as well as the opportunity to ride leges and universities that have tailored their we impressed him.” competitively with the equestrian team, that undergraduate business and technology curricula Team MECCo’s work has “a real-life flavor,” tipped the balance toward Kerri’s choice of to encourage young entrepreneurs. The Princeton says Hazelwood, senior lecturer in the Stevens,” says Equestrian Coach Patti Zwaan. “Her Review examined and critiqued 357 national pro- Chemical, Biomedical & Materials Engineering triumph at the IHSA Nationals puts Stevens’ eques- grams, with the result being its new list of America’s Department. “It demonstrates that a project trian athletics program squarely on the national Most Entrepreneurial Campuses 2004. Ranked at can hold water in the real world.” competitive map.” #18, Stevens is the sole university on the list to be It’s a great example of today’s “transla-STEVENS INSTITUTE OF TECHNOLOGY situated in the hub of world commerce near New tional research,” she says, showing how a proj- ANNUAL REPORT • 2004-2005 York City, at the heart of the Philadelphia-Boston ect “can go from the lab benchtop to the bed- axis of higher educational institutions. side in three to five years.” The Howe School of Technology Management34 35
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS agement by The Journal of Product program is part of the Systems Engineering and Professional Education, and Top center: Innovation Management. Engineering Management (SEEM) Department. Keith Sheppard, associate dean Dr. Rashmi Jain New research And it was one of five centers world- of engineering, are also mem- Bottom , left to right: Dr. Costas Chassapis, initiatives have wide recognized by SAP as a Center of Research, Awards & bers of the research team. Dean Erich Kunhardt, been undertaken Excellence in Business Process Drs. Christos Christodoulatos, Dean George Korfiatis, Innovation. Achievements Erich Kunhardt, George Jan Klein, Dr. Peerasit to build rapidly Also, the US Distance Learning Stevens faculty and research centers have made Korfiatis, and Richard Crowe Patanakul. on the wealth of Association (USDLA) Board presented impressive gains in sponsored research. were awarded a patent for a expertise and Stevens with its new 21st Century Best New research initiatives have been undertak- segmented electrode capil- Practices Award for Distance Learning. The en to build rapidly on the wealth of expertise and lary discharge, non-thermal ferment of award recognizes the leadership of trend- ferment of inquiry that characterize the Stevens plasma apparatus and inquiry. setting and innovative corporations and faculty. Efforts in biomedical engineering, process for promoting chemi- nonprofit agencies and is the highest award nanoscale technologies, cybersecurity, mathe- cal reactions. bestowed upon an organization in the industry. The matical cryptography and network security, as comprises more than 5,000 members in 50 char- The ingenuity of seniors at Stevens was on award is given to organizations that demonstrate well as computer modeling for more secure ports tered chapters worldwide and more than 40 display during Senior Engineering Design Day. A extraordinary achievement through distance learn- and harbors, have all added to Stevens’ renown Corporate Advisory Board members from govern- team of Civil Engineering seniors from Stevens ing. Its recipients have distinguished themselves in as a wellspring of revolutionary ideas and appli- ment, industry and academia. emerged victorious in a tough competition with areas that include research and writing as well as cations. The National Science Foundation (NSF) has six other universities in the Northeast Regional leadership activities in regional, national or inter- Dr. Gary Lynn was recognized by the awarded Professor Costas Chassapis and his Student Steel Bridge Competition. The students national forums. They have been active in melding International Association for the Management of team at Stevens a grant of $100,000 to study received awards in the Regional Competition for education and training technologies to enhance Technology (IAMOT) as one of the most active how to create an accredited online undergradu- Economy, Lightness, Construction Speed, and the learning experience of those at a distance. and prolific scholars in the area of innovation ate mechanical engineering degree. In addition First Place Overall. Recipients are singled out for their positive impact and technology management. Business 2.0 mag- to Chassapis, who serves as the Principal on the distance learning industry. azine also named him one of the nine leading Investigator, the research team at Stevens The Engineering Management undergraduate management gurus in the United States. includes, from the Mechanical Engineering New Faculty program was one of five national programs recog- Dr. Rashmi Jain has been appointed head of Department, Associate Professors Hamid Hadim Jan Klein joins The Howe School as an instructor. nized for excellence by the American Society for research and education for the International and Sven Esche and Assistant Professor Frank Professionally, he has been involved in many Engineering Management (ASEM). The Council on Systems Engineering (INCOSE). INCOSE Fisher. Robert Ubell, dean, School of areas of capital development, controllership, investments and investor rela- tions, business development and marketing and sales. He holds an EMBA from Cornell University (1987), a MBA in Finance & Investment from George Washington University (1972) and a BS in Aerospace Engineering from Pennsylvania State University (1972).STEVENS INSTITUTE OF TECHNOLOGY Peerasit Patanakul joins The ANNUAL REPORT • 2004-2005 Howe School as an associate pro- fessor and postdoctural fellow. Patanakul earned a doctorate in36 37
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS Systems Science/ Engineering Management Biomedical and Materials Engineering Department. from Portland State University in 2004. Prior to coming to Stevens, Yu was a research An Incubator Company Grows Up New faculty His research centered on the develop- associate at the University of Virginia’s have added to ment of a decision-support model for Department of Orthopaedic Surgery, where he What could be a better capstone to Stevens’ assigning multiple concurrent proj- studied tissue engineering and biomaterials. He year of accomplishments than the launch of one Stevens’ renown of its incubator companies into the real world? ects to project managers. His also served as a research post-doctorate asso- as a wellspring research interests focus on project ciate in advanced biomaterials and tissue engi- The acquisition of HydroGlobe, a Technogenesis environmental technology company incubated at Opposite, left to right: Stevens, exemplifies the completion of the Technogenesis cycle. HydroGlobe was acquired by Graver Dr. Xiaojun Yu, of revolutionary management, new product develop- neering in the Chemical Engineering Department Technologies, a leading manufacturer of filtration and separation products. John Schroeder, a Dr. Yi Guo. ideas. ment and strategic management. He of Drexel University. He has been widely pub- is a member of The Project lished and frequently presents papers at indus- Stevens alumnus and the past President of HydroGlobe, assumes the role of Vice President of Management Institute, IEEE and try conferences and meetings. Yu is also a mem- Operations. Professional Engineer, Engineering ber of the Society for Biomaterials as well as the HydroGlobe was founded in 2000 by three Stevens professors based on research conducted at the Institute of Thailand and serves as the Materials Research Society. He holds a doctor- Center for Environmental Systems, directed by Dr. Christos Christodoulatos. In addition to Conference Coordinator for the Project ate in Biomedical from Case Western Reserve Christodoulatos, the founders include Dean Korfiatis and Dr. Xiaoguang Meng, director of technical Management Track for the International University, Cleveland, Ohio (2002) and a Master and academic development at CES. The company produces patented products for the removal of Conference on Management of Technology. In of Science degree in Biomedical Engineering heavy metals – including lead and arsenic – from water. addition to his doctorate, Patanakul holds a from Peking Union Medical College, Beijing, “These technologies treat potable water supplies at both the home and municipal level, for vast Master of Science degree in Engineering China (1992). Yu earned a Bachelor of populations in the US and abroad,” notes Korfiatis. The acquisition “is a great recognition of our pio- Management from Portland State University Engineering degree in Polymeric Materials and neering work at The Schaefer School and in the Center for Environmental Systems specifically.” (2000) and a Bachelor of Engineering degree in Chemical Engineering from Tsinghua University, The acquisition and the agreement with Graver to license Stevens’ water-filtration technologies Chemical Engineering from Chulalongkorn Beijing, China (1989). through their HydroGlobe unit “is a major affirmation of Stevens’ vision of Technogenesis,” says University, Bangkok, Thailand. Yi Guo joins the School of Engineering as Wisniewski, who negotiated the technology licensing agreement on the Institute’s behalf. “It is proof Xiaojun Yu joins the School of Engineering as an assistant professor in the Electrical and that the innovation-to-implementation philosophy of technology development works on a grand an assistant professor in the Chemical, Computer Engineering Department. scale, and that it offers major long-term benefits to society and to the Institute through IP royalties Previously, Guo and licensing.” was a visiting Raveché calls it “a validation of our philosophy at Stevens, which rests on the belief that real- Assistant Professor world solutions can be found for major real-world problems through technology innovation.” in the Department of Electrical and Computer Engineering journals and conferences and has been cellular and tissue engineering, and cell signal- at University of widely published. Guo is a senior member of ing in tissue engineering. Before joining Stevens, Central Florida. the Institute of Electrical and Electronics he was a postdoctoral research fellow at She also was a Engineers (IEEE) and a member of Sigma Xi, The Wellman Center for Photomedicine, research fellow in the Scientific Research Society. She earned a Massachusetts General Hospital and Harvard the Computer Science Ph.D. at The University of Sydney, Australia Medical School. He then worked at a Dutch bio- and Mathematics (1999), a MSEE degree, Xi’an University of medical company, IsoTis NV. Wang has received a Division of Oak Ridge Technology, China (1995), and holds a BSEE broad and systemic training in chemistry and National Laboratory, from Xi’an University (1992). polymer chemistry, as well as biomaterialsSTEVENS INSTITUTE OF TECHNOLOGY Oak Ridge, Tenn. She Hongjun Wang joins the Department of design and tissue engineering. He has performed ANNUAL REPORT • 2004-2005 has served as a Chemical, Biomedical and Materials Engineering research in diverse fields and is the author of 15 reviewer for many (CBME) as an assistant professor. Wang’s scientific papers in the fields of polymer chem- professional research interests focus on biomaterials design, istry, biomaterials, tissue engineering and cell38 39
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS signaling. Wang received his doctor- Purdue University, and a Master of Science external affairs. Opposite bottom, left to ate in Polymer Chemistry and Physics degree in Mathematics with a specialization in Stevens’ goal is to “make all right: Dr. Ionut Fiorescu, The Edwin A. (Biomaterials Discipline, 1998) from Stochastic Processes from the University of available use of space” within its Dr. X. Frank Xu, Jim Snyder Top, left to right: Marjorie Stevens Society The Institute of Polymer Chemistry, Bucharest. compact urban setting, says Hank Everitt, Stefano Falconi. Nankai University, Tianjin, China, X. Frank Xu joins the Department of Civil, Dobbelaar, vice president for has achieved a with honors. He received his second Environmental and Ocean Engineering as an facilities and support services. To membership doctorate in Biomedical Engineering assistant professor. His areas of research inter- that end, Stevens is refurbishing roster of 500 – (tissue engineering) from The est include Computational Homogenization; and renovating several sites on a long-desired Institute for Biomedical Technology, Stochastic Homogenization of Materials; campus. University of Twente, The Multiscale (Stochastic) Modeling; Simulation Now under construction, The goal. Netherlands, in 2003. of Random Morphologies; Optimization of River Terrace Apartments complex Ionut Florescu joins the Nano/Micro-Architectured Materials; Porous will open in late 2006, ready to Department of Mathematical Sciences as an Media; Multiscale Finite Element Methods; and accommodate upward of 200 assistant professor. Florescu comes to Stevens Probabilistic Mechanics. He has worked profes- New Leadership undergraduate residents. Most of the buildings, from the Department of Statistics at Purdue sionally as a Civil Engineer for the Shanghai In the Office of Development and External tenements and brownstones that date from the University, where he received his doctorate in Foreign Service Company, Shanghai, China, and Affairs, long-time Vice President Jim Snyder early 20th century, have not been fully used Statistics (2004). He had also previously served as an Assistant Engineer for the Ministry of accepted an appointment as special assistant since 1993, when student residents were relo- on the faculty in the Department of Physics at Transportation in Shanghai. He received a doc- to the president. Stepping in as Acting Vice cated elsewhere on campus. the University of Bucharest, Romania. His pri- torate in Civil Engineering (2005) from The President for Development and External Affairs The renovation and expansion of the world- mary research area is the Mathematics of Johns Hopkins University, and a Master of is Marjorie Everitt. She and her team are build- renowned high-speed testing tank in the Center Finance, with a focus on the modeling, analysis Science degree in Civil Engineering from the ing strategies to develop new levels of support for Maritime Systems’ Davidson Laboratory will and approximation of option prices in the sto- University of Akron (2001). He also received a and recognition for Stevens’ programs, faculty provide Stevens with the most modern facility chastic volatility world. He was the recipient of M.Sc. degree with distinction in Offshore and facilities. in the world for testing naval architectural the Purdue Research Foundation Grant, and the Engineering from The Robert Gordon University, In March Stefano Falconi assumed office as design and large-scale environmental and Puskas Memorial Fellowship. Florescu also holds Scotland, and a Bachelor of Engineering degree Stevens’ vice president of finance, treasurer ocean engineering projects. Re-opening of the a Master of Science degree in Statistics with a in Hydraulic Structures from Tsinghua and chief financial officer. He is now in the facility is slated for early 2006. specialization in Computational Finance from University, China. process of creating the necessary financial The Walker Gym received a $4.5 million mechanisms and controls to guarantee that upgrade that includes state-of-the-art car- future growth can proceed apace. diovascular facilities, a running track, new locker rooms and a tunnel between Walker Gym and the Schaefer Athletic and Recreational Development & Center. Facilities Finally, the renovation of the fourth-floor In a historic first, the Edwin A. Stevens (EAS) of the Edwin A. Stevens Building has provided a Society, the Institute’s premier donor organiza- much-needed modern suite of offices and con- tion, has achieved a membership roster of 500 – ference facilities for the dean of engineering a long-desired goal for the Office of and other administrative staff. Development and External Affairs, which over-STEVENS INSTITUTE OF TECHNOLOGY sees the activities of the EAS Society. ANNUAL REPORT • 2004-2005 Stevens has added $1 million to its endow- ment for scholarships, notes Marjorie Everitt, acting vice president for development and40 41
