Weekly News Brief | October 28, 2022
From the Office of Chancellor Whitney Yamamura, Ed.D.

Last Friday, the Board of Trustees conducted a budget study session. In advance of the presentation by Vice Chancellors Drinkwine and Serban, I offered a few thoughts. In full transparency, those same thoughts are presented here.

First, our budget planning is necessarily based on state and system policies as they stand today. We know things outside our control can and will change. In some ways, stability is an optimistic assumption. If the economy struggles, that could result in future budget reductions or IOUs from the state.

Second, try as we might, growing out of our budget problem is nearly impossible in the short to medium term. For anything below 15 percent resident full-time equivalent students growth, the fiscal plateau or hold-harmless funding floor will serve as the Coast District's funding ceiling. This means that the Coast District will not receive cost-of-living adjustments beginning in 2025-26.

Third, the longer we wait to course correct the more disruptive and harmful our options become. One-time funds, emergency allowances, and hold harmless are giving us a reprieve. These short-term measures are very helpful, yet do not solve long-term, or structural, budget deficits.

We have time to act, but no time to waste. That means starting difficult participatory governance conversations now, both college-based and districtwide. Please accept my letter today as a new beginning to many conversations.

With gratitude,

 Whitney

Whitney Yamamura, Ed.D.
Chancellor

Postscript: Rising Anti-Semitism

As an institution of education and equity, the Coast District denounces anti-Semitic comments, postings, flyers, caricatures, and vandalism that infect public discourse and public spaces. The most recent examples may come from neighboring regions, yet we should never be complacent. Hate is as insidious and pervasive as it is corrupting. I stand with the Jewish community in denouncing hateful expressions whatever the form and location. I look to our district and colleges to set an example of inclusiveness, where our speech seeks to further understanding and mutual respect.

Report from the Board of Trustees

On October 21, 2022, the Board of Trustees held a special meeting and conducted a study session on the fiscal condition of the Coast Community College District. The presentation by Vice Chancellor Marlene Drinkwine and Vice Chancellor Andreea Serban began with a review of the generally positive budget for the 2022-23 year, with the caveat that a deficit factor (post-adoption budget reduction) from the state was possible given shortfalls in state and local revenues. Short or one-time budget augmentations also serve as a bridge to an anticipated funding floor in future years, where the state withholds cost-of-living adjustments thereby creating the fiscal plateau. Meanwhile, enrollment growth opportunities are limited by declining K-12 aged population and Student-Centered Funding Formula allocation limits on year-over-year funding increases.

With the aid of one-time funding, budget ending balances (reserves) are expected to increase in 2022-23 and 2023-24. Ending balances are projected to be above the Board's expected reserve requirement of 16.67 percent through 2025-26. Under current conditions, the Coast District would use funds above the reserve requirement to offset a nearly $7 million deficit in 2025-26. Under those same conditions, the Coast District will fall below the reserve requirement beginning in 2026-27. Falling below the reserve requirement would have consequences in the bond market. As reference, the median unrestricted general fund ending balance for California community college districts is 30 percent, nearly double the Coast District's current reserve level.

The Coast District ranks among the five highest districts in terms of salaries and benefits as a percentage of unrestricted general funds. Ninety percent of Coast District funding goes to employment. This leaves only ten percent of the budget for all other purposes, e.g., technology, supplies, events, and travel. As a statewide comparison, the average percentage of unrestricted general fund ending balance going to salaries and benefits for California community college districts is 83 percent. A higher-than-average percentage of budget going to salaries and benefits limits options to reduce expenditures.

No actions were taken at the budget session, though elements of a possible plan were discussed. Enrollment growth in current circumstances was suggested to be paced and moderate, rising above the fiscal plateau in the long run without making immediate cost problems worse. Part of making a moderate growth strategy work is containing costs and reducing expenses. Lowering the non-instructional side of costs will be essential as the colleges work with faculty and educational administrators on the academic side. Cost containment or even gradual reductions today are worth multiples of those same actions in 2025-26.

The full presentation is available here. Vice Chancellor Drinkwine offered to present the same information to stakeholder groups districtwide as requested.

College News

Schedule, Week of October 31

October is Domestic Violence Awareness Month. This year's theme is Everyone Knows Someone. All faculty, students, and staff are invited to join in a community of safety and support.

Board of Trustees
The next regular meeting will be held Wednesday, November 2, with closed session beginning at 4:00 p.m. and open session at 5:00 p.m.

Chancellor
Dr. Yamamura is in the District, Monday through Wednesday
Dr. Yamamura is working from a conference in Long Beach,
Thursday and Friday