Western Connecticut State President Out After Draining Reserves

Western Connecticut State University president John Clark is stepping down amid a financial crisis that resulted in a depletion of 99 percent of university reserves in recent years.

Clark, who has been president since 2015, will officially exit on July 14. His resignation follows a no-confidence vote regarding financial management issues leveled against him by the faculty union in May. Earlier this year, a scathing external report found that the university “has an expenditure control problem, not a revenue problem.”

The report, commissioned by the Connecticut State Colleges and Universities system, found a litany of financial missteps and no coherent strategy for reaching financial viability. It recommended a number of changes, including taking a hard look at current staffing levels. However, faculty members say the report ignores glaring issues, including years of declining state government funding, which has left institutions of public higher education scrambling to survive.

The Problems

The report conducted by the National Center for Higher Education Management Systems, an education consulting agency, shows a stunning drop in WCSU’s reserves over the past decade. It paints a picture of a university that failed to address financial issues as its reserves dwindled from $24 million in fiscal year 2012 to being “all but wiped out” in FY 2021.

A CSCU system spokesperson did not have a current figure for Western Connecticut’s reserves.

“Western Connecticut State University is an institution in serious financial difficulty. It has a structural deficit that has caused the university to dip into its reserves almost every year for the last decade,” the NCHEMS report states. “This practice of relying on reserves to balance the operating budget over an extended period has led to the current situation in which reserves have been totally depleted. The university now has no choice but to address the underlying factors that have led to this condition—operating within the constraints of a balanced budget is now an imperative.”

The report, delivered in January, notes that of the four state universities in the Connecticut State Colleges and Universities system, only Western Connecticut saw a complete collapse of its reserves. Two other state universities saw a growth in reserves since the end of the Great Recession, while Central Connecticut State University saw its reserves decline by about one-third.

Citing interviews with officials, NCHEMS described the administration’s approach to the financial crisis as “We haven’t had a balanced budget for years; why start now?”

High and rising expenditure levels led to the depletion of WCSU’s reserves, with most of the costs related to personnel, declining enrollment and the coronavirus pandemic, according to NCHEMS, which noted that WCSU’s problems were caused not by underfunding but by overspending.

But faculty members—who note no professors were interviewed by NCHEMS for its report—take exception to some of the findings, especially the claim that WCSU is not underfunded.

“The biggest problem is that the state of Connecticut has cut our budget repeatedly. State funding for public universities has been dropping, and Connecticut is not unique, unfortunately. State disinvestment in public higher education is really the underlying problem,” said Rotua Lumbantobing, an economics professor at Western Connecticut and president of the WCSU chapter of the American Association of University Professors.

Connecticut has indeed dialed down funding in years past, according to data available in the State Higher Education Finance report compiled by the State Higher Education Executive Officers Association. Numbers from SHEEO show that state appropriations have declined by 29.1 percent since 2001, falling from $18,660 per full-time student in 2001 to $13,232 in 2021.

Lumbantobing also disputes findings that suggest that WCSU is spending too much on personnel, arguing that staffing levels are already lean and have been “cut to the bone.”

She blames high personnel costs on administrative bloat at WCSU, which the report disputes.

Lumbantobing also sees system leadership as partly responsible for the current crisis, arguing that it failed to financially rein in proposals from Clark’s administration as the reserves dwindled.

“The school has to submit a budget to the system office, to the Board of Regents. Every single year they approved it, which means they knew the reserves had been going down every single year. This is not just bad decisions by local administrators, but also the system office, the Board of Regents, they’re very much to blame, because they approved that budget every single year,” Lumbantobing said.

Leigh Appleby, spokesperson for the Connecticut State Colleges and Universities system, said by email that system leadership engaged NCHEMS to help understand the financial issues at Western Connecticut and make recommendations that will return the university to financial health.

“The Board of Regents for Higher Education and CSCU have long understood the significant financial pressures facing WCSU and have taken actions meant to stabilize the university’s budget, including the adoption of a pilot program to allow students from New York and New Jersey to attend WCSU at an in-state rate, significantly bolstering enrollment at the university,” Appleby said. “However, the pandemic has exacerbated already significant enrollment and financial challenges. Recognizing the need for further action, NCHEMS was retained to review the situation, recommend immediate actions to stabilize the university, and ultimately provide long-term solutions to the problems that Western is facing. NCHEMS has produced a first report with immediate recommendations, and CSCU is currently working closely with the WCSU leadership team to ensure they are implemented. A second set of recommendations will be provided later this year by NCHEMS intended to strengthen long-term viability for the institution.”

The Solutions

Though a more comprehensive plan from NCHEMS is expected later this year, some recommendations were made in the initial report, including “right-sizing the personnel roster.” Cuts, the plan states, should come from faculty, academic support and student services employees. The report adds that collective bargaining agreements in place across the CSCU system make controlling costs at the campus level difficult and recommends shedding part-time faculty members.

One upside for Western Connecticut is that it is projecting a balanced budget for fiscal year 2023, according to Appleby. Documents from the Board of Regents show that WCSU expects a balanced budget thanks to an $18 million infusion of one-time state funding and another $11 million in salary and benefit savings from a hiring freeze, which involves leaving 73 currently vacant full-time positions open.

With Clark set to depart WCSU next month, the CSCU system has appointed an interim in his place. Paul Beran, currently a consultant and previously the president of Northwestern Oklahoma State University, will step into the presidency on July 15, faced with the challenge of righting the ship financially.

“I look forward to being able to build relationships with all members of the community—most especially the faculty and the administration at the university,” Beran told a local newspaper, The News-Times, last week when his interim appointment was announced. “There are issues to overcome but I believe they are completely doable—and I need the faculty and everyone else’s help.”

Beran did not respond to a request for comment via LinkedIn from Inside Higher Ed.

His appointment, however, is another cause of concern for Lumbantobing, who points out that Beran is an outsider, unfamiliar with the state university system and the needs of the campus.

“They replaced [Clark] with someone who doesn’t know anything about the system here, about Western, doesn’t know our problems, our unique situation, or our students,” Lumbantobing said. “And [CSCU system leadership] did not get the input of faculty and staff whatsoever.”

Clark, who did not respond to a request for an interview sent to the university, has said he’ll work to welcome Beran and enable a smooth transition as he takes over the presidency at WCSU.

In an email to the campus community last week, Clark wrote, “I personally welcome Dr. Paul Beran as my successor and our new interim president. In my view, he comes at the exact right moment in the University’s history, when we need a new leader with the vision, energy and ideas necessary to move the University to financial stability, enrollment growth and student success.”