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS Faculty Profiles mation embedded in pictures slips through the colleague Koduvayur Opposite: Dr. Rajarathnam same spam filters. Subbalakshmi are col- Chandramouli “ Our goal is to Rajarathnam Chandramouli: Secrets Worth 1,000 Words Digital steganography hides data by making small changes in the dots of color, or pixels, that laborating on ways to speed analysis, which Left: Dr. Christos Christodoulatos. take away an If a picture is worth one thousand words, comprise a digital image. A grayscale photograph, for is currently very com- easy way for then how much information could a ter- example, has 256 shades of gray. Each is described by putationally intensive, terrorists to pass rorist hide in an image? an eight-bit number ranging from 11111111 (white) and actually read the secrets to one The question is far from theoretical, to 00000000 (black). Steganography encodes data by hidden message after says Stevens Associate Professor of changing the last bit of the number. identifying its location. another.” Nudging the gray level up or down one step is “Our goal,” he Computer Engineering Rajarathnam – Dr. Rajarathnam Chandramouli. By making seemingly ran- imperceptible to the human eye. Yet passive ste- says, “is to take away Chandramouli dom alterations in a digital image, ter- ganalysis can identify those changes statistically. It an easy way for terror- rorists could embed text or diagrams inside an image does this by comparing each pixel to its neighbors. ists to pass secrets to without changing the picture in any visible way. Child “It’s looking for the ‘wrong’ pixel, the gray pixel sur- one another. If we can pornographers have used the technique to hide rounded by eight black pixels,” says Chandramouli. do that, we can make pornography inside seemingly innocuous pictures. By looking at the number and pattern of “wrong” the world safer.” thought it was nonreactive, but we found tungsten Digital steganography — Greek for “covered pixels, analysts can tell whether an image contains raises soil acidity, reduces plant growth, and dis- writing” — is extremely hard to find, says a hidden message. Unfortunately, says Christos Christodoulatos: Creating an solves in water in concentrations higher than lead.” Chandramouli. While national security software can Chandramouli, conventional statistics cannot Environment for Discovery CES used many of the instruments and protocols scan text for critical patterns and key words, infor- determine the length and location of the full mes- “It takes a lot of basic science to solve real prob- developed to monitor tungsten to analyze chromi- sage or the algorithm used to embed it. lems,” says Christos Christodoulatos, director of um and heavy metal pollution in Jersey City, N.J. Uncovering the complete message is the Center for Environmental Systems (CES). “Our Keck Geoenvironmental Engineering especially difficult because data usually “That’s why our engineers work with physicists, Laboratory has specialized analytical tools that hides in the least uniform parts of images, mathematicians, and chemists. I personally feel that enable us to do basic work on these as well as such as leaves or hair, where colors change if we don’t achieve basic scientific breakthroughs, it assess new remediation techniques,” says and blend into one another. Such chaotic is going to be very difficult to engineer solutions for Christodoulatos. environments create digital noise that the challenging problems we face today.” Sometimes, esoteric research provides payoffs for obscures the data. Since each pixel in a color This multidisciplinary approach has made CES more down-to-earth problems. For several years, CES photograph contains 24 bits that describe one of the nation’s fastest-rising environmental researchers developed ways to treat wastewater in more than 16 million possible colors, finding science and engineering facilities. Since it was space. “The problem to do it without the huge buffers the “wrong” pixels amid all the noise is founded in 1989, CES researchers developed new — the atmosphere and oceans — we have on earth,” extremely difficult. technologies and spun off businesses while assem- says Christodoulatos. The answers gave CES powerful To unravel the puzzle, Chandramouli turns bling the specialized equipment needed to achieve insights into ways to purify water in environments as to a technique he calls active steganalysis. It fundamental discovery. diverse as the Everglades and the Middle East. uses advanced statistical methods specially The center’s strength resides in its ability to Several CES inventions have spawned businesses. developed to separate nonrandom data from track and remove pollutants from water and soil. CES engineers pioneered a way to modify the surface of chaotic noise. It uncovers small pieces of the Sometimes its findings upend conventional wisdom. nanoscale-sized particles of titanium dioxide, a white message one at a time. “It’s like piecing That was certainly the case when CES assessed the pigment, to absorb arsenic. “This material is now usedSTEVENS INSTITUTE OF TECHNOLOGY together an eye, a mouth and stripes until environmental impact of tungsten. in commercial water filters,” says Christodoulatos. “We ANNUAL REPORT • 2004-2005 you finally see the tiger in the grass,” he says. “The US Army wanted to replace lead and think we can extend the approach to lead, chromium, Funded by US Air Force and National Science depleted uranium in bullets and projectiles with cadmium, and other heavy metals.” Foundation grants, Chandramouli and Stevens tungsten,” explains Christodoulatos. “Everyone A second invention, a plasma system that operates42 43
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS at room temperature without a vacuum, taking advantage of novel properties that are methods and corresponding experi- could find uses as diverse as air purifica- available at the nanoscale that aren’t available at mental techniques to describe the “ I think we’re tion in hospitals and protection against chemical and biological terrorism. larger scales.” Fisher’s primary research area is the mechanical effective mechanical behavior of these systems. talking about New research includes small systems modeling of polymer nanocomposites with a focus on For example, due to the extremely disruptive that create powerful oxidants used to carbon nanotube-reinforced polymers (NRPs). Since small size of the embedded nanotubes, capabilities that destroy bacteria and other organic con- their discovery in the early 1990s, carbon nanotubes a polymer interphase region forms in will have a very taminants in water. “Instead of shipping (CNTs) have excited scientists and engineers with these systems with mechanical proper- toxic chlorine, we’re looking at small, effi- their wide range of unusual physical properties. ties that are different from the proper- significant cient generators that make oxidants on- These properties are a direct result of the near- ties of the bulk polymer matrix. Due toeconomic impact.” site, where and when we need them,” perfect microstructure of the CNTs, which at the the extremely large surface area of the – Dr. Frank Fisher explains Christodoulatos. “That reduces atomic scale can be thought of as a hexagonal sheet embedded nanotubes, this interphase our potential exposure to toxic chemicals.” of carbon atoms rolled into a seamless, quasi-one- region can comprise a significant por- By combining fundamental research with engi- dimensional cylindrical shape. Besides their tion of the volume fraction of the com- neering, CES has become a recognized leader in new extremely small size (single-walled carbon nan- posite and significantly influence the environmental technologies. otubes can have diameters 100,000 times smaller overall mechanical properties of the than the diameter of a human hair), carbon nan- composite. rushed to embrace new technologies. Left: Dr. Frank Fisher Dr. Frank Fisher: Next-Generation otubes are half as dense as aluminum, have tensile “I think we’re talking about disruptive sorts of Today, they have far more choices. In addition to Above: Professor Julie Composite Materials strengths 20 times that of high strength steel alloys, instruments and capabilities that will have a very paint, stone, and metal, artists work with video, digi- Harrison. “From a research perspective,” says Dr. Frank have current carrying capacities 1,000 times that of significant economic impact for those nations and tal imaging, animation, and the Internet. These new Fisher, an assistant professor of Mechanical copper, and transmit heat twice as well as pure dia- those entities that achieve these developments,” media let them shape color, form, perspective and Engineering, “in nanotechnology we’re interested in mond. Given these unparalleled physical properties, says Fisher, “and I think that’s why we’re seeing the sound as well as time itself. CNTs offer the potential to create a US make a strong push as far as investing in nan- The new Art & Technology program gives them an new type of composite material with otechnology – because the really large payouts opportunity to stretch this palette of technologies, extraordinary properties. aren’t necessarily going to be within the next one to says Harrison. At Stevens, they can collaborate with “So what my research is inter- three years; it’s going to be a longer time-frame of researchers in such highly specialized disciplines as ested in looking into,” says Fisher, investment in technology R&D.” robotics, biotechnology, nanotechnology, virtual real- “is how to take these nanotubes as ity, aerodynamics, artificial intelligence, lasers and a reinforcing material and add them Julie Harrison: The Art of Technology, composites. into a polymer matrix, in order to the Technology of Art This fascination with technology mirrors come up with nanocomposite mate- From its perch above the Hudson River, Stevens Harrison’s own background. She has always pursued rial; and not only are we interested Institute of Technology overlooks the art capital of the emerging technologies. “My undergraduate art in improving mechanical properties, world. New York City is home to many of the world’s department was very traditional and totally unin- but also electrical and thermal leading artists and a showplace for their works and terested in video, so I found a way to do it in the properties. And the ultimate goal is performances. Now Stevens is building a bridge to con- dance department,” she relates. really to be able to create multi- nect that world with its own emerging technologies. Armed with the first lightweight video recorder, functional materials where we can As Director for Stevens’ new Art & Technology pro- a 10-pound black-and-white Sony Portapak, design the mechanical, electrical gram, Julie Harrison wants to introduce artists to new Harrison ventured into the world of performanceSTEVENS INSTITUTE OF TECHNOLOGY and thermal properties that we technologies under development at Stevens. She expects art, installations and interactive environments. ANNUAL REPORT • 2004-2005 want for various applications.” to find a receptive audience. From sculptors switching to From there, she turned to video image processing, One aspect of this work is the metal chisels to carve stone to architects embracing iron digital imaging and design. Over the years, she has development of enhanced modeling and steel to create soaring towers, artists have always exhibited her own works, directed documentaries,44 45
