ECC’s finance and management issues lack the transparency required of a public institution

Erie Community College is a public institution with an annual budget of $111 million, 45 percent of which is funded directly by state and county taxpayers. It is a public institution whose administration seems comfortable with talking around funding issues and how the school spends its money.

This blog has posted numerous articles about problems at the College. Last August a series of articles was posted about the financial management of the institution; its contract with Canisius College for dormitory space; and the manner in which the school’s president spends tens of thousands of dollars made available to him in two expense accounts.

All of this appears to be fine with the management of the school, its Board, county elected officials and state officials. So perhaps not all the rules about accounting for the receipt and use of public money apply to Erie Community College.

The State Comptroller released a devastating detailed audit of the management of the school in 2016. There have been no public updates on all the things that audit recommended to be done.

A new President, Dr. Dan Hocoy, joined the school in the summer of 2017. The school has continued to experience a decline in enrollment. Information published in Business First reports that full-time enrollment dropped by 1,802 students (20 percent) between 2013-14 and 2018-19. Part-time enrollment increased by about 30 percent during that timeframe. Full-time tuition increased $1,300 (36 percent) in those five years.

The local economy has been doing pretty well lately, and enrollment at community colleges usually goes in the opposite direction of the economy. People often tend to beef up their employment skills when the economy is tight. In addition ECC, like nearly all colleges in Western New York, draws most of its students from this area. The pipeline of students has been shrinking, creating problems for many schools.

A recent internal report about spring 2019 enrollment at ECC, prepared prior to final semester registrations, indicated that enrollment might go down 15 percent compared with the spring of 2018. Representatives of the College told the County Legislature in early January about a drop in enrollment with somewhat different numbers.

Dropping enrollment has a major impact on the College, which derives the majority of revenues from direct tuition payments and from state aid, which is calculated based on enrollment over a period of years.

The transmittal letter from the College President to county government last May, which forwarded the College’s proposed 2018-19 budget, noted that the school anticipated a flat amount of enrollment and tuition revenue for 2018-19, compared with 2017-18. The school did not plan to use fund balance.

A new revenue source identified by the school in that budget was the contract with Canisius College for the use of dormitory rooms by ECC students at Canisius. The contract was celebrated for providing a full college experience for ECC students, while producing revenues for both ECC and Canisius.

So in light of what was anticipated prior to the start of the 2018-19 academic year, I sent a new Freedom of Information Law (FOIL) request to ECC on January 5th, posing some follow-up questions. I asked for:

  1. The total dollar amount of tuition payments received from registered students for the fall 2018 semester, as of December 31, 2018; and comparable information for the fall 2017 semester.
  2. The total number of students registered for the fall 2018 semester who lived in the Canisius College dormitories; and the number of students scheduled to live in the Canisius dormitories for the spring 2019 semester.
  3. The total dollar amount that President Dan Hocoy received in 2018 as his bonus, per terms of his contract.
  4. A copy of the December 2018 Board policy concerning staff telecommuting.

These requests, it seemed to me, were fairly simple and easy to respond to. The December 2017 tuition revenue is a historical record that should be readily available. As soon as December 2018 accounting work closed out, the 2018 records should likewise be obtainable.

The number of student who dormed at Canisius during the fall semester was determined in September 2018, and with the spring semester underway, the dormer numbers for spring 2019 should be available.

President Hocoy receives a substantial salary ($229,500) plus other benefits including a vehicle. He is entitled to an annual bonus of up to $25,000. Salary information is public and should be part of the school’s personnel data.

All that was required for the question about the telecommuting policy was to send me a copy of the document approved by the Board at its December meeting.

After 19 days the College’s Freedom of Information officer informed me that they were “still working to obtain responsive documents from all areas encompassed by this request. We request an additional twenty days to respond. If available sooner, we will provide sooner.” Frankly, it seems that up to thirty-nine days is an awfully long time to provide information that is likely sitting on someone’s desk already.

Absent official documentation about enrollment or tuition payments received, one can only speculate about the state of the school’s finances. It has been noted to me by sources at the College that Hocoy and other senior staff have stated that their fund balance remains at about the same $15 million amount that it was at the end of 2017-18. Some senior staff have reportedly claimed that the total is larger than Erie County government’s fund balance and have suggested that the College is in a position to loan money to the county. The county’s general fund balance stood at more than $100 million at the end of 2017; audited 2018 figures are not yet available.

It is also being reported that ECC students will be dorming at Daemen College for the spring semester. Why the switch from Canisius? Payment problems? Student behavior problems?

The issue about a telecommuting policy is interesting because of anecdotal information that some senior staff does much of their work from home. If correct, how do you run a college without being there?

All of these issues can be cleared up with more transparency. School finance matters, however, cannot be swept under the rug forever. At some point a lack of funds will mean that someone will need to pay the piper.

Stay tuned for the next installment in the ECC saga.