Transcript Community College Finance

US Community Colleges
on a
Collision Course ?
Mission and Money
“No other countries but the United States (and to some
extent Canada) have formed comprehensive community
colleges. The primary reason is that compulsory
continues for a greater number of years for America’s
young people than it does in any other nation, a
phenomenon seeding the desire for more schooling.
The second reason is that Americans seem more
determined to allow individual options to remain open for
as long as each person’s motivations and the
community’s budget allow. Placing prebaccalaureate,
vocational, and developmental education within the
same institution enables students to move from one to
the other more readily than if they had to change
schools.
Cohen & Brawer, 2008, pg 27
Diversity Major Characteristic
“Every state offers
two-year colleges
as the first rung on
the ladder of higher
education. But
states differ greatly
in the use they
make of them.”
…for example…
market share of state’s
higher education
enrollment varies
greatly by state
California, Washington, &
Wyoming = 46%
Nevada & Indiana = 11%
Shaffer, 2008
Community Colleges: Role & Scope
• Community college responsibilities are
much the same across the nation
– But very different by state
• …differences are real and important
Shaffer, 2008, pg 1
Mission
Broadly Stated
“…the mission of the community college is
to provide access to postsecondary
education programs and services that lead
to stronger and more vital communities.”
Although they may achieve their mission with a different
emphasis --- commitment to five basis principles are
essential the same for all CCs
Vaughan, 2006
Mission &Commitments
Shape Role & Scope
OPEN ACCESS
Serving all segments of society through open-access admissions
policy that offers fair and equal treatment to all students.
COMPREHENSIVENESS
Providing a comprehensive educational program
COMMUNITY BASED
Serving the community as a community-based institution of higher education
TEACHING AND LEARNING
FOSTERING LIFE-LONG LEARNING
Vaughan, 2006
Low Cost Option
• Relatively
inexpensive option
• In 33 states cost is
for students and
half or less than
taxpayers
four-year
schools
• Tuition varies widely
by state but in every • Total cost of
operation is about
state cost less than
rd of public four1/3
four- year
year, graduate
research institution.
Average Published Tuition and Fees in Constant (2008)
Dollars,
1978-79 to 2008-09 (Enrollment-Weighted)
Sources: The College Board, Annual Survey of Colleges;
National Center for Education Statistics (NCES),
Integrated Postsecondary Education Data System.
Trends in Pricing, 2008
Revenue Sources
Another Important Difference
• have always operated in the political
arena
• funding has been marked by shifting
proportions coming from tuition, local
taxes, and state revenues.
• Trend has been toward increased
dependence on tuition
• States typically pick up a larger share than
local tax districts
Cohen & Brawer, 2008
Curricular Functions
• Collegiate
– Academic Transfer
– General Education
• Vocational
– Technical
– Occupational
• Developmental
(Remedial) Education
• Community Service
– Continuing Education
– Work Force
Development
Of late the definition of “community” has been broadened to
include foreign nationals and a global workplace.
Cohen & Brawer, 2008, 5th ed.
Financial
Differences
“In the final analysis, the funding
on the
social,
•package
CCs receive depends
most of
• Other
sources
funding from federal,
– Non credit courses
political,
and
economic
state and local taxes
– Continuing education
conditions
– Workas
forcethe
and
• Far BIGGEST
sourceas well
contract training
• From state
and localhistory of the
funding
– Community service
taxes Tuition
activities
community
college
in
a
given
• Tuition and fees (from
– Foundations are
varying
statedegree)
or even a geographical
beginning to play a
important source
new revenue role new
region.”
Vaughan 2008, pg 22
Resource Dependency Theory
“…the key to organizational survival is the
ability to acquire and maintain resources.”
worth discussion & consideration?
does it apply?
