In perspective: wages, the FY 2018 budget, and our future

Below is a message I sent the College community on May 12:

 

This is truly an exciting time at Pima Community College. On Wednesday evening, our Governing Board directed us to move forward with significant, wide-ranging initiatives that have the potential to reshape PCC so that we can best serve our community for years — and in some cases, decades — to come.

Let’s start with the budget. Last night, the Board approved key budget parameters that put the final pieces in place for Fiscal Year 2018.  We can now move forward with publication of the budget and Truth in Taxation notices for public review.  The budget will ultimately be adopted in June following the public hearing and special Board meeting.

Wages

The Board, in recognition of the great work by employees during these challenging times, directed the College to provide a 2 percent incremental increase to salaries and wages. Assuming formal approval by the Board in June, this increase will be calculated on base pay amounts throughout the year.  While it is not technically an increase to base pay, the amount will be essentially the same. Its continuance will be decided next year when we have more information from a class and compensation study the Board on Wednesday night directed the College to undertake, and how the organization is doing in relation to its strategic and operational goals.

The Board’s direction is an echo of my heartfelt thanks to our employees, whose grit and creativity put us back in good standing with our accreditor.  Specifically, I want to thank you all for your feedback, questions, suggestions, and patience throughout this dynamic budget scenario and development period.  We are clearly rebuilding the plane as we are flying it — we are incorporating strategic and organizational changes within the budget structures to facilitate changes necessary for us to become a premier community college.

The big picture: challenges

To reach that goal, we are working diligently on fiscal and operational challenges connected with declining enrollment — our infrastructure is misaligned, particularly in terms of our physical structure and the number of people we employ.  We have been discussing and working on this for several years, and have made very real progress by, among other things:

  • implementing the College reorganization;
  • reducing the size of the administration;
  • setting target ratios that guide the authorization to fill full-time faculty positions;
  • adjusting tuition and other service delivery to ensure we are market-competitive;
  • reducing equipment purchases that are subject to expenditure limitation;
  • improving classroom funding models consistent with the new organization;
  • scrutinizing every staff position prior to recruitment, and establishing unit-based budget reduction targets.

That said, our current enrollment results in a very real need to significantly reduce our operational expenses due to looming expenditure limitation realities.  The good news is we have some time to adjust to the reduction; the bad news is that reductions are a certainty we must address.

The big picture: opportunities

At the same time, the College is undergoing a strategic renewal, as evidenced by the Board’s actions Wednesday night:

  • Approving three strategic directions contained in the final draft of the 2017-2021 Strategic Plan;
  • Committing the College to the goal of ensuring that 60 percent of Pima County residents age 25 and older have a certificate or college degree by 2030, aligning us with Governor Doug Ducey’s Achieve60AZ initiative;
  • Approving conceptual Educational and Facilities Master Plans, which provide a vision for where we need to go as an organization. Ensuring program quality, relevance, and sustainability; implementing effective pathways to student success; establishing Centers of Excellence; and expanding and integrating our outreach efforts create an array of exciting possibilities to focus on. The plans also clarify the need to reinvest into the College to improve program and service delivery, educational space, and equipment.

A healthy, balanced budget

When we originally developed the budget scenarios back in December, it was with these challenges and opportunities in mind.  The feedback we received from our forums and feedback tools indicate that the College community understands the need to resize and reinvest.  Approximately 95 percent of the responses we received supported either Scenarios B or C, which trigger budget reductions and reinvestment starting in FY 2018.

The budget that the Board approved for publication includes a healthy balance of these conceptual and strategic changes.  Specifically, the budget includes the reduction of 100 vacant staff positions (approximately $6.3 million), the inclusion of $3.6 million in revenue bond debt service, an increase in property taxes to the levy maximum (approximately 3 percent), and direction to fund enhanced enrollment initiatives (i.e., marketing, retention efforts) and the aforementioned class and compensation study.

No reduction in force in FY 2018

The reduction of 100 positions will be achieved through the elimination of existing vacant staff positions.  Approximately 40 positions have already been identified for elimination, and 60 additional positions will be identified during the course of the year.  The Executive Leadership Team will develop a new process for reviewing all vacant staff positions, and only critical positions will be approved for recruitment.  As a result of this strategy, the College does not expect a Reduction in Force during Fiscal Year 2018.  However, this approach will require all of us to be more flexible with how and where we perform our duties, and there will be active and constructive discussion about how to more efficiently provide necessary services with fewer people.

