Partnerships: An Economic Recession Survival Strategy

Article By: 

Duane Lowe

Duane Lowe is a retired community college administrator, who worked in California Community Colleges for over ten years.  He studied philosophy at the University of California, Los Angeles and earned his doctorate at the University of Southern California.  In his spare time, he teaches courses at California State University’s Graduate Center for Public Policy & Administration.  Duane resides in southern California with his wife, two children, and loyal dog, Binkie.

Abstract: 

Can community college districts share resources as a strategy to survive the upcoming fiscal debacle? This provocative article discusses this concept with the intention of inspiring the community college faculty-members, administrators, and trustees to consider innovative resource sharing arrangements.

Article: 

Introduction

For fiscal year 2009-10 California Community Colleges were hit with a $544 million reduction in financial resources (Skinner, 2009).  The magnitude of this 8.7% budget cut presents a daunting leadership quandry for community college trustees, administrators, and faculty because the easy cuts, like deferring equipment purchases and trimming supply and travel budgets, have already been made and the total amounts for those budgets are comparatively minuscule.  At the same time, colleges are experiencing the “double whammy” of massive surge in student enrollment.  In the previous academic year, state-wide enrollment increased by over 135,000 students (4.9%) to a record high 2,913,735 students (Scott, 2009).   To survive this financial crisis new ways of getting the job done must be considered.  This article presents ideas and commentary about the feasibility and payback of establishing new partnerships to keep our colleges afloat.

Sharing

Since our brains have limited memory capacity, many of us keep important reference books handy to help guide our day-to-day decision-making.  For some, it’s the “Board of Governors Fee Waiver Program and Special Programs Manual” (California Community Colleges Chancellor’s Office, 2009). For others, it’s the “IPEDS Data Center User Manual” (National Center for Educational Statistics), or the “2009-2010 Constitution and Bylaws” (California Community College Athletic Association).  For me, it’s “All I really need to know I Learned in Kindergarten” (Fulghum, 1986).  In this inspirational work, Fulghum (1986) lists bits of wisdom about how to live and what to do and how to be.  At the top of his list is “sharing.”   And so, it hit me late one evening that sharing is the way for community colleges to survive the current fiscal crisis.  It is the way to do more with less and to continue to provide world-class educational opportunities to our 2.9 million students.  What can we share?  How about our library resources?  How about our computer technology systems?  How about our financial aid eligibility systems?  How about student admissions processing systems? And if we did, how much could we save?  Take a look at the following table, which was prepared from 2007-08 expenditure data reported by each district to the California Community Colleges Chancellor Office on the Annual Financial and Budget Report (CCSF-311).  
2007 Expenditures for Selected Activities
  
 2007-08 Expenditures Percent of Total General Fund
Academic & Management Information Systems & Technology                                                 $ 278,147,031  3.8%
Library                                                           126,403,696  1.7%
Admissions & Records                                    127,269,954  1.8%
Financial Aid Administration                            119,768,812  1.7%
                                                   Total   $       651,589,493  9.0%
  
  
Data source: http://www.cccco.edu/ChancellorsOffice/Divisions/FinanceFacilities/
                    FiscalServices/CCFS311PDFFiles/200708CCF 
If we could trim just 10% of these costs, system wide savings would be over $65 million.  Could we trim more? Maybe.  How would we trim costs? By sharing.

 Academic & Management Information Systems & Technology

Could districts with the same computer system (Datatel, Banner, or Oracle) share computer hardware, software and support staff?  I think so.  If a large multi-college district added new learning center, the computer/fiscal system would be modified accommodate a new location/site code to track the budget, course enrollment, FTES, and MIS reporting requirements for the new center.    It seems like adding a neighboring district’s college would entail similar chores as adding a new center, although the volume of work is likely to be higher.  The district providing the computer services could charge their neighboring district a reasonable fee, or negotiate some kind of barter arrangement for other services.  The opportunities for this kind of sharing partnership are limitless.

Libraries

Why not share library resources?  Neighboring colleges and universities can form partnerships with each other for books, digitized journals, etc. Heck, why not enter into this kind of dialog with city and county public libraries too?  Where I live the local university has a reciprocal borrowing agreement with seven neighboring community colleges and the city library system. Interestingly, these cooperative sharing arrangements are not well known or well publicized, so a bit more interagency communication has the potential to increase sharing of library materials, and allow a reduction in expenditures for duplicate volumes or internet accessible journal articles.

 Admissions and Records

The admission requirements for each of the 110 community colleges in California are exactly the same.  Specifically,
Admission to a California community college is open to any California resident possessing a high school diploma or equivalent. California community colleges may admit any nonresident possessing a high school diploma or equivalent or any person over the age of 18 who, in the judgment of the board, is capable of profiting from the instruction offered. (CCCApply.org)

Also, the criteria for determining California residency (at least one year of physical presence in this state, coupled with the capability and the intent to make California one's permanent home) is consistent throughout the community college system.  This means that we have seventy-two admissions offices and admissions staffs, which are doing exactly the same thing in reviewing applications for admission.  So, it seems to me that we have opportunities for one district to perform the admissions review and eligibility determination for another district.  Or, it certainly seems conceivable to me that regional admission offices could handle the admissions work for multiple colleges.  Similarly, a shared repository for digitized student records is a feasible concept because the current state of technology is capable of supporting this concept.  It would be like seventy-two branches of a bank having access to a common database containing information about each depositor’s accounts.
 
