Click photo to enlarge
Van Jones addresses the crowd of protesters at the State Capitol after marching down Capital Mall in Sacramento, Calif., on Monday, March 5, 2012. Students, faculty and supporters from community colleges and universities throughout California rallied at the State Capitol to protest budget cuts and fee hikes for higher education. (Laura A. Oda/Staff)

The drain of education dollars from the state's community colleges has raised the specter of campus closures or receiverships, a state college budget officer says.

The comment came as the local colleges look at the uncertain fate of Gov. Jerry Brown's tax measure on the November ballot. A defeat there could become a knockout blow for some campuses that have been absorbing cuts and dipping into reserve funds over the past three years.

All of California's interlocked higher education systems -- the University of California, the California State University and the community colleges -- have been hit hard by the state's fiscal problems, but community colleges perhaps most of all. Tasked with job training, remedial education and transferring students to universities, the schools receive less money per student than either the universities or K-12 schools.

If the tax initiative fails, Gov. Jerry Brown wants to slash $300 million from the 112-college system's $3.7 billion budget. And, although he would give the schools $340 million from the dissolution of redevelopment agencies, experts say that money may not arrive in time for this year's budget.

"I do think some districts are going to need state assistance," said Scott Lay, president and CEO of the Community College League of California, an advocacy group. "I don't know how many districts would be able to survive a reduction like that and the lost redevelopment money."

Troubled districts likely would need to ask the state for emergency loans to keep the doors open, but California may not have money available for such emergencies.


Advertisement

"It's not 100 percent clear that's a sure thing," said Dan Troy, budget chief for the state college system.

"We can't guarantee (colleges) would have the resources to operate."

The state last rescued a community college in 2006, when it loaned $30 million to the Compton Community College District, its second state loan in 25 years.

The loss of more state funds would force colleges to shift their missions dramatically, said Patrick Murphy, a University of San Francisco professor who studies school finances.

Community colleges may have to cut enrollment, lay off instructors and stop offering classes at some campuses, he said, as many schools have already done.

"I do think there's something to be said for shaking things up, but, at community colleges, we've done a lot of shaking up," Murphy said. "If I were the budget officer at a community college, I would quit or go to the rubber room."

With university tuition hikes preventing some students from affording those schools, additional cuts at the community colleges would leave many would-be students without options.

Alameda County's four-college Peralta district, for example, has cut enrollment dramatically since 2008, when the equivalent of 22,000 full-time students attended its schools. If Brown's tax plan fails, Peralta colleges will enroll 16,800 full-time students, said Ron Gerhard, the district's chief financial officer.

"That's unconscionable, in my mind," he said. "There is such an unmet need out there."

Statewide enrollment has dropped about 10 percent -- from 2.9 million to 2.6 million -- from 2008 to last year.

No matter how dire the November election outlook, the schools are having to deal with a more immediate uncertainty.

For college districts, the fiscal year starts July 1, and the school year begins in August or September. That means students will start classes before college leaders know whether their schools will lose millions of dollars.

The sobering possibility of deep midyear cuts follows three years of reductions that have left classes overflowing, shutting out hundreds of thousands of frustrated students.

At some colleges, administrators have drawn down reserve funds to ease the effects, and those funds have sunk to dangerously low levels.

California requires districts to keep a 5 percent budget reserve, and Santa Clara County's Foothill-De Anza district and the Peralta district each are brushing up against that figure this year.

Using reserves has kept the Foothill-De Anza district in the black, but its two colleges could soon see a lot of red as the district deals with a budget deficit for the fourth straight year.

Under a best-case scenario presented to employees May 17 by Chancellor Linda Thor, the district will need to cut nearly $8 million this year, or 4 percent of its budget, on top of a $4 million cut taking effect July 1.

The fiscal drain could worsen to more than $13 million this year. Before the cuts, the district's total budget will be between $176 million and $179 million.

"It's a choice of two bad scenarios," Thor said in an interview. "But we will not run this district into insolvency. We will cut, we will lay off people, but we will not bring this district to bankruptcy."

Foothill and DeAnza colleges have cut 11 percent of their classes the past two years, and plan to cut 6.4 percent more if the state tax initiative fails.

"We've already done all the economizing we can," said Kevin McElroy, the district's chief financial officer.

Matt Krupnick covers higher education. Contact him at 510-208-6488. Follow him at Twitter.com/mattkrupnick.

---