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS and designed books and websites. benefit from such artistic collaborations. “As more pany regards both our performances, then I’m going to She began teaching at Stevens in and more jobs move overseas, it is increasingly consider your viewpoint and trust that you will listen to “ The same 1992 and launched the Art & Technology program in 2004. What makes it unlike clear that an engineering degree, by itself, is not enough to ensure success,” says Harrison. what I have to say,” she explains. If conflict remains a smoldering issue among factors that any other art program in the metropoli- “Students need to be creative, not just about management, its embers have all but died in the encourage tan area is the collaboration it fosters engineering and technology, but about the broader boardroom. “There’s very little debate going on,” constructive between engineers and artists. cultural aspects of their solutions. It’s the differ- says Mooney. “Enron, WorldCom and other scandals conflict also “The people inventing things at ence between creating another mp3 player and an provide real evidence that directors should have Stevens are interested in research in iPod,” Harrison concludes. been evaluating executive actions more closely. encourage ways that are similar to how artists We’re only just starting to explore how to create destructive experiment with ideas. We want to bring Ann Mooney: Executive Decision more constructive conflict at the board level,” she conflict.” top artists here to collaborate with When corporate executives clash, what spells the says. them,” she says. difference between smarter decisions and angry Mooney has created a checklist of strategies that – Dr. Ann Mooney The large bioactive sculptures done finger pointing? can be used to encourage constructive conflict. “The by artist-in-residence Jackie Brooker exemplifies “In constructive conflict, leaders with different new Sarbanes-Oxley regulations offer suggestions this collaborative vision. Working with recycled ideas exchange views and build on them,” explains like encouraging more outsiders, but they only plastics processed by Dilhan Kaylon of the Stevens Ann Mooney, an assistant professor at The Howe scratch the surface,” she says. “In fact, boards like Highly Filled Materials Institute, Brooker is creating School of Technology Management who studies the Enron and WorldCom complied almost perfectly John Nastasi: Redesigning Design Opposite: large, porous, moss-containing sculptures that behavior of top managers. “Destructive conflict is with the regulations, yet they clearly were asleep at How can visitors to the supersonic Concorde passenger Dr. Ann Mooney scrub polluted rain and wastewater. more personally and emotionally driven. the wheel.” jet at New York City’s Intrepid Sea-Air-Space Museum Above: Professor John Nastasi. Technology and engineering students may also “The problem is that the same factors that “Boards need to select directors that have the sense what it looked like in flight? encourage constructive conflict also encourage time, expertise, and personality to contribute to That is one of the many questions students grapple destructive conflict, and it’s so easy to slip from boardroom discussions,” she continues. “They can set with in John Nastasi’s new Product-Architecture grad- the one to the other,” says Mooney. the stage for productive meetings by providing direc- uate program. By alloying architecture and industrial Many companies, she explains, try to cultivate cre- tors with meaningful advance materials and allowing design with engineering and technology, the program ativity by forming large teams to gather diverse opinions. time on the agenda for open discussion.” prepares students to use technology to free their “Unfortunately, large teams also make it more difficult Board chairs must take positive actions to imagination. to get your opinions heard and to get things done. That encourage constructive debate. “When facilitating The program grew out of Nastasi’s own search for can lead to personality clashes,” says Mooney. meetings,” says Mooney, “the chair should ensure new perspectives. After practicing architecture in Even companies where productive dialog is the that all directors speak up, because sometimes one Hoboken for 12 years, Nastasi returned to Harvard to rule must guard against corrosive friction. Top or two directors dominate discussions. Simple study advanced design. There, he learned to integrate managers have different skills and corporate strategies like assigning one director to be devil’s data, electronic technologies and media with tradi- responsibilities, she explains. These differences advocate or inviting individuals directly involved tional design and architecture. make it easy for constructive conflict to turn with issues can go a long way towards ensuring bet- “Before I left, a colleague told me not to go back destructive because team members may misinter- ter decisions.” unless it changed how I designed,” Nastasi recalls. pret and question each other’s motives. Most important of all, directors should hold some Burning with new ideas, Nastasi joined Stevens to “We’re looking at strategies to break this sessions without the CEO present. “They may be more develop a course that he calls “the equivalent of sys- cycle,” says Mooney. One possibility may be to inclined to disagree with proposals when he or she is tems engineering for designers.”STEVENS INSTITUTE OF TECHNOLOGY teach strong-willed executives to express them- not present,” she says. The core of the Product-Architecture program ANNUAL REPORT • 2004-2005 selves in less contentious language. In short, Mooney warns, “Companies that want to Nastasi developed with Associate Dean of Engineering Another is to hold all members accountable for ensure top performance need to look at how they man- Souran Manoochehri rests on three legs: advanced team decisions. “If team results affect how the com- age constructive conflict at the board level.” modeling of geometric objects (and associated data)46 47
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS and their interrelationships, the use of Rather than build a conventional housing, the data, and that data has a lot of utility.” simulation software to predict results, and students first modeled the aircraft. Using compu- Such data has many positive uses, “ We need to optimization of simulation results. The new methodology enables design- tation fluid dynamics, they simulated the airflows as it took off, broke the sound barrier and cruised Wright explains. The government wants to use it to uncover terrorist threats. find ways to ers to explore not only physical aspects of at supersonic speeds. Companies want to market more effi- balance utility their design, but their informational con- “The design students said we needed to make the ciently, improve service and predict and privacy.” tent as well. “Nothing is static any more, scientific information publicly accessible,” says fraud. Medical researchers hope to everything involves feedback and rela- Nastasi. “So they designed the enclosure based on the access millions of medical histories to – Dr. Rebecca Wright tionships,” Nastasi explains. “We’re put- air forms around the plane during flight. unearth hidden clues to disease preven- ting engineering methodologies in the “Even when the plane is sitting still, you can under- tion and cure. hands of designers so they can make those stand its condition in flight. They’re also developing a The problem, says Wright, is that the relationships part of their design.” performance piece with mist projectors so you can see same information can be assembled into The approach shines in student designs for a pavil- the change in the air as it skims the aircraft and hear highly detailed medical, financial, ion to house the Concorde. The Intrepid Museum origi- the boom as it breaks the sound barrier.” lifestyle and political profiles of individ- nally asked Associate Dean of Engineering Keith The Product-Architecture Lab abounds with sim- uals, invading privacy in ways that would Sheppard and Professor Dimitri Donskoy to find a way ilar concepts. On one table are a pair of surfboards have been inconceivable in the past. to prevent the aircraft from corroding. They asked that optimize their shape for individual surfers. On Many organizations try to obscure Product-Architecture students to design a structure to another sits a lightweight quick-release racing car personal information. “The US Census protect the aircraft. wheel rim. Across the room is a design for a church Bureau, for example, suppresses publi- apse whose custom framing system automates the cation of data about small towns that anyone. She describes it as “sharing data without Opposite: construction of graceful domes. would let someone infer the profits of a local com- actually sharing it.” Dr. Rebecca Wright “Just give design students analysis tools and pany or the income of the renter who lives in a two Above: Dr. Yan Meng with Some of her schemes involve breaking the com- student. this is what happens,” says Nastasi. bedroom apartment and commutes more than 50 puting into discrete steps so that each computer miles to work,” says Wright. does some of the calculations, then sends the infor- Rebecca Wright: Privacy in the Age of “Yet people can often successfully identify mation to another computer for additional mathe- Databases individuals by cross-referencing Census data, voter matical processing. “This doesn’t just protect a per- Walk into a store and charge a purchase on a credit and automobile registrations, and other types of son’s name, but protects all their personal informa- card, and that transaction is instantly stored in mul- lists,” she continues. “We need to find ways to bal- tion and data,” says Wright. tiple databases. The same is true of transactions ance utility with privacy.” Wright’s goal is make the solutions practical involving our checking accounts, supermarket pur- Wright is working on ways to restore this balance enough to become part of the everyday infrastructure. chases, health history, utility fees, tax payments, through the PORTIA (Privacy, Obligations, and Rights “Privacy is important, but you have to be careful or voter registration, and many other personal decisions. in Technologies of Information Assessment) project. you’ll get solutions no one wants to use,” she says. If someone put all this information together, how In addition to Stevens, collaborators include much privacy would we really have? Is there a way to Stanford University, Yale University, New York Yan Meng: Reconfigurable Platforms at share some of this data legitimately without reveal- University, University of New Mexico, and govern- the Embedded Systems and Robotics Lab ing information that should remain private? mental and industrial partners. Embedded systems are application-specific com- These are some of the questions Associate In addition to developing a framework to discuss puting systems which contain both hardware and Professor of Computer Science Rebecca Wright privacy policy, PORTIA is also looking for better tech- software tailored for a particular task and are gen-STEVENS INSTITUTE OF TECHNOLOGY hopes to answer. nologies to handle sensitive information. erally part of a larger system. They are almost ANNUAL REPORT • 2004-2005 “There’s a growing proliferation of data about The research of Wright and her students focuses everywhere in our lives, in cell phones, cars, wash- individuals today,” Wright explains. “Networked on ways to allow two or more parties to process ers, TVs, printers, digital cameras and common computing has made it much cheaper to collect data collaboratively without revealing the data to robotics.48 49
  • STEVENS STUDENTS STAND OUT AS ACHIEVERS AND LEADERS Embedded systems often fall under challenges for software development. John Horgan: A Center for the category of reactive and real-time “Instead of pushing the limit of software Science Writings at Stevens “ A real-time systems, meaning they contain sensors or similar elements which constantly inter- design,” says Meng, “we turned our attention to reconfigurable hardware and developed a dynam- Under the direction of noted science journalist John Horgan, an Institute- complex system act with the external environment and ically reconfigurable embedded-system platform wide Center for Science Writings and a must adapt to must compute certain results or take cer- by integrating Field Programmable Gate Arrays, or program of Communications across the highly dynamic tain actions within their environment FPGA, and embedded processors in a system-on- Curriculum were inaugurated this fall. environments and through actuators in real-time, without chip environment.” The multi-dimensional Stevens Center delay, as in the case of mobile robots. This new platform can dramatically reduce the for Science Writings will contribute to emergencies.” “Generally speaking, my current overall system responding time and greatly Stevens’ growing reputation as a lead- – Dr. Yan Meng research interests include real-time increase the system robustness and fault-toler- ing cultural hub in the New York Metro embedded intelligent systems and ance, and is in the process of implementation in a area. In addition to directing the center, robotics,” says Professor Yan Meng of the mobile robot, Pioneer 3DX, in the Embedded Horgan will also teach one undergradu- Department of Electrical and Computer Engineering. Systems and Robotics Lab. Meng is also seeking to ate class each semester. “My students and I work on research projects extend this reconfigurable platform to the design Horgan has written three widely such as a self-reconfigurable embedded-system of intelligent computing systems and devices, reviewed books: The End of Science platform using System-on-Chip technology,” she which can adapt to environments through self- (1996), a bestseller translated in 13 says. “Basically, a real-time complex system – for learning. languages; The Undiscovered Mind example, an autonomous mobile robot – must Her ongoing research projects on robotics include (1999); and Rational Mysticism (2003). adapt to highly dynamic environments and emer- multi-robot coordination and communication. Multi- He taught science journalism at gencies under real-time constraints.” robot teams are desirable in some scenarios, such as Polytechnic University and has two A significant amount of processing power is planetary exploration or urban search and rescue. Science Journalism Awards from the American tific experts and the Stevens community. Above: Center for Science needed for such complex applications. The Multi-robot systems are more advantageous than a Association for the Advancement of Science. “All the students at Stevens should care about Writings Director resources in the embedded general processors are single expensive robot in several ways, including Horgan also garnered the National Association of these broader scientific issues, and Stevens should John Horgan Opposite: Horgan hosts a typically very limited, which imposes significant attributes such as parallelism, robustness, scalability, Science Writers Science-in-Society Award. He has show that it cares about these sorts of issues,” he panel of prominent science and simpler programming served as an editor and writer for the IEEE Spectrum says. “Stevens should care not only about the writers at Stevens. Left to for each unit. With and senior writer at Scientific American, with many issues themselves but also about how they are dis- right: Sharon Begley, The acquired multiple robotic freelance publications to his credit. cussed in the media. That’s something that’s been a Wall Street Journal; John systems, managing the As a longtime freelance writer, Horgan enjoys big concern of mine – that the media sometimes Rennie, editor-in-chief, communication, dynamic having an office on the Stevens campus. “As a get their coverage of certain scientific issues Scientific American; Horgan; and Steve task allocation and coop- writer, at least for me, it’s really important to wrong.” Petranek, editor-in-chief, eration among multi- bounce ideas off other people, to hear what they Anticipated events include lectures, confer- Discover. robots becomes challeng- have to say and have them tell me what they’re ences and roundtable discussions of timely sci- ing. working on,” he said. “About a year ago I really ence-related topics. “Lecturers would talk about “Our research focuses started thinking about getting a job at a university how science is presented and address important on building an optimiza- to get that intellectual companionship.” science-related issues such as global warming tion model of multi-robot Though the Center for Science Writings is still in and also how science relates to areas such as cooperation, as well as its infancy, Horgan looks forward to the challenge national security, stem cell research and so on.” InSTEVENS INSTITUTE OF TECHNOLOGY dynamic task allocation of creating the program from the ground up and has the future, Horgan envisions the center as a ANNUAL REPORT • 2004-2005 under good or bad com- ambitious plans for its future. He aims to hold prominent fixture on campus that will encourage munication situations,” events on campus that will spark debate and pique experts in the field of science to make Stevens one says Meng. interest, while bringing together the media, scien- of their stops.50 51
