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WCC’s financial disclosures reveal a big risk

Washtenaw County voters elect seven people from the community to provide oversight for Washtenaw Community College. WCC’s financial disclosures show that failures of leadership at the highest levels are putting the College at risk, but the Board of Trustees has done little to stop it.

WCC has five different employee groups. They are:

  • Administration/Professional
  • Custodial and Maintenance (CM)
  • Faculty
  • Office, Professional and Technical (OPT)
  • Part-time employees

You may not know that the faculty and the administration had a long-standing agreement about the size of each group. If the size of the Administrative group expanded beyond the size of the faculty group, the faculty union could add instructors until the groups were again equal in size. The agreement kept the size of the College administration in check.

In practice, the two groups were rarely exactly equal in size, but the first three presidents carefully honored this agreement. Vacant administrative positions sometimes went unfilled to maintain this system of parity.

WCC President Rose Bellanca has disregarded this agreement since her arrival, and that’s putting the College at risk.

Why does the size of the administration matter?

From the outside, this tit-for-tat arrangement might seem trivial, but it’s not. Aside from respecting the agreement with the faculty, there’s another very good reason to keep the College administration small.

WCC can issue municipal bonds, which are investments. Securities laws require WCC to file information about its operations. Investors use WCC’s financial disclosures when deciding whether to buy the College’s bonds.

Investors look carefully at the size and cost of the College administration. When it is too large, the College’s credit rating is at risk because its administration costs are too high. A top-heavy administration can torpedo investor interest in a bond issue. It can also lead to higher borrowing costs for the College.

The table below shows the size of the Custodial/Maintenance, OPT, Faculty and Administrative groups from 2000-2018. The numbers, taken from WCC’s financial disclosures, reflect the employee counts at the end of each fiscal year. You can see that size of the faculty group was always larger than the Administration with no exceptions – until 2013.

Year C&M OPT Admin Faculty Difference
2000 53 98 155 170 -15
2001 60 116 181 182 -1
2002 69 115 154 200 -46
2003 63 116 175 190 -15
2004* 63 116 175 190 -15
2005 65 110 175 201 -26
2006 64 116 179 203 -24
2007 66 118 187 206 -19
2008 70 122 187 208 -21
2009 72 122 186 203 -17
2010 72 120 189 195 -6
2011 75 116 178 194 -16
2012 73 109 182 192 -10
2013 69 105 200 187 +13
2014 70 101 201 193 +8
2015 64 98 205 186 +19
2016 68 104 212 181 +31
2017 71 101 215 192 +23
2018 72 102 228 196 +32

* As reported in the FY 2004 disclosure

Unrestrained growth in the College administration

At the beginning of FY 2012, WCC’s Board of Trustees hired Rose Bellanca as the College’s fourth president. Between FY 2012 and FY 2018, the size of the College administration grew by 50, more than 28%. In comparison, the size of the full-time faculty increased by 1%. The Custodial and Maintenance group decreased by 1.37%. The OPT group decreased by 6.42%.

The table below shows the Fall enrollment figures during Rose Bellanca’s administration. % Change measures the percent change in credit hours year-over-year.

Year Students Credit Hours % Change
2011 12,932 113,422 -9.68%
2012 12,476 107,372 -5.33%
2013 12,327 105,302 -1.93%
2014 12,295 104,597 -0.67%
2015 12,211 101,519 -2.94%
2016 12,231 100,393 -1.11%
2017 12,390 101,858 1.46%
2018 12,337 100,260 -1.57%

The College added a huge number of administrators, but it wasn’t due to overall growth in enrollment. In fact, since Bellanca arrived on campus, credit hour enrollment has decreased every year but one. Overall, the Fall credit hour enrollment has dropped 11.6% and the number of enrolled students has dropped by 4.6% since FY 2012. As the number of students and the number of credit hours dropped, and the size of all other employee groups remained stable or decreased, Rose Bellanca added an average of 6.5 administrative positions each year of her tenure. The hiring spree continues unabated.

The Danger of Administrative Bloat

This uncontrolled growth of the College administration is hard to overlook, and it poses three significant risks to the College. First, it jeopardizes the College’s credit rating. A bloated administration looks bad to prospective investors. It could drop the College’s credit rating, which will increase WCC’s future borrowing costs.

Second, it puts the administration at odds with the faculty. WCC’s previous presidents have honored the parity agreement because the size of the administration was a sore point among the unionized employee groups. Rose Bellanca’s willingness to ignore this element of the WCC culture shows her disregard for the WCC community.

Third, it is insulting to the Washtenaw County taxpayers who bore the burden of WCC’s ill-conceived, ill-timed construction of the Health and Fitness Center. While thousands of Washtenaw County residents lost their homes to foreclosure, WCC’s previous administration incurred millions of dollars in public debt. The current administration has used long-awaited increases in its tax revenues not to improve educational programs, but rather to add dozens of administrators to the payroll. At the same time, it reduced the ranks of those who deliver on the College’s educational mission and the staff who support them.

Where is the Board oversight?

The Board of Trustees has both the right and the responsibility to question Rose Bellanca’s expansion of the College’s administrative staff. It has yet to do anything except rubber-stamp all personnel requests, even when they jeopardize the College’s credit rating; its relationship with the College faculty and staff; and the goodwill of the voters. We need authentic oversight by trustees who are willing to demand the prudent spending decisions that WCC’s president seems incapable of. If the Board of Trustees does not act, the College will suffer the ill effects of this executive’s administrative bloat for years to come.

Photo Credit: Jeso Carneiro