How Much More 'Stewardship' Can We Take?

Updated: Nov 19, 2019

At Plenary, President Blake said that “this year as we explore the possibilities, our primary focus will be fiscal stewardship.” She went on to announce that the College would be developing a Fiscal Stewardship Plan and that difficult decisions would be necessary. Let’s put aside for now what’s ominously unstated in that phrase, “difficult decisions”—cutting classes? cutting programs? cutting benefits and salaries?—and consider this “sudden” interest in “fiscal stewardship.”


The need for a fiscal plan to overcome deficit spending is not new. In fact, such a plan has been in the works for nearly two years. The first draft of the Financial Recovery Plan (A.K.A. Fiscal Recovery Plan) was completed over a year ago, with the College asserting to its accrediting body that it would be updated and finalized by the end of June 2019.


On the surface, it appears that trustees and the campus community are actively monitoring, discussing, and revising the Financial Recovery Plan; in reality, however, none of that is actually happening. Instead of moving forward with the timely suggestions laid out in the plan, Blake buried it. For details, click HERE.


There are several telling statements in that buried Financial Recovery Plan. One set focused on particular kinds of spending that needed to be dialed back. There were several, but three stand out:

  • Legal fees (remember that the District’s lawyer is paid more than two-and-a-half times the going hourly rate, and billable hours are excessive as well).

  • Consultants’ fees (something PFF Co-President Teresa Laughlin called out not long ago).

  • Travel expenses (At a board retreat last February, it was revealed that trustees had overspent their travel budget. Trustees Evilsizer and Halcon both subsequently argued that those budgets should be increased, not reigned in.)

Another telling statement in the Financial Recovery plan was its warning to the reader that, “[t]he greatest risk associated with the key strategies and action steps is that the plans to grow revenues and contain costs may not be followed or adhered to.” As a reminder, the author of this report was Ron Perez—a valued and honest member of the administration—and, well, we all know what happened to him.


Make no mistake, Palomar College’s fiscal stability is in danger. The College had to borrow millions of dollars from the Retirees’ Benefit account to bolster its reserves. Also, the Fiscal Crisis and Management Assistance Team (FCMAT) has been asked to identify the College’s specific risk rating for fiscal insolvency.


This is serious business. Peralta Community College District—the system where Blake was last employed before she came here—is currently facing dire financial straits. Take a look at the article in the San Francisco Chronicle to get a better sense of both the analyses done to determine if a college is at risk for insolvency as well as the warning signs at such colleges. Some of these signs may seem very familiar to you.


Our own warning signs have been present for some time, yet the one person who was fighting to head off trouble is no longer here and his work has been largely concealed. Just as recently as the end of July, the Board was told that the FCMAT visit was a “business process analysis”—in other words, “Nothing to see here, folks!” Genuine “stewardship” should have started a long time ago and included careful, considered, transparent cost/benefit analysis of expensive ventures that are now dragging us down.

 

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