Dr. Stephen Smiley (Source: Trudeau Institute)

Last week, NCPR and the Adirondack Daily Enterprise reported on the internal debate over the future of Trudeau Institute, the  immunology laboratory in Saranac Lake.

Among the comments to the In Box was the following essay, written by Dr. Stephen Smiley, who joined Trudeau's faculty in 2000 and has served as the Institute's director of corporate relations.

I'm reposting Dr. Smiley's perspectives, because I think they warrant wider attention.

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

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

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

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

What is needed is a plan to pay off our debt and rebuild the endowment – quickly. Then, the scientists can return to their work, return to bringing in grant funds to cover most expenses, and know that the $2M revenue from the endowment is there to cover the shortfall. I believe the "translational problem" can be addressed by partnering with nearby institutes with clinical facilities (e.g. Univ of Vermont, SUNY Upstate) who value our stellar reputation and scientific strength in basic infectious disease research. In fact, Trudeau will announce new grant awards over the next few weeks that demonstrate our ability to perform translational studies by partnering with others. However, I think it highly unlikely that partnering will suffice to overcome our revenue shortfall – most businesses are struggling in the current economy and I don't think any partner will commit to providing Trudeau with the extra $2M per year in operating funds that we need.

So I urge the community to help us rebuild the endowment. I am a scientist. I don't know how to raise an endowment. Our Board doesn't seem to know how to either. If there are people in the community who care and truly have the capacity to help, then I urge you to get involved now. How? I'm not sure. We may need a grass roots effort to figure out how. Or maybe there are a few key "champions" in our community who can come to the rescue philanthropically, or take the lead on a vigorous fundraising campaign.

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

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

But I think Trudeau's future is currently dependent on the good will of this community. Trudeau needs substantial philanthropic assistance now. It needs to rebuild its endowment very quickly. I hope my contribution to this blog will help to turn the conversation away from a rehash of who is to blame for what. Certainly with hindsight we can identify past mistakes by well intentioned individuals, including myself. But what we need now is a discussion of how a community that cares about Trudeau Institute can help to ensure it survival for another 127 years.

The last couple of weeks, I've been poring over internal documents leaked by former employees at Trudeau Institute, including more memos and studies provided this week to NCPR and the Adirondack Daily Enterprise.

They provide new detail and clarity on the turmoil and lingering uncertainty at the biomedical research laboratory, which employs about 100 people in Saranac Lake.

It appears that for the last half decade, the lab's leadership has been painfully divided, with some board members and staff secretly pursuing a plan to relocate some or all of the institute without buy-in from other board members.

When the relocation plan was vetoed by the full board in January 2011, the organization entered into a period of unprecedented disruption, losing key administrators and faculty.

Trudeau's national reputation has clearly suffered.  Eighteen months after the decision was made to stay, the institute still lacks a permanent director, and the community has no clear understanding of what the new plan is for moving forward.

Trudeau is a private institution.  But it is also a vital part of the North Country's economy, culture and history, and it relies for the lion's share of its funding on taxpayer dollars.

Saranac Lake has staked a significant part of its future on emerging as a biomedical research cluster, with Trudeau at its heart.  It appears that state and Federal officials are willing to help by investing significant funds in that vision.

So as the public discussion moves forward — and it appears that the timeline for solving some of Trudeau's "structural" problems will need to be fairly swift — here are the questions Trudeau's leadership needs to answer.

1.  In simple terms, what is the plan?  Has the board accepted that Trudeau can no longer serve the mission of conducting fundamental research into the human immune system, as it has done for half a century?  If so, what's next?

2.  Whatever the plan is, how much money do you need?  Trudeau executives hoped to garner roughly $88 million in subsidies, grants and philanthropic donations to relocate to Florida.  What kind of public support is needed to sustain your vision in Saranac Lake?

3.  Is the current board of trustees up to the task of guiding this institution, or does there need to be a substantial change?  A survey conducted of Trudeau staff and faculty in April 2011 revealed a lot of fear, anxiety and distrust.  Is it time for a shake-up at the top?

4.  Is there a way to better engage and communicate with the community?  Trudeau Institute relies on public support for its operations, but the organization often operates invisibly.  The result has been deep distrust between some local leaders and Trudeau executives, and a remarkable level of detachment and apathy among the public.  Do you think that needs to be fixed and if so how?

5.  Exactly what is the situation now?  How much money is left in Trudeau's endowment?  What are the most pressing, short-term needs, financial and otherwise, that will keep Trudeau afloat while bigger questions are answered?  And why has it taken so long to hire a permanent new director?

Trudeau chairman Benjamin Brewster declined to be interviewed on tape for our reporting. And he didn't return phone calls after the most recent Trudeau board meeting last Friday.

But in the absence of a permanent director at the lab, someone needs to step forward soon to speak bluntly about the institute's next steps.

Today, NCPR and the Adirondack Daily Enterprise launch a two-day investigative report on the behind-the-scenes debate over the future of Trudeau Institute, the bio-research and immunology laboratory in Saranac Lake.

We've known since the autumn of 2010 that there was a "strategic planning" effort that included the possibility of moving the facility out of state.  So why we revisit the controversy now?

Sources have been saying off the record to reporters for months that the situation at Trudeau remains fragile, with deep divisions over the future of the institute, which still employs roughly 100 people.

Documents leaked recently by a former staffer gave new insight into the policy differences that sparked those rifts, and the leadership decisions that shaped events behind the scenes.

Memos and other documents indicated that some staff and board members engaged in a concerted effort to keep the effort to move the laboratory to Florida secret for months and even years.

Even after executives traveled to Florida and submitted a formal application for more than $88 million in incentives from officials in Port St. Lucie Florida, it appears that some board members were still kept in the dark.

Those documents also suggest that troubling questions remain about Trudeau's future.  At stake are dozens of high paying jobs an a facility that anchors Saranac Lake's fledgling "biotech cluster."

But Trudeau is also an essential part of the village's culture.  Founder E.L. Trudeau served as Saranac Lake's first mayor in the 1800s.

Tomorrow, Chris Knight takes the story forward, looking at the options being considered for Trudeau as the lab works to recover from months of turmoil, budget cuts and internal divisions.