SUNY Erie’s financial issues come to a fork in the road

“When you come to a fork in the road, take it.” Yogi Berra

As regular readers of this blog know, I have over the past several years written many posts detailing the financial problems facing SUNY Erie, aka Erie Community College or ECC. The problems have been long-term and very serious.

SUNY Erie is not unique among colleges in facing money problems. Most institutions are heavily dependent on growing or at least maintaining steady enrollment since in one form or another enrollment determines most of the financial resources of the schools. In New York State and elsewhere enrollment has been declining for several years. The pandemic has made matters worse.

Being in like company, however, is small comfort to any college. They must all work their way through their individual issues if they are going to survive and prosper.

ECC’s problems were made worse by management problems. Some poor decisions about how to use the school’s resources and how information was shared among the college’s constituencies had consequences. The former president has moved on and others in his leadership team are also gone, some voluntarily, others involuntarily. The challenges to the school remain.

In July former finance vice president and interim president Bill Reuter returned for a second stint as interim president. The roots of the college’s problems are financial, and Reuter is very well suited to help navigate those issues.

The Erie County Fiscal Stability Authority, (ECFSA or the control board), met virtually last week with Reuter and ECC Board Chair Danise Wilson to review the status of the school one month into the new academic year. ECFSA members said they were glad to have him back in the school’s administration.

Pandemic issues resulting in adjustments in on-campus work schedules greeted Reuter when he began work on July 1. A re-opening plan, approved by SUNY, was received that day.

Probably more importantly, the previous administration had made some major errors in preparing the school’s next budget, particularly in the calculation of state aid, which dramatically slashed the school’s 2020-2021 budget. Reuter went to work immediately to re-set the budget with more realistic assumptions about revenues and spending which the Board subsequently approved.

The college’s enrollment numbers for the fall of 2020 tell a scary tale. The full-time equivalent enrollment is down nearly 19 percent compared to the fall of 2019. The school made changes in their 2020-2021 budget which lowered enrollment expectations somewhat, but even with those adjustments the school is about four percent below the targeted enrollment, which has a direct impact on the bottom line. Those numbers might improve a bit when final enrollment activities are processed.

Compounding that problem is the matter of reduced state aid payments – a 20 percent reduction which is impacting both direct aid and the amount of money students are eligible for under the Tuition Assistance Program (TAP), money that flows to the school in tuition payments. The state has described the aid reductions as “withholdings” rather than cuts, as they wait for federal pandemic relief funding. The prospects of receiving the aid are not good at this time, with Donald Trump unable to focus on a position while Mitch McConnell walked away from a new COVID relief package that would provide money to states, local governments and schools.

The proposed 2021 Erie County budget will be released this week but given the county’s own pandemic-related financial difficulties it seems that substantial additional aid for the college is unlikely.

In his presentation to the ECFSA Board Reuter noted efforts by the college to reduce expenses. He suggested that the college had been on a hiring binge even as enrollment dropped. More than 50 jobs were added to the ranks of the Administrators union in recent years. Salaries of existing administrative staff were raised as well.

Reuter is working with his Board to reverse some of those actions, resulting in layoffs. He told the control board that the college’s payroll over the first two pay periods of the 2020-2021 fiscal year was reduced by an average of $450,000 compared with last year’s costs.

Reuter has told County Executive Mark Poloncarz that the college would work its way through previously authorized but not completed capital projects and would not ask for new capital funding at this time, an acknowledgement of the fiscal issues facing county government.

At some point in time the college’s Board and SUNY must come to terms with the unsustainability of running a three campus operation. The South campus might be shut down. At the moment, however, the school is up to its eyeballs in alligators, so future planning will need to wait a bit.

ECC Board Chair Danise Wilson told control board members that the college’s board could have been more attentive to the school administration’s personnel actions. She said the board had been distracted by other issues such as the school’s accreditation but would be more involved in monitoring and controlling spending actions going forward.

At the end of the control board meeting the directors approved a resolution that lays down a marker for where things stand now and what needs to happen next:

[T]he ECFSA does not view the currently adopted 2020-21 budget as in balance and achievable at this point, based upon lower than anticipated actual enrollment subsequent to its adoption. In no more than 90 days from the passage of this resolution the ECFSA calls upon the College to revise its budget and implement steps to close anticipated gaps…

[G]iven the ECC submission does not include out-year projections, the College, when it does have relevant and timely information, or no more than 90 days from the passage of this resolution, whichever comes first, must submit a revised budget and 4-year plan for the ECFSA to review and opine on…

[T]he ECFSA recommends that there be a very public discussion about the future of ECC and how it fulfills its role in the region and within the network of higher education.

Reuter and his Board have their work cut out for them. They are at that fork in the road. Shining some sunlight on the college’s difficulties should leave all concerned with a clearer understanding of what needs to be done to get the school moving in the right direction.

3 thoughts on “SUNY Erie’s financial issues come to a fork in the road

  1. Why does SUNY Erie have 3 campuses for a county of around 1 million. That’s a lot of unnecessary overhead. And a waste of money.

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  2. I hate to be insulting to ECC but I suggest the leadership at ECC make a visit to MCC in Rochester and meet with its leadership. 1) Find out if they have and how their handling declining enrollment. 2) Find out how they have partnered with local Colleges and Universities so its an acceptable 2 year degree to transfer to local schools. 3) Find out how they partner with local employers to provide a 2 year degree that businesses need. MCC is right next door and its larger than ECC even though Monroe County has a smaller population than Erie County. Why not take a look at best practices at other local community colleges.
    ECC should also take a look at NCC and GCC. Are they doing distance learning also? Can each of the 3 community colleges offer distance learning and create a way for each community college to compliment each other rather than compete with each other. ECC is a commuter college and perhaps the 3 college campus’s should be ECC, NCC and GCC not ECC-North, ECC-downtown and ECC-South.
    I would send out a mass mailing questionnaire to every business in the western ny region within commuting distance to ECC which will in very broad and very targeted focus skills employers want in a 2 year degree that would allow then to get hired and start work “hit the ground running.” I have to wonder how well ECC knows and provides what is needed in its curriculum and if there is any way to eliminate non-value degree programs and courses while expanding value added degree programs.
    Simple Questions: How big is our construction industry? How big is our industr-al production industry? How big is our machining industry? How big is our insurance (back office operations) industry? How big is our banking (back office operations) industry? ECC should know and be in contact with every business in WNY. ECC should also have a program for entrepreneurship. ECC should also work with local high schools to offer courses in household finances. I truly want to know if there is 1 person at ECC that understands the employer demographics of our region and has contacted all of them? I think you would be disappointed at how out of touch ECC really is with its employer demographics. The true test of a successful community college is not how well it adheres to State Department of Education but how many students get livable wage jobs or transer into 4 year degree schools.

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