  • CONSOLIDATED FINANCIAL STATEMENTS Report of the Treasurer and Chief Financial Officer Ever since I joined Stevens Institute of Technology twelve months ago, I have been impressed with this intellectually vibrant Institution, constantly growing and developing in unique areas of research. Over the past 10 years, it has truly leveraged the outstanding quality of its faculty and student body into the impressive accomplishments in instruction and research described here by President Raveché Report of the Treasurer and Chief Financial Officer 53 and Chairman Babbio. That this Institution managed to accomplish so much from an objectively small endowment and financial base is testimony to the Report of Independent Certified Public Accountants 56 ingenuity and resourcefulness of its community. Following this first phase of growth and expansion is a necessary focus on leveraging those gains and establishing even broader recognition while remaining cognizant of the major financial issues concomitant with this Consolidated Financial Statements rapid growth. These issues include a small capital base with an endowment and accumulated gains of $130M, minimal borrowing capacity combined with significant debt service and the need to improve operating results to comfortably cover depreciation. In addi- Statement of Financial Position 57 tion, there is a need for our financial administration to develop and improve if it is to keep pace with the rest of the Institution. I was brought on board to address these issues and help bring about their resolution while bringing greater transparency to Stevens’ finan- Statement of Activities 58 cial management. I am glad to report that this process is well underway, as officially recognized by Moody’s Investors Service when it recently affirmed Statement of Cash Flows 59 our Baa2 credit rating and stable outlook. I believe the Fiscal 2005 results published here confirm this positive trend, as highlighted in more detail in the following paragraphs. Notes to Consolidated Financial Statements 60–77 Summary of Financial Position In Fiscal 2005, Stevens has strengthened its financial position. The Consolidated Statement of Financial Position, on page 57, shows that total net assets were approximately $187.5M at June 30, 2005, an increase of $6.1M or 3.4%, from the prior year. Especially sig- nificant are its continued strength in investments, with an increase of over $10M, and an increase of over $16M, net, in the physical plant (including land, buildings and equipment), reflecting the continuing process of major campus renewal. On the liabilities side, long-term debt increased by $10.4M. This represents the net impact of the normal payoff of outstanding debt principal, offset by the issuance in July 2004 of a $13.3M fixed rate bond issue to fund the renovation of four existing Institute- owned buildings into the new River Street Dorm complex. With the completion of this project, Stevens will have accomplished the core campus renewal initiated several years ago that is described by Chairman Babbio on page 3. On the operating side, the year marked progress towards the goal of improving the financial situation of the Institute. The Consolidated Statement of Activities on page 58 shows essentially break-even operations before a depreciation charge of $4.8M. This may be compared with a $1.2M surplus before a depreciation charge of $4.8M in the prior year. When evaluating these numbers it should be noted that Fiscal ’04 was positively affected by an unusually large unrestricted bequest to the Institute. Net of one-time large contributions, Fiscal 2005 operating results reflect an improving trend. It is our firm intention to further improve operating results over the next three fiscal years so that revenues will cover all operat- ing expenses, including depreciation. This goal, though ambitious, can be achieved over the next several fiscal years with close atten- tion to cost containment, organic growth of key operating revenues and careful re-allocation of existing financial resources to sup- port Stevens’ strategic objectives. Accomplishing this will require collaboration and support across the entire Institute but will enable Stevens to continue its pattern of growth over the next decade. Endowment and related investments The market value of investments in the endowment and related investments totaled $130,159,592 at June 30, 2005, compared to $120,063,929 at June 30, 2004, an increase of $10,095,663 or 8.4%.STEVENS INSTITUTE OF TECHNOLOGY Our investments are managed to maximize total investment return relative to appropriate risk, as further explained by Investment ANNUAL REPORT • 2004-2005 Committee Chair Harold Wilmerding in the accompanying box. The ending market value is affected by three factors: market gains or losses, gifts to endowment and the distributions authorized by the Board to support operations or specific needs of the Institution.52 53
  • CONSOLIDATED FINANCIAL STATEMENTS The table below tracks beginning market value of the endowment, gift additions and distributions and net gains over the Fiscal basis was lower than the 3-year average for FY’98 through FY’01, and higher for FY’02 through FY’04. This period marked a significant increase in 1998 – Fiscal 2005 period (source: audited cash flow statements). the use of financial resources, concomitant with the accomplishment of important institutional and fund-raising objectives authorized by the Board of Trustees. Having accomplished most of these objectives, we have now entered a period of significantly reduced distribution, consistent Endowment & Similar Funds 1998 1999 2000 2001 2002 2003 2004 2005 with our need for financial equilibrium. Thus the Fiscal 2005 spot distribution rate was the lowest since Fiscal 1999. Beginning Market Value 124,264,389 133,147,657 142,838,338 157,545,642 135,548,366 114,218,919 113,102,216 120,063,929** Proceeds from Sales of Investments: Distributions (3,285,525) (4,813,572) (6,230,410) (7,637,080) (8,854,027) (8,418,674) (7,681,517) (5,218,969) The Management of Stevens’ Investments Other Proceeds (130,503,833) (93,416,526) (46,599,208) (74,346,039) (99,084,972) (23,102,106) (54,520,082) (19,830,819) A message by Investment Committee Chair Harold P. Wilmerding Subtotal Proceeds (133,789,358) (98,230,098) (52,829,618) (81,983,119) (107,938,999) (31,520,780) (62,201,599) (25,049,788) Purchases of Investments: The Investment Subcommittee of the Finance Committee of the Board of Trustees is charged with the responsibility and the authority to manage the Gifts 3,004,407 1,207,607 7,248,672 6,821,228 2,958,548 300,414 1,085,686 3,112,639 Institute’s investments, primarily restricted and unrestricted funds comprising the endowment. The Committee meets regularly, formally once a month, but in Other Purchases 129,629,310 97,604,695 45,332,575 68,988,843 97,058,615 29,796,029 54,849,446* 20,490,928 addition communicates by phone or e-mail as required to prepare for meetings or to follow up afterwards. The Committee is supported actively both by the Office Subtotal Purchases 132,633,717 98,812,302 52,581,247 75,810,071 100,017,163 30,096,443 55,935,132 23,603,567 of Finance and by external financial advisors in order to consider both the immediate requirements of the Institute and longer term goals to optimize investment Net Gain / (Loss) 10,038,909 9,108,477 14,955,675 (15,824,228) (13,407,611) 307,634 14,870,441 11,541,884 returns and the preservation of capital. The Committee allocates funds among external established managers and partnerships and monitors their performance Ending Market Value 133,147,657 142,838,338 157,545,642 135,548,366 114,218,919 113,102,216 121,706,190 130,159,592 monthly against benchmark rates of return, adherence to defined styles and audited financial information. (*): Amount includes reclassification of $2.1M of artwork contributed in FY’03. The operating policy of the Committee closely follows accepted standards for investment managers and gives considerable emphasis to maximum total return (**): Amount reflects reclassification of $1.6M in investments to other assets. strategies. As is the convention, Stevens follows a “spending rate” policy, which is a bi-annual transfer of assets from endowment gains to support the operat- ing budget of the Institute. The specific amount is determined by taking a defined percentage of the average of the trailing 3 years of endowment value. The As can be seen from this table, Stevens’ investments performed quite well for most of the period, with significant gains in the years leading to spending rate for Fiscal 2005 was 5.4%. the peak of the so-called high-technology “bubble” (Fiscal 2000), as well as in the two most recent fiscal years, 2004 and 2005. The only excep- Given the modest size of the endowed funds relative to the current operating and capital requirements, the Committee continues to diversify against risk. Although there is limited flexibility to pursue illiquid but potentially higher return forms of investment often found in larger endowments, the Committee is opportunistic and has tions are Fiscal 2001, 2002 and the first half of Fiscal 2003, where investment losses coincided with a period of adverse conditions in the capital utilized alternative investments to an advantage. The sectors and asset classes to which the investments are committed are as follows: fixed income (10-15%), equi- markets, which affected investments across the nation. Still, net gains added to a total of over $31.6 million to our investments over this 8-year ties (20-40%), alternative investments (20-35%), private equity (10-15%) and cash equivalents (3-5%). These asset allocations are reviewed and adjusted annually. period: this represents an increase of 25.4 % over the market value of Stevens’ investments at the beginning of Fiscal 1998. In conjunction with the Finance Subcommittee, the Investment Committee meets with the Office of Finance throughout the year to review the outlook against which its policies and procedures are established. The 3-year trailing average distribution rate for Fiscal 2005 was roughly1 equal to 5.4% of the average market value of investments over the three prior fiscal years. This was unchanged from Fiscal 2004. Over the Fiscal 2000-2004 period, however, the draw was augmented by a special distribution authorized by the Board of Trustees to fund the Stevens capital fund raising campaign. Thus, the overall authorized distribution for Changes in Financial Administration and Reporting the ’00-’04 period was higher than the 5.4% trailing 3-year average. The past 12 months have also been dedicated to developing our financial administration and improving our financial reporting and The chart below illustrates this overall distribution as a percent of the beginning market value of our investments over the Fiscal 1998 - Fiscal analysis. As we continue to draw upon existing strengths in our financial organization, the financial team has been restructured around 2005 period, and compares it with the 3-year trailing average for the same period. As can be seen from the chart, the distribution rate on a spot the key positions of Controller and Associate Controller, while several additional appointments in the course of the past year have brought fresh talent. In August we also created a new position of Institute Auditor, reporting to the Audit Committee of the Board of Trustees and with Endowment and related Investments Draw administrative reporting relationship to me. Additionally, in December, the Office of Sponsored Research has been moved organizationally to as % of End. Market Value the VP for Finance area to emphasize its administrative accountability and compliance functions, and a staffing plan is being implemented to 3-yr trailing avg. and spot enable this key branch of the administration to keep pace with the growth of university research. Over the past year we also engaged in an in-depth review of all Institute policies and procedures, in close collaboration with the 3-yr trailing avg. rate: academic and administrative leadership, to keep up with the changing regulatory environment and the increasing complexity of FY98=6.0% FY99=5.75% 8. 0% Institute operations. This ongoing project has already resulted in extensive revisions of existing policies and the introduction of sev- FY00=5.5% FY01-05=5.4% 7. 0% 7. 4% eral new ones in such diverse areas as accounting, federal regulatory compliance and controls. All policies are accessible through a 6.0% 6.8% new policy portal on our website, and personnel are being trained in their implementation. 6.5% We are dedicated to improving not only the quantity but also the quality of financial reporting at Stevens. We are especially com- 5.0% $ mitted to a continuous improvement of our communication with and outreach to our community of faculty, students, alumni, friends 4. 0% 4.8% 4.3% 4.4% and supporters. Our new financial web site contains valuable information, including our audited financial statements, endowment 3. 0% 3.6% value and trends and exhaustive information on our long term debt. It is frequently updated and should prove an important resource 2.0% 2.6% for anyone wishing to gain insight into the financial picture at Stevens. 1.0% I am confident that with continued growth, clear and sound financial policies and procedures, exceptional talent and a unique tra- 0.0% dition, our Institution is well positioned to consolidate and expand its reputation as a steeple of education and research. 00 98 99 03 04 01 02 05 Respectfully submitted,STEVENS INSTITUTE OF TECHNOLOGY 19 19 20 20 20 20 20 20 ANNUAL REPORT • 2004-2005 Fiscal Year Spot Distribution Rate, All-In (% of FY beginning MV) Trailing 3-yr Distribution Rate Stefano Falconi 1 Vice President of Finance, Treasurer and Chief Financial Officer The Stevens endowment is comprised of a subset of funds received as a gift gift by the Taylor Foundation and referred to as the Taylor Trust Funds. The draw for these funds follows a somewhat different rule which was established by Stevens in accordance with the wishes of the Taylor Trust Foundation upon acceptance of the gift (20% of income generated by investments). The actual draw on any fiscal year is affected by February 8, 2006 the combination of this rule and the 5.4% rule.54 55