Lastly, the revenue bond debt service of $3.6 million will enable the College to have an infusion of approximately $45 million to take a major first step toward the implementation of the Educational and Facilities Master Plans.  The specific projects will be identified in coming months through a series of summits and discussions, and the actual process of issuing debt will require Board action. The revenue bond will enable us to make significant progress toward consolidating programs and creating our new Centers of Excellence.

I mentioned that the budget was predicated on foundational assumptions that include financial and operational metrics, and the budget makes good progress toward our upcoming expenditure limitation.  A commitment toward increasing enrollment will focus our energies on specific initiatives and tangible gains, and decrease the amount we will eventually have to reduce by 2021.  The proposed Fiscal Year 2018 budget contributes more than $5 million of progress on our expenditure limitation, which is within our targeted Scenario B goal.

A final word

When he was CEO of Intel Corp., Andy Grove coined the term “strategic inflection point,” defined as that which causes a fundamental change in an organization’s strategy. With our accreditation challenges behind us, and with fascinating new initiatives ahead, it’s clear we are pivoting toward a brighter future. Working together, we can reimagine PCC for the benefit of our students and community.

Celebrating Aviation Technology

Aviation 5

Like any PCC graduation, the Aviation Technology ceremony was a family affair.

I was honored to deliver keynote remarks at our Aviation Technology completion ceremony last week. The event kicks off the start of the best time of year at PCC, graduation season. Over the next month, the College will celebrate the achievements of students at about a dozen ceremonies, including the 2017 Graduation at the Tucson Convention Center Arena on May 18.

Aviation technicians are “the surgeons of the sky” – highly-trained technicians who can diagnose and treat aircraft so that day after day they deliver passengers and cargo safely to their destinations. It’s a profession distinguished by high academic, industry and government standards. Our Airframe and Powerplant students attend class weekdays from 7 a.m. to 3 p.m. for 19 months, receive more than 2,000 hours of instruction and take 100 tests.

Aviation 4 (2)

With Governing Board member Sylvia Lee and new Aviation Technology graduate Dennise Ponce.

It’s also a profession with tremendous employment opportunities. An estimated 25 percent of Arizona’s 17,500 civil aviation workers will reach retirement age in the next two years. Some 98,000 additional aviation technicians will be needed across North America over the next 20 years; worldwide, that number will exceed 675,000.

Through the hard work of Academic Director Jason Bowersock and the faculty and staff at the Aviation Technology Center, the program has a sterling reputation throughout the  industry. When one of our students mentioned during a recent job interview that he was attending PCC, for example, he was hired on the spot.

After the ceremony, PCC Governing Board Member Dr. Sylvia Lee and I visited with graduate Dennise Ponce. Dennise is from Nogales, and is considering a career in the armed forces or working for federal contractors. [She’s particularly interested in drones.] For Dennise and the 30 other students honored last week, the sky’s the limit.

Building Community 2017

Giant check

A $428,000+ donation from the estate of a Tucson woman will help fund scholarships for aspiring nurses.

I had the privilege of speaking last week at the Building Community breakfast, a Pima Community College Foundation event in which students and friends of PCC share the ways PCC support has helped students realize their academic and career dreams.

About 200 people heard from Shekeycha Ward and Kyle Hughes, both of modest means. Shekeycha is an aspiring pediatric nurse; Kyle is studying to be an accountant and hopes to become a lawyer. They described how scholarships helped them pay for school, and how PCC supports students who are new to the world of higher education. As Shekeycha says, “College is different from the movies . . .  It’s OK to know that there are things you don’t know.”

I shared how the College’s North Star – student success, community engagement and diversity – is driving a wide range of developing initiatives. These include regionally and nationally recognized Centers of Excellence in Applied Technology, Healthcare and other areas essential to the economic growth of our county and state.

We also are building academic pathways that precisely map students’ education journeys at PCC, so they can save time and money by earning credentials quickly and efficiently.

Howard N. Stewart, president and CEO of AGM Container Controls, spoke eloquently about the need for companies to provide financial assistance to employees who wish to continue their education.

Rachel Schaming, Executive Director of the Foundation, and her team deserve recognition for bringing together community leaders and students in an enriching celebration of achievement and promise.

What a week!

Last week was phenomenal, and not only because on March 9 our accrediting organization lifted all sanctions from the College. On March 10 we held two events with the potential to shape PCC and community for years to come.

More than 100 business, education, government and community leaders joined PCC employees for Futures Conference 2017.  The theme of 2017’s conference is an echo of the first conference.  As in 2014, we are looking to define a handful of comprehensive priorities, or Wildly Important Goals (WIGs), to guide the College through 2020. [Another session of the conference will be held March 23. You also can offer your insights in an online survey.]

