The higher education landscape is rapidly changing. As birthrates continue to fall and the cost of a college education remains stubbornly high, many institutions are facing economic cliffs that, for some, will mean closure or merger. This does not have to happen.
Community colleges have long been the sector most prone to economic and political shifts. In Massachusetts, the Legislature under the current governor has invested significant capital in a free community college program for all residents — this after a successful similar program for returning adults. Although these and similar programs transfer state money to the colleges to cover tuition and fees for qualifying students, the bottom line remains unchanged. Even as the community colleges benefit from increased enrollment, the costs of campus operations remain a critical burden.
Personnel costs continue to rise — each community college in Massachusetts is responsible for its own budget, relying primarily on tuition revenue to support operational expenses. A brief study of a few commonwealth community college budgets illustrates how payroll and fringe benefits cannibalize gains from higher enrollments. One institution that reports an approximately $60 million budget spends well over half of its revenue on salaries and fringe benefits alone. Similarly, a Boston-area community college with a large enrollment base has also experienced revenue erosion as a result of growing operating costs. Over 40% of a vast $100 million budget is allocated to payroll — the consequences resulting in reduced investment in students and academic outcomes.
The current situation for the Massachusetts community colleges is untenable. Without significant financial overhaul, campuses will reach a financial dead end — mergers and closures assured.
There are two opportunities for lawmakers and college leaders to seize on now to prevent the loss of treasured institutions.
First, the community college system needs a centralized budget. Although the commonwealth does make contributions to the colleges, payroll costs are supported by campus revenues, tuition and fees. These deficits are often filled by layoffs, drawing from reserves, program closures, and other short-term patches that fail to address the long-term issues. A centralized financial system would reduce fiscal redundancies, including in the area of academic programming, that continue to create overwhelming operational costs on each campus. The Connecticut community colleges recently trudged through a lengthy process to merge the independent campuses into a single institution. The rationale: reduce overhead by eliminating redundancies in programming and personnel.
The second opportunity already exists — students. Across Massachusetts, there are far too many part-time community college students. In some cases, upwards of 75% of the tuition base carries fewer than the required number of credits to be full-time. There is plenty of scholarship to illustrate the many reasons community college students elect to attend part-time. And, there is even more to indicate that full-time students graduate at higher rates than do their peers. It is not enough to recognize the issue, but a permanent solution must be found soon before some of the smaller colleges teeter on the edge. Many years have now elapsed since the pandemic shifted education online and the higher education community has learned a lot about what makes community colleges successful. If a college increases the number of full-time students using new practices like compressed online programs and guided pathways, completion rates rise as do revenues. In most instances, colleges can recover financial losses by converting students they already have from part-time to full-time. More full-time students equals more credits and more revenue. It is like expecting to go 300 more miles on a quarter of a tank of gas. Unless you fill the tank, the car won’t make it.
The Legislature and college leaders, including faculty and staff, can decisively turn the situation around. A centralized budget will reduce financial waste and bring programs and operating costs into alignment. The colleges, in turn, must find new ways to educate, including reconstructing programs meant for a past generation. Students and their institutions benefit from full-time enrollment. Supports like advising, tutoring, writing centers, and small classes ensure that students can and will complete their degrees on time.
Most importantly, there are ways to cut costs without sacrificing faculty and staff who have committed themselves to their institutions for decades. A centralized budget and a sizable increase in the number of full-time students can hold off the financial cliff many institutions are now facing if the Legislature is ready to partner with campus presidents on these issues.
Chet Ragusett, Ph.D., is an author, academic, and former Greenfield Community College provost.