Budget Bulletin 

October 2009

Index

Introduction

As you are aware, Mt. Hood Community College (MHCC) is currently facing budgetary challenges that require our full attention. We must address these challenges and find solutions to them or face the consequences of not acting in the best interest of the College. Our constituents - students, employees, College and Foundation Board members, elected officials, community leaders, tax payers - are counting on us, as an institution, to make wise decisions as we move forward in these difficult economic times.

MHCC employees, thank you for the sacrifices you have made and will continue to make for the betterment of the College, our students and our community. However, there is more work to be done. We are a business, and we need to always remember that. When we fully embrace that realization, then we will truly move mountains and overcome the challenges that we face.

As I have said since the beginning of my tenure as president of MHCC, I value open communication, and I continue to espouse this philosophy as we navigate through these fiscal challenges.

In an effort to keep you informed, following is information about:

  • the realities that we face
  • the sacrifices we have made
  • the solutions we need to explore and implement
  • the communications that will occur to ensure we are communicating openly and honestly to internal and external stakeholders
  • the consequences that we will face if we do not find solutions

As we continue to address the budget challenges, I will continue to communicate with you through various methods, including this Web page site and town hall meetings. Thank you.

Our Reality

Following are the realities of our current fiscal challenges:

  • The 2009-10 state funding was reduced by nearly $2.5 million, affecting the general operating budget.
  • The College's reserve is now at 1.75 percent of the budget instead of the 5 percent mandated by the College Board a few years ago. That is, we have $900,000 saved out of a $52-million budget instead of $2.6 million saved.
  • There is no protected contingency budget, which is necessary in the event of legal matters (like a lawsuit) or weather-related damage as we experienced last winter.
  • We have to protect our retirement plan (PERS) and thus cannot touch those monies.
  • The College's bond rating was reduced in August 2009 due to reserve funds being too low, which the financial community sees as a risk that needs to be addressed.
  • Unfunded projects include enhancements of facilities and master planning.
  • Portland General Electric just informed us that we need up to $3 million to redo our electrical system, since much of the electrical wires are buried underground and not in conduit.
  • The seams in our walls are not in compliance in case of an earthquake. Therefore, seismic upgrades to the Gresham Campus are needed. These upgrades will cost upwards of $25 million.
  • If state funding is reduced again in February 2010 or if the tax measures that were passed by the legislature to increase the state budget are overturned, we will have another round of reduced state funding.

Our Sacrifices

Following are some of the sacrifices many of us have made to overcome these challenges:

  • Faculty positions were reduced by 10, and faculty are receiving four fewer days.
  • Non-represented employees (administrators, managers and confidentials) received no steps or COLA and are receiving five fewer days.
  • Classified employees are receiving five fewer days.
  • Executive Committee members (administrators and managers), faculty and classified staff are all reducing the number of days worked.

Our Solutions

Following are some of the solutions we need to explore and implement to address these challenges:

  • Consolidate the furlough days into the same time period, thereby allowing the College to save additional funds by reducing utility costs associated with keeping the campuses open. Students and community members are encouraged to take advantage of the College's resources available on the Web site during these periods (Thanksgiving week and the week between Christmas and New Year’s Day).
  • Review tuition, fees and other funding models
  • Research impact of tuition increases, differential tuition, new and increased fees (including a parking fee) and other revenue-generating concepts
  • Maximize space at all three of our locations and expand the times and number of sections taught at the College
  • Further engage the MHCC Foundation Board in our financial challenges
  • Increase external funding in partnership with the MHCC Foundation
  • Ask the MHCC Foundation Board to fund a position focusing on grants and other new sources of revenue that will offset College expenses
  • Use best practices from other colleges and universities to create budgetary guiding principles in an open and transparent College-wide method (draft guidelines are currently being reviewed by the dean's committee and will be shared with all employees for feedback)
  • Initiate program review.
  • Continue to work with the Joint Leadership Council (JLC) to explore and implement cost-cutting ideas, including:
    • Purchasing control 
    • Printing savings 
    • Energy savings 
    • Marketing and revenue generation 
    • Other campus closures (i.e. holiday closures, etc.)
     
  • Monitor the expected revenue generation and cost reduction from energy savings (Johnson Controls Project)
  • Explore the concept of spinoffs, 501 (c) (3) and other models for Workforce Development, etc.
  • Consider the status and future of grant-funded projects and programs
  • Examine the “cafeteria plan” of health care benefits
  • Hire a vice president of student success and enrollment management, who will help us with developing a professional enrollment management plan, which is something we have been lacking for years.

Our Communications

Following are the important communications that will occur to ensure we are communicating openly and honestly to our internal and external stakeholders:

  • Create a Presidential District-wide Finance Advisory Committee
  • Create district-wide task force of external advisors
  • Create a Faculty Budget Committee
  • Review the budget with faculty members and others as part of our commitment to openness, honesty and transparency
  • Work with the Classified Employees Association and Faculty Association leadership to explore “creative” solutions to our fiscal challenges. 
  • Give financial updates to the College Board during each Board meeting
  • Send financial updates often to MHCC employees and Board members via e-mail (Ski Financial Bulletin)
  • Hold town halls meetings with internal (employees and students) and external (community and business leaders and residents) stakeholders
  • Send letters to newspaper editors to better educate the general public about our budgetary challenges and how residents can assist us
  • Develop a Financial Bulletin page on the MHCC Web site

The Consequences

There is a lot at stake. Unfortunately and inevitably, there will be consequences we will all have to face if we do not implement solutions to these challenges.

Up until this point, I have said no layoffs. I feel that a reduction of the workforce would be counterproductive to serving our growing student body. However, if we are unable to implement solutions that address and resolve our current budgetary challenges, going forward, we may have no choice other than to lay off some employees.

Despite the challenges facing the College, I remain encouraged. Together, there is nothing we cannot achieve. With everyone playing his or her role, going beyond the call of duty and keeping open minds and hearts, we can achieve many positive outcomes - despite the budgetary challenges.

The Positive Outcomes

Following are some of the positive outcomes that we can achieve together:

  • Increase in percentage of high school seniors who attend the College instead of other community colleges
  • Increase in enrollment from residents over the age of 50
  • Increase in private funding
  • More continuing education offerings
  • More green and sustainability initiatives
  • Increase in local, regional and national recognition of the College
  • New academic programs that meet our community's needs
  • Strengthened partnerships with the business community
  • Strengthened relationships with elected officials in the Metro Portland area

I am very excited about the spirit of hopefulness and collaboration that many of you have demonstrated and expressed to me publicly and privately. With that kind of positive spirit, I am confident that the challenges that seem insurmountable can be overcome.

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 Last Modified: 5/3/2012 10:17:14 AM