March 10 also was the inaugural Ethnic, Gender and Transborder Studies summit. More than 300 students, community members and employees gathered for a morning of scholarship and idea-sharing. The afternoon was spent discussing ways to create a Center of Excellence devoted to diversity, inclusion and social justice.

I am extremely proud of the event’s organizers, who have applied the Center of Excellence concept in a way that will make us a leader among community colleges. Moreover, the center has the capacity to give students a physical space devoted to data-based scholarship, alliance-building, and advocacy for the historically marginalized. Or, as one student eloquently put it, the center will be a place for “inspiring humans.”

The key point to remember is that while the College worked with our accreditor, we have been developing an array of forward-looking initiatives that go far beyond compliance. Meeting regulatory standards is of course an important foundational activity, but it’s only one of a range of efforts we are undertaking to achieve a greater end – becoming a premier community college.

Accreditor removes PCC from sanction

Here is a message I shared with the College community earlier today regarding our status with the Higher Learning Commission, an organization that accredits community colleges, colleges and universities:

Colleagues,

I have great news. The Higher Learning Commission’s Board of Trustees has removed the College from Notice.

The College was notified in an Action Letter dated today from HLC President Barbara Gellman-Danley. [The Action Letter and accompanying Public Disclosure notification are available on our website.]

“During its meeting on February 23, 2017, the Board removed the sanction of Notice from the College. This action is effective as of the date the action was taken,” President Gellman-Danley writes. “The Board determined that the removal of the sanction was warranted based on evidence provided by the College, including the Notice Report, the report of the visiting team, the staff analysis of the sanction, and the College’s responses to these reports.”

This is wonderful news for current and prospective students. While we remained fully accredited as we sought to comply with HLC standards, removal from Notice is a crystal-clear indication to students that their school is operating and will continue to operate at a high level. These students, who have invested their time and money in us, deserve nothing less.

It is also wonderful news for the community. Pima County residents can rest assured we are an institution that is worthy of their support and can continue to significantly contribute to our region’s economic development.

Regaining the full confidence of our accreditor required a Herculean effort that spanned nearly four years and involved hundreds of employees – regular and adjunct faculty; exempt, non-exempt and temporary staff; and administrators — along with Governing Board members, students and community stakeholders.

The creativity and perseverance of our colleagues and friends has been phenomenal. As you might imagine, there are many, many people to thank. I want to express special gratitude to the Provost’s Office, which was charged in early 2013 with leading our accreditation effort and time and again responded admirably to the challenge.

I need to point out that, as we celebrate today’s achievement, we are preparing for our next Comprehensive Evaluation, part of the routine Standard Pathway of the HLC’s accreditation process.  This process will include developing an Assurance Argument and Evidence file, previously known as a Self-Study, as well as hosting a Comprehensive Evaluation Visit. We have been asked by the HLC to embed an Interim Report into the Assurance Argument in order to update the HLC Board on the status of items related to planning, budgeting, Developmental Education and the assessment of student learning.

We welcome the HLC’s interest in our institution, and confidently look forward to meeting and exceeding their standards now and in the future. We welcome the passionate interest so many have in PCC. The work we do matters. I am always proud to be part of PCC, and today, I am especially proud to lead a school that helps our neighbors climb the economic ladder and realize their personal, diverse vision of the American Dream.

Lee D. Lambert,
Chancellor

The role of grants in higher education

As states experience fiscal challenges, higher education institutions across the U.S. are facing reductions in publicly funded support.  One of the ways to counter this loss of revenue is by winning grants from government and private entities. Pima Community College is actively competing for this source of funding.

Currently, we have 45 active grants, totaling more than $50 million. The grants range in size from $5,000 to $15 million. The grants serve 12,000 students and employ 200 staff and faculty. They provide student support services, curriculum development, professional development for faculty, classroom redesign and other services.

Our most recent grant award is a $3.1 million Hispanic-Serving Institutions Science, Technology, Engineering, Mathematics (HSI-STEM) grant from the U.S. Department of Education. The grant will expand student support services and tutoring, and establish specific transfer pathways to Arizona’s four-year universities. The goal is to improve the academic and career success of Hispanic/low-income students by increasing the number of students who receive certificates or degrees from PCC in STEM-related majors, and-or who transfer to STEM fields at Arizona’s three four-year universities.

As Program Coordinator Lupe Waitherwerch told Tucson’s NPR radio affiliate, the goal of the grant is straightforward: “We want [students] to feel like they belong in college to begin with and … be able to believe that they can succeed.”

It’s important to put awards like these into context. First, PCC was in the running for the grant because we are viewed as a Hispanic-Serving Institution by the U.S. Department of Education. More than 43 percent of our students are Hispanic, far exceeding the 25 percent threshold for an HSI designation from the Hispanic Association of Colleges and Universities.

