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Going Above and Beyond

March 26, 2010

Nearly all California community colleges enrolled more students than the state paid for this academic year. Relative to their size, however, some two-year institutions are taking on significantly more of the state's nearly 202,000 unfunded students than others, despite the increased risk of doing so.

Showing a willingness to dip into reserve funds, officials from the institutions that are taking on greater numbers of unfunded students argue it is part of their mission to provide as much access as possible to students. But other college officials think that taking in too many unfunded students could create a financial disaster and hurt the quality of the education they offer.

Of the state’s 72 community college districts, College of the Sequoias, in Southern California’s San Joaquin Valley, took on the third-highest percentage of unfunded students this academic year. More than 26 percent, or 5,127, of its students are unfunded.

Bill Scroggins, College of the Sequoias’ president, said the decision to exceed state financing in setting his institution’s enrollment limit was a matter of responsibility to his relatively rural and economically depressed district. Tulare and King Counties, which the college serves, have 18 percent unemployment, and there is no other public institution of higher education within a 30-mile radius of the community college.

As a result of taking on so many unfunded students, Scroggins said, the college is subsidizing its $52 million operating budget with nearly $2 million from its $10-million reserve fund, which was built up during “the good years.” Though there have been no salary reductions or furloughs for faculty at the college, the average class size has grown from 26 to 31 students in the past year, and, generally, those at the institution are doing more with less.

Still, not everyone is being served. Scroggins noted that there are about 5,000 students on waiting lists for classes at the college. Still, he argued that the college’s attempt to take on more than its financial share of students only magnifies its worth in the eyes of the state government that trimmed its funding.

“There are certainly different strategies out there,” Scroggins said. “There was some intention on the part of my colleagues [at other institutions] to cut enrollments down right to what was funded. The philosophy being, ‘Doggone it, if they’re not going to give us money, we’re not going to put the seats in the classroom. We’re going to send a message to Sacramento.’ I don’t agree with that. It’s our political strategy to prove our worth and to demonstrate that we can educate our population and contribute to the economic recovery. Then, when we come out on the other side, we can say, ‘We saved your bacon, and we’re the ones worthy of investment because we make the biggest difference.’ ”

Officials from Mt. San Jacinto College, in California’s Inland Empire, similarly cited the 15 percent unemployment in their rural district. The college is serving the fourth-most unfunded students, by percentage, in the state. More than one-quarter, or 5,852, of its students are unfunded.

Becky Elam, the college’s vice president of business services, noted that the college has replaced a number of “low-demand, low-enrollment” courses with “high-demand, high-enrollment courses.” It, too, has not furloughed faculty or cut their pay, but she added that the college has made many small budgetary changes, such as eliminating its travel and conference budget.

Like College of the Sequoias, Mt. San Jacinto College also dipped into its reserves to fund some of the increased enrollment. Still, its officials admit that this, even coupled with other cost-saving measures, is not a long-term solution, especially for one of the state’s fastest-growing districts.

“The campus has done a remarkable job,” Elam said. “But we recognize we can’t keep going after reserves. That’s not prudent. If the situation continues we won’t be able to do that again. Our budget will continue to contract, and then you’ll see us taking on a lower percentage of unfunded students. It’ll be years before we see revenue go back up to the level it was before.”

This understanding of the grim financial reality that California community colleges face is the primary reason that many other institutions take on far fewer unfunded students.

For example, only 1.3 percent of students -- that is, 1,191 -- in the San Diego Community College District are unfunded. Still, as one of the largest districts in the state, it faces some different financial challenges.

Richard Dittbenner, the district’s director of public information and government relations, said it has been difficult for the college to turn away around 10,000 students per semester. Still, he praised its financial management in these tough economic times.

“Reserves are one-time monies,” Dittbenner said. “It’s like savings. When you’ve depleted your savings, then that one-time money is gone. This is a rainy day, but it’s not a rainy season. If we did what others are doing, we wouldn’t be displaying fiscal responsibility.”

Dittbenner pointed out that his district had earned the highest bond rating Standard and Poor’s Investment Services awarded to a California community college, AA+, for the second year in a row. The district, he said, is planning for long-term stability.

“The district’s healthy fiscal position relative to other California community college districts is the result of sound management that took the initiative to prepare for cutbacks at an early stage and has maintained a conservative budgeting approach,” the Standard and Poor’s report reads. “As a result, the district has a history of strong balances and operating surpluses.”

Jack Scott, chancellor of California Community Colleges, explained that the divergence of administrative decision-making among the state’s two-year institutions was primarily driven by economics, noting that those who are dipping into their reserves are likely doing so for a good reason. He also took issue with Scroggins's contention that some community college presidents were trying to “send a message” to the state legislature by staying close to their state funding levels for enrollment.

“We’re not trying to send a message,” Scott said. “We’re trying to survive. Whatever the legislature gets out of it, we’re doing the best we can do, educating more students than [they’re] paying us for, and we don’t do it forever.”

Stephen G. Katsinas, professor of higher education and director of the Education Policy Center at the University of Alabama at Tuscaloosa, attributed the fiscal conservatism of some of California’s community college leaders to larger concerns about the future of state funding. In a recent survey by Katsinas’ Education Policy Center, nearly 80 percent of state community college leaders expressed concern about what would happen to their funding in fiscal year 2011-12 and beyond, when federal stimulus money disappears from the picture.

“College presidents in California have come to grips with the notion if they expect to do more with less, less is what they’ll be given,” he said.

 

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