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Lakeland Community College Deficits Require Oversight

Yesterday I wrote about Lakeland Community College and its ongoing financial and governance problems. The Ohio Auditor of State indicated that the school’s structural deficits are so severe that it must change the way it operates immediately.

The State Auditor’s report should be ringing alarm bells among the Lake County Commissioners. As Eastern Gateway Community College is finding out, there is some liability that goes along with a community college that fails in Ohio.

I am not a lawyer, but Section 3354.17 of the Ohio Laws and Administrative Rules seems to place the responsibility for repaying LKCC’s bonds on Lake County taxpayers.

“In the event of any such dissolution, or in the event of any failure on the part of the officers of any district to qualify and act, or in the event of any resignations or vacancies in office which prevent action by said district or by its proper officers, the county auditor and all other officers charged in any manner with the duty of levying and collecting taxes for public purposes in any county in which such property is situated shall perform all acts which are necessary to the levying and collecting of any taxes which are necessary to pay the principal and interest of such bonds or notes. Any holder of any bonds or notes issued pursuant to sections 3354.01 to 3354.18, inclusive, of the Revised Code, or any person or officer who is a party in interest may, either by suit, action, or mandamus, enforce and compel performance of the duties required by such sections of any of the officers or persons mentioned in such sections.”

Unpaid bills go to the county.

Providing oversight is a community college trustee’s sole responsibility

In Ohio, the Governor appoints community college trustees, but the County gets the bond debts when the Trustees fail to do their jobs. If I were a Lake County resident, I would be asking the Governor of Ohio for an explanation of why his appointed trustees do not believe they have the agency that state law clearly provides to them. After all, if the Trustees can hire a community college president – as they did earlier this month, they can also fire a community college president who fails to cooperate with the Trustees.

In LKCC’s case, the outgoing president resigned unexpectedly after previously announcing that he would retire at the end of the fiscal year.

The change of administration at the college does not change the authority that the Board has (at all times) to exercise oversight over the college’s operations. I am certain that the LKCC Board of Trustees voted to authorize all six current bond issues. Likewise, I am certain that the votes included full information about how much each issue was worth. Further, information about how much money the college receives from the Legislature, and how many students are enrolled in any given semester as well as local tax receipts are all public information.

At the very least, even if the LKCC administration flat-out refused to discuss any financial matters with the Trustees, the Trustees always maintained the authority to refuse to issue bonds, sign off on the college budget, authorize new hires, etc.

It is ridiculous for the LKCC Trustees to suggest that they had no clue about LKCC’s financial condition when they sign off on the college’s expenditures. It is likewise ridiculous for the State Auditor to accept their explanation.

Photo Credit: Public Affairs, USACE , via Flickr