My continuing interest in the operations of Erie Community College, aka ECC or SUNY Erie, has generated some new information.

Public information about the school’s finances and operations has been greatly diminished in the past several months, so on February 4 I sent a Freedom of Information Law (FOIL) request to the College. They stalled on the response, but finally on March 13 answers arrived.  With the exception of one set of numbers, which concerned the number of students in the Spring 2020 semester, all of the information given me was obviously available to have been provided me as soon as February 5^th.

The following is a summary of the data provided via the FOIL request, along with some other previously available information that helps put the new information in perspective:

Enrollment

• President Dan Hocoy’s introductory letter to the 2019-2020 ECC budget noted in April 2019 that “[s]ince 2010/11, student populations have declined 29%, per FTE.”
• Per the FOILed information, the school reports that as of October 15, 2019 there were 10,031 students enrolled during the Fall semester. The full-time equivalent number was 3,747.2. This compares with 2019-2020 budget projections of 10,461 students by headcount and a full-time equivalent number of 4004.6.
• That leaves the school with 257 FTEs (6.4 percent) less than was expected. Translated into tuition value, the lower number would amount to $1,259,300 in lost revenue when calculated at $4,900/per student.
• The school reports that as of March 12, 2020 there were 9,905 students enrolled for the Spring semester. The school, like other SUNY institutions, switched to online programs shortly after that date to deal with the COVID-19 pandemic. The full-time equivalent number was 3,425.22. This compares with 2019-2020 budget projections for the semester of 9,969 students by headcount and a full-time equivalent number of 3,714.7.
• That leaves the school with 289.48 FTEs (7.8 percent) less than was expected. Translated into tuition value, the lower number would amount to $1,418,452 in lost revenue when calculated at $4,900/per student.
• With the drops in enrollment, the two semester 2019-2020 tuition shortfall therefore would equal a loss of about $2.68 million. Fewer students also decreases student fees, and could also have a negative impact on state aid. The school has been restricting some spending to deal with the tuition shortfall.

Finances

• The school previously included a “Financial Dashboard” as part of the published Board Agenda package. That information vanished last fall. The Budget & Audit Committee had nothing to report at the Trustees’ December meeting. There are no published minutes from the most recent meeting of the Board on January 30, 2020. The agenda for that meeting refers to reports on “Budget vs Actual 2018-2019” and “Budget vs Actual 2019-2020,” but if you attempt to click on those lines to take you to the documents there is no link.
• Part of the FOILed information was a spreadsheet entitled “Preliminary Draft Budget to Actual 2018-19 Presented at October 31, 2019 SUNY Erie Board of Trustees Meeting.” That report indicates that the school collected $111,113,487 in that Fiscal Year, which was $472,317 less revenue than originally budgeted.
• The same report says the College spent $112,090,183, which was $504,379 over budget.
• At actual spending of $62,131,129 the College exceeded the budget for salaries and wages by $4,257,534 (6.15 percent). Employee benefits exceeded budget by $417,029 (13.84 percent). Supplies, services and equipment, on the other hand, were below budget by a combined $4,170,184.
• The combined revenues and expenses for 2018-19 show a loss of $976,696 compared to budget.
• But then part of the FOILed information was a spreadsheet entitled “Budget to Actual FY 2018-19 Presented at January 30, 2020 SUNY Erie Board of Trustees Meeting.” While the subject and date range was the same as the report given to the Board on October 31^st, the numbers are considerably different.
• The January report indicates that the school collected $109,909,747 in that Fiscal Year, which was $1,676,057 less revenue than originally budgeted.
• The January report indicates the College spent $110,010,161, which was $1,575,643 under budget.
• At actual spending of $62,058,542, in the January revised 2018-19 numbers, the College exceeded the budget for salaries and wages by $4,184,947 (7.23 percent). Employee benefits in the most recent report were below budget by $791,191 (2.8 percent). Supplies, services and equipment were below budget by a combined $4,765,301. No explanations are offered for any of this information.
• The combined revenues and expenses for 2018-19, as reported to the Board in January, show a loss of $100,414 compared to budget. The January document indicates that the loss was made up by use of Fund Balance.
• It is not unusual for there to be some variance between preliminary close-out and final budget numbers for a public institution.
• A second brief report presented to the Board of Trustees in January, and not previously disclosed publicly, contains information about the school’s finances for the current fiscal year, thought December 31, 2019 – four months into the fiscal year. While the report indicates actual revenues and expenses through that date, the information isn’t particularly useful since it comes with footnoted caveats:
  • The second quarter State aid payment hadn’t been received.
  • “Tuition and Student Fees based on point in time at 12/31/19 for both budget and actual.”
  • “Budget in time 12/31/19 based on total divided by 12 months, actual expenses occur heavily in fall and early spring, created a skewed point in time perspective at 12/31.”
  • “Include Police Academy salaries and fringes managed under grants but paid by college.”
• President’s Expenses.In a previous post in August 2018 I reported on the use of three college expense accounts over a five month period that were available to the College President, Dr. Dan Hocoy, for social expenses related to College business. My analysis showed $37,483 in costs under those accounts in that five month period, with most of the expenses related to lunches and dinners that Hocoy had, mostly with College staff, faculty, and trustees. A considerable portion of those expenses was for the purchase of alcoholic beverages.
• In my most recent FOIL I asked for the same information for the month of November 2019. I was not offered detailed bills, checks and invoices as in the 2018 report, but just a summary. A summary was provided for only one expense account, which is known as the “President’s Pepsi Account.” The summary shows 12 charges, ranging from $2 for parking to $745 for Hocoy’s reservation at a Middle States Conference in December. The total of the charges was $1,938.77. Eight of charges were for meetings, which included a meal, and had an average cost $125.85.
• Canisius College dormitory rooms. I requested billing information from Canisius College to ECC for the rental of dormitory rooms for ECC students. The total cost for the Fall 2019 semester was $448,700 for the rental of 74 beds.

Some observations

The information received under the FOIL request indicates things that are not particularly new, and are to a certain extent matters that the College does not have much control over. But those indicators are getting worse.

Like most colleges in Western New York, ECC is struggling with declining enrollment related to the demographics of the region.  There are fewer students in the educational pipeline.

So the issue becomes, what to do about such things? Consolidate the three campuses, merge with other community colleges?  Just wondering.

Local colleges, which have already been dealing with strains on their budgets, will be caught up in the financial pain that is resulting from the coronavirus pandemic. Some refunds may be necessary.  State aid could be delayed or cut.  Students, particularly part-time students, might have trouble finding money for tuition.  Further cuts in staffing and other expenses will be necessary.  This calls for strong management.

Strong management would not go with hit-or-miss financial reporting to its Board. Some months, at least from what ECC has provided to me, there have been no financial reports.

It also seems rather incredible that an institution with an annual budget of more than $100 million cannot produce a cash flow document for budget analysis that factors in historic trends to project how the normal September, October, etc. month’s revenues and expenses are likely to fall out, which can then be compared with actuals. That would give decision makers a more accurate picture.

The declining enrollment, troubled finances, and a potentially worsening financial picture all call out for leadership.