By BRIANNA HERNANDEZ
Elimination of state funding and continuing drops in enrollment have left Pima Community College officials facing tough budget decisions.
Proposed solutions have generated talk of possible tuition hikes, layoffs, campus closings, spending cuts and elimination of programs.
“As you look at the impacts of no state support, declining enrollment, you have to recalibrate,” PCC Chancellor Lee Lambert said.
“You start off by saying ‘everything’s on the table,’” he said. “That allows you to take a big view of how are you going to balance all these pieces … and minimize the impact.”
Current spring semester enrollment dropped 2.96 percent compared to the previous spring semester.
“This is in stark contrast to Spring 2015, when enrollment dropped by as much as 9.77 percent from the previous year,” Lisa Brosky, PCC vice chancellor of external relations, said.
College officials blame enrollment declines on an improving economy, online competition and accreditation concerns.
“It is generally accepted that the peak enrollments that followed the start of the Great Recession in 2008 were an anomaly and, barring a crisis, are not likely to be seen again,” Brosky said.
“Unemployment in the Tucson region is down significantly, which generally means people are working instead of attending college,” she said.
The unemployment rate in Arizona was 4.3 percent in December 2016, according to the U.S. Bureau of Labor Statistics. The rate in December 2008 was 6.9 percent.
Brosky cited the work of Anthony Carnevale, director of Georgetown University’s Center on Education and the Workforce. He contends declines in enrollment may be fueled by a perceived lack of correlation between college and employment.
“That may be true here as well, where manufacturers and other employers are struggling to fill skilled positions which often pay very well,” Brosky said. “People are unaccustomed to thinking about college to get a manufacturing job.”
Future jobs will require education beyond high school, but less than a four-year degree. Employers need critical thinkers who possess technical and communication skills, Brosky added.
Competition among online programs represents another contributing factor.
“The competition has grown from online competitors,” Lambert said. “ASU online has grown significantly. University of Southern New Hampshire is marketing in our backyard.”
To grow Pima’s online curriculum, the college has hired Michael Amick to serve as vice president of distance education.
PCC has received a $100,000 grant to develop online degree programs that use open-source texts and resources. Pima was the only institution in Arizona, and one of 38 nationally, to receive the endowment.
Pima has also been approved to offer online college courses in 28 states as a participant in the National Council for State Authorization Reciprocity Agreements.
“We think online probably has great growth potential and we are looking at classes, programs and even methods of course delivery,” Brosky said. “Taking courses on a cell phone, for example, is now a mainstream idea.”
Accreditation has been another issue.
“Even though the college is fully accredited, the concerns cited by the accreditor likely affected some people’s decisions to attend,” Brosky said.
“It’s difficult to know by how much,” she added. “The good news is the college is well on its way to putting the ‘on notice’ sanction behind us.”
Lambert said the college faces difficult options going forward.
“First of all, I don’t want to be raising tuition on students,” he said. “Two, I don’t want to be laying off employees. Three, I don’t want to be closing campuses.
“I also have a fiduciary responsibility to this community that we will run a financially healthy organization.”
David Bea, PCC executive vice chancellor for finance and administration, presented three budget scenarios to the PCC governing board in December.
BUDGET SCENARIO ONE
The first scenario would entail spending cuts, working toward a major cut of $15 million in 2020.
Tuition hikes are also on the table, with a $7-per-unit increase. The proposed increase would be the largest PCC has ever placed on students. The previous highest increase was a $5-per-unit increase.
“Declining enrollment means declining tuition revenue,” Brosky said. “That, combined with loss of state funding, has put unprecedented economic pressure on the college.”
Tuition for PCC remains low compared to other community colleges in Arizona.
PCC spokeswoman Libby Howell said the college recognizes that many Pima County students are low-income and first-generation college students.
“Setting tuition rates is a balancing act between the needs of the college and the needs of students,” she said.
BUDGET SCENARIO TWO
In the second scenario, the college would lower spending by $5 million per year for three years. Pima would examine and phase out under-performing programs that are suffering from low enrollment.
“We want to make sure we are offering programs that will help students get jobs after college, especially in our career and technical program areas,” Howell said.
