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FMCC adopts $16.04M budget

JOHNSTOWN — The Fulton-Montgomery Community College Board of Trustees on Thursday approved the adoption of a $16.04 million 2020-21 operating budget and a $140 per year tuition increase while the college faces uncertainty over state aid and enrollment for the next year due to the impacts of the coronavirus.

The adopted $16.04 million 2020-21 operating budget represents a 6.69 percent decrease from the current year’s $17.19 million budget. The budget anticipates revenues of $4.43 million in aid based on an enrollment rate of 1,275 full-time equivalent students.

The budget will be balanced in part through a $140 tuition increase to a rate of $5,040 per year and a $334,141 fund balance allocation.

FMCC Acting President Greg Truckenmiller provided an overview of the proposed budget during the remote board meeting while noting that the budget was drafted under continually changing circumstances with revenues and expenses included in the budget that may be revised over the course of the next year.

“This year has produced challenges unlike any that we’ve seen in the past. It started with concerns over what was going to happen with the state budget before COVID and then COVID actually hit,” said Truckenmiller.

FMCC was facing an estimated $447,831 decrease in state aid next year as Gov. Andrew Cuomo in his executive budget released in January sought to remove the funding floor for community colleges maintaining state aid allotments each year at a level of at least 98 percent of what school’s received the prior year regardless of enrollment.

Before state lawmakers first approved a funding floor in 2019, state aid to community colleges was tied to student enrollment with schools receiving a set amount of aid per full-time equivalent student. For the 2019-20 academic year state aid was set at a rate of $2,947 per student FTE. Under this formula community colleges statewide experiencing declines in student enrollment in recent years have also faced declining state aid.

State University of New York institutions were advocating for the reinstatement of the funding floor by state lawmakers in the final state budget before the impacts of the coronavirus created a state budget crisis as expenditures to control the outbreak rose and revenue sharply declined while businesses closed under the state stay at home order.

FMCC and schools across the state are now facing extreme uncertainty while preparing budgets for the next academic year under the state budget approved by lawmakers in April that eliminated the funding floor and includes a provision allowing the state to adjust or reduce aid over the course of the year based on actual revenue received by the state.

The state will determine actual spending following three “measurement periods” running from April 1 to 30, May 1 to June 30 and July 1 to Dec. 31. Although the first measurement period has now ended, state officials have yet to release information on how state aid allocations will be altered if at all.

Truckenmiller said the state Budget Office advised localities to plan for a possible 10 to 50 percent cut in state aid, leading SUNY to require schools in the system to submit budget scenarios planning for aid reductions at various levels for the next academic year the begins in the fall and for the remainder of the current year.

“That cut doesn’t wait until the next fiscal year, that cut will likely begin in our June state aid payment,” said Truckenmiller.

FMCC may experience some relief through $817,000 allotted for the school through emergency funding included in the federal Coronavirus Aid, Relief, and Economic Security Act for higher education. But Truckenmiller noted that the funds are currently held up by the state Division of Budget and may be factored into any decisions surrounding cuts in state aid.

“The realistic reason that they’re doing that is they’re considering how that funding fits into potential cuts,” said Truckenmiller. “We don’t anticipate that our state aid is going to be cut a certain percentage and then they’re going to simply take the CARES Act money on our behalf. We think that money is going to be used by the state to offset some of the cuts so they may not be as severe as what they’re predicting.”

If the state cuts aid to schools by 50 percent, Truckenmiller pointed to the likelihood that the $817,000 CARES Act allocation would be used to backfill FMCC’s aid reduction, creating an overall loss in aid of less than 50 percent for the college. Given that these considerations will continue to come following the first state measurement period, Truckenmiller pointed to future federal relief packages as likely playing a large role in the impact to FMCC’s budget and the amount of state aid the college will receive.

“Keep in mind these cuts are probably going to be rolling throughout the next 18 months or so as the director of budget reviews revenue projections each quarter and makes determinations on state aid,” said Truckenmiller.

While state aid is expected to decline due to the impacts of the coronavirus, school officials are similarly uncertain how the impact of the virus on the economy and necessitating the physical closure of campuses will impact enrollment at FMCC.

“Are we going to continue the decline that we’ve seen in recent years or are we going to see an increase due to the conditions? We just don’t know and that’s why this has been a particularly challenging year for us to put together a budget,” said Truckenmiller.

Historically, Truckenmiller noted that rising unemployment and the emergence of national recessions have led to increased enrollment at higher educational institutions and at community colleges in particular.

The shift by colleges statewide to remote instruction when physical campuses were ordered to close in March due to the coronavirus may lead students to opt to attend community colleges in the fall as cost effective options that are closer to home as uncertainty continues to loom over how and when college campuses will be able to reopen.

FMCC and all colleges in the SUNY system will offer only remote instruction for the summer semester and SUNY institutions have been tasked with planning for the possibility of continued remote instruction in the fall while awaiting state guidance on reopening.

“If we’re remote and everyone else is remote does that make us an attractive institution for individuals who are entering their higher education career,” said Truckenmiller.

Truckenmiller pointed to the proposed budget as giving the college the flexibility to accommodate a surge in enrollment through additional expenses if necessary or to reduce expenses over the course of the year to fall in line with actual revenues to the college if enrollment remains flat or declines.

“The budget is a plan, it isn’t a contract, it isn’t a commitment to spend certain dollars, it’s a plan and it’s a plan that needs to be flexible and responsive to the various conditions that we’re going to see,” he said.

Truckenmiller went on to note that the college cannot exceed the finalized operating budget if expenses arise in explaining the scope of the budget and the inclusion of the $334,141 fund balance allotment that he said the college would not aim to fully expend.

He pointed to the fund balance allocation as providing the college flexibility to meet a surge in enrollment through the addition of faculty and staff if necessary, with the funds in that case likely replenished through increased tuition revenue.

“We wouldn’t spend more than that and we hope to spend less than that,” said Truckenmiller.

The Board of Trustees on Thursday approved resolutions adopting the proposed $16.04 million 2020-21 operating budget and setting tuition for the next academic year at $5,040. The budget will next be presented to Fulton and Montgomery counties for board approval before it is sent to the SUNY Board of Trustees for final approval.

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