LCC Faculty Colleagues,

Please find below a memo to the Board of Education and Budget Committee from Classified, Faculty, and Student leaders.

To: Board of Education Members and Budget Committee Members

From: LCCEF, LCCEA, and ASLCC

Re: Concerns about the FY24 Budget Process

CC: Stephanie Bulger

Esteemed Members of the Board of Education and Budget Committee,

We are writing and speaking to share our serious concerns about the FY24 budget process. 

The process was complicated by many staffing transitions and a lack of continuity in the budget and finance departments. (After the budget manager and Controller both resigned in May 2022, neither position was filled on a permanent basis until a new Controller began in late January. The budget manager position has only just been posted. In addition, the VPFO position has not been filled for many months and has not had consistent, permanent staffing since January 2020.)

The Budget Development Subcommittee (BDS) and College Council both approved budget balancing scenarios with 2% and 3.5% tuition increase but did not consider prior to your April Board meeting a scenario with a 5% tuition increase. For this reason, stakeholders were surprised by the presentation to the Board, implying that the 5% tuition increase was based on a BDS recommendation.

Specific concerns about the budget process include but are not limited to:

1. FY22 audit was not completed until February when it is typically publicized in November or December at the latest. The audit contains a note* about spending that exceeded the parameters of Oregon budget law in Fund VIII, which allows spending variations of 10%. No explanations from management are available to explain the expenditures in excess of the 10% allowed by state law.
2. The Budget Development Subcommittee had to cancel several meetings because administrators could not provide the data necessary for the BDS to do its work.
3. Data provided to BDS was erroneous. For example, one figure provided indicated that $1 in tuition increase would amount to revenue of $200,000, but that figure was 19% above the correct amount.
4. The process was also delayed substantially because the departmental budget planning which is scheduled to take place in Fall term each year still had not taken place when the BDS finalized its work in March.
5. A dearth of information about the budget has been presented to the Board of Education.
6. The tuition scenarios presented to the Board of Education at the April 4 meeting were NOT developed nor approved by the BDS nor by College Council. The presentation to the Board states that the 5% tuition recommendation was based on the BDS recommendation, consultation with student government leaders, etc. The 5% increase was a surprise to all stakeholder groups. The BDS and College Council, including student government representatives, did approve two balanced budget scenarios with 2% and 3.5% tuition increases depending on state funding level. These scenarios approved by BDS and College Council include not only a tuition increase but also expense reductions that comprise the vast majority of funds needed to achieve a balanced budget. This disconnect between the presentation to the Board and the actual approved  consensus budgets reduces stakeholder confidence in the administration’s investment in our shared governance system and raises questions about accountability.

7. Managers have informed the BDS that changes are made to the budget after the BDS completes its work and after the Board has reviewed and approved the budget each year, calling into question the important, statutory oversight role of the Board of Education.
8. For instance, when the BDS, College Council and Board of Education have, as is typical in past years, approved a budget with a figure for decreasing staffing expenses (i.e., not filling vacant positions), managers have informed BDS members that the vacant positions are NOT removed from the budget. This exacerbates pressure on the budget and virtually guarantees that each subsequent year will begin with substantial projected deficits.
9. Long-term systemic issues with the LCC budget such as Titan Court, which drains $500,000 – $700,000 from the General Fund, have not been addressed.
10. There is no plan for restoration of the Ending Fund balance even though the BDS and College Council approved a transfer to the general fund in order to address the depletion of the General Fund Ending Fund balance. It is unlikely that LCC will comply with the Board’s ending fund balance policy.
11. Frequent changes in publicly presented information about actual expenditures from FY22 reduce confidence in data presented to the Board and more generally to the public. See table below. 

FY 22 Accounting Change impacts
Date of reporting of Actuals	Report Source	Fund I net reported	Fund IX net reported	Total net reported
11/30/2022	Report to Board	$782,452	$1,286,082	$2,068,534
1/4/2023	Report to Board	$218,132	$1,286,082	$1,504,214
2/10/2023	Audit Statement	$182,470	$1,273,870	$1,456,340

12. LIkewise, changes to projections for FY23 and FY24 changed frequently and substantially throughout the budget development process.
13. Historically, budget deficit projections have proven to be erroneous, contributing to scarcity thinking and short-sighted decision making. For instance, in January 2022, it was projected that FY22 would end with a $2.9M deficit (See O22 on 1.22.2022 tab. However, just five months later FY22 actuals were documented with a net positive of $324,915 in Fund I and $1.3M in Fund IX (See FY22 actual column in Board Budget Update at the end of this message)
14. There are unresolved questions regarding the appropriate use of Bond funds and insufficient deferred maintenance projects completed with Bond funds, in contradiction to our collective promise to the Lane County community in passing the Bond.
15. While the Board did vote on a tuition increase based on the Administration’s presentation at the April 4 meeting, no information has been publicly presented about how, even after the increase, the remaining $3,178,215 deficit will be addressed.

For all of these reasons, we cannot in good confidence support the budget planned for FY24. We urge you as the Board of Education and Budget Committee to ensure that you are provided all details of the planned budget before the budget document is printed. Because no information has been presented publicly about how the remaining $3,178,215 budget gap will be addressed, it will be critical for the Board and Budget Committee to take a more active role in ascertaining and reviewing the proposed changes. Ensuring that detailed information is presented publicly for your consideration is crucial to maintaining fiduciary responsibility and accountability to the voters of Lane County.

Sincerely,

LCCEF Representatives:

Frankie Cocanour, LCCEF President and Classified Professional

Buck Potter, LCCEF Vice President of Labor Relations, Classified Professional & BDS Member

Dawn Rupp, LCCEF Grievance Officer, Classified Professional

Colin Vurek, LCCEF Vice President of Organizing 

Fiora Starchild-Wolf, LCCEF COPE Officer and Classified Professional

Marleena Pearson, LCCEF Communications Officer, Classified Professional

Tracy Weimer, LCCEF Recording Officer, Classified Professional

LCCEA Representatives:

Adrienne Mitchell, LCCEA President and BDS member

Aryn Bartley, LCCEA Secretary

Marge Helzer, LCCEA Treasurer

Christina Howard, LCCEA Vice President for Career Technical Faculty

Peggy Oberstaller, LCCEA Vice President for Part-time Faculty

Rosa Lopez, LCCEA Vice President At-Large

Wendy Simmons, LCCEA Vice President for Learning Advancement

Kate Sullivan, LCCEA Vice President for Transfer Faculty

Gary Mort, faculty member & BDS Member

Lane SGA Representatives:

Nikhar Ramlakhan, President 

Amaya Carricaburu, Vice President & BDS member

Ilhan Haniff, Senate Seat 3

Ryuto Susumu, Senate Seat 5 

Owen Robles, Senate Seat 7

* Note 10, p. 49 of the official FY22 audit states, “The College budgets all College funds required to be budgeted in accordance with the Oregon Local Budget Law on a Non-GAAP budgetary basis. The Board legally adopts the budget before July 1 through a Board resolution. The resolution authorizing appropriations for each fund sets the level by which expenditures cannot legally exceed appropriations. The level of control established by the resolution for each fund is at the major expense function level (i.e. Instruction, Community Services, etc.). Appropriations lapse at year-end. During 2021-22, the College overexpended the Community Services appropriation in the Special Revenue Fund by $1,365,170, the Student Services appropriation in the Special Revenue Fund by $204,064 and the Plant Additions appropriation in the Special Revenue Fund by $249,278.”