By Patrick Fitzgerald
City College’s budget of nearly $199 million moves forward towards final approval from the Board of Trustees by Sept. 15. The budget provides a blueprint for operations during the 2014-15 fiscal year.
The tentative budget is predicated on 2012-13 enrollment levels of 33,119 full-time equivalent students, a recent high mark. Since then enrollment has fallen, believed largely due to an ongoing accreditation controversy.
“As we prepare our budget of fiscal year 2014-2015 we face great uncertainty and risk,” said Vice Chancellor of Finance and Administration Ron Gerhard in a budget memo dated Feb. 13.
To mitigate this risk, three budget scenarios were developed, factoring in enrollment decline to plan for an orderly downsizing of operations if funding and/or accreditation issues develop.
The first scenario assumes no access to an outside funding sources and an enrollment decline of 4,000 full time equivalent students resulting in a budgetary shortfall greater than $18 million, approximately nine percent of total revenue. Subsequent operations and personnel reduction, including faculty, would be implemented to balance the budget.
The second scenario projects the same enrollment decline but assumes access to outside funding to make up the $18 million-plus shortfall.
The third scenario optimal, where enrollment equals or exceeds 2012-13 levels and the college resumes normal fiscal operations while working to resolve the outstanding accreditation issues.
Last year, the college was permitted to access stability funding from the state, offsetting an enrollment decline and resultant financial shortfall. It provided additional funds to match operating expenses.
As confirmed by Chancellor Arthur Tyler and according to the Governor’s May California Budget for 2014-15 posted online Aug. 4, access to stability funding will continue for at least another two years.
How heavily City College will rely on outside funding will depend on fall enrollment levels. Admission and Records declined to comment on preliminary Fall 2014 enrollment figures.
The tentative budget builds in a contingency fund of $7.5 million to meet unforeseen expenses as a further buffer. The budget assumes a deficit of $2.8 million.
The planned shortfall will be resolved through efficiencies and focused cost savings measures as opposed to reducing department budgets proportionately.
City College must achieve enrollment levels equal to or greater than 2012-13 levels to regain financial independence.
The College has been working on the accreditation issues, having reportedly resolved 94 percent of the alleged violations. The administration continues making substantial progress toward removing the cloud of uncertainty hovering over the school‘s future.
Chancellor Arthur Tyler explains in his tentative budget letter dated May 19 that this year’s planning cycle as the first under the new Board Policies 8.01 and Administrative Procedures 8.01. These are guiding planning documents.
Two chief criterions are that the budget supports the College’s educational mission and another specifies the final budget to be balanced with revenue equaling expenditures.
Other items of note in the proposed budget are that dollars allocated for faculty positions are projected to decrease across all categories; one category, Faculty Regular Hrs PBL, by over $4 million from 2013-14 level.
Health plan costs are to increase by almost $1.7 million as well as contributions to San Francisco retirement system by $873 thousand. Overall, total figures are projected to remain flat in comparison to last year’s budget.