Yesterday, I wrote about the inconsistencies in decision-making at WCC. This strategy allows the WCC Administration to arbitrarily select WCC spending priorities. The WCC administration uses General Fund dollars to pay the $1M+ bond debt and continual rehab costs for the Health and Fitness Center while it closes the Children’s Center because it loses money.
It enables the WCC administration to collect millions in salary, bonuses and benefits while cutting the instructional budget. It enables the WCC administration to allocate $300,000 for campus maintenance and repair while delaying the ML renovation, even though the delay increased the project’s cost by $1M.
The WCC administration uses this inconsistency to justify the elimination of academic programs, too. According to an interview in the Student Voice about the decision to cut the Culinary Arts program, Executive Vice President for Instruction Kim Hurns said:
“This was a program where the enrollment had been suffering for a while… we would have had to make new investments, so it really was not sensible for the college to do.”
Children’s Center closure defies accountability
Here’s the problem with this statement. WCC does not exist to turn a profit. As a community college with a high number of technical and occupational programs, WCC’s instructional costs are going to be high. Look at the instructional budget and the tuition revenues in any given year. For the current year, the year-to-date collections for tuition are about $27.75M. The cost of instruction, year-to-date, is $49.5M.
Student tuition and fees cover only about 56% of the cost of instruction. Put another way, not one single academic program at WCC covers its costs. They cannot, because WCC does not charge enough tuition to fully cover the cost of instruction. If WCC did, tuition and fees would be about $188 per credit hour. To argue that the culinary program got cut because it wasn’t covering its costs is – in one word – bullshit. If that’s the new standard, every single academic program at WCC should get cut.
Why the Children’s Center could not break even
The Administration claimed that The Children’s Center was closed because it cost $1.2M more to operate than it collected in fees. Ok, well, let’s look at that. The Children’s Center charged $3 per hour for its services. If it needed to make up $1.2M per year in service fees, the Children’s Center would need to provide an additional 400,000 hours of childcare per year. There are 52 weeks per year, but the Children’s Center was not open over the holiday break, so we’ll say that The Children’s Center had 48 operating weeks to deliver those 400,000 hours of additional care.
Because the center operated only Monday-Friday, that’s 240 days per year. It would need to offer an additional 1,667 hours of care per day. If the Center operated 12 hours per day, to deliver the required care, it would have to serve 139 children in addition to the children it enrolled at the time it closed.
Which is ridiculous because the State of Michigan determines how many children a facility can serve at one time. At the time it closed, the State licensed the childcare to serve a maximum of 135 children at any given time. That automatically capped its income potential at $1.17M per year. The Children’s Center was programmed to lose a minimum of $1.03M per year based on its maximum allowed capacity.
The only way to make $2.2M per year (the Center’s operating costs) would have been to run the facility full-time from open to close, and charge about $6-$8 per hour for care. At that rate, The Children’s Center would have been cost-competitive with full-time daycare.
But again, the purpose of the Children’s Center was not to turn a profit. It was to serve students.
$1.2M is an interesting number
The $1.2M operating loss for the Children’s Center is an interesting number. Mostly because that’s the exact loss the WCC administration projected for the Health and Fitness Center this year. Unlike the Children’s Center, the Health and Fitness Center is supposed to turn a profit. Yet, there is no talk of closing the HFC, even though lost as much as the Children’s Center did.
Here’s another difference between the Children’s Center and the Health and Fitness Center. The public agreed to subsidize the Children’s Center as part of WCC’s operation. Providing childcare for students is directly related to WCC’s mission. We did not agree to subsidize a for-profit health club, which has no relationship to WCC’s primary purpose.
And yet, here we are. Mission critical function: eliminated. Irrelevant function: fully funded.
Did the WCC Administration close the Children’s Center to patch the budget hole the Health and Fitness Center created?
Photo Credit: Ken Teegardin , via Flickr