This scenario would include reductions in infrastructure and staffing.
Bea said in his budget presentation that 75 percent of the PCC general fund consists of personnel expenses.
“Our enrollment today is currently at 1992 levels,” Howell said. “And yet our staffing ratio to Full-Time Student Equivalents has not been adjusted accordingly.”
Faculty numbers fall in the middle compared to similar institutions and colleges.
PCC exempt and nonexempt staff numbers are twice the average, Howell added.
BUDGET SCENARIO THREE
In scenario three, the college would reduce spending by $10 million per year for the next three years. The savings would be used to transform and revamp PCC.
“We know that to meet the needs of the students and those of our community, the college must invest in our campuses and our programs,” Brosky said.
“We envision high-tech, 21st century learning environments that spark interests,” she said, adding that the college aims to “put the latest technology at student’s fingertips.”
This scenario would also involve notable reductions in staffing and infrastructure.
It could involve closing campuses. College officials have not said which sites might be targeted.
Imminent campus closings are not being considered at this point, according to Howell. Lambert said the focus is to keep all campuses operating.
“The approach is going to be not to have to close down a campus, but to give each campus its own identity around this notion of its ‘center of excellence’ where it makes sense,” he said.
Under the center of excellence concept, each campus would specialize in certain areas of curriculum. An example would be to transform the Downtown Campus to a center of excellence for applied technology, Lambert said.
“I think that this strategy will allow us to hopefully maintain all the present locations,” he said. “But I still have to adjust for a new fiscal reality.”
Lambert said he expects pushback on the new plans.
“There is a mythology here at Pima that no one has ever been laid off,” he said. “So I think knowing what I know, I expect there will be pushback.”
Since the new plans are being driven by external forces, discomfort among current faculty is to be expected, Lambert added.
“I would say to them, we are doing it thoughtfully,” Lambert said. “We didn’t just do it willy-nilly. But ultimately, they don’t get to make decisions. That is something I have to recommend to the board.”
It is too early to say whether employee layoffs are near or how many layoffs there would be, Howell added.
In the upcoming summer semester, PCC will experiment with a program that allows employees to voluntarily take two months off with no pay.
The experiment is based on an employee survey conducted in 2015. The results showed that 48 percent of employees indicated interest in exploring the option.
“The details are still being laid out, and will be announced to employees soon,” Howell said. “Once again, let me emphasize that at this time, this option would be voluntary and based on the needs of the college.”
Faculty sabbaticals will also fall victim to funding cuts in 2018.
The PCC Executive Leadership team decided last November to fund six sabbaticals in 2017. There will be no funding the following year, due to financial concerns, Howell said.
PCC allotted $434,700 for online and outdoor ads as part of a “Think Smart” campaign in Fall 2015, with hopes of attracting prospective students.
The college created the campaign to increase awareness and understanding about the value and advantages of attending PCC.
“The funding was for a comprehensive approach to marketing that also included print, digital and direct-mail advertising,” Brosky said. “Some of the ads were designed as general awareness ads regarding college access, affordability, value and convenience.”
The campaign included radio, TV and print ads.
“Our advertising budget focused on driving attention to our website, and that was successful, with substantial increases in ‘click-throughs’ from digital advertising,” Howell said.
One campaign focused on potential students over the age of 55, who receive half-priced tuition.
“PCC is cautiously optimistic that enrollment is beginning to level out,” Brosky said.
The college will adopt its 2017-18 budget in June.
“We need to make sure that we have a healthy Pima Community College, that is here to meet the needs of students and this community far into the future,” Lambert said. “That is what it comes down to. My job is to make sure we navigate to that.”
News Editor Eddie Celaya contributed to this report.
Upcoming 2017-18 budget activities planned for PCC Board of Governors meetings include:
March 8 meeting
- Approve tuition rates
- Approve student/course fees
- Approve contracts for employee benefits
April 12 meeting
- Approve the capital budget
May 10 meeting
- Present proposed budget plan
June 14 meeting
- Approve property tax levies
- Adopt budget
Governing board meetings begin at 5:30 p.m. in the District Office C-105 Community Board Room, 4095 E. Broadway Blvd.