Access Mission
• Proposed SUNY, CUNY budget cuts
hurt economic development (NYSUT Media Relations January 15, 2009)
• "The core mission of our higher education institutions is in jeopardy,
and it's fair to ask how long it would take for them to fully recover,"
Lubin said. "Reducing access to college for New York students not
only hurts our future competitiveness and forces New York
businesses to look out of state or to other countries for highly skilled
workers, it also cripples places like Oswego, Geneseo, New Paltz
and Cortland, which rely on students on campus to fuel their local
economies."
Access Mission Collision
• California Community Colleges May
Reduce Enrollment by 250,000 Student
(Chronicle of Higher Education, May 21,2009)
• “If the budget cuts are enacted, the 110-campus system
will be forced to reduce its enrollment by a minimum of
250,000 students because it will have to eliminate
courses and fire thousands of faculty and staff members,
community-college officials said. The California
community-college system is the nation's largest,
enrolling about 2.7 million full- and part-time students
each year.”
Source: Hudson, 2008, Dissertation, A Policy Analysis of Community College Funding in Texas
Revenue Sources
Public Community Colleges
Source: AACC Fast Facts 2009
Hudson
Schoolcraft
College
One Example
Tuition ……………..… 38%
Property Tax ………… 41%
State Appropriation .... 18%
Other …………............. 3%
Wayne County Community College District
From Financial Plan 2008
“The struggling economy of Michigan and Wayne
County is negatively impacting WCCCD’s revenue from
local property taxes and state aid. Pending a more
detailed report form the Wayne County Treasurer’s
Office, WCCCD is expecting reduction in property tax
revenues …”
…70% default rate on payment of taxes
…collapse of real estate values
…cut back of state funds
Wayne County Community College District (WCCCD) Prepares
for Tough Financial Outlook
Wed May 13, 2009 12:02pm EDT
DETROIT HEADLINE
Financial Viability and Stability
• WCCCD Chancellor Dr. Curtis L. Ivery said the
College is taking immediate actions to respond
to significant reductions in property tax and state
aid revenues.
• "WCCCD is at one of the most pivotal junctures
in its history. The personnel and financial
decisions we make now will shape the college's
development…financial viability and stability in
the years ahead.”
Traditional but ….
•
•
•
•
•
•
Tuition increase
Cutting low-demand
instructional programs and
courses.
Instituting a hiring freeze on
vacant staff positions and
reducing the number of overall
jobs.
Increasing class sizes.
Offering early retirement to longstanding WCCCD employees.
Reducing energy costs through
environmental sustainability
efforts.
•
•
•
•
•
Increasing use of technology as a
teaching tool, such as through
distance learning.
Cutting non-essential student
activities.
Reducing staff travel.
Delaying equipment upgrades.
Consolidating and restructuring
internal processes to create
additional efficiencies.
Mission Collision?
•
•
•
•
•
•
•
…strategic decision to reduce institutional growth
…program enrollment caps
…not deny access to any eligible student
…admit all eligible students until classes are full
…offer only cost effective courses
…target ALL enrollment increases (health sciences)
…review remedial education (developmental at
what level?)
Mission Collision
One CC president commented last month:
“The money is just not there! We are getting out
of the high school & junior high business…we
need to think seriously about who can make it. In
case you haven’t heard, the comprehensive
community college is dead!”
Michigan
One Solution
• Community College enter into contract
with a company…
• CC with either self-fund or issue bonds to
cover cost of training needed (facilities,
faculty, etc.)…
• CC repaid through diversion of employee
withholding taxes generated by wages
earned by new employees…
New Jobs Training Program
Other Options Under
Consideration by Michigan
• CC Retirement System Reform
• Debt Restructuring
• Baccalaureate in Applied and Technical
Areas
• Job Training - diversion of employee
withholding taxes to CC
Collision Alert
• The American Recovery and Reinvestment Act
of 2009 – one time dollars – not a long term
solution!
• The collision between constrained public funding
and the open access mission of the community
college is becoming well documented.
• Funding gap varies from state to state --however it is a crisis!
• Crisis has led to a challenge to the fundamental
mission of U.S. community colleges.
Adapted from the February 2009 ARRA Policy Statement
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