City College Faces $22.5 Million Budget Deficit and Threat of State Take Over
By Sarah Berjan
The prospect of government takeover looms over City College of San Francisco due to a projected budget shortfall of $22.5 million as it enters the 2021-22 Fiscal Year.
State auditors in early April warned the California Community College Chancellor’s office to act quickly in order to remain independent, deeming the college “not currently stable,” citing its ineffective attempts at reducing its costs necessary to supplement the 35% enrollment decline over the past eight years, which resulted in the college tapping into its reserves.
Furthermore, a total of 93% of City College’s budget is composed of salary and benefit expenses, prompting the college to consider laying off 163 instructors to compensate last spring.
According to a statement released by City College on March 9, this deficit is the result of several factors, including retiree health care liability costs of almost $11 million, a 5% cash reserve need of $9.2 million required by the state, projected employee health and welfare increases which range from $750-$900k, and collective bargaining agreement obligations for step and column increases of $1.8 million.
The college has been deficit spending for at least 10 years, and there are currently no emergency funds left according to the notice.
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“I just want to be very candid, we heard very clearly from our federal leaders, our state leaders, that they want to see that structural change at our college,” Board of Trustees President Shanell Williams said during a May 10 meeting, adding, “They were not really receptive to providing funding.”
More than $25 million in state and federal COVID-19 emergency funding was offered to City College in the past year through initiatives like the Higher Education Emergency Relief Fund (HEERF) and the CARES Act. These funds have so far been used for technology, protective equipment, and other costs associated with the pandemic, including more than $3 million to patch a hole in the budget created by a loss in projected sales tax revenue.
Vice Deputy Chancellor John al-Amin, who has warned in the past about the cost to the college of misusing government aid, reported [date], “COVID-19 has impacted some programs and services in terms of executing all of their deliverables. But in a lot of these cases, we have the ability to rollover funds.”
These constraints, and the nature of the college’s deficit which long predate the pandemic, are part of what lead administrators to suggest, and the Board of Trustees to approve, the distribution of layoff notices on March 3 to 163 faculty members and 34 administrators, despite the ready availability of relief funds.
On May 10, however, the Board of Trustees approved a contract with City College faculty union AFT2121 for the 2021-22 school year that would cut full-time base faculty pay over $30 thousand by 14.4%. It should be noted that AFT2121 states on their website that all other pay is subject to a 4-11% reduction as well.
Trustees expressed their gratitude to instructors for their sacrifice, which is estimated to have saved the college $8.5 million, during the meeting.
Trustee Alan Wong said of the contract, “This is a one year deal and City College will continue to have a structural budget deficit,” adding, “Immediately after approving this tentative agreement we must turn our attention to long term funding.”
The contract will, for one year, help to preserve courses and programs at City College, including many non-credit language courses. This is especially important to preserve language and further communicate with the monolingual cantonese community of San Francisco where, during the pandemic, anti-Asian crimes skyrocketed.
City College administration released on March 9 a statement which read, “We stand in solidarity with our college community that the funding model for community colleges must change. Calling on our labor partners, our elected representatives, and the San Francisco community to work with City College through this financially difficult time. The existence of the College is at stake.”
Over the last year there has been an increase in registration by 13%, Trustee John Rizzo reported during a Board of Trustees meeting on June 24, despite the overall downward trend.
Trustee Aliya Chisti noted during the meeting that the declining enrollment is mirroring the sharp decline in enrollment across community colleges in California and during the pandemic.
Board of Trustees Vice President Tom Temprano said, “We all should agree that additional resources to support our students and provide more services … to help students walk through our various registration … and access various support services.”
Temprano added, “Due to the reality of our fiscal situation, we are not able to offer them. And I also do not think it is at all outrageous in this moment of crisis for the city and county to step up and to provide us additional funding to help support an institution that is the economic and in many ways cultural engine of this city.”
For several years the college has relied on one-time funds to cover expenses. In the last fiscal year, the college withdrew $21 million from its Other Post-Employment Benefits (OPEB) Retiree Trust to fund annual retiree costs for two fiscal years; 2019-20, 2020-21, and is currently facing a year end deficit of $5.5 million according to the March 9 statement. Additionally, the current audit confirmed the college ended the 2019-20 fiscal year with an operating deficit of $1,033,952 and a district cash reserve of negative $461,951.
At the June 24 Trustees meeting John al-Amin said of the prospect of city funding, “This is not the first time that we actually have made that request. In fact, we have [been making] requests to the city … I believe since 2009 the amount has ranged from … 30 million to a high of 55 million.”
The vice president added, “then of course we had the legislation passed, which gave us additional funding authority and support from the state,” noting, “last year, fiscal 19-20 year, we made a request for up to $15 million dollars in credit.”
A likely impact of this is the reduction of classes offered as well as student services. As it stands the college plans to offer 4,500 class selections next year. Details on what specific offerings will be cut or reduced, and to what extent, will not be available until the Board of Trustees ratifies a more detailed budget for the year as details on funding is made available by the state of California.
Classes currently offered in the fall serve students seeking to obtain an Associate Degree, transfer to a 4-year school, become certified and employed across a range of careers, finish a high school diploma, or take noncredit classes, such as English as a Second Language (ESL).
Vice Chancellor Tom Boegel explained at the June 24 meeting that students would be able to identify between online and in-person classes by way of a “big note next to the scheduled classes.”
“Please do stay in touch,” Boegel added to students in attendance, “reach out to your instructor and stay in touch with your instructor. They’ll be able to provide you some specific details about exactly how things are going.”
According to Wynd Kaufman, Engineering Instructor & Faculty Adviser to WISE, the Academic Senate unanimously adopted a resolution expressing an ongoing lack of confidence in the college’s budgeting process which included recommendations to address the ongoing crises, not just with its budget but with enrollment and registration.
Kaufman, who referred to City College as an “amazing, creative, starved survivor with PTSD” at the June 24 meeting added in public comment, “Work with us, don’t ignore faculty recommendations. Respect our voice, I know that you all care about the future of this college and are committed to keeping it a community college.”
“What I’m saying,” Kaufman went on, “is that if you want the chance to rebuild the city college to the robust community college that it needs to be … then listen to your faculty, listen to those who are committed to students, and to the vision of a community college.”