The College’s HSI designation benefits not only Hispanic-Latino students, however. Low-income students of every ethnicity are eligible to take advantage of the grant’s resources. As individuals, the students who achieve academic and career success through the program will become Pima County’s taxpayers, homebuyers and entrepreneurs of the future. Additionally, they will enhance southern Arizona’s reputation for producing employees capable of powering cutting-edge 21st-century industries. Everyone will benefit.

It’s also important to recognize the limitations of grants. While grants greatly enhance education of our students, they are not part of the operating budget; our fiscal hurdles remain. Additionally, grants pay for programs for a specific time. The HSI-STEM grant has a five-year life. It is a challenge for colleges and universities to find ways to institutionalize a promising initiative after the money runs out.

So PCC, like most of its counterparts in higher education, will continue to pursue grant opportunities that benefit our students and communities in order to ameliorate the impact of budget reductions. In that respect, we are walking the path well-trod by businesses everywhere. We’re adjusting and diversifying our revenue streams.

Report validates our progress on accreditation

I am pleased to report that we have received the Draft Feedback Report from the Higher Learning Commission’s Peer Review Team, who recommended removing the College from sanctions in 10 of the 11 areas of concern.  And while they determined that one area required the College to remain “On Notice” for an additional six months, our work earned praise and recognition.

In fact, the Report validates every effort we have made to strengthen Pima’s commitment to students and the community.

As you know, while remaining fully accredited, the College was “On Notice” as we addressed 11 areas of focus where the HLC, the College’s accrediting body, thought we could easily slip out of compliance with accrediting standards.

Following review of considerable documentation and an intensive September Focused Visit, the Peer Reviewers, who are college leaders from across the country, concurred that PCC made significant progress and fully addressed the concerns of the Commission in five areas of focus.  That is outstanding news.  It allows us to move forward with no need for monitoring.

In five other areas, Reviewers complimented the College on its work and acknowledged the strong foundation built in each area, but believed we needed additional time to provide evidence of effectiveness. As we expected, those areas were recommended for additional monitoring, but there was no recommendation of a sanction, and of those, only one required HLC follow up. Again, more good news.

In only one area, regarding assessment of student learning outcomes, the Peer Reviewers thought the “evidence of effectiveness was insufficient” enough for the college to remain “On Notice” for an additional six months, until Sept. 1, 2017.

Specifically, Reviewers want to see the College complete hiring of two critical assessment positions, a Director of Assessment reporting to the Assistant Vice Chancellor for Accreditation and Academic Quality Improvement, and a Research Analyst reporting to the Director of Assessment. The extra time gives the College the opportunity to complete the hires and to allow these individuals to develop goals, strategies and tactics. We are firmly on track; an offer has been made to a candidate for the Director’s position and interviews for the Research Analyst position occur this week.

Reviewers were particularly attentive to assessment of student learning outcomes, in part because it viewed the College’s efforts as overdue, and in part because our model is still new and will require continued oversight and direction by someone who has a direct line of accountability for its success.

Even so, Peer Reviewers said the “new structure has enhanced visibility, consistency and stronger leadership of the PCC assessment efforts.”

Next steps

The College was given the opportunity to review the Draft Feedback Report for errors. After reviewing the College’s comments, the HLC will finalize and issue the Feedback Report.  We expect this to happen in the next few weeks.  The Final Feedback Report and supporting evidence will be reviewed by the HLC Board of Trustees in February 2017 for a final decision. The status becomes official with the HLC Board vote.

By Sept. 1, 2017, we will submit a report on the status of hiring the two assessment positions. The report also will include updates about the monitored areas. Review of the College’s report will determine if a site visit is required for Fall 2017.

While the College had hoped to come fully off sanction, we are heartened and encouraged by the significant progress to date.

The Reviewers’ compliments were abundant and included statements such as “the institution’s governance and administrative structures promote effective leadership and support collaborative processes that enable the institution to fulfill its mission. … The team found during its visit that it appeared the College had improved the climate of openness and inclusivity of individual perspectives.”

And “it is clear that PCC has embraced a new culture that includes a focus on Developmental Education and on Adult Education, including KPIs related to the development of both within the Strategic Plan. The Dean of Developmental Education is progressively leading an enthusiastic group of faculty, advisors and staff who are focused on student success.”

We are grateful for the Reviewers’ thoughtful evaluation and for recognizing the hard work behind all of the achievements in these past several months. We still have much hard work ahead, but now our path is clear and we can be confident in our actions.