  • CONSOLIDATED FINANCIAL STATEMENTS Stevens Institute of Technology Consolidated Financial Statements To the Board of Trustees of Stevens Institute of Technology: June 30, 2005 We have audited the accompanying consolidated statement of financial position of Stevens Institute of Technology (the "Institute") as of June 30, 2005, and the related consolidated statements of activities and cash flows for the year then ended. These consolidat- (with summarized comparative information for 2004) ed financial statements are the responsibility of the Institute’s management. Our responsibility is to express an opinion on these finan- cial statements based on our audit. The prior year summarized comparative information has been derived from the Institute’s 2004 Statement of Financial Position consolidated financial statements, which were audited by other auditors, whose report dated July 29, 2005, expressed an unqualified 2005 2004 Assets opinion on those consolidated financial statements. Cash $ 1,513,202 $ 26,774 Student, research and other receivables, net 22,794,143 22,858,500 We conducted our audit in accordance with auditing standards generally accepted in the United States of America as established by Contributions receivable, net 10,124,125 18,019,699 Prepaid expenses and other assets 4,129,671 3,699,397 the Auditing Standards Board of the American Institute of Certified Public Accountants and the standards applicable to financial Investments 130,159,592 120,063,929 audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require Trusts held by others 2,002,596 1,976,219 that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of Deposits with bond trustees 25,543,013 31,831,717 material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit pro- Land, buildings and equipment, net 116,758,226 99,762,078 Total assets $ 313,024,568 $ 298,238,313 cedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Institute’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a Liabilities and Net Assets test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting prin- Liabilities Lines of credit $ 11,820,171 $ 8,620,890 ciples used and significant estimates made by management, as well as evaluating the overall consolidated financial statement pres- Accounts payable and accrued expenses 9,465,254 13,545,190 entation. We believe that our audit provides a reasonable basis for our opinion. Deferred revenue and deposits 2,120,191 2,397,062 Annuities payable 2,775,098 2,772,661 Accrued post-retirement benefit In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated finan- obligations 11,874,911 12,554,238 cial position of Stevens Institute of Technology as of June 30, 2005, and the consolidated changes in their net assets and their cash Long-term debt 82,311,070 71,927,407 flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. Refundable advances 5,131,056 5,022,103 Total liabilities 125,497,751 116,839,551 Net assets Unrestricted 76,758,277 70,767,957 Temporarily restricted 15,215,547 19,614,711 Permanently restricted 95,552,993 91,016,094 Total net assets 187,526,817 181,398,762 New York, New York Total liabilities and net assets $ 313,024,568 $ 298,238,313 February 8, 2006STEVENS INSTITUTE OF TECHNOLOGY ANNUAL REPORT • 2004-200556 57
  • CONSOLIDATED FINANCIAL STATEMENTS Statement of Activities Statement of Cash Flows Temporarily Permanently Totals 2005 2004 Unrestricted Restricted Restricted 2005 2004 Cash flows from operating activities Operating Activities Changes in net assets $ 6,128,055 $ 8,488,003 Adjustments to reconcile changes in net assets to net cash Revenues and other support used in operating activities Tuition and fees $ 78,052,472 $ - $ - $ 78,052,472 $ 69,765,437 Depreciation expense 4,776,430 4,762,273 Less student aid (20,739,643) - - (20,739,643) (18,638,286) Loss(gain) on disposal of property 674,883 (2,970,704) Net tuition and fees 57,312,829 - - 57,312,829 51,127,151 Write-off of furniture, fixtures and equipment - 750,461 Research revenues Net gain on investments (11,541,884) (14,870,441) Direct 26,301,429 - 26,301,429 26,819,506 Indirect 5,509,969 - - 5,509,969 5,275,480 Present value adjustment on annuities payable 32,560 (234,861) Total research revenues 31,811,398 - - 31,811,398 32,094,986 Provision for doubtful accounts 540,773 2,822,966 Non-research grants 2,476,978 - - 2,476,978 1,563,732 Contributions restricted for long-term investments (1,312,909) (2,977,514) Contributions 5,482,652 1,822,812 - 7,305,464 9,541,415 Changes in assets and liabilities State of New Jersey appropriation 1,196,723 - - 1,196,723 1,139,239 Decrease (increase) in receivables 7,419,158 (6,904,198) Other revenues 1,237,109 - - 1,237,109 1,656,318 (Increase) decrease in prepaid expenses and other assets (430,274) 237,038 Auxiliary enterprises 14,234,178 - - 14,234,178 12,656,820 (Decrease) increase in accounts payable and accrued expenses (5,724,166) 5,812,121 Investment return in support 5,514,544 - - 5,514,544 6,338,569 Decrease in deferred revenue and deposits (276,871) (3,221,796) of operations Decrease in accrued post-retirement benefit obligations (679,327) (122,406) Net assets released from restrictions 5,900,409 (5,900,409) - - - Net cash used in operating activities (393,572) (8,429,058) Total operating revenues and other support 125,166,820 (4,077,597) - 121,089,223 116,118,230 Cash flows from investment activities Proceeds from sales of investments 25,049,788 62,201,599 Expenses Purchases of investments (23,603,567) (53,797,098) Instruction 39,584,084 - - 39,584,084 35,298,593 Proceeds from disposal of property - 3,450,000 Research 28,269,936 - - 28,269,936 27,922,311 Purchases of property, plant and equipment (20,803,231) (24,131,142) Academic support 6,957,023 - - 6,957,023 5,812,790 Decrease in deposits with bond trustees 6,288,704 20,082,707 Library 1,383,084 - - 1,383,084 1,527,499 Student services 11,744,599 - - 11,744,599 10,102,091 Net cash (used in) provided by investing activities (13,068,306) 7,806,066 Public services 1,123,481 - - 1,123,481 1,534,422 General institutional support 19,585,344 - - 19,585,344 20,508,622 Cash flows from financing activities Development 1,541,947 - - 1,541,947 1,960,137 Proceeds from contributions restricted for long-term investments 1,312,909 2,977,514 Public relations 806,084 - - 806,084 1,296,905 Borrowings under line of credit 3,199,281 4,205,107 Auxiliary enterprises 10,294,100 - - 10,294,100 8,917,031 (Decrease) in payable to custodian - (3,326,053) Total expenses before (Increase) decrease in trusts held by others (26,377) 5,737 depreciation 121,289,682 - - 121,289,682 114,880,401 Increase in annuities payable 259,081 869,497 Net operating activities before Payments of annuity obligations (289,204) (115,035) depreciation expense 3,877,138 (4,077,597) - (200,459) 1,237,829 Proceeds from long-term debt 13,265,000 1,260,017 Depreciation expense (4,776,430) - - (4,776,430) (4,762,273) Payments on long-term debt (2,881,337) (5,362,649) Net operating activities after Increase in refundable advances 108,953 108,953 depreciation expense (899,292) (4,077,597) - (4,976,889) (3,524,444) Net cash provided by financing activities 14,948,306 623,088 Non-operating activities Net increase in cash 1,486,428 96 Investment return in excess of Cash amounts authorized for use in Beginning of year 26,774 26,678 operations 5,749,978 178,007 3,510,044 9,438,029 10,734,254 Contributions 50,974 43,578 978,755 1,073,307 1,241,110 End of year $ 1,513,202 $ 26,774 Private grants 2,000,000 - - 2,000,000 - Gain(loss) on disposal of property (674,883) - - (674,883) 2,970,704 Supplemental disclosure of cash flow information Other losses (236,457) (17,876) - (254,333) (70,689) Provision for uncollectible contributions Cash paid during the year for interest $ 4,915,679 $ 4,001,698 receivable - (444,616) - (444,616) (3,105,107) Minority interest - - - - 7,314 Present value adjustment on annuities payable - (80,660) 48,100 (32,560) 234,861STEVENS INSTITUTE OF TECHNOLOGY Net non-operating activities 6,889,612 (321,567) 4,536,899 11,104,944 12,012,447 ANNUAL REPORT • 2004-2005 Changes in net assets 5,990,320 (4,399,164) 4,536,899 6,128,055 8,488,003 Net assets Beginning of year 70,767,957 19,614,711 91,016,094 181,398,762 172,910,759 End of year $ 76,758,277 $ 15,215,547 $ 95,552,993 $ 187,526,817 $ 181,398,76258 59
  • CONSOLIDATED FINANCIAL STATEMENTS Note 1 – Organization Refundable advances represent obligations of the Institute to the Federal Government under the Federal Perkins Loan Program. Investment returns including gains or losses on investments are reported as follows: Stevens Institute of Technology (the “Institute”), founded in 1870 and located in Hoboken, New Jersey, educates and • as increases (decreases) in permanently restricted net assets if the terms of the gift inspires students to acquire knowledge needed to lead in creation, application and management of technology and to excel require that they be added to the principal balance; in solving problems in any profession. The Institute is accredited by the Middle States Association of Colleges and Schools • as increases (decreases) in temporarily restricted net assets if the terms of the gift ` and the Accreditation Board of Engineering Technology and presently serves approximately 5,300 students. impose a purpose restriction on the use of the income; and • as increases (decreases) in unrestricted net assets in all other cases. The Institute is also committed to a comprehensive and rapidly growing program of research, which strengthens the educa- tional experience and materially contributes to our nation’s goals. In this context it has pioneered the concept of Contributions of property, plant and equipment without donor stipulations restricting the use of such long-lived assets are “Technogenesis” or the educational methodology by which faculty, students and colleagues in industry jointly nurture the reported as unrestricted revenues. Contributions of cash or other assets to be used to acquire property, plant and equip- process of conception, design, and market place realization of new technologies. ment are reported as increases of temporarily restricted net assets. Restrictions are considered to be satisfied at the time of acquisition or completion of construction of such long-lived assets. The Institute is the sole owner of Ravenswood Corporation, which owns and operates several residential properties in Hoboken, New Jersey. The Institute is also the sole owner of Stevens Technology, Inc., which focuses on technology transfers Cash and Cash Equivalents in accordance with the “Technogenesis” concept, and is the majority owner of Technology Holding, LLC. The minority inter- Cash and cash equivalents are recorded at fair value, and are comprised of highly liquid financial instruments with original est reflected in the accompanying consolidated statement of activities represents the interests of third party investors in maturities of three months or less at time of purchase. Certain cash equivalents which have been restricted by donors are the operations of Technology Holding, LLC. included in Investments. Investments Note 2 - Summary of Significant Accounting Policies Investment in equity and debt securities with readily determinable market values are recorded at fair value and reported based upon quoted market prices. Alternative investments, including hedge funds and private equity and limited partner- Consolidation ships, are recorded based upon published information or partnership information (see Note 3). The accompanying consolidated financial statements include the accounts of the Institute, its wholly-owned subsidiaries, Ravenswood Corporation and Stevens Technology, Inc. and its majority owned subsidiary Technology Holding, LLC. All significant Deposits with Bond Trustees inter-company accounts have been eliminated in consolidation. Deposits with Bond Trustees represent funds held by the trustees associated with various bonds described in Note 9 below, and will be utilized to fund various construction projects. Basis of Presentation The Institute prepares its consolidated financial statements on the accrual basis of accounting in conformity with U.S. Generally Split-interest Agreements Accepted Accounting Principles (“GAAP”) and with standards established by the Financial Accounting Standards Board for The Institute’s split-interest agreements include charitable remainder trusts, perpetual trusts held by others, and life external financial reporting by not-for-profit organizations. Accordingly, the Institute’s resources are classified and reported income funds. Charitable remainder trusts and life income funds for one or more beneficiaries generally pay lifetime income based upon the existence or absence of donor-imposed restrictions, as follows: to those beneficiaries, after which the principal is made available to the Institute in accordance with donor intentions. Where the Institute is the trustee, a liability is established for the present value of the estimated future payments to the Permanently restricted: net assets subject to donor-imposed stipulation that require the corpus be permanently retained to beneficiary, with the difference between the liability and the fair value of the proceeds received by the Institute recorded provide a perpetual source of income to the Institute. Donors of these assets generally permit the use of all or part of invest- as a contribution. The present value calculation is performed in accordance with guidelines prescribed by the Internal ment earnings for operating or specific purposes, such as scholarships, chairs and educational and research programs. Revenue Service. Temporarily restricted: net assets subject to donor-imposed restrictions that will be satisfied either by actions of the Institute Perpetual trusts held by others for the benefit of the Institute are recorded at the fair value of the assets contributed to the or the passage of time. trust. Unrestricted: net assets that are not subject to donor-imposed restrictions, and therefore, are expendable for operating pur- Deferred Revenue and Deposits poses. Unrestricted net assets may be designated