Financial Aid Administration

A major function of financial aid administration is determining the eligibility of students for federal Pell grants and state funded Cal-Grants.  Similar to admissions, the eligibility determination criteria for these financial aid programs are universal throughout California.  So, again, we have opportunities to perform financial aid eligibility determination for other colleges or to get the job done through a cooperative regional office.

Models for Sharing

Of course, the devil is in the details, so I want to discuss models for the organization and governance of sharing arrangements.  Three basic models occur to me.   First, is the simple fee for service arrangement that would be like outsourcing, except we would only outsource to colleagues in another college or university.  Like any contracting out of services arrangement, the challenge would come from coming to a true “meeting of the minds,” where quality and timeliness of work to be performed was clear to both parties and fairly delineated in a formal contract or memorandum of understanding.  An arbitration process or some other ways to mediate disputes should be developed and discussed.  Last but not least, there must be a “meeting of the minds” about fair and reasonable remuneration for the service provider.

The second model is the barter model, which is a variant of the outsourcing among colleagues model.  The difference would be that the barter model would require agreeing about a service of equal value.  For example, if I do admissions determination work for 500 of your applicants, would it be fair for you to do the financial aid eligibility work for 500 of my students? 
 
The third model is to establish an independent consortium to perform work for the member districts.  This model is the most complex because a board of directors must be established to oversee the organization, develop policies, and approve a budget for the operation of the consortium.  Also the consortium would have to hire a director and sufficient staff to perform the necessary work.  A consortium to provide computer and technology support to a group of college districts looks feasible and promising.  The efficiencies would come from economies of scale.  For example, it would be more cost efficient to have one team of computer programmers develop a computer routine to extract data for the Accountability Reporting for the Community Colleges (ARCC) system, than to have ten separate teams working in ten different college districts.
 
Precedents

I can think of a few examples of the kinds of sharing arrangements that I have in mind.  The Claremont colleges are six undergraduate colleges and two graduate institutions that share a centralized organization that provides campus safety, a central library, health and counseling services, ethnic centers, central bookstore, physical plant and facilities support, payroll and accounting, information technology, human resources, real estate, risk management and employee benefits to each of the eight independent institutions.  Their unique organizational scheme works and the Claremont colleges have a reputation for being top-notch institutions.  The second example is the risk management JPA’s that allow member institutions to share in the benefits risk pooling.  These JPA’s have been around for many years and successfully serve the needs of their member organizations.

Barriers 

What are the barriers that prevent sharing arrangements? This is a complex question, but I think the answer is two-fold: One, our colleges seem to have huge amounts of organizational inertia that make change very difficult. Second our colleges seem to have a very competitive spirit.  You see that spirit on the athletic field, and you see it in our goals to have the best programs, the most outstanding faculty, the most awe inspiring buildings (many of them are libraries).  That mindset makes it hard to work hard to create mutually beneficial sharing arrangements.   Nonetheless, I believe that two colleges can play football on Saturday and share library resources or computer systems on Monday.

Call to Action 

Let’s make our kindergarten teacher proud of us.  Let’s forget about all of the sophisms, egotism, and conformatism that we got from graduate school. Let’s make a paradigm shift from doing everything within our own organizations to a new world where we have sharing arrangements for getting the work done to educate our students with the resources that we, collectively, have.  This will require strong leadership and a bit of risk-taking, but we have a moral imperative to try some new organizational configurations.  If we don’t actively pursue work sharing adaptations, it is likely that external stakeholders will force district consolidations, or even regional or statewide governance structures, like the California State University or University of California systems.

References
California Community College Athletic Association 2009-2010 Constitution and Bylaws. Retrieved from http://www.coasports.org/working/pdf/Constitution/Z-Complete%20C&B%20and%20Appendices.pdf .
California Community Colleges Chancellor’s Office. (2009, August 10). Board of Governors Fee Waiver Program and Special Programs Manual. Retrieved from http://www.cccco.edu/Portals/4/SS/FA/FA_RE_09-10/bogfw_manual_and_cvrltr_final_revised_aug_2009.pdf
Fulgram, R. (1986) All I really need to know I learned in kindergarten. New York: Random House Publishing Group.
National Center for Educational Statistics. IPEDS Data Center User Manual. Retrieved from http://nces.ed.gov/ipeds/datacenter/IPEDSManual.pdf.
Scott, J (2009, September 2) Enrollment at the California Community Colleges Skyrockets to 2.9 Million {Press release]. Retrieved from http://www.cccco.edu/Portals/4/News/press_releases/2009/Enrollment_Surge_CCCs_%20Duncan_Release_9-3-09.pdf.
Skinner, Erik. (2009, August 18). 2009-10 BUDGET WORKSHOP. Retrieved from http://www.cccco.edu/Portals/4/CFFP/Fiscal/Allocations/workshop/Tab_2_-_2009-10_Budget_Workshop_PowerPoint_Erik_Skinner.pdf