The emergency budget reserves for the state’s dozen community colleges are nearly empty as college leaders and the governor try to fix the schools' routine structural deficits for the long term.
Matt Fleury, the chairman of the Board of Regents’ Finance Committee, said during a meeting Thursday that this is the “first time in forever” the reserves have dipped below $10 million.
“This is not a sustainable outlook,” he said of the remaining $9.7 million balance. College officials said they were forced to turn to the reserves in recent weeks in order to close this year's budget shortfall.
“That is particularly troubling and concerning. This is a low point,” the system’s budget chief, Erika H. Steiner, told the committee. “We are in trouble for [next year] and need some support.”
The community colleges’ $16.8 million anticipated deficit for fiscal 2015 – a nearly 4 percent shortfall in scheduled spending – follows years of the system's tapping the reserves to close deficits at the schools. Those deficits have been the result of declines in revenue after drops in enrollment, cuts in state support, mandatory 5 percent pay raises for unionized staff and a switch by hundreds of faculty members to a retirement plan that costs the colleges more to fund.
“No wonder the reserves have gone down,” Lester Primus, dean of administration for Capital Community College in Hartford, told the board.
The community colleges over the last three years have used $29.5 million of its reserves to cover its yawning deficits. (See school-by-school breakdown here.)
“We have been just using the reserves constantly. And now we’re basically down to almost nothing,” Regent Gary Holloway, a member of the finance panel, said during a meeting Thursday.
And with looming deficits, college officials have teamed up with Democratic Gov. Dannel P. Malloy to ask the legislature to fund a plan that bails them out next year while also setting in motion a strategy aimed at boosting enrollment to increase tuition revenue.
“It’s a new paradigm,” said Gregory Gray, president of the college system that includes the community colleges, the four Connecticut State Universities and online state college. “We have to increase enrollment.”
The 12 community colleges have an enrollment of 31,000 full-time students.
The system is budgeting for tuition revenue from an additional 7,000 students by fall semester. This follows years of steady decreases in enrollment and fewer high school seniors (the traditional college-bound students) graduating each year.
“And when do you know you have a problem?” Holloway asked, referring to whether the increased enrollment strategy has worked.
Gray said he will be able to tell by Sept. 1 if the strategy to offer students one free course for every class they pay for has enticed the 7,000 additional students to enroll.
“I hope the board understands the bet they’re making,” Holloway said.
The panel Thursday also voted to increase tuition and fees by 2 percent next school year, which will cover one-third of the system’s overall $42.1 million deficit. To close the remaining gap, the schools are depending on an increase in state funding and the influx in student enrollment.
“We believe 2 percent is a reasonable tuition hike, and we will still be able to pay our bills. Of course there are some uncertainties," Gray said.