for specific purposes by the Institute’s Board of Trustees. Deferred revenue and deposits primarily represent payments received from students in advance of the start of the academ- ic year and summer semester, as well as, research grants received in advance of related work performed. Such amounts are Revenues are reported as increases in unrestricted net assets unless use of the related assets is limited by donor-imposed reflected as revenue when the related services are performed. restrictions. Expenses are reported as decreases in unrestricted net assets. Appreciation or depreciation in the fair value of investments and gains and losses on other assets or liabilities are reported as increases or decreases in unrestricted net assets Research Activities unless otherwise restricted by explicit donor stipulation or by law. Expirations of temporary restrictions on net assets are report- The Institute receives grant and contract income from governmental sources. The Institute recognizes revenue associated ed as net assets released from restrictions. with direct costs of sponsored programs as the related costs are incurred. Recovery of indirect (facilities and administra- tive) costs of federally sponsored programs are at cost reimbursement rates negotiated with the Institute’s cognizant Contributions, including unconditional promises to give, are recognized as revenues in the period received. Unconditional prom- agency, the Office of Naval Research. ises to give are recorded at their net realizable value if they are expected to be collected within one year or at the present value of future cash flows if they are expected to be collected over periods longer than one year. Conditional promises to give are not Operating Measure recognized until they become unconditional, that is when the conditions on which they depend are substantially met. The Institute classifies its consolidated statement of activities as operating and non-operating. Operating activitiesSTEVENS INSTITUTE OF TECHNOLOGY Contributions of assets other than cash are recorded at their estimated fair value at date of donation. Contributions to be include all income and expenses related to carrying out the Institute’s educational and research mission. Operating rev- received after one year are discounted using a risk-free rate of return. Amortization of discounts is recorded as additional con- enues also include investment return used to fund current operations in accordance with the endowment spending policy ANNUAL REPORT • 2004-2005 tribution revenue in accordance with donor-imposed restrictions, if any. An allowance for uncollectible contributions receivable (see “Spending Rate Policy” below). is provided upon management’s judgment of prior collection history, type of contribution and nature of fundraising activity. Net assets resulting from certain large contributions are designated by the Institute’s Board of Trustees for capital or long-term Non-operating activities include current year investment return in excess of amounts authorized for expenditure by the investment (see Note 10). Board of Trustees (spending rate policy); contributions, private grants and other resources intended for capital purposes or restricted by donors for specific purposes; present value adjustments of annuities payable; gains or losses on disposal of60 61
  • CONSOLIDATED FINANCIAL STATEMENTS property, plant and equipment; and minority interest, if any. Investment expenses totaled $383,591 and $319,268 in fiscal 2005 and 2004, respectively. Spending Rate Policy Investments related to split interest agreements included within the investment categories reported above totaled approx- The Institute maintains an investment pool for substantially all of its long-term investments. The pool is managed to imately $4.9 million as of June 30, 2005 and 2004, respectively. Other investments totaling approximately $1.6 million in achieve the maximum prudent long-term return. The Institute’s Board of Trustees has authorized a spending rate designed 2004 were reclassified to other assets. to fulfill the following objectives: • Preserve the value of the investment pool in real terms (after inflation); and During Fiscal 2004, $5,500,000 of accumulated gains were loaned to the operating fund. The terms of the loan require repay- • Provide a predictable flow of funds to support operations. ment over a 10-year period, in a combination of interest-only and balloon payments with interest at an annual rate of For the years ended June 30, 2005 and 2004, the spending rate permitted the use of total returns (dividend and interest income 4.75%. The first interest only annual installment of $339,788 was repaid to the endowment fund in October, 2005. and capital gains) at a rate of 5.4 % of the average year-end fair value of long term investments, over a three-year period. Investments for which the total return is permanently restricted by donors are excluded from the spending rate. Since alternative investments may not be readily marketable, the estimated fair value is subject to uncertainty and, there- fore, may differ from the value that would have been used had a ready market for such investments existed. The values Auxiliary Enterprises assigned to these holdings do not necessarily represent amounts which might ultimately be realized upon sale or other dis- Auxiliary Enterprises include revenues and expenses primarily related to student housing, the campus bookstore and student position since such amounts depend on future circumstances and cannot reasonably be determined until the actual liqui- dining facilities. dation occurs. Because of the inherent uncertainty of such valuations, those estimated fair values may differ significant- ly from the values that would have been used had a ready market for such investments existed and the differences could be Taxes material. The Institute has been classified as an organization described under Section 501(c)(3) of the Internal Revenue Code (the “Code”) and, therefore, is exempt from Federal income taxes under Section 501(a) of the Code. The components of investment return for the years ended June 30, 2005 and 2004 were as follows: Prior Year Summarized Financial Information 2005 2004 While comparative information is not required under GAAP, the Institute believes this information is useful and has includ- Dividends and interest $ 3,410,689 $ 2,202,381 ed summarized financial information from its fiscal 2004 consolidated financial statements. Net realized gain 5,521,099 2,779,575 Net unrealized appreciation 6,020,785 12,090,867 Such summarized information is not intended to be a complete presentation in conformity with GAAP. Accordingly, such Total investment return 14,952,573 17,072,823 information should be read in conjunction with the Institute’s consolidated financial statements for the year ended June 30, Investment return used for operations 5,514,544 6,338,569 2004, from which the summarized financial information was derived. Net investment return $ 9,438,029 $ 10,734,254 Reclassifications Certain prior year information has been reclassified to conform with the fiscal 2005 presentation. Note 4 – Receivables Use of Estimates The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires Receivables (student, research and other) as of June 30, 2005 and 2004 were comprised of the following: management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues 2005 2004 and expenses during the reporting period. Actual results could differ from those estimates. The most significant assumptions Student $ 9,855,064 $ 7,821,703 include valuation of alternative investments without readily determinable fair values; actuarially determined costs associat- Research contracts and grants 11,529,672 13,381,343 ed with split-interest agreements and the accrued post-retirement benefit obligations; and the recoverability of receivables. Student loans 5,441,770 5,501,863 Mortgage notes 1,171,986 1,252,704 Accrued interest 224,991 202,803 Other 139,781 171,048 Note 3 – Investments 28,363,264 28,331,464 Less: The Institute’s investments consist of publicly traded fixed income and equity securities and alternative investments and Allowance for doubtful student accounts 4,119,040 3,880,289 cash equivalents. The fair values of publicly traded investments are generally determined based upon quoted market prices. Allowance for doubtful research accounts 907,739 1,050,333 Alternative investments, including hedge funds, private equity funds and limited partnerships, are carried at estimated fair Allowance for doubtful student loans 542,342 542,342 values provided by the management of those funds or partnerships where the general partner considers such value to be 5,569,121 5,472,964 appropriate. A portion of investments held by the limited partnerships are valued by the general partners of those partner- Total receivables, net $ 22,794,143 $ 22,858,500 ships in the absence of readily determinable market values. Cost and fair value of investments as of June 30, 2005 and 2004 were as follows: 2005 2004 Fair Value Cost Fair Value CostSTEVENS INSTITUTE OF TECHNOLOGY Equity $ 66,724,097 $ 53,722,510 $ 62,558,627 $ 52,921,831 ANNUAL REPORT • 2004-2005 Alternative investments 22,295,555 17,295,696 19,145,382 15,142,053 Fixed income 17,160,168 15,670,571 16,318,603 15,513,761 Private equity 12,959,731 11,555,729 13,330,720 13,077,424 Cash and cash equivalents 4,934,079 4,934,079 2,549,465 2,549,465 Trusts 4,928,460 4,914,191 4,850,671 4,811,823 Other 1,157,502 1,340,454 1,310,461 1,560,949 Totals $ 130,159,592 $ 109,433,230 $ 120,063,929 $ 105,577,30662 63
  • CONSOLIDATED FINANCIAL STATEMENTS Note 5 - Contributions Receivable Note 8 - Accrued Post-Retirement Benefit Obligations Contributions receivable, net, as of June 30, 2005 and 2004, consisted of the following: The Institute provides health benefits to substantially all of its employees. Upon retirement, employees may be eligible for continuation of these benefits. Amounts are accrued for such benefits during the years employees provide services to the 2005 2004 Institute. The Institute funds its post-retirement benefit cost on a pay-as-you-go basis. Amounts due in Less than one year $ 7,955,126 $ 10,437,297 The net periodic post-retirement benefit cost for the years ended June 30, 2005 and 2004, follows: One to five years 5,742,502 11,486,768 More than five years 200,000 - 2005 2004 13,897,628 21,924,065 Service cost $ 123,293 $ 229,089 Less: Discount to present value 771,732 1,347,211 Interest cost 411,821 690,846 13,125,896 20,576,854 Amortization of loss 282,217 295,503 Less: Allowance for doubtful contributions 3,001,771 2,557,155 Amortization of prior service cost (1,102,345) (690,371) Contributions receivable, net $ 10,124,125 $ 18,019,699 Net post-retirement benefit cost $ (285,014) $ 525,067 For the year ended June 30, 2005, a full year amortization of the plan amendment recognized November 21, 2003 was includ- A discount for pledges to be received over periods longer than one year from date of contribution is provided using a risk free ed in amortization of prior service cost; for the year ended June 30, 2004, only a partial year amortization was included. For rate of return, which ranged from approximately 3% to 5% at June 30, 2005 and 2004, respectively. the years ended June 30, 2005 and 2004, payments made by the Institute for these benefits totaled $531,974 and $703,322, respectively. From time to time, donors who are members of the Board of Trustees make pledge commitments to the Institute. At June 30, 2005, contributions receivable included $7,204,366, in the aggregate, from members of the Board of Trustees. The actuarial present value of benefit obligations and the amount recognized in the consolidated statements of financial position as of June 30, 2005 and 2004, follows: Note 6 - Property, Plant and Equipment 2005 2004 Change in benefit obligation Benefit obligation at beginning of year $ 8,051,810 $ 17,475,644 Property, plant and equipment are stated at cost net of depreciation, or fair market value at date of contribution, if donat- Service cost 123,293 229,089 ed. Upon disposal of assets, the costs and accumulated depreciation are removed from the accounts, and the resulting gain Interest cost 411,821 690,846 or loss, if any, is included within non-operating activities. Plan participants’ contributions 137,661 55,492 Amendments/curtailments/special Depreciation is calculated by using the straight-line method over the following estimated useful lives: termination - (10,540,965) Actuarial loss (1,594,610) 845,036 Buildings 40 years Benefits paid (531,974) (703,332) Building improvements 20 years Benefit obligation at end of year $ 6,598,001 $ 8,051,810 Furniture, fixtures and equipment 4 to 15 years Change in Plan Assets As of June 30, 2005 and 2004, property, plant and equipment consisted of the following: Fair value of plan assets at beginning of year $ - $ - Institute contribution 394,313 647,830 2005 2004 Plan participant contribution 137,661 55,492 Benefits paid (531,974) (703,322) Land $ 1,763,196 $ 1,763,196 Fair value of plan assets at end of year $ - $ - Buildings and improvements 109,961,105 106,707,631 Furniture, fixtures and equipment 12,973,660 12,690,776 Funded status at end of fiscal year $ (6,598,001) $ (8,051,810) Construction in progress 58,910,405 41,185,344 Unrecognized actuarial loss 3,678,339 5,555,532 183,408,366 162,346,947 Unrecognized prior service cost (8,955,249) (10,057,960) Less: Accumulated depreciation 66,650,140 62,584,869 Accrued post-retirement benefit obligation $ (11,874,911) $ (12,554,238) Total property, plant and equipment, net $ 116,758,226 $ 99,762,078 2005 2004 Depreciation expense totaled $4,776,430 and $4,762,273 for the years ended June 30, 2005 and 2004, respectively. Assumptions used to determine benefit obligations at June 30 Discount rate 5.25% 6.00% Note 7 - Pension Plans 2005 2004 Weighted average assumptions used to determine net periodicSTEVENS INSTITUTE OF TECHNOLOGY The Institute participates in the Teachers Insurance and Annuity Association/College Retirement Equities Fund (TIAA/CREF) benefit cost for the years ended June 30 ANNUAL REPORT • 2004-2005 for academic and professional administrative personnel. In addition, the Institute participates in a defined contribution Discount rate 6.00% 5.75% plan underwritten by the Variable Annuity Life Insurance Company (VALIC) for non-academic support and union personnel. Retirement costs related to these plans for the years ended June 30, 2005 and 2004 totaled $2,552,148 and $2,497,926, respectively.64 65
