Washington State Community College is facing a nearly $1.5 million deficit, but only a little more than $200,000 is expected to be made up through a reorganization and reduction in force.
That means the number of people expected to lose their jobs will be a "handful," college President Bradley Ebersole said Wednesday after a meeting of the board of trustees' finance committee.
"Some will be higher-level, higher-income positions; some will be lower," he said.
Ebersole said he expects to share the specific positions with the board of trustees at Monday's regular meeting, but that information would not be released to the public until the affected employees had been notified.
The reorganization is expected to account for $206,000 toward reducing the college's projected $1,467,054.25 deficit, the result of a projected 12 percent drop in enrollment. The decline is attributed to multiple factors - including changes in federal financial aid, improvement in the economy leading people to go to work rather than school and the state-mandated transition from quarters to semesters - that are affecting institutions around the state.
During Wednesday's finance committee meeting, Ebersole told trustees that spending reductions already enacted as enrollment for the fall semester declined saved $550,000. Those steps included freezing 15 percent of discretionary spending on things like travel, not filling vacant positions and holding back 15 percent of the adjunct/overload budget.
By the numbers
- $1,467,054.25 - projected budget deficit.
- $550,000 - amount saved by spending reductions already enacted.
- $280,000 - estimated savings from 10 furlough days for employees.
- $164,000 - savings realized from early retirement program.
- $300,000 - amount recommended to be transferred from college reserves.
- $206,000 - amount to be saved through reorganization/reduction in force.
Source: Washington State Community College CFO Jess Raines.
- 4 p.m. Monday, Room 106, Arts and Sciences Building. Ohio Association of Community Colleges President Ronald Abrams will attend to speak to trustees about the enrollment challenges facing institutions around the state.
An early retirement program approved by the board of trustees last month had four takers, three of whom were eligible for the $10,000 bonus to be paid from previously allocated funds. The savings from that is expected to be $179,000, with the estimated cost to provide some interim coverage at $15,000, meaning a net savings of $164,000.
The trustees also approved a voluntary furlough program, but it appears that will be expanded. Ebersole said a survey, recommended by faculty and staff leaders, asked employees how much furlough time they were willing to accept.
"Generally, the consensus was no more than 5 percent of the annual salary," he said. "That gives us about $280,000."
That equates to 10 furlough days per employee. Ebersole said he was committed to honoring that because the employees showed a willingness to sacrifice to save jobs but can only absorb so much of the loss.
College chief financial officer Jess Raines noted the final savings could vary depending on the reduction in force, because those employees obviously would not participate.
Ebersole said the board of trustees will be asked to approve the transfer of $300,000 from the college's reserves to help address the deficit. The reserves total $3.6 million, but he said the college can't draw from them lightly, since they are not easily replaced.
"The purpose of reserves are to protect the institution, and we have to be very cautious about how we use them," Ebersole said.
Raines told trustees the deficit amount is a projection based on historical data on the change in enrollment from the fall to the spring terms. Over the last six years, the change has averaged a 6.7 percent decline in total head count and, making a much larger impact on finances, a 7.9 percent drop in total credit hours.
However, Raines cautioned that the previous data is based on quarters, which also had a winter quarter between them, so there's no way to firmly project what will actually happen on the semester system.
"We have to look at that as a range," he said.
Raines included other scenarios in the document he gave to trustees, from a 6 percent enrollment decline which would result in a $1.42 million deficit to a 15 percent drop, which would mean a $1.65 million deficit.
"If our spring enrollment is not that strong, then our number could be worse than what it is now," Ebersole said.
Ebersole noted Rea & Associates, a local firm that does the college's audits, had reviewed the numbers and formula Raines was using and deemed them "prudent."
Trustee Holly Dexter asked if it would be possible to determine how much savings could be realized from going to a four-day work week, especially in the months of January through March, when heating costs might be higher. Raines said it would only be a "guesstimate" but there would be some savings.
Trustee Dan Pennock asked if it would be better to close for a single block of days like some plants do rather than have employees take a variety of furlough days. Ebersole said that could be considered.
Dexter praised the work of the administration in attempting to deal with the deficit.
"As difficult as all of this is, at least we're ahead of the game," she said.
A few employees attended the meeting. One of them, microcomputer support technician George Molden said he didn't have much to say about the situation yet, noting he was "waiting to see what happens after the board meeting on Monday."