  • CONSOLIDATED FINANCIAL STATEMENTS 2005 2004 Note 9 - Long-Term Debt and Lines of Credit Assumed medical and prescription cost trend rates at June 30 Health care cost trend rate assumed for next fiscal year – pre-65 8.25% 8.50% Health care cost trend rate assumed for next fiscal year – post-65 7.75% 8.50% Long-term debt as of June 30, 2005 and 2004, consisted of the following: Prescription drug trend rates assumed for next fiscal year 10.00% 8.50% Ultimate medical and prescription cost trend rate 5.00% 5.00% Issue (Interest rate range; Maturity Date) 2005 2004 Fiscal year that ultimate trend rate is reached 2013 2010 ( a) 1998 Revenue Series I Bonds (4.25%~5.38%); $ 14,755,000 $ 15,535,000 2005 2004 Matures 7/1/2028 Effect of a 1% change in the assumed health care 1%Increase 1%Decrease 1%Increase 1%Decrease ( b) 2000 Higher Education Capital Improvement Fund 122,500 127,500 cost trend rates Series A Bonds (5.00%~5.75%); Matures 8/15/2020 Effect on total of service and interest $20,231 $(17,327) $21,014 $(17,940) ( c) 2000 Higher Education Capital Improvement Fund 1,292,500 1,342,500 cost components Series B Bonds (2.34%~5.75%); Matures 9/1/2020 Effect on post-retirement benefit obligation $146,387 $(128,579) $165,855 $(145,782) ( d) 2001 Dormitory Safety Trust Fund Series A and B 1,820,346 1,985,832 (Interest free); Matures 1/15/2016 Contributions ( e) Equipment Leasing Fund Series 2001 A (3.50%~5.00%); 128,118 150,102 The Institute expects to contribute $603,378 to its post-retirement health plan in fiscal year 2006. Matures 8/1/2009 ( f) 2002 Revenue Series C Bonds (3.00%~5.25%); 51,270,000 53,210,000 Expected benefit payments Matures 7/1/2032 Employer Contributions Prescription Subsidy Receipts ( g) 2003 Dormitory Safety Trust Fund Series A (Interest free); 215,000 235,000 Fiscal year ending June 30, Matures 1/15/2018 2006 $ 657,048 $ 53,670 ( h) 2003 Equipment Leasing Fund Series A (3.50%~5.00%); 14,662 16,517 2007 662,467 118,641 Matures 8/1/2011 2008 650,263 130,247 ( i) 2004 River Street Dorm Series B 2009 625,652 141,066 (4.50%~5.375%); Matures 7/1/2034 13,265,000 - 2010 604,203 153,590 2011 – 2015 2,907,122 914,022 82,883,126 72,602,451 Less: Unamortized discount 572,056 675,044 The Institute applied and was approved for the Medicare Part D prescription drug federal subsidy, therefore the above dis- Long-term debt, net $ 82,311,070 $ 71,927,407 closure reflects, as of June 30, 2005, the future subsidy payments from Medicare, commencing January 1, 2006. (a) Revenue Bond, 1998 Series I The reduction in the accumulated post-retirement benefit obligation for the subsidy related to benefits attributed to past During August 1998, the Institute arranged a $17,000,000 loan with the New Jersey Educational Facilities Authority through service as of June 30, 2005 was $1,221,269. As the impact of the subsidy was reflected at June 30, 2005, there was no impact the Authority’s issuance of Stevens Institute of Technology Revenue Bonds, 1998 Revenue I. The 1998 Revenue I Bonds are a on the measurement of the net periodic post-retirement benefit cost for fiscal year 2005. special obligation of the Authority payable from and secured by a pledge of revenue obtained by the Authority pursuant to the mortgage loan agreement between the Authority and the Institute. Principal and interest payments on the long term The Medicare Prescription Drug Improvement and Modernization Act of 2003 (the Act) was signed into law in December of debt are made by the Institute on a semi-annual basis to the trustee. The bonds are due serially through 2028 with interest 2003. The Act provides certain prescription drug benefits under a new Medicare Part D program for retirees. The Act also ranging from 4.25% to 5.38%. provides for a subsidy to employers who sponsor prescription drug plans that are actuarially equivalent to the new Part D benefit. In January of 2004, the Financial Accounting Standards Board issued a Staff Position permitting companies to defer The mortgage loan agreement is secured by (i) a mortgage on the land on which the athletic and recreation center was built; accounting for the effects of the Act. The Institute has elected this deferral for fiscal 2004. Management has also not yet (ii) any building improvements to be made to the land; and (iii) the Technology Hall and the land upon which it was con- been able to determine the effect of the Act or if the plan may meet actuarial equivalence for fiscal 2004, due to the recent structed. plan changes which significantly reduced benefits. As such, the Institute’s post-retirement benefit obligation and net peri- odic post-retirement benefit cost do not reflect the effects of the Act for fiscal 2004. Guidance on the accounting for the (b) Higher Education Capital Improvement Fund Series 2000A federal subsidy under the Act was issued in January of 2005 and the Institute may modify previously reported information The Institute entered into a loan agreement with the Authority on July 31, 2000 for capital improvements and related costs. The to reflect the subsidies and other changes resulting from the Act. loan agreement was financed through the issuance of bonds by the Authority, the Institute’s portion of which amounted to $143,138. In accordance with the loan agreement, the Institute is required to provide one-half (50%) of the annual debt serv- On November 21, 2003, the Institute announced the January 1, 2004 amendment of its post-retirement medical plan, dis- ice and related costs. The State of New Jersey is obligated to provide one-half (50%) of the annual debt service and related continuing coverage with Oxford medical plan and enrolling all retirees in an Aetna comprehensive plan. Under the Aetna costs. The bonds mature on August 15, 2020 and bear an interest rate ranging from 5.00% to 5.75%. plan, expenses are reimbursed at 80% after a $500 single/$1,000 family deductible. Aetna coordinates with Medicare through exclusion. In addition, minimum employee contributions of $40 per month/single, $80 per month/family were (c) Higher Education Capital Improvement Fund Series 2000B established for retirees who previously had not made any contributions. On May 17, 2004, the Institute sent a notice to the The Institute entered into a loan agreement with the Authority on July 31, 2000 for capital improvements and related costs. participants stating that all future premium increases would be passed on to the retirees. These changes to the post-retire- The loan agreement was financed through the issuance of bonds by the Authority, the Institute’s portion of which amount- ment medical plan were recognized as of November 21, 2003. The change in the accumulated post-retirement benefit obli- ed to $1,468,088. In accordance with the loan agreement, the Institute is required to provide one-half (50%) of the annu- al debt service and related costs. The State of New Jersey is obligated to provide half (50%) of the annual debt service andSTEVENS INSTITUTE OF TECHNOLOGY gation due to this plan amendment is called a prior service cost, and is amortized over the average future service eligibility of active participants not yet fully eligible. This unrecognized prior service cost was calculated to be $10,057,960 and is related costs. The bonds mature on September 1, 2020 and bear an interest rate ranging from 2.34% to 5.75%. ANNUAL REPORT • 2004-2005 reflected in the accrued post-retirement benefit obligation in the consolidated statement of financial position at June 30, 2004. The amortization of the prior service cost was $690,371 and was a component of the net post-retirement benefit cost (d) Dormitory Safety Trust Fund Series 2001 A and B for the fiscal year ended June 30, 2004. The Institute entered into a loan agreement with the Authority on May 3, 2001 for improvements of dormitory safety facili- ties, including fire prevention and sprinkler systems. The loan agreement was financed through the issuance of bonds by the Authority. The Institute’s portion amounted to $1,200,000. In accordance with the loan agreement, the Institute is required66 67
  • CONSOLIDATED FINANCIAL STATEMENTS to provide for the principal payments of the annual debt service in fifteen annual installments. On July 1, 2003 the Institute Principal and interest payments for long term debt for each of the next five years and thereafter are as follows: received an additional $1,000,000 from the Authority financed through the issuance of Dormitory Safety Trust Fund 2001 A Bonds. In accordance with the loan agreement, the Institute is required to provide for the principal payments of the annu- Principal Interest Total al debt service in 14 annual installments. The State of New Jersey is obligated to provide the interest payments of the annu- Fiscal year ending June 30, al debt service. At June 30, 2005 and 2004, the Institute’s liability, present valued, amounted to $1,287,741 and $1,361,000, 2006 $ 2,232,990 $ 4,138,680 $ 6,371,670 respectively. The bonds mature on January 15, 2016. 2007 2,316,736 4,050,662 6,367,398 2008 2,422,982 3,949,972 6,372,954 (e) Equipment Leasing Fund Series 2001 A 2009 2,126,950 3,847,989 5,974,939 The Institute, along with other institutions, entered into a capital lease agreement with the Authority, dated September 1, 2001, 2010 2,228,422 3,752,298 5,980,720 for equipment purchases required for laboratory and instructional facilities. The agreement was financed through the issuance Thereafter 71,555,046 47,649,863 119,204,909 of Authority bonds, the Institute’s portion of which amounted to $191,412. The bonds were issued on September 1, 2001 and bear $ 82,883,126 $ 67,389,464 $ 150,272,590 interest at the rate ranging from 3.5% to 5.00% per annum and mature on August 1, 2009. In accordance with the agreement, the Institute is required to make annual lease payments equal to 25% of the annual debt service and related costs. The State Lines of Credit of New Jersey is obligated to pay the remaining 75% of the annual debt service and related costs. As of June 30, 2005 and 2004, The Institute has a $9,000,000 line of credit with PNC Bank (“PNC”) which bears interest at a rate per annum equal to LIBOR the Institute had a capital lease obligation, net of unamortized interest, of $128,118 and $150,102, respectively. plus one hundred (100) basis points (1.00%), which was 4.34% at June 30, 2005. On June 23, 2005 the term of this line was extended to June 30, 2006. During the year, the balance fluctuated within the allowable amount of the line of credit. At (f) Revenue Bonds, 2002 Series C June 30, 2005, the outstanding balance was $7,820,171 ($4,620,890 at June 30, 2004). During December 2002 the Institute arranged a $59,585,000 mortgage loan with the Authority through the Authority’s issuance of Stevens Institute of Technology Revenue Bonds, 2002 Series C. The Institute on a semi-annual basis makes prin- On June 20, 2003 the Institute borrowed $4,000,000 from PNC as evidenced by two Committed Non-Revolving Line of Credit cipal and interest payments on the long-term debt to the trustee. The bonds are due serially through 2032 with interest Notes in favor of the bank which bear interest at a rate per annum equal to LIBOR plus one hundred twenty-five (125) basis ranging from 3.00% to 5.25%. points (1.25%), which was 4.59% at June 30, 2005. The original expiration date was June 20, 2005, but was extended to July 31, 2006 with outstanding principal and accrued interest due at that time. At June 30, 2005 and 2004, the $4,000,000 outstand- The mortgage loan agreement is secured by (i) a first and second mortgage of the land on which the athletic and recreation ing balance was included as a component of lines of credit in the accompanying consolidated statement of financial position. center was built; (ii) any building improvements to be made to the land; (iii) the Technology Hall and the land upon which it has been constructed. The Institute pledges rentals, tuition fees and other available money sufficient to cover the cost of The terms of these agreements require the lines to be collateralized by a first priority perfected lien on cash and/or mar- operating and maintaining the projects financed under the mortgage loan agreement. ketable securities in an amount not less than $13,000,000. Under the 2002 Series C Bonds, the mortgage loan agreement requires the Institute to establish and maintain all original Interest Expense funds as deposit with a trustee in a debt service reserve account and construction and other escrow accounts similar to a Total interest paid on long-term debt and lines of credit for the years ended June 30, 2005 and 2004 was $4,915,679 and construction loan whereby the Trustee, as evidenced by Institute payments, releases funds during construction. Such $4,001,698, respectively. Capitalized interest for fiscal years 2005 and 2004 was $3,408,650 and $2,894,150, respectively. deposits amounted to $13,775,710 and $31,831,717 as of June 30, 2005 and 2004, respectively. Net interest expense included in the consolidated statement of activities for the fiscal years 2005 and 2004 totaled $1,507,029 and $1,107,548, respectively. (g) Dormitory Safety Trust Fund, Series 2003 A On January 15, 2004, the Institute entered into a loan agreement with the Authority for improvements of dormitory safety facil- Note 10 - Net Assets ities, including fire prevention and sprinkler systems. The loan agreement was financed through the issuance of bonds by the Authority. The Institute’s portion of the funds amounted to $243,500. In accordance with the loan agreement, the Institute is At June 30, 2005 and 2004, net assets were comprised as follows: required to provide principal payments of the annual debt service in fifteen annual installments. The State of New Jersey is obligated to provide the interest payments of the annual debt service. As of June 30, 2005 and 2004, the Institute’s liability, 2005 2004 present valued, amounted to $175,551 and $184,788, respectively. The loan matures on January 15, 2018. Unrestricted Operating $ (3,836,853) $ (6,394,679) (h) Equipment Leasing Fund, Series 2003 A Board designated: On September 1, 2003, the Institute entered into a loan agreement with the Authority for equipment purchases required for Quasi-endowments 37,999,013 33,862,544 laboratory and instructional facilities. The loan agreement was financed through the issuance of bonds by the Authority. Institutional portion of Perkins loans 2,144,872 2,030,386 The Institute’s portion of the funds amounted to $16,517. In accordance with the loan agreement, the Institute is required Net investment in plant 40,451,245 41,269,706 to provide twenty-five (25%) percent of the annual debt service and related costs. The State of New Jersey is obligated to Total unrestricted 76,758,277 70,767,957 provide seventy-five percent (75%) of the annual debt service and related costs. The interest ranges from 3.50% to 5.00%. Temporarily restricted The loan matures on August 1, 2011. Education and research programs 763,551 4,605,260 Capital projects 9,580,568 12,451,534 (i) River Street Dorm Revenue Bonds, Series 2004 B Annuity and life income funds 2,311,035 2,137,473 On July 1, 2004, the Institute arranged a $13,265,000 mortgage loan with the New Jersey Higher Education Financing Term endowment and funds held in trust 2,560,393 420,444 Authority through the Authority’s issuance of Stevens Institute of Technology Revenue Bonds, 2004 Series B. In accordance Total temporarily restricted 15,215,547 19,614,711 with the loan agreement the Institute is required to provide for principal and interest payments on a semiannual basis to Permanently restricted the Trustee, Wachovia Bank, N.A. The bonds are due serially through 2034, with interest ranging from 4.500% to 5.375%. Endowment 89,181,801 84,990,392STEVENS INSTITUTE OF TECHNOLOGY Student loans 5,160,835 4,738,022 Under the 2004 Series B Bonds the mortgage loan agreement requires the Institute to establish and maintain all original ANNUAL REPORT • 2004-2005 Annuity and life income funds 1,210,357 1,287,680 funds as deposit with a trustee in a debt service reserve account and construction and other escrow accounts similar to a Total permanently restricted 95,552,993 91,016,094 construction loan whereby the Trustee, as evidenced by Institute payments, releases funds during construction. Such Total net assets $ 187,526,817 $ 181,398,762 deposits amounted to $11,767,303 as of June 30, 2005. Unrestricted contributions revenue - operating of $5,482,652 includes a donor gift in the amount of $2,133,347, the result- ing net assets of which have been designated by approval of the Board of Trustees as a quasi-endowment.68 69
  • CONSOLIDATED FINANCIAL STATEMENTS Note 11- Allocation of Depreciation and Operations & Maintenance Expense, by Program Note 13 - Commitments and Contingent Liabilities Operating expenses are reported based on the Institute’s primary program activities. The consolidated statement of activ- The Institute receives funding or reimbursement from Federal Government agencies for sponsored research under ities presents operating expenses before certain allocations such as depreciation, interest and operations and maintenance Government grants and contracts. These grants and contracts provide for reimbursement of indirect costs based on rates of plant. Interest expense totaling $848,511 and $1,107,548 in 2005 and 2004, respectively, has been allocated to the negotiated with the Office of Naval Research (ONR), which is Stevens’ cognizant Federal agency. The Institute’s indirect respective functional categories based upon the purpose of the debt issuance. For the years ended June 30, 2005 and 2004, cost reimbursements have been based on fixed rates with carry forward of under or over recoveries. depreciation and operations and maintenance of plant were allocated as follows: The Defense Contract Audit Agency (DCAA) is responsible for auditing both direct and indirect charges to grants and con- 2005 Operating Expenses Allocation of Total Operating tracts in support of ONR’s negotiating responsibility. The Institute has final audited rates through Fiscal 2000. It is the before Certain Allocations Allocation of Operations Expenses plus opinion of management that disallowances, if any, resulting from open years will not have a material effect on the accom- and Depreciation Depreciation and Maintenance Depreciation panying consolidated financial statements. Program Instruction $ 39,584,084 $ 1,377,137 $ 2,161,481 $ 43,122,702 The Institute has committed to invest in various partnerships for a period of years pursuant to the provisions of the individ- Research 28,269,936 569,171 893,340 29,732,447 ual partnership agreements. As of June 30, 2005, the aggregate amount of such unfunded commitments totaled $2,657,895. Academic support 6,957,023 97,581 153,157 7,207,761 Library 1,383,084 238,262 373,963 1,995,309 The Institute is contingently liable in the event of default for certain student loans as the guarantor of student debt due to Student services 11,744,599 292,485 459,069 12,496,153 a third party. Such loans totaled approximately $59,000 as of June 30, 2005. Public services 1,123,481 73,841 115,897 1,313,219 General institutional As of June 30, 2005, the Institute was contingently liable as a guarantor of a related party’s (PlasmaSol Corporation) bank line support 12,806,031 291,828 458,040 13,555,899 of credit in the amount of $250,000. This liability has been released as of December 31, 2005 (see Note 15, subsequent events) Development 1,541,947 47,419 74,426 1,663,792 Public relations 806,084 - - 806,084 The Institute is a party to various legal actions arising in the ordinary course of operations. While it is not possible to pre- Auxiliary enterprises 10,294,100 1,788,706 2,089,940 14,172,746 dict the outcome of these actions at this time, it is the opinion of management that the resolution of these matters will not Total $114,510,369 $ 4,776,430 $ 6,779,313 $ 126,066,112 have a material effect on the Institute’s consolidated financial position, changes in net assets, or cash flows. 2004 Operating Expenses Allocation of Total Operating Note 14 - Related Party Transactions before Certain Allocations Allocation of Operations Expenses plus and Depreciation Depreciation and Maintenance Depreciation Program Members of the Institute’s Board of Trustees and senior management may, from time to time, be associated, either direct- Instruction $ 35,298,593 $ 1,345,831 $ 2,127,482 $ 38,771,906 ly or through interlocking board memberships, with companies doing business with the Institute. Under the Institute’s con- Research 27,922,311 556,232 879,288 29,357,831 flict of interest policy, all business and financial relationships between the Institute and entities affiliated with trustees Academic support 5,812,790 95,362 150,748 6,058,900 and officers are subject to review and approval of the Audit Committee of the Board of Trustees. Library 1,527,499 232,845 368,081 2,128,425 Student services 10,102,091 285,836 451,848 10,839,775 Transactions entered into during the normal course of business with certain vendors classified as related parties amount- Public services 1,534,422 72,162 114,074 1,720,658 ed to approximately $574,400 during Fiscal 2005. At June 30, 2005, amounts due to these vendors, included in accounts General institutional payable and accrued expenses on the accompanying consolidated statement of financial position totaled approximately support 13,835,944 285,197 450,835 14,571,976 $195,000. Development 1,960,137 46,341 73,255 2,079,733 Public relations 1,296,905 - - 1,296,905 From time to time, the Institute is the recipient of gift annuities from donors who are members of the Board of Trustees. Auxiliary enterprises 8,917,031 1,842,467 2,057,067 12,816,565 These gift annuities are reported as contributions revenue with the related annuity payable reported in the accompanying Total $108,207,723 $ 4,762,273 $ 6,672,678 $119,642,674 consolidated statement of financial position. The allocation of depreciation on buildings and building improvements is based on square footage occupancy. Depreciation The consolidated statement of financial position at June 30, 2005, includes a related party receivable of approximately $1.1 on equipment is allocated to the programs for which the equipment was purchased. million for mortgages due from the President. The mortgages are fully collateralized by real estate owned by the President, bear interest at 2% and are payable in monthly installments. The Institute maintains an unfunded Supplemental Executive Retirement Plan (SERP) for the benefit of the President. The Note 12 - Net Assets Released from Restrictions plan provides for the payment of a pension benefit, for life and ten year certain, upon the retirement of the President. As of June 30, 2005, the accrued cumulative benefit payable under this plan was $601,000. During the years ended June 30, 2005 and 2004, net assets were released from restrictions by incurring expenses satisfying purpose or time restrictions as follows:STEVENS INSTITUTE OF TECHNOLOGY 2005 2004 Instruction $ 638,589 $ 787,708 ANNUAL REPORT • 2004-2005 Research 164,006 612,814 Academic support 36,671 33,998 Student services 165,269 983,585 Library 2,000 67,132 Public services 68,330 321,041 Operations and maintenance 3,595,966 163,925 Student aid 1,229,578 951,156 $ 5,900,409 $ 3,921,35970 71
  • CONSOLIDATED FINANCIAL STATEMENTS Note 15 - Fair Value of Financial Instruments Financial instruments include cash, receivables, investments, trusts held by others, accounts payable, lines of credit and long-term debt. The carrying amount of all of the Institute’s financial instruments, except with respect to the Institute’s investments in lim- ited partnerships and similar interests, and loans receivable from students under government loan programs, approximate fair value. Loans receivable under federally guaranteed student loan programs are subject to significant restrictions. Accordingly, it is not practicable to determine such fair amounts. Note 16 - Subsequent Events On December 16, 2005, the Institute entered into a lease agreement with Celtic Leasing. This five year agreement allows the institute to lease office furniture having a total cost of $954,715. This agreement also provides end of term options includ- ing a purchase option for 35% of the original equipment cost, renewal of the lease for an additional two years, or refinance of the 35% purchase option for up to five years, based upon the prevailing lease conditions. Quarterly rental payments under this agreement will be $41,343. On December 31, 2005, a separate corporation, PlasmaSol Corp., was sold to Stryker, an unrelated third party. PlasmaSol had entered into an agreement with the Institute to license certain technologies patented by the Institute for a consider- ation of royalties and stock held by the Institute through its subsidiary Technology Holdings, LLC. As a result of this sale, the Institute received proceeds of approximately $4.5 million before administrative expenses and distributions to partners and inventors in accordance with Institute policy. Additionally, the Institute’s contingent liability as a guarantor of PlasmaSol’s bank line of credit totaling $250,000 was released.STEVENS INSTITUTE OF TECHNOLOGY ANNUAL REPORT • 2004-200572 73
  • STEVENS INSTITUTE OF TECHNOLOGY Castle Point on Hudson • Hoboken, NJ 07030 BOARD OF TRUSTEES Stevens Institute of Technology is incorporated and chartered in the name of “The Trustees of the Stevens Institute of Technology.” Officers of the CorporationLawrence T. Babbio, Jr. ChairmanKenneth W. DeBaun Vice ChairmanSteven Shulman Vice ChairmanHarold J. Raveché PresidentStefano Falconi (Vice President of Finance) TreasurerMark Samolewicz (Vice President of Human Resources) SecretaryDiana Colombo (Executive Assistant to the President) Assistant SecretaryMichael D’Onofrio (Controller) Assistant TreasurerFrederick L. Bissinger Chairman Emeritus Other Principal Officers of the InstituteHenry P. Dobbelaar, Jr. Vice President for Facilities, Support Services and Community RelationsMarjorie H. Everitt Acting Vice President for Development and External AffairsGeorge P. Korfiatis Dean of the Charles V. Schaefer, Jr. School of EngineeringErich Kunhardt Dean of the Arthur E. Imperatore School of Science and ArtsLex McCusker Acting Dean of the Wesley J. Howe School of Technology ManagementMaureen P. Weatherall Vice President for University Enrollment and Academic ServicesHelena S. Wisniewski Vice President for University Research and Enterprise Development VOTING MEMBERS OF THE BOARD OF TRUSTEESEdward G. Amoroso ‘86, M.S., ‘92 Ph.D., Vice President, Network Security, AT&T Ronald P. LeBright ‘55, M.E., Retired Senior Vice President/Chief ExecutiveLawrence T. Babbio, Jr. ‘66, B.E., M.B.A., ‘01, HonDEng, Vice Chairman & Officer Europe, ABB Lummus Crest, Inc.President, Verizon Communications John J. LoPorto ‘46, M.E., ‘54, M.S., ‘58, M.S., ‘97, HonDEng., President, LoPortoEnrique L. Blanco ‘72, B.E., ‘76, M.M.S., Alumni Trustee, Associate Director of Associates, Inc.Technology, Colgate-Palmolive, Co. Dawn M. Madak ‘89, B.E., Alumni Trustee, Private InvestorStephen T. Boswell ‘89, B.A., M.A., ‘91, Ph.D., P.E., President & CEO, Boswell Harold J. Raveché, B.A., Ph.D., D.H.L., President, Stevens Institute of TechnologyEngineering Richard R. Roscitt ‘73, B.E., M.B.A., Former President & CEO, MCIThomas A. Corcoran ‘67, B.E., ‘03, HonDEng, President & CEO, Gemini Air Cargo John A. Schepisi, Esq., ‘65, B.E., J.D.,Philip P. Crowley ‘71, B.S., J.D., Assistant General Counsel & Assistant Secretary, Ralph W. Selitto, Jr., ‘71, B.E., J.D., Partner, McCarter and English, LLPJohnson & Johnson Corp. Steven Shulman ‘62, M.E, ‘63, M.S., ‘02, HonDEng., Principal, The Hampton GroupKenneth W. DeBaun ‘49, M.E., ‘95, HonDEng, President & CEO, The DeBaun World, Richard F. Spanier ‘61, B.S., ‘62, M.S., ‘68, Ph.D., Director and ChairmanInc. Emeritus, Rudolph Research Analytical CorporationDavid J. Farber ‘56, M.E., ‘61, M.S., ‘99, HonDEng, Distinguished Career Professor Victoria Velasco ‘04, B.E., Alumni Trustee, Fair Lawn, NJ High School,of Computer Science & Public Policy, Carnegie Mellon University School of Science Mathematics TeacherAngie M. Hankins, ‘95, B.E., J.D., Attorney, Stroock and Stroock and Lavan James M. Walsh ‘69, B.S., ‘71, M.S., M.B.A., Managing Principal, Walsh Advisors,Barrett Hazeltine, B.S., M.S., Ph.D., Professor of Engineering, Brown University LLC Compiled by the Office of Development and External AffairsKatherine C. Hegmann, B.S., M.S., ‘02, HonDEng., General Manager, Global Cardinal Warde ‘69, B.S., M.Phil., Ph.D., Professor of Electrical Engineering,Business Transformation Outsourcing, IBM Corporation Massachusetts Institute of Technology Marjorie H. Everitt, Acting Vice PresidentHenry F. Henderson, Jr., ‘90 HonDEng., Managing Director, Thoreb North America Jerald M. Wigdortz ‘69, B.S., M.S., M.B.A., Imbot Patrick A. Berzinski, Director, University CommunicationsLLC Harold P. Wilmerding, B.A., Retired Senior Vice President, United States TrustEdwin J. Hess ‘55, M.E., M.B.A., Retired Senior Vice President, Exxon Corporation Company of New York Copies of this report are available on CD-ROM by request – 201-216-5116Frank Ianna ‘71, B.S., M.S., Former President, Network Services, AT&T ©2005-2006 Stevens Institute of TechnologyJuan P. Jaime ‘05, B.E., Alumni Trustee, Information Management Leadership EMERITUS TRUSTEEProgram, Johnson and Johnson (non-voting) Writers: Stephenie Overman, Alan S. BrownGeorge W. Johnston ‘72 B.E., J.D., Vice President & Chief Patent Counsel, Frederick L. Bissinger ‘33, M.E., ‘36, M.S., J.D., ‘73, HonDEng., Retired President, Photographer: Jim CumminsHoffman-LaRoche Allied Chemical Corp. Design: Susan Pogany/graphics, etc.